Networx pressure on agencies to increase

The pressure on agencies to transition from the General Services Administration’s FTS 2001 telecommunications contract to its Networx vehicle has been building. But in all likelihood, they ain’t seen nothing yet.

GSA Administrator-designate Martha Johnson — expected to sail through confirmation by the full Senate in coming weeks — has vowed to dial up the intensity.

For agencies slow to transition, “there will be consequences, both financial and political,” said Warren Suss, president of Suss Consulting Inc. “Every day until they do transition, it’s costing them money.” Services on Networx cost between 10 percent and 40 percent less than the same services do on FTS2001.

“But the biggest motive may be political,” Suss said. “If the [June 2010] deadline passes and agencies haven’t completed their transition, they could be called up before a congressional committee to explain why they haven’t, and that has its own consequences.”

President Barack Obama’s Cyberspace Policy Review calling for secure governmental operations in cyberspace and including meeting requirements of the Office of Management and Budget’s Trusted Internet Connections (TIC) Initiative will crank the dial even higher.

TIC both reduces the number of agencies’ Internet connections and standardizes and secures the way they make those connections. Qualified agencies may act as their own TIC access providers (TICAPs), modeled after the shared-service provider concept in other consolidation initiatives.

GSA also cast TIC as a product available through Networx as the Managed Trusted Internet Protocol Service (MTIPS) and gave the five Networx Universal and Enterprise vendors a chance to qualify as TICAPs.

Agencies now have the full slate of TICAPs from which to choose: AT&T Inc., Qwest Communications Inc., Sprint Solutions Inc. were joined mid-month by Verizon Communications Inc., the fourth and final Networx carrier to win a contract modification from GSA to provide MTIPS; Level 3 Communications Inc. withdrew from consideration in January.

Level 3 opts out

Networx Enterprise contract-holder Level 3 was and remains a supporter of OMB’s TIC initiative, but after evaluating what becoming a TICAP would cost and what profit could be expected, the company opted out of becoming an MTIPS provider.

“There were multiple reasons for why we withdrew,” said Edward Morche, senior vice president of Level 3’s federal markets group.

A new security operations center would have to be stood up very quickly; MTIPS is an application layer solution while Level 3 is primarily an infrastructure provider; and the solution is historically something a systems integrator would do, while subcontracting to Level 3 for infrastructure needs, Morche said. “It also would have required us to report violations, which we weren’t comfortable doing.”

In its TIC initiative, OMB called for cutting the number of federal government connections to the public Internet to 50; in the first four months of 2008 agencies cut the number of connections from about 4,300 to 2,758.

Today the total number of target connections is 400. But in June 2008, when OMB issued its Trusted Internet Connection Initiative Statement of Capability Evaluation Report, the connections target stood at 100, 10 of which were likely to go to Networx providers.

It might still have been worth pursuing, Level 3’s Morche said, but “last year, OMB gave [TICAP status] to the 18 largest agencies, and they just walked away, so they didn’t have to buy MTIPS; they could provide it themselves.

“We did some modeling, we looked at the capital investment it would take, and we weren’t comfortable making that investment. There was just no way it made sense for us,” he said.

At any rate, “most of the [MTIPS] work is going to go to the Networx Universal carriers on this,” Suss said. “For them, it’s an investment on the margin; for Level 3 or any similarly focused company, it’s a stand-alone business.”