AT&T, Verizon Business and Qwest win $20bn US government contract

AT&T, Verizon Business and Qwest have hit the jackpot, winning a 10-year, $20bn (£10bn) telecommunications contract with the US federal government that is the largest of its kind in the world.

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AT&T, Verizon Business and Qwest have hit the jackpot, winning a 10-year, $20bn (£10bn) telecommunications contract with the US federal government that is the largest of its kind in the world.

The three companies beat off rival Sprint Nextel, which has held two previous such contracts, FTS 2001 and FTS 2000. Sprint Nextel served the US government as a telecom provider for 18 years but lost out on the new "Networx Universal" contract.

US government procurement agency, the General Services Administration (GSA), announced the winners late last week.

John Johnson, assistant commissioner for integrated technology services with the GSA's federal acquisition service, would not comment on why Sprint lost the massive deal.

"The three [companies] that we awarded to addressed the objectives of our programme more readily," Johnson said.

Networx Universal will provide domestic and international voice, data, video and wireless services to federal agencies for the next decade. It includes 50 services, from legacy frame-relay and ATM to cutting-edge VPNs and VOIP.

Networx Universal "will transform the current federal telecommunications system to a secure, worldwide IP and MPLS-based network compliant with Internet Protocol Version 6 and other major technological advances," according to a GSA statement.

A companion contract, called Networx Enterprise, will provide emerging IP and wireless services. Networx Enterprise is expected to be awarded in May.

Together, Networx Universal and Networx Enterprise represent the largest federal telecom acquisition ever completed. The two contracts will support 135 agencies in 191 countries.

GSA can spend as much as $50bn (£25bn) on Networx Universal and $20bn (£10bn) on Networx Enterprise. But agency officials estimate they will spend $20bn (£10bn) in total on the two contracts over the next decade. "Twenty billion represents what we anticipate the business volume to be, based on current volumes and anticipated growth," Johnson said.

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