Sprint Nextel Corp. of Reston is teaming with Lockheed Martin Corp. of Bethesda to battle other telecommunications companies for a huge opportunity to provide telecommunications and network services to the federal government.
The recently announced Sprint Nextel-Lockheed team will compete for the General Services Administration's 10-year Networx telecommunications and IT services contract. The contract, valued at nearly $20 billion, is scheduled to be awarded next year.
The mega-contract will allow the government to provide a wide range of telecommunications and networking services, providers and solutions to all federal agencies.
AT&T Government Solutions of Vienna and MCI Inc. of Ashburn previously announced their teams for the competition. Other telecom carriers, including Qwest Communications International Inc. and Verizon Communications Inc., are expected to bid on Networx. Spokeswomen for both companies said neither has set an announcement date yet.
AT&T Government Solutions went first. At the beginning of August, it announced a team consisting of Northrop Grumman Information Technology, EDS Corp., GTSI Corp., SRA International Inc., Cingular Wireless LLC, Global Crossing Ltd., and other small and midsized government communications and IT companies.
Then MCI said it was partnering with several companies, including Anteon International Corp., Computer Sciences Corp., G2 Satellite Solutions Corp., Hewlett-Packard Co., TeleTech Government Solutions LLC, WilTel Communications Group Inc., Verizon Wireless, Comtech Telecommunications Corp., Protus IP Solutions Inc. and Proxim Wireless Networks.
The Sprint Nextel team that was announced Aug. 26 includes more than 40 companies, including many technology firms and small businesses, said Stephanie Taliaferro, a Sprint Nextel spokeswoman. The company declined to make public the names of the team members other than Lockheed Martin, the Pentagon's biggest contractor.
The face of the telecommunications industry today is reflected in the competitive field, analysts said. "This program is too important for major players not to be involved in," said Warren Suss, president of Suss Consulting Inc., a federal telecom networks and information technology consultancy in Jenkintown, Pa.
The Networx contract has two parts. The Universal part will provide government locations with a broad range of telecom services nationwide. The Enterprise part will offer a mix of specialized Internet protocol or wireless services in specific geographical areas. All three telecom firms that have announced their teams so far will bid for both parts, the companies said.
Company proposals are due Oct. 5 for the Universal portion and Oct. 7 for the Enterprise portion. GSA will issue multiple awards for both parts in April 2006.
"Winning any portion of these contracts -- Universal or Enterprise -- guarantees you a steady source of revenue, so it's imperative for these guys to get a good team together and make the right bid," said Sean Buckley, senior analyst for public sector solutions at Current Analysis Inc., a Sterling-based telecom and IT market research firm.
All three companies are strong competitors, analysts said. The GSA, the government's main procurement agency, will select winners based on pricing and technical capabilities and compliance, they said.
"They all bring a wealth of capability to the table, and the issue is going to be how they propose it to the government," said Charles H. Viator Jr., vice president of the government group at Rivulet Communications Inc. of Portsmouth, N.H. He is also the chairman of the shared interest group on networks and telecommunications at the Industry Advisory Council, a Fairfax-based organization of information technology professionals who provide products and services to the government.
Networx is to replace the current FTS 2001 contract for government-wide telecom services, which expires in 2006. MCI and Sprint are the two incumbents on that contract.
MCI has the "lion's share of the current FTS 2001 business, and they've had a long successful track record of serving their current [government] customers," Suss said.
Sprint's strengths are that it is the second-level FTS 2001 incumbent and has a strong set of wireless offerings, while AT&T has aggressively pursued government business and has a strong management board, he said.
Buckley questioned how the acquisitions of MCI and AT&T will affect their participation in Networx. "While AT&T and MCI have sizeable presence as government solutions providers, their respective mergers with SBC and Verizon could have an impact on their ability to deliver services under Networx," he said.
SBC Communications Inc. of San Antonio agreed in February to buy AT&T for $16 billion. Verizon agreed in May to buy MCI for about $8.5 billion.
Sprint Corp. and Nextel Communications Inc., two of the largest wireless operators, completed their $35 billion merger in August. The new company has its corporate headquarters in Reston and its operational headquarters in Overland Park, Kan.
Roseanne Gerin is a staff writer with Washington Technology. For more details on this and other technology contracts, go to www.washingtontechnology.com.