Qwest, AT&T and Verizon on Thursday were awarded the government’s largest telecommunications contract ever, a 10-year deal worth up to $48 billion.
In 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 contract winners, who beat out Sprint Nextel, don’t simply split a pool of money. They now have to compete with each other for the telecom needs of federal agencies, the General Services Administration 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 announcement was a huge blow to Sprint, analysts said, because it has been providing telecom services to the federal government for nearly 20 years.
“The federal government was Sprint’s first major customer since the company started,” said technology consultant Warren Suss.
Today’s announcement was most significant for Qwest, the smallest among them. Qwest may now leverage its government business to gain more corporate clients.
For Sprint-Nextel there may be a consolation prize after loosing the Networx Universal contract. GSA is planning in May to award a second telecommunications contract called Networx Enterprise — worth up to $20 billion — that contains fewer mandatory requirements and services in select areas across the nation.
DailyWireless has more on The Networx Contract.
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