Fed Deal Energizes Qwest

Qwest Communications has sewn up a contract extension with the U.S. Department of Energy (DOE), an agency whose bandwidth needs have been doubling yearly. Neither the duration or value of the contract was disclosed.

The deal calls for the Denver telecom to upgrade portions of the backbone to 10 Gigabits per second though its QWave services, which are managed, all-optical, high-capacity, private line services.

Qwest will also boost capacity of the DOE’s Energy Sciences Network (ESnet), a system linking scientists at 35 research sites throughout the United States. Qwest has supported ESnet since December 1999.

“Collaborative research increasingly relies on real-time sharing of high-bandwidth applications, and the network that supports these applications should never be the log jam for scientific advancement,” said Jim Leighton, ESnet’s project manager.

In 2002, the backbone speed for ESnet was upgraded three times and three-quarters of the access circuits were upgraded at least once.

For Qwest the deal represents another public sector win — a key area for telecom network operators as business from carriers and enterprises has slumped over the last two years.

In December, Qwest signed a $7.2 million agreement with NASA. A month later, it followed with a contract with the U.S. State Department that will allow the agency to zip large, content rich files to far-flung embassies and offices.

Qwest, which serves 14 western states, is looking to right itself in 2003. After an accounting probe last year, the company restated earnings from 1999 to 2001, slicing off nearly $1.1 billion of transactions.

The company had incorrectly accounted for sales of optical capacity assets as well as some equipment transactions. The revelations forced out CEO Joseph Naccio.