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.