Let the transition begin

Award of Networx heralds new phase for firms

Tony D'Agata, vice president of Sprint's federal government business

Rick Steele

The three companies that bid and won places on the Networx Universal network services contract are making their next moves, while the sole loser ? Sprint Nextel Corp. ? looks to the May award of Networx Enterprise as its one, final hope of getting a place in the program.

Sprint officials said not getting Universal, although a blow, won't be fatal. Enterprise could put the company back in the game, and if not, Sprint has other contract vehicles for agencies to use. But telecommunications analysts said losing Universal is a serious setback for the company.

The General Services Admin- istration can't mandate that agencies buy through the Net- worx program, but analysts expect it to be a major vehicle for telecom and network services for the next decade.

Tony D'Agata, vice president of Sprint's federal government business, said he was disappointed and surprised not to win a spot on Universal but is hoping for Enterprise.

Sprint earns about $1.1 billion annually in federal business, and the FTS 2001 contract accounts for only about 30 percent of that. Those factors make him hopeful that the company would continue to succeed without either Networx contract. He is still gunning for Enterprise, however.

"We're going to be aggressive and hopefully be successful," he said.

The winners ? AT&T Inc., Qwest Communications International Inc. and Verizon Communications Inc. ? are now moving to help customers transition from FTS 2001 to Networx. GSA plans to issue a notice to proceed within the next few weeks, which will be the green light for agencies to begin placing orders through Networx.

Qwest's win and Sprint's loss may be tied for the most surprising aspect of the contract award. Alan Chvotkin, senior vice president and counsel at the Professional Services Council, credited Diana Gowen, senior vice president of government sales at Qwest, for that company's win. Gowen joined Qwest in 2005, drawing on 25 years of experience.

She said the full commitment of the company's executive team was a key factor in Qwest's success. "When I came here, I can't say that was there," she said.

Qwest has been preparing for the award on the assumption that it would win. The company expanded the government sales staff by 60 percent, and Qwest has been working on its Networx-required operations support systems and certification and accreditation efforts.

AT&T is continuing its own operations support systems testing and putting the final touches on its bid for Networx Enterprise, said Don Herring, president of AT&T Government Solutions. Meanwhile, the company is ready for orders as soon as GSA gives the go-ahead, he said.

"We're ready to go [and] anxious to go," he said.

Verizon Business opened a government network operations and security center in 2006 designed specifically for the requirements of government agencies. Susan Zeleniak, vice president of the federal organization of Verizon Business, said the company is ready to start on Networx.

The Networx bidders all have teams of partners to bring to the table, as well, and expect to add others as the 10-year contract progresses. Mike Cook, senior vice president of the North American division at Hughes Network Systems, said the company expects both to build new business from its partnerships with AT&T and Qwest and to steer some agency customers to Networx.

Hughes, a provider of satellite communications services, was also part of Sprint's team.

"It's very, very important to be represented as part of those teams," he said. "Government agencies have limited resources, and they don't want to be buying telecom services from a dozen different contract vehicles," because each contract has its own overhead costs.

Associate Editor Michael Hardy can be reached at mhardy@1105govinfo.com.

About the Author

Technology journalist Michael Hardy is a former FCW editor.

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