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The federal government has an I.T. budget of over a trillion dollars, but how can you get in on the action?

Max Smetannikov correspondent | HostingTech | msmetannikov@hostingtech.com

Servicing the federal government's $1 trillion-plus I.T. budget is a big job, and an increasing number of Web hosts and managed service providers are vying for a piece of the pie. Despite adverse economic conditions, the demand for Web hosting and managed services within the government sector is only getting bigger. Unfortunately, getting a juicy government contract can be a paperwork-strewn path to a migraine.

In the wake of September 11 and the high-profile fight against international terrorism, there are many new projects regarding disaster recovery and intelligence gathering getting started. These projects are in addition to the ongoing demand for services and equipment supporting "e-government" initiatives. One of the active contract areas for Web hosts is in the development and maintenance of large agency portals linking existing databases with Web front ends.

Security is paramount when bidding for such projects. Some records collected through the Web are highly sensitive, like the personal tax information Qwest Communications (www.qwest.com) hosts for the IRS. Other projects are noteworthy simply because of their sheer magnitude, such as FirstGov (www.firstgov.gov), the portal maintained by AT&T (www.att.com) that helps consumers, enterprises, and federal employees find their way to a wide array of online federal resources.

"I think the government requirements are becoming more complex, based on the greater role that the Internet begins to play on the federal level," says Chris Stelter, director of sales engineering for AT&T Government Solutions, who has been working in this space for 25 years.

You do not have to be a multinational corporation to sell something to Washington; after all, the government needs everything from pencils to tanks and from database management to managing a global network connecting U.S. embassies. What counts is knowing how to maneuver through the maze of federal regulations governing relations with contractors.

Getting all of the necessary clearances can take up to a year, and that is just the beginning. One of the biggest issues for most service providers is finding out what the government's needs are. The true requirements for projects are sometimes deeply buried in political rhetoric. Because of this, some companies have made it a point to specialize in working the government system. Their expertise is badly needed by some companies who cannot afford to spend the time and resources on studying the federal market.

"We don't do very much with the federal government," says Tina Mayland, a vice president of marketing at Savvis Communications (www.savvis.net), a network operator and managed services provider, "but when we do, it's through companies like SAIC [Science Applications International Corporation]."

Science Applications International Corporation (www.saic.com) is a Fortune 500 company with offices in 150 cities around the world. The engineering and research firm has been present in Washington for decades, and brings value to contracts simply because of its long history of working on federal I.T. installations and with various government bureaucracies. Although association with a firm like SAIC is great for companies not comfortable with selling directly to Uncle Sam, some operators find it worthwhile to make their own investment in learning how to interact with the federal market.

The first and perhaps most complicated step for newcomers to the government sector must do is to get certified as a government contractor. In order to make the process of selling to the government more streamlined and to help track where taxpayer money is going, the lawmakers have set up the General Services Administration (GSA; www.gsa.gov) that handles all of the buying for the government. Anybody who wants to sell anything to the federal government needs GSA approval. Web hosting and managed services fall into two different units - known as schedules - within the GSA.

The Federal Supply Service (FSS) handles the purchasing of all products the government might need. From airplanes to pencils, the FSS is in charge of approving orders for computer equipment and software applications.

"We do have hosting elements on the Federal Supply Services schedule, which includes things like space and certain levels of services, such as those we provide at our CyberCenters," says Wes Kaplow, chief technology officer for Qwest's Government Services Division, which has two datacenters in the Washington metro area and has the IRS and U.S. Treasury as customers.

Most hosting services, though, are covered by the Federal Technology Services (FTS) schedule. WorldCom (www.worldcom.com) and Sprint (www.sprint.com) share the master FTS contract for 2001 that covers most federal telecom services. Along with the main telecom contract, the federal government also awards Metro Area Acquisition (MAA) contracts for large-scale services in major cities.

Qwest, which holds four of these contracts, has found an elegant way to make use of government regulations that apply to specific distributed hosting services. The firm now offers a service dubbed managed federal hosting.

"There is an opportunity for MAA holders to offer emerging technology or other services to the GSA in so-called crossovers," says Kaplow, "so you go from a metro area to something you can do nation-wide."

Qwest's Crossover MAA FTS schedule is flexible enough to allow Qwest to construct most types of managed hosted services for the government, including hardware configuration, professional services, colocation space, and other services that combine hardware and service offerings.

Although working through GSA is the most efficient way to prequalify for bidding on government jobs, there are ways around getting a regular GSA certification. Akamai (www.akamai.com), which has been recently awarded a GSA schedule contract, has found that subcontracting to companies already in the GSA schedule also helps get the job done.

"One of our partners in working with the government is IBM," says Laura Stich, director of product marketing at Akamai, "and they've provided us with the ability to quickly and efficiently offer our services to government agencies, prior to our own GSA schedule award."

The real trick
Getting into the federal market space is only half of the fun. Staying on top of very different Washington agendas is the real ongoing challenge, as Akamai can attest.

Akamai's federal sales force went from zero to seven within the last year, as the content and applications distributor received requests and contracts from a number of different agencies seeking insight into the inner workings of the Internet.

What the government will do with this information is what makes the ongoing relationships with different agencies interesting, as Akamai seeks to build up services to accompany its alerts and raw performance information. Although analyzing the same data in different ways is a great source of revenue, avoiding getting caught by interagency politics is part of the art of doing business in Washington.

"Different agencies have different contexts," says Avi Freedman, Akamai chief network architect. "The CIA wants one thing; the FBI wants another. It's interesting how people have different agendas, and they are driven by different missions."

Navigating this maze can be made easier by joining forces with other vendors. To grow its power base in the city, Akamai has joined forces with two: the Information Technology Association of America (www.itaa.org) and the Armed Forces Communications and Electronics Association (www.afcea.org). If contracting with Uncle Sam is something your firm is considering, similar vendors are a good place to start.

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