GSA wins qualified praise for progress on new telecom contract

The General Services Administration has made vast improvements to its plan to restructure the federal government's telecommunications contract, but challenges remain, the nation's leading telecom providers told a House committee Wednesday.

GSA's Federal Technology Service is responsible for ensuring that agencies have access to required telecom services. In 1998, the agency awarded a government-wide contract for long-distance service to Sprint and another in 1999 to MCI -- a venture known collectively as FTS 2001. The contracts are set to expire in December 2006 and January 2007.

The transition from FTS 2000 to FTS 2001 was plagued by delays. As a result, industry and government officials have been closely watching GSA as it prepares to open the contracts to competition as the end of FTS 2001 nears.

The next phase, known as Networx, will be divided into a contract for nationwide telecom companies, dubbed Universal, and one known as Enterprise for companies with specialized services. The agency initially planned to offer Enterprise contracts nine months after awarding Universal contracts but decided on a simultaneous process after industry objections.

GSA is committed to a "very aggressive schedule" on Networx, FTS Commissioner Sandra Bates told the House Government Reform Committee. Officials will release preliminarily request proposals Nov. 1 and again on April 1, 2005, before the contracts are awarded in April 2006, she said.

GSA has "made significant improvements" to Networx, enabling it to be more "pro-competitive," said Jerry Hogge, senior vice president and general manager of government markets at Level 3 Communications. He recommended, however, that the agency specify a "minimum business commitment ... [to] facilitate agency decision-making post-award" and create "effective competition throughout the life of the program."

The agency also is not adequately considering future changes in technology, said Donald Scott, senior vice president for EDS government solutions.

"Networx should offer an even broader, richer set of services and solutions," he said. "There is compelling evidence that the information technology and telecommunications industries are converging and that traditional telecommunications will be largely acquired using commodity schedules or through integration into total service packages and solutions."

Shelley Murphy, president of federal markets at Verizon Communications, agreed. "Over time it is possible that consolidation will reduce the number of Networx awardees, thereby reducing the competition for services," she said. "The GSA's current approach omits a plan for adding new technologies as they become available and mandates the use of soon-to-be obsolete services throughout the 10-year term of the contract."

Murphy also urged GSA to re-evaluate its wireless strategy so that coverage requirements apply to 95 percent of the top 100 most populated markets.

Jerry Edgerton, senior vice president of government markets at MCI, which will continue to provide GSA with FTS2001 service until 2007, called for the government to "set clear limits on the number of Networx contract awards" and "place clear limits on the number and types of services that will be included in the federal supply schedule."