Qwest's Gowen aims at Networx

New government leader shoots for $500 million mark

Diana Gowen's strategy

  • Put together winning proposals for Federal Technology Service Networx and Defense Information Systems Network Access Transport Services contracts.

  • Forge strong partnerships with systems integrators.

  • Maintain the momentum of Qwest's government services division.

  • Raise Qwest's government revenue to $500 million over the next two years, and to $750 million within five years.

Qwest Communications International Inc.

Location: Denver

Chairman and CEO: Richard Notebaert

Head of government services division: Diana Gowen

Employees: 41,000

2004 revenue: $13.8 billion

2004 net loss: $1.8 billion

Services: Provides local calling service in 14 western and Midwestern states; provides long-distance, as well as broadband data, voice, and video services outside its local area and around the world; and offers wireless services through Sprint PCS' network.

Washington Technology 2005 Top 100 ranking: 55


"Anybody who is going to strengthen and grow their federal government business has to be a Networx player." ? Diana Gowen, Qwest

Zaid Hamid

Diana Gowen has several targets in her sights as the new head of Qwest Communications International Inc.'s government business. The first is winning the General Services Administration's $20 billion Federal Technology Services Networx contract. Also in her crosshairs is the $500 million Defense Information Systems Network Access Transport Services contract.

Those contracts, particularly Networx, are critical to Gowen's goal of pushing Qwest's government revenue to $500 million by 2007, up from between $350 million and $400 million today. By 2010, she wants her unit to be pulling in $750 million a year.

"Anybody who is going to strengthen and grow their federal government business has to be a Networx player," Gowen said. "That's why that's high on the priority list. It's very hard to be in the federal government environment for 10 years and not have a big [governmentwide acquisition contract] like that to work on."

Gowen assumed her post as senior vice president of Qwest Government Services in early July after James Payne was forced out in May. She made it her immediate goal to shed Qwest's second-tier status in the government arena and become a major player.

Winning a slot on Networx would be a sweet victory for the Denver carrier, especially after its recent string of disappointments.

In May, the company lost its fierce tug of war for MCI Inc. to Verizon Communications Inc., which snared the Ashburn, Va., long-distance company for $8.5 billion.

Qwest also suffered the embarrassment of a financial scandal under former Chief Executive Officer Joseph Nacchio, and continues to carry a multibillion-dollar debt load.

Qwest's government services unit suffered another blow when it lost the 10-year, $1 billion Treasury Communications Enterprise contract to AT&T Corp. Qwest and four other bidders filed a protest, which the Government Accountability Office upheld. In late May, the Treasury Department informed GAO that it intended to terminate the contract with AT&T and use GSA's contracting vehicles to acquire the WAN communications requirements for the department.

"The No. 1 focus will be Networx and winning a place at the table there. If they lose, [Gowen's] in trouble," said Warren Suss, president of telecommunications and IT consultancy Suss Consulting in Jenkintown, Pa.

Networx is a governmentwide telecommunications and network services procurement with two parts, Universal and Enterprise. Gowen said that, like most companies, Qwest plans to use a lowest-price-for-service approach to compete for both parts, but she would not elaborate further on the company's strategy.

The Universal part of Networx will offer a wide range of telecom services nationwide, while Enterprise will offer a mix of specialized IP or wireless services in specific geographical areas. GSA likely will issue multiple awards for both parts in April 2006.

Gowen joined Quest from Broadwing Communications LLP of Austin, Texas, where she was president of government solutions for the telecommunications services provider. She has 25 years' experience in the communications industry as a senior executive for MCI and AT&T. She also has worked for U.S. government civilian and military agencies in the United States and internationally.

As the former vice president of MCI Government Markets, Gowen was responsible for building the company's federal practice from less than $100 million to close to $1 billion, Suss said. At MCI, Gowen oversaw the FTS2001 program, Networx's predecessor, and other big programs for the Defense, Homeland Security and State departments, Social Security Administration and other civilian agencies.

But Gowen's track record as a leader won't guarantee an increase in Qwest's federal government business, some industry insiders said.

Gowen "is a seasoned, experienced player in our space, and she knows her way around the marketplace, [but] I don't see a big impact to Qwest," said Tony D'Agata, Sprint Corp.'s vice president and general manager, government systems division.

Suss said Gowen is "an extremely competitive, hard-charging person who knows how to command corporate resources." She helped MCI's federal practice grow tenfold, "so if anyone can help Qwest get there, I think Diana can ... but, still, the future role of Qwest will depend on its overall viability and overall success, and that's up in the air at this stage."

If Qwest fails to secure a slot on Networx, Gowen said, the company will fall back on its business with the government and continue to pursue other new contracts, including GSA's 10-year, $50 billion Alliant IT services contract and the Defense Information Systems Agency's 10-year, $10 billion Encore II Information Technology Solutions.

Qwest also delivers local telephone services to six major metropolitan areas in the United States under GSA Metropolitan Area Acquisition contracts and has an FTS crossover agreement to provide long-distance calling services to government agencies.

Its FTS crossover agreement expires in 2010, although Gowen declined to estimate how much revenue the contract generates.

The company also holds a $19 million subcontract under Lockheed Martin Corp. to provide enhanced networking capability to the Housing and Urban Development Department's Information Technology Services contract.

Qwest again teamed with Lockheed Martin on the U.S. Postal Service's Universal Computing Connectivity contract for managed network services, worth up to $3 billion over 18 years if all options are exercised.

Continuing to forge strong relationships with systems integrators is another important part of Qwest's strategy to reach its target of $750 million in annual government revenue, Gowen said.

At the same time, she also wants to maintain the momentum the government unit has. Qwest rose to No. 55 on Washington Technology's 2005 Top 100 list federal prime contracting revenue for IT and telecom, up from No. 67 on the 2004 list.

"I see us as being a significant player," Gowen said. "You want a seat at the table for Networx ... and that's what I'm charging this group to achieve."

Staff Writer Roseanne Gerin can be reached at rgerin@postnewsweektech.com.

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