Summary: The General Services Administration's (GSA) Federal Technology Services provides its customers with a broad range of end-to-end telecommunications services, including global voice, data, and video services, supporting both local and long-distance government telecommunications users. Its FTS2000 long-distance services reached more than 1.7 million users through two multibillion dollar 10-year contracts that were awarded to AT&T and Sprint in December 1988. Two contracts have since been awarded for the successor FTS2001 program--one to Sprint and one to MCI WorldCom. The federal government is now switching from the FTS2000 to the FTS2001 long-distance telecommunications program. This report answers the following questions: What percentage are the minimum revenue guarantees of the FTS2001 contracts? When are the minimum revenue guarantees likely to be satisfied? What sensitivities are there in each of these estimates? What factors could significantly alter them? If additional competitors were allowed to compete for the FTS2001 business, how might that competition affect the estimates provided? Would lower prices and transition costs resulting from such competition offset the impact on estimates?
