Waiting on the feds
No competition worth winning is going to be easy, right? There may be no better way to describe the federal government's storied Networx program, in which several pre-qualified service providers are competing for the right to upgrade the telecom services and infrastructures of a multitude of government agencies served by the General Services Administration. The Networx program, at roughly $68 billion, is the biggest government telecom project of its kind, succeeding the previous FTS-2001 program under which federal agencies procured their telecom gear and services.
The service providers who earned Networx slots did so more than two years ago, and while it sounds like the business of locking up contracts with various individual agencies should be like shooting fish in a barrel, it has been anything but. Complaints about how slowly Networx contracts were trickling out began as early as 2007, and apparently the complaining did little to grease the wheels of progress. At this week's GSA 2009 Network Services Conference, GSA officials admitted that only 23 percent of the roughly 5 million services subject to the program have made the transition from FTS-2001 to Networx.
The reasons for the glacial pace vary. Some observers blame the fact that agencies are required to submit a service orders or more than $2,500 to a mandated Fair Opportunity competition before awarding a contract, though the piecemeal way in which agencies are breaking up contracts among multiple service providers also has drawn out the process. Unfortunately, the delays come at a time when most telcos are trying to beef up their revenue from government markets as consumer and business spending stagnates along with the general economy.
The GSA is doing everything it can to help. At this week's conference, several GSA officials reached out to the 1,200 or so attendees offering whatever help necessary and asking for agencies to communicate whatever problems they are having. Meanwhile, Edward O'Hare, assistant commissioner of integrated technology services for the GSA's federal acquisition service, was clear about the sense of urgency: "At this point we need to stop talking about Networx schedules, and just understand what the requirements are and get the job done. This needs to get done." Still, it's unlikely that it will get done by the original Networx transition deadline of next summer.
All the telcos can do is be patient, and compete aggressively for the service contracts that are still open for bidding. Anyone with a sense of history and irony will find this to be an interesting turn of events. Equipment vendors can tell you that selling to telcos traditionally has never been a particularly efficient process, as much a test of endurance as a test of technology. Procurement processes measured in years rather than months were once the norm. It may not be quite that way anymore, but perhaps as telcos now increase their efforts to sell their own services and technology to the federal government, they can better appreciate what it was like for all those equipment vendors they kept in suspense for so long back in the day.
- NextGov was first with details on the Networx delays
Qwest announced a $14. Million Networx win from NASA this week
Networx contract competition was authorized to begin in 2007
Networx contracts were barely trickling out in early 2008
More Networx contracts had been settled by the end of 2008
Verizon won a Networx contract from the DHS