When we found this short article we were so excited, having sought for over a year for this, discovering it on this site was an thrilling time for yours truly.
At the eastern end of the San Francisco Bay Area, Sheriff Warren Rupf of Contra Costa County and cigar-chomping Sheriff Charlie Plummer of neighboring Alameda County were political powerhouses seemingly locked in an endless duel of one-upsmanship.
When Rupf set up a marine patrol, Plummer started buying boats. They echoed each other with helicopters, SWAT teams, and on it went.
But in 2005, amid a federal push to avoid another communications nightmare like the one blamed for the Sept. 11, 2001, deaths of 125 New York firefighters at the collapsed World Trade Center, Rupf and Plummer joined forces. They set their sights on a new digital Walkie Talkie system so that all of their first responders could talk to each other.
There was, however, a catch.
A notice circulated by Alameda County to gauge vendors’ interest in the project said that the first $5.7 million phase must include a master controller made by Motorola Inc., and the equipment must connect with the county’s aged, proprietary Motorola SmartNet II system.
In other words, “it was already a done deal. … Nobody else could make their equipment compatible with soon-to-be-obsolete Motorola equipment” — nobody except Motorola, said Steve Overacker, who was Contra Costa County’s telecommunications manager at the time.
Any appearance that there would be a fair, competitive bidding process “was a ruse,” he said in a phone interview.
Chalk up another contract win for the Schaumburg, Ill.-based Goliath of the public safety communications industry, a company that for decades has ruled a market financed entirely by taxpayers and now totaling billions of dollars a year. For Motorola Solutions Inc., as it has been known since 2011, the value of this California contract would snowball toward $100 million.
Such outcomes have come to be expected for the company that has long led the way in two-way radio technology, even as the nation went on a post-9/11 spending binge on emergency communication. However, a seven-month McClatchy investigation found that, in one region after another, city, county and state officials also have favored Motorola, helping the firm secure an estimated 80 percent of all the emergency telecommunications business in America.
From the nation’s capital to the Pacific Coast, government officials have handed the company noncompetitive contracts, used modifications of years-old contracts to acquire new systems or crafted bid specifications to Motorola’s advantage. These officials, perhaps without recognizing their collective role, have helped stunt the very competition that’s needed to hold down prices and assure the most efficient use of government dollars.
The company’s contract wins have been clouded by irregularities or allegations of government favoritism in Chicago, Dallas, the San Francisco Bay Area and on statewide systems in Illinois, Iowa, Kansas and Washington, to name a few. Losing bidders often have been left chafing with the belief that they weren’t playing on a level field.
In a weakly policed but humongous patchwork of as many as 20,000 city, county, state and federal two-way radio networks, governments have paid as much as $7,500 apiece for Motorola models, when some competitors offered products meeting the same specifications for a fraction of its prices. In Europe, albeit with a lower-power network that requires more costly towers and infrastructure, police radios serving the same functions sell for $500 to $700.
“While our public safety people do an extraordinary job in protecting the public, I am not impressed with the choices they’ve made relative to technology,” said veteran Democratic Rep. Anna Eshoo of California, who represents part of Silicon Valley and has for years monitored Motorola’s dominance with chagrin.
In a phone interview, she called radio prices of $5,000 and above “ludicrous.”
The Washington State Patrol has bought 2,700 Motorola radios in recent years as part of a major upgrade of its communications system aimed at meeting a federal mandate to free up space on the radio spectrum for more users. The $32 million contract is part of a project budget of just more than $41 million and includes a cost of roughly $5,400 to $5,500 per radio, said Bob Schwent, commander of the patrol’s electronic services division.
The state chose to tie in with a federal system, which saved $12 million but required Washington to buy its equipment through a no-bid contract with Motorola. At the time, some companies complained that the radio purchase wasn’t opened to competitive bidding.
The new system is up and running in just three of eight regions of the state, not including Puget Sound. Public radio’s Northwest News Network reported earlier this year that the system had been rolled out in the patrol district that includes Tacoma, but turned off two days later after communication problems. Troopers in other districts have also reported trouble with dead air and garbled transmissions.
Motorola Solutions declined to make its chief executive, Gregory Brown, available for an interview or to respond to detailed questions submitted by McClatchy.
Instead, Motorola issued a statement saying it has developed “state-of-the-art technology to support the challenging and demanding missions of public safety” for more than 80 years.
“Customers choose Motorola because we have remained committed to serving these dedicated professionals by closely listening to them and responding with innovative solutions that meet their needs,” it said.
Ever since the Sept. 11 commission recommended in 2004 that the nation’s public safety community adopt measures to improve “interoperability” — a buzzword meaning that all two Way Radios must interact, no matter their manufacturer — the nation has spent tens of billions of dollars toward that end.
Nearly a decade later, radio connections have improved — New York’s networks, for example, performed well after Hurricane Sandy last year. But the U.S. Department of Homeland Security says there are still too many weak signals and agencies still use too many fragmented frequencies. The push to resolve such issues with competitively priced upgrades has moved at a snail’s pace.
McClatchy’s investigation found that:
• Even after uniform design standards for two-way radios took hold in 2005, Motorola found ways to elbow rivals out of some markets by peddling proprietary extras that don’t interact with non-Motorola radios, such as special encryption software sold for a few dollars per radio in states including Colorado, Louisiana and Kansas.
