Industry, government don't see eye to eye on Networx

By Alice Lipowicz

By Alice Lipowicz

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Survey says the two sides have polar opposite views of the huge Networx telecommunications contracts. Which side might be guilty of wishful thinking?

Industry and government disagree on whether government will spend more money on the Networx contract in fiscal 2012. Most of the vendors -- 86 percent -- expect a rise in Networx spending, while only 13 percent of government executives think spending will rise, according to a new survey by MeriTalk. CenturyLink and Telework Exchange sponsored the study, which was published May 21.

In 2011, both government and industry were more in synch in their views of Networx spending and revenue. Half of government Networx users increased their Networx spending, while 44 percent of Networx contractors increased their revenues.

Steve O’Keeffe, founder of MeriTalk, said the survey revealed a sharp difference in perceptions on Networx spending in 2012. Importantly though, he said the government respondents are more likely to have an accurate picture of how much the government agencies will spend, since the agencies control the money.

“Somebody is going to find some coal in their stockings,” he said, referring to the vendors.

The holders of the Networx contract are: AT&T, CenturyLink, Level 3,, Sprint Nextel, and Verizon.

However, O’Keeffe also emphasized that the survey referred only to Networx contract spending, not to all federal network and telecommunications spending. The vendors’ bullish opinions may have partially reflected a more general optimism about network spending.

The poor government agency forecast for Networx spending in 2012 could mean that federal agencies are preparing to buy telecommunications services from other acquisition programs, he said.

“It could mean they are going to use other vehicles,” O’Keeffe said. 

The survey included 163 federal government and industry employees in February and March 2012.

Matthew Weigelt contributed to this report.

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