Qwest, AT&T, and Verizon win deal of the decade

Senator Everett Dirksen (R-Illinois), the minority leader in the Senate from 1959 to 1969, was listenning to a debate on the floor of the Senate over the federal budget, and famously muttered to himself: “A billion here, a billion there, and pretty soon you’re talking real money.” Why this walk down memory lane? Becasue Qwest, AT&T, and Verizon late last week were awarded the government’s largest telecommunications contract ever, a ten-year deal worth up to $48 billion. In what must be regarded as the deal of the decade, the federal government plans to spend at least $20 billion for telecommunications services over the life of the Networx Universal contract, which is capped at $48 billion. The three winners will now have to compete with each other for the telecom needs of federal agencies, the General Services Administration (GSA) announced. The contract covers voice, video, and data services and technologies domestically and internationally for at least six federal agencies, but could apply to as many as 135 agencies operating in more than 190 countries.

The big loser is Sprint Nextel. The company has been providing telecom services to the federal government for nearly twenty years. All is not lost, though, as there may be a consolation prize in the offing: GSA is planning in May to award a second telecommunications contract called Networx Enterprise — worth up to $20 billion — which contains fewer mandatory requirements and services in select areas across the nation.

The big winner is Qwest, the smallest among the three winners. Qwest may now leverage its government business to gain more corporate clients, something it has so far found difficult to do.

-read more about Networks in Rhonda Wickham’s Wireless Week report; and the GSA Web site