Federal farm agency re-bids $350M network deal, chooses same carrier
It appears the second time’s the charm for AT&T, which won a $350 million data networking contract from the U.S. Department of Agriculture two years after having been awarded — but later stripped — of the same deal because of a protest from the losing bidders.
It appears the second time’s the charm for AT&T, which won a $350 million data networking contract from the U.S. Department of Agriculture two years after having been awarded — but later stripped — of the same deal because of a protest from the losing bidders.
AT&T announced Wednesday that it will provide the USDA with a secure, virtual private network that extends to more than 5,000 locations nationwide. AT&T’s contract also includes managed firewall, intrusion detection, intrusion prevention, authentication, ant-virus and other managed security services.
The AT&T deal was awarded as a task order under Networx Universal, a multibillion dollar program that provides telecommunications services to all U.S. federal government agencies until 2017. The Networx Universal contracts are held by AT&T, Qwest and Verizon Business.
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AT&T originally won the USDA’s data networking business in September 2008, but the award was protested by rivals Qwest and Verizon. USDA canceled its selection of AT&T in November 2008, and the agency started the process to re-solicit bids under the Networx Universal program.
The USDA suffered not only a two-year delay in upgrading its data network as a result of the legal protest, but it also used up additional procurement funds. Experts estimate the agency spent several hundred thousand dollars to re-compete this award.
“Provided there were no requirements to reimburse the protester for the legal costs of the protest and that there were no requirements to pay a vendor for a “bridge” or “transition” contract, the effort to respond to the protest and then to re-do an award of this nature could cost the government anywhere from $150,000 to $300,000 in additional effort,” says Ray Bjorklund, senior vice president with Federal Sources, a consulting firm.
USDA also lost out on the opportunity to save money on its monthly telecom bill over the last two years. The General Services Administration (GSA), which runs the Networx program, says prices on the Networx contract are anywhere from 5% to 15% less than those available on the predecessor contract, known as FTS 2001.
USDA’s Office of the CIO said in March that it expects to “save millions over the next several years by switching all telecommunication services to Networx.”
Federal agencies such as the USDA have come under fire on Capitol Hill for being slow at transitioning to the Networx program from FTS 2001. GSA said in June that more than 40% of FTS 2001 circuits had yet to be disconnected. That’s why USDA finally making an award of its data networking contract is a boon to the Networx program overall.
Winning the USDA business also is significant for AT&T. “`It’s one of the largest networks in the federal government from a geographic perspective,” says Jeff Mohan, Executive Director, Networx Program Office for AT&T Government Solutions. “USDA has extension agents in every county in the United States to oversee whatever agricultural activities happen in that county…They have a lot of different types of network activities.”
Mohan says the USDA will be switched over to AT&T’s MPLS network by next summer. “This is evidence that Networx is continuing to ramp up in terms of agency activity,” Mohan said.
AT&T is an incumbent on the USDA deal, previously providing around 60% of the agency’s data networking services under FTS 2001. Now AT&T will carry 100% of USDA’s data traffic on its backbone network.
“We were a provider for part of the USDA data network, but now we are going to be the provider for all of it,” Mohan said. “We will be connecting all of the sties together and providing…network-based IP VPN and a bunch of security services.”
Although many organizations split their data traffic among two carriers for added reliability — a practice dubbed multihoming — USDA has decided to put all of its data traffic on the AT&T backbone network. Mohan said USDA considered the redundancy and reliability of AT&T’s network as part of its evaluation criteria.
“It’s a lot easier for the agency if they have a single carrier,” Mohan says, adding that having one data network provider eliminates interoperability issues and reduces cost. “You can have redundancy and reliability on a physical level because you can connect to the network at two different places…It depends on your tolerance for risk and how much you want to spend.”
Mohan asserts that AT&T does not have any “single points of failure” in its network. “The reason we won was a combination of best technical solution, lowest risk for implementation and cost,” Mohan adds.
USDA has made several smaller awards from the Networx program in the last year. In October 2009, Verizon Business won the agency’s paging business, Sprint won its wireless services, and AT&T won its fixed satellite services. AT&T also won the USDA’s video conferencing business in March.
