AT&T fighting to keep foothold

AT&T may have lost FTS 2001 contracts to competitors Sprint and MCI WorldCom

18 months ago, but the telecommunications giant did not go quietly into

the night.

Instead, the company went after and won six Metropolitan Area Acquisition

contracts, becoming a local phone service provider and therefore eligible — at some point — to bid once more on FTS 2001.

More recently, however, it helped launch a General Accounting Office

investigation into whether the FTS 2001 contracts should be reopened. The

letter spurring the GAO to action, dated Jan. 5, 2000, was sent from the

House Committee on Government Reform and signed by committee chairman Rep.

Dan Burton (R-Ind.).

But according to electronic copies of the letter acquired by Federal

Computer Week, the letter originated nearly a month earlier — on Dec. 7 — in the computer of AT&T AT&Torney and one-time lobbyist Thomas Sisti.

"Our policy is we write our own letters," said Mark Corallo, a spokesman

for the government reform committee. Corallo could not say why Sisti would

appear as the author of a letter sent from the committee to GAO.

"I have no explanation because it doesn't prove that he is the author,"

he said.

William O'Neill, until recently director of procurement policy for the

reform committee, also denied the letter was drafted by anyone outside the

committee.

An AT&T spokeswoman said Sisti did not write the letter, but said, "AT&T,

like other companies, sometimes supplies information to [congressional]

offices, and possibly data we submitted was used in formulating another

document."

Sisti works in AT&T's legal department, she said, but because he worked

for a time in 1998 with its lobbying group he was registered as a lobbyist,

the spokeswoman said. Sisti would have no comment, she said.

Whenever a Word document is created, it dates the file and identifies

as the author the individual designated to use the computer. When sent electronically

as an Attachment, creation date and authorship are revealed by calling up

the "properties" selection from the file menu.

Properties may also note the title of the document and the date it was

last saved. Any changes made to a document, however, are not detailed.

For those reasons, it is possible a document could be edited or changed

by subsequent savers, but the original creator will be identified as the

author.

Last year, Burton weighed in on the measure to open FTS 2001 contracts

to local phone service providers. In a July 1999 letter to the General Services

Administration, first reported on by Federal Computer Week, Burton demanded

GSA open FTS 2001 long-distance business to local carriers.

Burton did not specify AT&T or any other company, though his letter followed

AT&T's successful bid for three local service contracts from the GSA.

GSA, which Burton's committee oversees, did ultimately decide that local

service providers may apply for FTS 2001 contracts one year after the contracts

were signed. That meant AT&T was eligible to apply for FTS 2001 contracts

as early as December 1999 — one year after FTS 2001 contracts were signed

with competitor Sprint.

AT&T has submitted a proposal to FTS, the company said, but GSA has not

approved it.

While GSA can reopen FTS 2001 contracts to bid, it would do so at a

risk. Under the contracts, Sprint and MCI have been guaranteed minimum revenues

of $750 million each over the life of the contracts. If the two companies

fail to meet the so-called MRGs, GSA will have to come up with the difference.

The AT&T/Burton letter to GAO directed the agency to review whether additional

competition in FTS 2001 would benefit taxpayers.

The report, released April 14, concluded there would be a savings to

taxpayers only if a new competitor had provided service under the FTS 2000

contract because there would already be a communications structure established.

That description fit only one company: AT&T.

But if the letter was intended to use GAO findings to buttress an argument

to reopen the contracts, it failed.

The report also concluded that additional competition would further

split the revenues among competitors and make it unlikely that Sprint and

MCI would make the MRGs. That would leave the taxpayers — through GSA — responsible for the revenue shortfall.

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