Five firms secure $20b US government deal

Five US companies, AT&T, Level 3 Communications, Qwest Communications, Sprint Nextel and Verizon, were awarded a US federal telecommunications contract worth up to $20 billion over 10 years, an Associated Press report said.

The Associated Press report said the winners of the so-called Networx Enterprise contract must now compete with each other to win business from agencies looking to improve their voice, data and other telecom services.

The report said the contract is the second telecom contract awarded by the US General Services Administration in about two months.

In late March, Qwest, AT&T, and Verizon were winners of the much larger Networx Universal contract, the government's largest telecom contract ever awarded, the report said.
That deal is potentially worth up to $48 billion over a decade, it added.

For Sprint, the only bidder shut out from the Universal contract, getting on the Enterprise contract was critical, the Associated Press report said.

The company had been providing telecom services to federal agencies for the last 18 years, the report said.

The Associated Press report also quoted GSA officials as saying that they expect agencies to spend roughly $20 billion over the life of both contracts, or less than one-third of what's allowed.

Universal will require companies to not only maintain current agencies' needs, such as supporting older network systems, but also will offer advanced services, such as Internet-based telephone service, network security and video and web conferencing, to as many as 135 agencies operating in 190 countries, the report said.