Contract for high-speed Defense network put on hold again

The saga over the award of a high-speed Defense Department network contract continued Friday as the agency postponed announcing the award of the contract for the second time, Government Executive has learned. Defense asked the five telecommunications companies bidding on the Defense Research and Engineering Network (DREN) contract to hold firm on their final bids for another 45 days. This is the second time in the past month that the Defense Information Systems Agency (DISA), which administers the contract, has asked the companies to give the agency more time to make a decision. DISA was to have announced an award Jan. 25, but asked for an extension after Global Crossing, one of the competing companies, filed for Chapter 11 bankruptcy protection on Jan. 28. An announcement was expected March 4, but now that all the bidding companies have agreed to extend their offers, DISA has until April 18 to make an official announcement. The DREN contract has been steeped in controversy for the past seven months. The contract for a high-speed linkage of more than 5,000 scientists at universities and Defense locations nationwide was awarded to Global Crossing in July, but rescinded weeks later after the losing bidders-AT&T, WorldCom, Sprint and Qwest Communications-protested that Global Crossing couldn't meet a number of security requirements spelled out in the government's request. The subsequent set of requirements issued by DISA changed or eliminated a number of those security requirements. Industry officials have charged that those changes effectively relaxed the stringency of the contract and made it easier for Global Crossing to mount a second bid. Industry insiders and observers have speculated for months as to whether DISA still planned to award the contract to Global Crossing, even though the firm is saddled with more than $12 billion in debt and is under investigation by the Securities and Exchange Commission and the Federal Bureau of Investigation for suspicious accounting practices. By postponing the award, DISA has bought more time to reach a decision, a move that has some industry observers questioning the agency's intentions. DISA officials did not respond to phone calls about the postponement. One telecommunications industry source close to the contract process, who spoke on condition of anonymity, said DISA's delay indicates that the agency still favors giving the DREN contract to Global Crossing. "I have to assume that if they were going to go with someone else there'd be no delay. That seems to be the only good reason for extending." The source added that DISA might also be waiting to see how Global Crossing fares in bankruptcy hearings, set to begin this month. It isn't clear whether the company will be sold or liquidated. Rep. Billy Tauzin, R.-La., is also looking into Global Crossing's bankruptcy and is drafting a letter to the company to request related documents. A spokesman for Tauzin declined to reveal the substance of that letter or whether it would address the DREN contract.