Networx gets a tentative thumbs-up

GSA Networx page

Industry officials say they are generally pleased with General Services Administration officials' plans for the next sweeping telecommunications contract, but they still harbor some misgivings.

Officials from GSA's Federal Technology Service, which is developing the Networx contract, have laid out their new strategy so that industry officials can continue to comment on it. FTS officials plan to release final requests for proposals next April and to award Networx contracts in April 2006, said John Johnson, FTS assistant commissioner for service development and delivery.

The agency still plans to divide Networx into two separate contracts, Universal and Enterprise. But they will be awarded at the same time instead of the nine months apart that FTS officials had first envisioned, Johnson said. Smaller telecom companies had worried about the staggered timetable, concerned that larger firms would snatch up all the business before their contract was awarded.

The new plan also makes some adjustments to the requirements for each contract and to the billing requirements that vendors will be expected to follow. Networx Universal specifies 39 services that bidders must provide and 10 optional services. Networx Enterprise includes nine required services and 42 optional ones.

"I think the changes are moving in the right direction," said Shelley Murphy, president of Verizon Federal. "It provides a foundation for better competition than we saw in the first round."

Another industry observer questioned the need for two contracts. FTS officials' plan is for Enterprise to provide more localized services and perhaps provide an opportunity for companies that don't have the national reach Universal requires.

But some people believe that managing two major contracts, especially with simultaneous awards, may be too much for FTS to handle, the observer said.

"You can get everything you need in Universal," the observer said. "It seems to me like a big cherry-picking exercise. They've got to come up with a replacement contract for FTS 2001. If they can do that and get the Enterprise contracts done, so be it, but they've bitten off a lot."

"What's unclear to us is procedurally, how are the two contracts going to work?" said Tony D'Agata, vice president and general manager of Sprint's Government Systems Division. "Will all of the elements of the Enterprise contract be available under the Universal contract? Will the government have to issue task orders to all the parties on both programs?"

D'Agata also has questions about minimum revenue guarantees. FTS 2001, the contract that Networx will eventually succeed, guaranteed a minimum revenue to Sprint and MCI (then WorldCom), the two vendors that first won spots on it. FTS officials have said any guarantees on Networx will be small but have not specified possible amounts.

However, he added that a small guarantee is not a liability if the cost is proportionally lower.

"Sprint had to spend $100 million" to develop the capabilities that FTS 2001 required, D'Agata said. Networx will not require systems development.

Tony Bardo, senior director of civilian agency sales and marketing at Qwest, said that the agency has narrowly and correctly defined boundaries for Networx.

"The focus is on telecommunication services," he said.

"This isn't an [information technology] contract. I think the strategy spells that out pretty clearly," Bardo said. "That's not to say there's not work for IT community participants on this contract, but the real focus is to replace telecom services from FTS 2001 and to expand on it."

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Networx deliverables

Officials at the General Services Administration's Federal Technology Service plan for Networx to deliver:

Continuity of services.

Competitive prices.

Full-service vendors.

High-quality service.

Alternative sources.

Operations support.

Transition assistance and support.

Performance-based contracts.

Source: Federal Technology Service