Treasury seeks savings with comm upgrade

contract with TRW lists neither a maximum nor a minimum amount to be paid for TCS work.

A new fee-for-service arrangement will let the Treasury Department build its
backbone network in a fashion and at a price that will not break the bank, senior Treasury
officials said.

In 1995, Treasury awarded a 10-year contract to TRW Inc. to overhaul the Treasury
Communications System that serves the department’s 10 agencies.

After one year, Treasury officials began to balk at the thought of maintaining the
massive network and at the expense of buying all new equipment for TCS.

So Treasury, working through TRW, decided to outsource the project for high-speed
asynchronous transfer mode services.

Last month, TRW awarded six-year subcontracts to Qwest Communications Inc. of Denver
and Sprint Corp. to provide ATM and frame relay services as well as network management and
monitoring services to Treasury.

“Another major advantage is the fact that we can split the costs of installing
communications lines and other equipment among the various agencies within the
Treasury,” the department’s chief information officer James Flyzik said.

The provisions of Treasury’s contract with TRW list neither a maximum nor a
minimum amount to be paid for TCS work. To date, Treasury has spent $470 million on the

“In the long run, we believe that outsourcing, or fee-based service, is cheaper
and more efficient than owning or leasing equipment,” Flyzik said. “In this way,
we can make sure that we have state-of-the-art equipment at a fraction of the purchase and
maintenance cost of owning or leasing.”

Although Treasury has managed to get around the high price of equipment and
maintenance, some users in the department still see the transition as a daunting project.

Over the past 14 years, TCS has evolved into a network that is difficult to maintain
and administer, said Tom Wiesner, Treasury’s director of corporate systems

TCS is a collection of networks based primarily on legacy x.25 technology.

The network supports roughly 150,000 users on 10,000 circuits with more than 1,300
routers. The system includes both public and private frame relay networks along with ATM

“Our plan now is to migrate towards a catalog of services based on user
requirements. The vendors will furnish whatever equipment and circuits are necessary to
meet the requirements,” Wiesner said.

“At the end of the day, we would like the TCS network to be totally service-based
and to include commercial transport circuits provided by Qwest and Sprint,” he said.

When the network is complete, Flyzik said, the bulk of traffic it carries will be data,
not voice.

“As we migrate off the legacy TCS network and toward the new TCS environment, we
are strategically headed towards the aggregation of data, voice, multimedia and wireless
information over a single consolidated network,” Flyzik said.

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