FTS 2000 Cost Comparison Gao ID: AIMD-96-95 May 31, 1996

This report identifies agencies that are using the Federal Telecommunications System (FTS 2000) and compares telecommunications costs of agencies that use FTS 2000 with those of agencies that do not. GAO focuses on four FTS 2000 services: switched voice and dedicated transmission, which constitute the bulk of FTS 2000 use, and packet switched and compressed video transmission. As of March 1996, 139 agencies and other government entities were using telecommunications services provided under the FTS 2000 contracts. GAO's comparison of telecommunications costs incurred by a sample of agencies that use non-FTS 2000 networks with what FTS 2000 would cost produced mixed results, with some costs comparable, some less, and others more.

GAO found that: (1) as of March 31, 1996, 140 federal agencies and other government entities were using FTS 2000 telecommunications services; (2) in fiscal year 1995, the General Services Administration billed these organizations $680 million for FTS 2000 services, of which 66 percent was for switched voice services and 25 percent was for dedicated transmission services; (3) DOD could have saved 75 percent on switched voice services if it had used FTS 2000 Network A services, but would have paid 8 percent more if it had used FTS 2000 Network B services; (4) GAO switched voice service costs were roughly comparable to Network A service costs, but about 8 percent less than Network B costs; (5) DOD could have paid between 8 and 15 percent less for dedicated transmission services by using FTS 2000; (6) FAA and the Postal Service would have paid 10 to 70 percent more for FTS 2000 dedicated transmission services; (7) the Federal Reserve would have paid 1 percent less for dedicated transmission services from Network B and 9 percent more for services from Network A; and (8) GAO would have paid 15 to 46 percent more for frame relay services and about the same for video transmission services using FTS 2000.

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