• Many cities and counties have awarded Motorola sole-source contracts by using so-called “cooperative contracts,” in which they piggyback on deals that Motorola won competitively elsewhere. In 2011, financially distressed Forth Worth, Texas, and Washington, D.C., each handed Motorola a $50 million deal by adopting pricing from a Houston-Galveston regional contract.
• Auditors who track the use of grants from the Department of Homeland Security and other agencies have given little scrutiny to the behavior of state and local officials who tilt procurements toward Motorola, including those who ignore requirements that its radios fully interact with other brands.
• Motorola has cultivated cozy relationships with police and fire chiefs, its biggest customers, donating more than $25 million to public safety-related foundations over the last six years and bankrolling a key public safety coalition to which police and fire chiefs belong. Motorola sales representatives also coach public safety agencies on how to secure federal grants.
Motorola’s rugged two-way radios, able to survive a dropped bowling ball or submersion in a tank of water, have for decades set the standard for performance in the emergency communications market.
The company usually holds a technological edge over competitors, even if its digital radios were plagued by some of the same failures as its rivals in recent years — glitches blamed for contributing to the deaths of at least five firefighters nationwide.
Motorola’s relentless campaign to preserve its huge market share, aided by public officials, has not been without consequences for the nation. With competition stifled, industry officials say such high prices have almost assuredly saddled taxpayers with hundreds of millions, and perhaps more, in added costs.
In addition, the company’s longstanding marketing of proprietary features in its systems has clashed with the national goal of interoperability. It got so bad that fire commanders in some cities carried multiple radios to multi-alarm blazes to ensure they could talk with every unit dispatched to the scene.
John Powell, a former chairman of a National Public Safety Telecommunications Council panel on the subject, said that even today “we’ve got these systems going in with federal grant dollars that are really being a detriment to interoperability,” because they don’t comply with Homeland Security guidelines dating to 2006 that require recipients to buy radios that meet uniform design standards.
To examine Motorola’s dominance and the resulting effects, McClatchy reviewed thousands of pages of public records and conducted more than 100 interviews with officials from contracting offices, information technology units, police and fire departments and standards-setting agencies, as well as lobbyists and politicians.
In addition, McClatchy surveyed nearly 60 police, fire and sheriff’s departments in the nation’s 20 largest cities. Only San Antonio and the New York Police Department have bought large radio systems from a vendor other than Motorola over the last decade. In nine of the cities, Motorola won noncompetitive contracts.
In Pierce County, both county government and the regional emergency communications agency, South Sound 911, have purchased Motorola radios in the last couple of years to comply with new federal standards. Both made their purchases through no-bid contracts.
South Sound 911 has bought 3,479 Motorola radios since October in a joint contract with the City of Tacoma. The average cost per radio is from $4,200 to $4,500, said Andrew Neiditz, director of South Sound 911. Neiditz said the radios were purchased through a sole-source contract because they were upgrades to an existing Motorola system.
Pierce County made a separate purchase of 1,700 Motorola radios – including 900 for the Sheriff’s Department – as part of a $24 million contract that included transmission equipment and additional radios. Each radio cost about $4,800, said Tim Lenk, the county’s 911 communications manager.
The county hadn’t used Motorola radios previously, but chose the company for a sole-source contract to piggyback on Pierce Transit’s Motorola system. The deal was already in the works when voters approved a one-tenth of 1 percent sales tax increase to create South Sound 911 in 2011.
Amid the push for interoperability, many states are courting cities and counties to join statewide systems that have traditionally served highway patrols and other state agencies. In that lucrative market, Motorola’s largest competitor, Florida-based Harris Corp., and companies it acquired have constructed five statewide systems. The smaller EF Johnson Technologies Inc., based outside of Fort Worth, Texas, has assembled one. Motorola has apparently built all of the others.
It is rare that a single company wields such power over a multibillion-dollar industry, especially one financed solely by taxpayers.
“Motorola is, in practical terms, a monopoly, and they control the market for the purpose of keeping the pricing very high,” said Jose Martin, president of Power Trunk, a subsidiary of a Spanish firm, Teltronic, that is trying to break into the U.S. public safety radio market.
Motorola stressed in its statement that it was “an early participant” in the 25-year-old industry-government effort to develop design standards, known as Project 25, or P25, that are supposed to open competition to all comers.
Martin, however, has a quite different view. He contended that Motorola pushed for P25 standards so that the United States wouldn’t fall under Europe’s similar uniform manufacturing standard for emergency radios, known as Terrestrial Trunked Radio, or TETRA, which Motorola was a leader in drafting in the early 1990s.
As a result, Martin said, “U.S. taxpayers are being exfoliated.”
In a 2011 report, Congress’ investigative arm, the Government Accountability Office, warned that government agencies may be overpaying for radios because they “lack buying power in relationship to device manufacturers.”
California Rep. Eshoo said that Motorola’s grip on the radio market was a big reason behind her decision to co-author legislation enacted two years ago that allotted $7 billion for a nationwide, next-generation emergency data-delivery network that she believes will invigorate competition.
If that so-called “broadband” network someday reliably transmits voice communications, it would represent a huge threat to Motorola Solutions’ radio franchise, pitting the company against much bigger broadband giants such as Verizon and AT&T.