Networx: Now for the hard choices

With Universal and now Enterprise, feds must sort through telecom options.

Now that the General Services Administration awarded two major telecommunications contracts, including Networx Enterprise this past week, federal agencies will have to make hard choices. It won’t be like choosing between vanilla or chocolate ice cream. It will be more like choosing between a bowl of ice cream or a five-gallon tub of it.

GSA’s Networx Web site

The brand names will mostly be the same. GSA awarded Networx Enterprise May 31 to five companies: AT&T, Level 3 Communications, Verizon Communications, Qwest Government Services and Sprint/Nextel. In March, three of those companies — AT&T, Verizon and Qwest — also won contracts under GSA’s larger Universal Networx program.

The two contracts offer many of the same services. All 10 of the telecom services that GSA required vendors to provide under Enterprise are included on Universal. Universal offers 25 additional varieties of telecom services. But there are other differences in the contracts that agencies should consider, too, GSA officials said.

“Enterprise required awardees to bid IP services, but the optional categories are where we hoped to attract new entrants into the market,” said John Johnson, assistant commissioner of integrated technology services at GSA’s Federal Acquisition Service. “Universal provides a robust suite of services, while Enterprise has the value of better prices. It is focused on IP-based services, and there are more vendors who can compete” in offering those services.

The Networx program is the successor to GSA’s FTS 2001 program, whose contracts are nearing expiration. Agencies will have about two years to move their telecom business from the FTS 2001 contracts to the Networx ones. Johnson said agencies should begin their transition to Universal in late July or early August and their transition to Enterprise by September.

Networx has a maximum lifespan of 10 years and an estimated value of about $20 billion, according to GSA. It covers voice, IP, wireless, satellite and IP-centric services.

One of the largest users of Networx will be the Defense Department, which played a key role in developing the contract’s requirements, Johnson said. “We had several meetings with [the Defense Information Systems Agency] to make sure Networx would satisfy them,” he said. “Networx is heavy in the area of security and reliability.”

DISA spokesman Mike Thiem said DISA intends to transition all FTS commercial voice services to Networx and has hired a full-time transition manager to accomplish that task. “Any commercial circuits or frame relay will be moved to Networx,” he said. “Command and control related requirements will go to the Global Information Grid,” DOD’s worldwide secure IP network.

The Agriculture, Homeland Security, Housing and Urban Development, Interior and Treasury departments also will be among the first to transition to the new contracts.

A DHS spokesman said the agency intentionally did not include wireless products or services on its agencywide contracts because it plans to order those services through Networx.

HUD is considering a variety of Networx services, including wireless, voice over IP for data and video, and security services for voice and data communications, said Bajinder Paul, HUD’s deputy chief information officer for information technology operations.

1105 Government Information Group staff writers Michael Hardy and Matthew Weigelt contributed to this story.

Networx fees will be tieredEditor's note: This sidebar was updated at 2:44 p.m. June 4, 2007. Please go to Corrections & Clarifications to see what has changed.

Agencies requiring less help from the General Services Administration to use the new Networx telecommunications contracts will pay lower fees, said John Johnson, assistant commissioner of integrated technology services at GSA’s Federal Acquisition Service.

GSA officials are developing a new fee structure for Networx, a multiple-award, indefinite-delivery, indefinite-quantity contract.

“Agencies will pay a fee commensurate with the value add from GSA,” Johnson said. “We anticipate it will be a tiered fee structure.”

GSA is still conducting research on the fee structure. One factor GSA will consider in setting the fees will be agencies’ plans for transitioning to Networx, Johnson said.

— Jason Miller

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