ATandT, Verizon Contracts Under Obama Administration Review

AT&T's $350 million contract to improve communications at the Treasury Department is reportedly among more than two dozen older government IT deals that the Obama administration is reviewing as it looks to trim costs and pare down the budget deficit.

According to an Aug. 23 report in the Wall Street Journal, the White House, guided by federal agencies, has identified 26 government IT projects for review, and those not meeting their stated goals will be trimmed back or cut. The projects currently come at a total cost to the government of $30 billion. Among them are the AT&T contract—begun in September 2007 and intended to be completed in late September 2016—and a $203,000 contract with Verizon Business Network Services that was launched in April 2009 and has an expected completion date of Sept. 30, 2013.

Former White House Budget Director Peter Orszag, before leaving office last month, reportedly ordered a review of the contracts, suggesting that a lack of oversight had led to instances of “cost overruns, delays and the implementation of obsolete systems,” WSJ  reported.

“We need to end a culture in Washington where we continue to throw good money after bad money,” Vivek Kundra, Obama’s CIO, said during a call with reporters, according to WSJ. “If these projects can’t be turned around, if they don’t add value, we will take the appropriate actions.”

On an official U.S. government Website detailing IT spending, called IT Dashboard, the AT&T contract appears to be both the highest-dollar and longest-term technology project. The dashboard offers the public a look at IT spending, relaying data received by the Office of Management and Budget, as well as “general information on over 7,000 federal IT investments" and detailed data for nearly 800 of those investments that agencies classify as "major,” states the site.

As for the fresh look at older IT commitments, Roger Kay, an analyst with Endpoint Technologies Associates, was skeptical about the effectiveness of such an undertaking.

“Large infrastructure projects sometimes do some good, but they're almost always pork-lined,” Kay told eWEEK. “The problem is the politics that go into getting the projects through in the first place. The process is inherently corrupt, and everyone is potentially implicated. So, no one can clean it up.”