Postal Service Selects AT&T, Verizon, and XO

January 10th, 2011 by · 4 Comments

According to the beltway-contractor-centric publication Washington Technology, the US Postal Service handed three major six-year contracts to three telecoms.  As always, the incumbents got the lion’s share: Verizon (NYSE:VZ, news, filings) got the biggest share of $186M, while AT&T (NYSE:T, news, filings) got $100M.  But competitive operator XO Holdings (news, filings) managed to walk away with $45M.  The Postal Service is aiming to fully integrate its communications infrastructure for billing, ordering, and inventory systems.

As wonderful as the big dollar values are here though, these contracts are really just pre-qualifications to compete for the real thing via task and delivery orders down the line.  Initially, that means secure data services to 14K facilities nationwide, the scope of which explains why AT&T and Verizon won the bulk of the deal. I doubt we’re talking about fiber to every one, just a fraction.  XO does have an extensive central office footprint and has been pushing its EoC offerings, perhaps that is what they are leveraging to get a sizeable piece of this deal.

The range of services provided will grow over time, slowly of course (this is Washington after all).  Hopefully they aren’t using as much Cobol as the SSA.  One thing I’m not clear on here, though, is why there is no mention of the Networx contract here.  I would have thought such contracts would be under that umbrella. Was this separately bid?

Seems like we should hear from XO soon about that rights offering, or whatever it morphs into…

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