CenturyLink takes over DoD's $750 million DREN III networking contract

CenturyLink (NYSE: CTL) struck another major coup in the public sector service market by being awarded the Defense Research and Engineering Network (DREN) III contract, unseating incumbent provider Verizon (NYSE: VZ).

DREN III is sponsored by the U.S. Department of Defense High Performance Computing Modernization Program (DoD HPCMP).

The HPCMP was designed to solve complicated and time-consuming problems that need the support of massively-parallel computing and high-speed networking solutions such as Ethernet and 100G optical. 

Awarded by the Defense Information Systems Agency's Defense Information Technology Contracting Organization (DISA DITCO), DREN III is a 10-year indefinite-delivery, indefinite-quantity (IDIQ) contract that has a minimum award value of $250,000 and a ceiling of $750 million.

Under the terms of the agreement, CenturyLink will provide a fiber-based network that will connect the department's supercomputers and researchers at speeds ranging from 50 Mbps to 100 Gbps. It will supply a mix of Ethernet, IP and optical wavelength services through a Virtual Private Local Area Network Service (VPLS) that will connect defense scientists and engineers at various research entities, laboratories and test facilities at more than 150 U.S.-based DoD locations.  

It also connects a number of other research sites in the federal government agencies such as NASA and the Department of Energy (DoE) in addition to Internet 2.

Researchers can use DREN as a test bed to develop and deploy high speed bandwidth applications and deploying next-gen networking and security technologies.

For Diana Gowen, senior VP and general manager at CenturyLink who oversees solutions for federal, state and local government customers, getting DREN III is a personal goal, as she led the successful competition for the previous two contracts when she served in the government divisions at MCI (now Verizon Business).

"It's always hard to unseat an incumbent, and the incumbent was not doing a terrible job, so we had to be creative and innovative in our proposal to them," Gowen said. "This community wants the biggest, fastest, baddest next-generation network that they can find, and they are the researchers of the world."

Of course, CenturyLink's DREN III award was not without its challenges.

As is typically the case in large-scale government contract wins, the existing DREN II contractor Verizon Business filed a protest against the award last June after DREN III was awarded to CenturyLink.

However, the Government Accountability Office, after review, re-awarded the contract to CenturyLink.

"It was awarded to us last June and the incumbent protested the award and the General Accountability Office (GAO) sustained the award and reawarded to us before the end of the year," Gowen said, adding "we were not the cheapest price so we got an award based on being the better value."

In 2002, MCI protested and won away the DREN II contract from Global Crossing.

For more:
- see the release

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