Connections contract still a puzzle

The General Services Administration, by putting a massive $35 billion ceiling on the Connections telecommunications program, has all but guaranteed that large numbers of systems integrators and telecom providers will vie for a spot on the new program.Nevertheless, many industry officials still believe GSA's Federal Technology Service, which is administering the program, has wildly inflated the program's potential value."The existing GSA or FTS contracts that [will] be subsumed under the Connections program don't come close to $35 billion," said Warren Suss, president of Suss Consulting Inc., Jenkintown, Pa., which specializes in the federal telecommunications market. "The number reflects a very open-ended, optimistic, future-oriented view of the market potential associated with a very broadly interpreted set of products and services."Suss said he views the new program as an attempt by FTS to compete head-to-head with another GSA branch, the Federal Supply Service, which administers Schedule 70 and other widely used schedules for off-the-shelf information technology products. Connections also would compete with some of the governmentwide acquisition contracts, called GWACs, administered by other federal agencies."The more interesting question is whether [FTS] will succeed in [using] this as a way of capturing a significantly larger market share," Suss said.Connections is an eight-year contract designed to provide a wide range of telecom infrastructure services and equipment for what is frequently dubbed "the last mile," the connection from the telephone lines outside an office building to the desktop. The request for proposals was issued Dec. 16, and bids for the first, national phase of the contract are due Feb. 15.GSA spokesman Bill Bearden said Connections combines several smaller contracts that either have expired or are on the verge of concluding. He defended the dollar figure assigned to the contract, saying: "Everyone should understand this is the maximum potential ceiling value of all of the potential contract vehicles. It's only the potential value, since no one knows exactly what the requirements will be in the future."The figure is derived from historical data and discussions with federal customers about their prospective needs, Bearden said. And GSA's Federal Technology Service, which is administering the program, doesn't want to set a ceiling that's too low, he said, because amending the ceiling after the awards are made makes the contracting process more difficult.Ray Bjorklund, vice president of Federal Sources Inc., a McLean, Va., consulting and research firm, said there are five programs, with a total of 15 contractors, that appear to be included in Connections: Aggregated Switch Procurement; Purchase of Telecommunications Services; Technical and Management Support Services; Telecommunications Support Contract; and Wire and Cable Services.Government procurement data show the combined dollar value of purchases made under these programs since their inceptions, beginning in August 1995, to be about $221 million through June 2001, Bjorklund said."The ... ceiling is probably ambitious," said John Polivka, a spokesman for Sprint Communications Corp. of Westwood, Kan. "However, it does still represent a sizable opportunity, and remains attractive for us."Sprint is one of two companies ? the other is WorldCom Inc., Clinton, Miss. ? that provides long-distance telecommunications services under the GSA's $2.3 billion FTS2001 program.Regarding Connections, some industry officials also have said its complex requirements make it a difficult contract to bid. Three different categories ? equipment, labor and turnkey solutions ? each have national, international and state levels.An industry official familiar with the RFP said companies can bid as pure prime contractors to do the work themselves, but teams that bid must give 40 cents of every subcontracted dollar to small businesses. That may be a difficult objective to meet, said the official, who asked not to be identified.Another official said his company had found Connections program requirements would be complex and bidding would be expensive. He also said while Connections is geographically broad in scope, the company found it narrow in application, focusing as it does on the "last mile." The company, a major integrator, concluded it is unlikely to bid as a prime contractor because of these constraints, said the official, who also asked not to be identified.