Deju vu for DREN: DISA faces protests

Somewhere in soliciting bids and awarding the $450 million contract for the Defense Research and Engineering Network, something went wrong for the Defense Information Systems Agency. Again.

Earlier this month, DISA announced that WorldCom Inc. had won the contract to bring long-haul telecommunications service to more than 6,000 scientists and engineers at Defense Department laboratories, test centers, universities and industrial sites.

It was the second award of the DREN contract in nine months, with the same result: protests.
In the weeks after the April 4 announcement, three of the four losing bidders'Sprint Communications Corp., Global Crossing Ltd. of Bermuda and AT&T Corp., in that order'filed protests with the General Accounting Office.

All cited inconsistencies in the evaluation criteria DISA used. GAO will issue its decision by July 22, said Dan Gordon, associate general counsel at GAO.

Qwest Communications International Inc. of Denver, the fourth losing bidder, did not protest the latest award. The protest window closed this month.

The contract has a three-year base and seven one-year options. It is worth at least $137 million, but could reach $450 million if DOD exercises all the options.

A WorldCom spokeswoman said company officials have not decided whether they will file a response to the protests.

'WorldCom has the technical expertise as well as the experience necessary to provide services for the DOD now and into the future,' spokeswoman Natasha Haubold said. 'We also have faith in the DOD's decision regarding this contract award and are looking forward to finally providing services.'

Industry sources criticized DISA's repeated fumbles on DREN.

'They keep changing their mind,' said Euan Rellie, co-founder and managing director of Business Development Asia, a New York consulting firm that has followed DREN since last July, when DISA first awarded the contract to Global Crossing but then rescinded it amid protests from all the losing bidders.

'I think it's become a political football,' Rellie said. 'There are so many question marks at the moment.'

Among the most vexing issues are inquiries by the Securities and Exchange Commission into accounting procedures at Global Crossing as well as at WorldCom and Qwest.

'There has been a lot of scrutiny on telecom companies in general,' Rellie said. 'So many providers are looking fragile at the moment. There's bound to be a lot of pressure on the government to find a suitable provider.'

Rep. Dana Rohrabacher (R-Calif.) has raised security concerns about the contract.

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