US West Ready for Telecom Showdown
US West Ready for Telecom Showdown
By Patrick Seitz, Senior Editor
After watching from the sidelines as the General Services Administration awarded the first in a series of local telephone contracts, US West Federal Services of Washington is preparing to fight for the next group of contracts in its own back yard.
Executives at the government-focused subsidiary of US West Inc. in Denver have waited patiently for GSA to bid Metropolitan Area Acquisition contracts within the Baby Bell's 14-state territory. The first MAA contracts, covering Chicago, New York and San Francisco, were awarded to AT&T Corp.
Upcoming phases of the MAA program should include contests to provide telecommunications services for federal agencies in cities such as Albuquerque, N.M.; Boise, Idaho; Denver; Portland, Ore.; and Seattle, said Mike Peterson, US West Federal business development manager. The GSA's Federal Technology Service is expected to release requests for proposals for those cities starting in the next few weeks, he said.
The company especially is interested in the contract covering Denver, its hometown, which has the largest concentration of federal workers of any region outside of Washington, Peterson said. The MAA contract for Denver could be worth $100 million to $200 million over the life of the contract, which is four years plus four one-year options, he said.
AT&T and WinStar Communications Inc., both of New York, are also expected to compete for the contract, Peterson said.
US West Federal is preparing for the MAA contracts by reviewing its capabilities, its current work for federal agencies and the competitive environment, said Shirley Menish, US West Federal director of business development and marketing. She described the MAA contracts as quite complex in both pricing and configuration. Bidders will get 30 days to respond to the GSA's requests for proposals, she said.
The contracts call for a variety of local voice and data services, including the latest commercially available enhanced telecommunications services and technologies.
"I think we have a very sophisticated customer in the federal market," Peterson said. Federal agencies often are more willing to implement new telecommunications technology than the commercial world, he said.
The federal government also takes advantage of the heightened competition in the telecom field to get better prices and more innovative services, he said.
"The competition is driving us to offer high-quality services as a differentiator," Peterson said. The regional Bell operating company competes not only with the long-distance telephone companies but the competitive local exchange carriers.
US West Federal Services posted revenue of $130 million last year and is targeting 10 percent growth for this year, Menish said. The unit is small compared to the parent company's 1998 revenue of $12.4 billion.
US West leverages its commercial expertise and infrastructure to help its federal business, Menish said. The company is spending $4 billion on capital improvements this year and is adding about 1,000 miles of fiber-optic cable per month, she said. US West's service area covers 42 percent of the continental United States, from Oregon to Iowa and from Montana to Arizona.
US West Federal stands to gain greater stature in the federal market through the planned merger of its parent company with Qwest Communications International Inc. of Denver, announced July 18. Scheduled for completion in mid-2000, the merger promises to boost US West's offerings in advanced networking and broadband Internet communications.
US West's five-person Washington office is the only local office for a regional Bell operating company, except for Bell Atlantic Corp., Menish said. "We've had some sort of Washington, D.C., presence for our federal sales group for about 10 years," she said. Its customers include the departments of Defense, Energy and Treasury, the General Services Administration and the U.S. Postal Service.
US West's Washington office also keeps the company close to the major government systems integrators, Peterson said. The company has partnered with such companies as Computer Sciences Corp., El Segundo, Calif.; Harris Corp., Melbourne, Fla.; and TRW Inc., Cleveland.
Among the telecommunications trends that US West capitalizes on are convergence and providing total solutions, Peterson said. For example, US West merged voice, data and video communications into one system for the New Mexico National Guard under a contract awarded last year.
"This type of consolidation of services is a trend we've been seeing and are supporting," Peterson said. US West ousted incumbent provider Sprint Corp. of Westwood, Kan., for the project.
The New Mexico Guard telecommunications system connects 600 workstations on 50 local area networks throughout the state into a single wide area network. US West is providing an asynchronous transfer mode solution to carry simultaneous voice, video, teleconferencing and data over the network, said Maj. Eugene Barnes, the New Mexico National Guard's telecommunications director. The system has "exceeded our objectives," he said.
One major goal for the new system is to create a distance learning network to meet the educational needs of both military personnel and civilians.
The company increased the guard's available bandwidth and reduced its telecom costs by 24 percent, from $14,300 to $10,872 a month.