GSN costs to ripple through agencies

Telcos ready to assist stranded GSN users

Telecommunications operators are lining up to offer network lifelines to government agencies using the State Services Commission’s troubled Government Shared Network (GSN).

Users, meanwhile, are saying promised benefits of the network have never materialised and the cost of the failure will increase considerably as it ripples through government departments.

TelstraClear, Gen-i and even GSN partner FX Networks are all positioning themselves for potential opportunities should the network be scaled back or even shut down.

TelstraClear spokesman Chris Mirams says the original GSN concept had merit “at the time”, but the regulatory landscape has now changed.

“The SSC could benefit from that,” he says, adding TelstraClear will speak to GSN users about their needs “at the appropriate time”.

Last week the SSC launched an independent investigation of contracts with consultancy Voco after allegations of irregularities in the way its contracts were renewed. Voco was paid $8.2 million for its part in the project. SSC says the independent investigation was ordered after receiving new information of a “material” nature.

Gen-i, which launched its Tahi programme in answer to initiatives such as the GSN, is also ready to pick up business from any fallout.

“There are plenty of departments in conversation with us and other providers,” says Gen-i’s CEO Chris Quin. He says Gen-i will assist them to get off the GSN, if it comes to that, while minimising costs.

“At the time of launch we were not able to engage in and supply to the GSN because of the contract,” Quin says. “We recognised government as a sector and an industry needed the benefit of scale.”

He says the price of network and other services in Tahi recognise the volume of government procurement as a whole. Twelve central agencies use Tahi along with 47 local authorities, 17 crown agencies, nine district health boards and 13 tertiary institutions, Gen-i says. Thirty such users recently met at a Tahi client council meeting.

Should the GSN be discontinued, FX Networks will also approach GSN-using agencies, says managing director Murray Jurgeleit.

“We’re constrained from doing that at present under the terms of the GSN agreement,” he says. NZ Police is likely to be an early customer on that basis.

“The part of the GSN which Police currently uses is just the national fibre network services and this network aspect of the GSN will continue to operate,” says a Police spokeswoman.

“Therefore there is no impact on Police by the GSN discontinuing. It does not concern us.”

FX provides the backbone to the GSN. It has not been involved in the products and services provided at user level, says Jurgeleit. It seems some of the agencies didn’t get the advanced and packaged service they expected, he says, “but it would be wrong of me to comment on the cause of that”.

The root problem with the economics of the network was clearly the slow speed of takeup by agencies and the answer to that is “to make the offerings more attractive”, he says.

“I think the GSN is a good idea and we’d like to see it succeed.”

Jurgeleit says FX was not involved in any of the network’s alleged shortcomings, which have reportedly included downtime, sometimes of hours’ duration and dropped packets.

“We were engaged to deliver a high-capacity pipe and we’ve done that. We have never, in two years, been notified of any problem with our services. We believe we have delivered and we have never been advised to the contrary.”

IBM, the prime contractor for the GSN project, was not prepared to comment.

Meanwhile, users who were not prepared to be named suggest departments face spending millions of dollars if they have to bail out of the GSN, raising the cost of the failure further as it ripples through agencies.

Senior government IT people described GSN as a Rolls Royce solution that hadn’t delivered. One said his department would have to spend at least $1 million to revert to previous services “but we don’t really know the real cost at this stage”.

“We were promised savings that haven’t been delivered,” another says.

Another said the case put before Cabinet for the GSN investment “just didn’t stack up”.

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Tags VocoGSNNetworking & Telecomms IDssc

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