LIVE FROM AT&T BUSINESS SUMMIT – DALLAS, TEXAS: Mike Zeto, AT&T VP of IoT and the man in charge of the operator’s smart cities business, warned a move by regulators in the US to limit small cell siting fees could force AT&T to re-evaluate its public-private partnership (PPP) model.

Zeto explained PPPs, such as the smart city deals AT&T struck with San Jose and Los Angeles in California, involve the exchange of value rather than cash.

AT&T offers to build, deploy and manage connectivity solutions to help cities solve a set of problems including issues related to traffic, public safety, energy efficiency, economic development and digital inclusion. In return for that investment, Zeto said the operator typically asks cities for help with small cell siting, waiving fees and accelerating approval timelines to help it more quickly expand its network.

The financial trade-off is generally equal, he said, in part because the high cost of small cell fees is easy to balance against deployment costs. But Zeto noted the US Federal Communications Commission’s recent move to cap small cell fees at under $300 could knock that equation out of balance.

If the FCC’s rules stand, Zeto said “there’s a discussion to be had around value. We’ll have to revisit the public-private partnership model in some cities because it drives down the value.”

In the meantime, Zeto said AT&T is pushing ahead to strike new deals with cities, which he noted can be a boon for those lacking alternative funding options for such technology projects.

“Some programmes can be federally funded, but some programmes within a city, if there’s not an return on investment for it and it’s not federally funded, they can’t invest in it. So that’s where there’s a big opportunity for public-private partnerships.”