Motorola removed from government strategic suppliers list following ESN exit

Written by Sam Trendall on 17 May 2023 in News
News

Company claims excision from roster of Whitehall's most significant commercial partners is a ‘routine update’

Motorola Solutions has been removed from the government’s list of strategic suppliers following its exit from the programme to deliver the UK’s multibillion-pound new emergency services communication network.

An updated list of strategic suppliers was released last week by the Cabinet Office; the new version contains 39 companies considered to be government’s biggest or most significant suppliers. This is one fewer than the previous update, published in March, with Motorola no longer featured.

The list was introduced in 2011 and each featured company works with a named Crown representative, who oversees the relationship with government as a whole – rather than the supplier in question engaging with individual departments discretely. Tech firms feature heavily on the list, including Amazon Web Services, Microsoft,  Computacenter, Fujitsu, IBM, Oracle, Virgin Media, and Vodafone.

Airwave – the company that created the incumbent emergency services comms system – was included on the list from its inception. The UK firm was bought by Motorola in 2016, since when the US-headquartered telecoms outfit has been a strategic supplier.

The removal from the roster comes four months after the telecoms firm reached an agreement with the Home Office to terminate a £400m contract for the delivery of the core voice component of ESN – which is also known as the Emergency Services Mobile Communications Programme.

A government spokesperson said: "We keep our list of suppliers under regular review. It would be inappropriate to discuss details around specific suppliers."

Alongside the termination of its role in the new £12bn comms network for the emergency services, in recent monthe Motorola has become embroiled in a dispute over the amount being charged for the ongoing delivery of Airwave.

Following an 18-month inquiry, the UK Competition and Markets Authority announced last month that it was imposing price controls on the Airwave contract which will require Motorola to lower by £200m a year the current amount being charged. The regulator found that the tech firm has generated “supernormal profits” via the engagement, with inquiry chair Martin Coleman claiming that “the emergency services are locked in with a monopoly provider with no option but to pay a much higher price than they would if the market was working well”.


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In response to an enquiry from PublicTechnology about the firm’s removal from government’s strategic supplier list, a spokesperson for Motorola Solutions said: “This is a routine update which relates solely to our mutually agreed exit of the ESN programme and has no impact on our UK business operations. This includes the delivery of the existing Airwave service relied on by over 300,000 emergency services users who protect communities across the UK every day. Motorola Solutions has been a trusted partner to the UK emergency services for more than half a century and remains a strategic supplier for public safety."

The company also indicated that its position on the CMA’s decision remains unchanged, and pointed towards its previous statement in which it said that it “strongly disagrees with the CMA’s final decision and believes it cannot be justified on competitive, economic or legal grounds [and] we will appeal the decision”.

The CMA’s report revealed that, in summer 2022, Motorola offered the Home Office the opportunity to sign a new deal to covering the provision of Airwave for up to 10 further years. This contract offered a price reduction of £31m for 2023, £46m a year from 2024 to 2027, and £61m from 2028 onwards. The Home Office declined the offer.

Following the initial publication last year of the CMA’s proposals to implement price controls on the contract going forward, the Home Office issued a response calling for the regulator to go further and “address the very significant harm already caused, and the supernormal profits from which Motorola’s shareholders and other investors have benefited” already.

The end date of the Emergency Services Network project has now been formally set back from 2026 to March 2029 – a decade later than originally scheduled. 

The most recent estimate for the lifetime costs of delivering the programme was £12bn, which is double the budget set out when work began in 2015. This figure – which was published before the termination of the Motorola contract and the three-year postponement of delivery – is likely to rise further still.

 

 

About the author
Sam Trendall is editor of PublicTechnology. He can be reached on sam.trendall@publictechnology.net.

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