Let them all compete

The FTS 2001 contract is full of so many pleasers and teasers that it may

never really deliver what was promised: the latest and greatest networking

technology and services at rock-bottom prices.

In planning the follow-up to FTS 2000, the government had hoped to set

up a common contract that would truly usher in modern telecommunications

for federal users, with plenty of fast, advanced services and enough flexibility

for maneuvering in the fast-tracking telecom marketplace.

Instead, nearly nine months after the contract was awarded, many agencies

are not getting the services they desire, some are clinging to the old contract

and others are still trying to determine who is going to do the work involved

in switching from one network to another.

What's going on? For starters, outside of the legal reality that the

old contract is expiring, there doesn't seem to be a driv-ing economic incentive

for most agencies to take the plunge. The new prices are being offered under

the old contract. The new deal is not mandatory, so agencies are not actually

required to shift. And lastly, it is not a simple proposition to change

the government's entire telecom infrastructure in one fell swoop.

But what's at work may be more basic. The government has tried to create

a monolithic telecom contract during a storm of economic and technological

change. Long-distance prices in the open market are already dropping to

the vanishing point. That's the reason MCI WorldCom and Sprint are looking

to merge, which could further upset the FTS apple cart. To offer FTS winners

revenue guarantees in the midst of such change is to almost ensure that

there won't be money left for the bells and whistles that agencies most

desire in the contract.

Perhaps it's time the federal government got out of the business of

managing agency telecom services and instead worked out a way to let all

providers compete for agency voice and data business. Then agencies could

negotiate directly for what they want at a fair price, and service providers

wouldn't be lulled by terms that are a bit too sweet.

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