'Flawed' Procurement Policy Threatens to Harm Government's High-Tech Future

WASHINGTON - In testimony today before the House Committee on Government Reform, Shelley Murphy, vice president, federal sales for Verizon Enterprise Solutions Group, urged the U.S. General Services Administration (GSA) to consider several key changes to the proposed Networx acquisition strategy to maximize competition, reduce risk, achieve best value for the customer and ensure rapid access to emerging technologies.

Networx is the federal government's fourth-generation procurement program, intended to provide the full-range of domestic and international communications and network services. Currently, the GSA-proposed acquisition strategy separates potential suppliers into two classes --traditional interexchange companies and others.

"There is no need to artificially create two classifications of service and providers of service and restrict competition when the marketplace is best-suited to determine the ultimate solution," said Murphy, referring to the GSA's proposal to create separate categories of providers and the services they are permitted to offer to federal customers.

Murphy warned that if implemented in its current form, Networx would be inequitably and illogically biased in favor of the traditional long distance carriers and limit competition from a host of other communications providers that are capable of delivering the innovation required by federal agencies as they strive to fulfill their mission-critical objectives, including homeland security, defense of the homeland and the delivery of citizen-centric services.

Rather than maintain the status quo, Verizon urges Congress and the GSA to reconsider the flawed approach to the proposed Networx acquisition program by leveling the playing field, opening service and project opportunities equally to interexchange carriers and non-traditional service providers, and creating a flexible procurement framework that takes into account the market dynamics that are changing the competitive forces shaping the communications industry of the 21st century.

"The current Networx acquisition strategy is unlikely to provide robust competition," said Murphy. "As proposed, Networx will restrict the federal government's ability to obtain high-quality voice and data communications services and will not encourage the communications industry to provide new technology or innovative solutions to meet increasingly complex information technology requirements.

"Unfettered competition will encourage the communications industry to deliver the services that will drive ultimate value for federal customers," she said. "Competition will enable federal agencies to leverage the products and services that are the future of communications - convergence and Internet protocol-enabled applications such as voice over Internet protocol."

"Restructuring Networx into a single procurement, minus government-imposed classifications, will guarantee maximum industry participation and create value for federal customers," said Murphy. "The departments and agencies of the federal government are quite capable of choosing the service provider or providers best suited for meeting their specific requirements. Free competition is the best catalyst for reaching this objective. Verizon urges the federal government to foster competition among all the players in the telecommunications industry."

A Fortune 10 company, Verizon Communications (NYSE:VZ) is one of the world's leading providers of communications services, with approximately $68 billion in annual revenues. Verizon companies are the largest providers of wireline and wireless communications in the United States. Verizon is also the largest directory publisher in the world, as measured by directory titles and circulation. Verizon's international presence includes wireline and wireless communications operations and investments, primarily in the Americas and Europe. For more information, visit www.verizon.com.

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