GSA Delays Decision on Massive Networx Awards Until 2007
The GSA delayed by 9 months, until early 2007, its target dates for picking winners of the Networx contracts to provide communications services to the federal govt. worth about $20 billion over 10 years. Sources in govt. contracting told us Thurs. they were surprised by the delay’s length, though not that the agency was unable to pick winners within its original timetables. GSA likely needs more time because the bids are so complex, not because there was an unexpectedly larger number of them, sources said. Under the revised schedule, the broad Universal contract will be awarded in March 2007; the more narrowly focused Enterprise contract, in May 2007. GSA is expected to award multiple contracts.
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Four telecom firms have confirmed they bid on the Networx Universal contract - Qwest, Sprint Nextel, AT&T, prior to the merger with SBC, and MCI, prior to the Verizon merger. Those 4, plus Verizon Federal, WilTel and Level 3 and at least one wireless carrier, bid for the enterprise contract. The 2 near-term winners are major govt. contract incumbents Verizon and Sprint, which retain those contracts for the time being.
“After a month or 2 had gone by and absolutely no comment from GSA, I was anticipating a delay of at least a few months, but the 9 months was a surprise,” John Okay, former deputy administrator of GSA, said: “Clearly, GSA wanted to give everybody pretty realistic expectations. They may have put it out there far enough so that they don’t have to readjust and have a further extension of the timeline.”
The requests for proposals (RFP) on which bids had to be based were extremely complex and open to interpretation, said Okay. Each carrier’s proposal ran thousands of pages. “The process was very long and very complex. What I suspect happened is that each of the bidders approached their proposal in a somewhat different way,” Okay said. “Where the RFP gave less than crystal clear guidance, the different bidders probably made different interpretations.” Okay said the GSA team evaluating the proposals will have to “take some extra time and steps to try to get everything on an even keel, so that they're comparing apples with apples and not apples with turnips.”
Govt. contracting expert Warren Suss of Suss Consulting said delays are common in awards as big as Networx. Earlier, GSA delayed several times the deadlines for filing proposals. “I was not surprised, given the magnitude of these contracts and the number of services… and the size and complexity of the pricing model,” Suss said. “There are literally millions of elements in the pricing.”
The delay probably reflects proposals’ complexity more than their number, Suss agreed. “Some of the players were hoping for a quick award, some were hoping for a later award,” he said: “I don’t think you can read tea leaves here. The incumbents are happy and the nonincumbents are unhappy.”
Of 4 bidders for Networx Universal, Suss views MCI, the main incumbent, as the team to beat, especially since choosing a firm already under contract minimizes “transition” issues. Sprint, the #2 incumbent, also is positioned strongly. AT&T, which has given more attention to govt. contracts, is deemed a strong challenger, Okay said. Qwest is viewed by most as more of a dark horse among the 4 major contenders.
No system integrators made stand-alone bids, sources said, though major integrators are parts of teams assembled by the 4 contenders for Networx Universal. MCI partnered with G2 Satellite Solutions, Verizon Wireless, Computer Sciences, Anteon, WilTel, Hewlett-Packard and TeleTech Govt. Solutions. AT&T’s team includes Cingular, Northrop Grumman, Electronic Data Services, GTSI, SRA International and Global Crossing. Qwest said its lineup includes BellSouth, Akamai Technologies, Lucent, Bearing- Point, Hawaiian Telecom, Istonish Holding, Science Applications International and Wire One. Sprint’s main support is from Lockheed Martin.