Telecom giants battle for $1B systems revamp

Bidders view the upcoming $1 billion-plus project to upgrade Pentagon telecommunications systems as a battle of the telephone giants pitting AT&T against its offspring including Bell Atlantic and Lucent Technologies Inc. as well as GTE Inc. All four companies will vie for a prize valued as both a showcase and a business opportunity.

Barbara Connor president of Bell Atlantic Federal Systems called the Pentagon Management and Information Renovation program (PMIR) "the crown jewel of the Department of Defense" telecommunications contracts. "It is big visible and a major undertaking with at least a billion-dollar price tag " Connor said.

Connor said that besides the high price and equally high visibility PMIR has attracted such a large field of competitors "because it's a single-award contract which delights those of us who have been going through the multiple-award battles. This is going to be fiercely competed."

Tom Brooks vice president of AT&T Technical Services Co. and also a vice president of AT&T Government Markets said PMIR offers the winner a lot more than just "the bucks. It gives you a lot of visibility long-term stability and the chance to achieve a strategic partnership." Connor pointed out that Bell Atlantic already has such a partnership through its Washington-area Telecommunications Modernization Program contract with DOD and already has modernized a portion of the building.

"We have been working in the basement of the Pentagon as well as the `swing space ' " Connor said. The swing space she explained consists of office space that will house workers as their wedge of the Pentagon undergoes a physical rehabilitation as well as an upgrade of its communications systems.

Bell Atlantic already has installed advanced systems to provide services to roughly 3 500 workers in the swing space located in Presidential Towers in Crystal City Va. Connor said this includes "ISDN and [Asynchronous Transfer Mode] service to the desktop.... When people move [into the swing space] literally all they have to do is plug in their computer and telephone and they are ready to go.... It is an impressive engineering job."

Brooks said that while "at first glance Bell Atlantic might seem to have an advantage because of their incumbency we can bring fresh thinking and new technologies to bear." Because the overall renovation plan calls for splitting the Pentagon into five wedges with workers moving in and out of those wedges over a 10-year period wireless technology could provide the best solution to handle the ebb and flow Brooks said. "That's the kind of fresh approach we want to take to the architecture. We also would love to get AT&T Labs involved in this project no one knows more about networking than AT&T and AT&T Labs."

Dave Stephens director of new business development for Lucent declined to comment on his company's approach to PMIR at this date. Industry sources said Lucent has already signed Computer Sciences Corp. on as a partner but Lucent also needs to find a phone company partner. Lucent spun out of AT&T last year.

Diana Gowen director of Defense and national information infrastructure for MCI Government Markets said she has an interest in PMIR "but not as a prime." GTE Government Systems is "absolutely interested in bidding PMIR as a prime " a company spokesman said but he could not provide any more details of GTE's strategy.

Warren Suss a Pennsylvania-based telecommunications analyst said that although healthy competition could drive PMIR costs down he does not expect the procurement to end up as a price shootout. "The government is looking for a long-term innovative solution not price. It has also provided the bidders with a lot of latitude on those solutions " he said.


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