AT&T wins $1B Treasury Department network deal

AT&T announced Monday that it will build and manage a next-generation wide-area network for the U.S. Department of Treasury under a contract worth up to $1 billion over the next 10 years.

The Treasury Network (TNet) was the first order placed under the Networx Universal program, a 10-year, $20 billion umbrella contract that U.S. federal agencies are required to use to buy telecommunications services.

Networx Universal was awarded in March, and the three carriers on the contract completed their required back-end systems and security testing in early September.

AT&T officials said they believe the other Networx Universal providers -- Qwest and Verizon Business -- bid against them on the Treasury Department network upgrade.

Don Herring, senior vice president of AT&T Government Solutions, called the TNet win a "vote of confidence" for AT&T’s Networx Universal offerings.

"Being on Networx Universal and Enterprise is great . . . but it really doesn’t matter until the agencies see the value of what you’re offering and start placing orders," Herring said. "With our broad portfolio of Networx offerings, we have a host of services that meet Treasury’s needs."

AT&T will build a secure Multiprotocol Label Switching (MPLS) network spanning 1,000-plus locations and supporting more than 100,000 employees of the Treasury Department’s 12 bureaus, which include the Internal Revenue Service, the U.S. Mint and the Bureau of Engraving and Printing.

TNet will provide a single, converged backbone network to carry data, voice and video traffic. It also features secure remote access to support teleworking, as well as disaster-recovery services.

The initial TNet award is for $270 million, but AT&T officials say the deal could be worth as much as $1 billion, including add-on services bought over the 10-year life of the contract.

AT&T’s subcontractors on TNet include Northrop Grumman Information Technology, Bechtel National, SRA International, Accenture, NCR and Archura.

AT&T has been seeking the Treasury Department’s network upgrade for years.

In December 2004, AT&T was awarded a $1 billion telecommunications deal called the Treasury Communications Enterprise (TCE) contract. The TCE award was later overturned after five of the six other bidders protested the Treasury Department’s award to AT&T.

The Treasury Department decided to wait and purchase its new network through the federal Networx program. The agency put out a task order for TNet under Networx Universal in early summer. AT&T learned on Sept. 21 that it had won the deal.

"We think that our transition plan for moving Treasury to an IP MPLS network, the people we have on this job, and the expertise we have [are] probably why we won," Herring said.

Next up for Networx Universal providers is the Department of Homeland Security’s purchase of OneNet, a consolidated backbone network. Bids on OneNet are due in October.