Questions and Answers
Request for Proposal – Wireless Products and Services

October 26, 2006

Q1. Why is the government changing the way it procures wireless products and services?

A1. The Government of Canada (GC) is streamlining and transforming the way it buys wireless products and services. This will provide better value and accountability for Canadian taxpayers.

Public Works and Government Services Canada (PWGSC) is committed to ensuring that procurement is both accountable and cost-effective, supporting the goals of the GC’s new Federal Accountability Act and Action Plan.

The proposed Request for Proposal (RFP) on wireless products and services is expected to achieve significant savings over the next four years.

The goal of the procurement transformation is to ensure better value for Canadian taxpayers while making procurement simpler, and ensuring fair, simple and open access for suppliers – both small and large across Canada.

Q2. How is the government currently procuring wireless products and services?

A2. Currently there is no government-wide procurement strategy for wireless equipment and services. In 2004, nine departments, including PWGSC, came together to establish a service contract. By consolidating their purchases, they achieved significant savings. For example, PWGSC achieved 40% savings.

However, the remaining government departments and agencies do not have any contracting strategy for the purchase of wireless products and services. They are buying wireless products and services from suppliers in a large variety of ways and are able to choose from any number of models. Departments are purchasing the products and services on an ad hoc basis and may not be getting the best value. There is little focus on consolidating requirements or buying in sufficient numbers to realize economies of scale.

Currently, departments sign up for the best promotion available at the time.

Q3. What is going to change?

A3. The new process will help ensure the standardization of wireless products and services and achieve best value for the government. PWGSC will decide which models will be made available for ordering throughout the GC. This decision will be based on a number of factors, including price and feature availability.

Because wireless services is a mandatory commodity, all mobile wireless products and services business for the GC will be covered by this contract. As a result, this will improve asset management throughout all departments and agencies.

The new proposed process calls for the categorization of wireless products and services in six streams:

Stream 1 - Wireless Cellular, Personal Digital Assistants (PDAs), and Aircards in North America.
Stream 2 - Wireless Cellular, PDAs and Aircards for use internationally.
Stream 3 - Push-to-Talk (PTT) Products and Services.
Stream 4 - Wireless Priority Service (WPS) on PCS/Cellular handsets and PDAs, and associated services.
Stream 5 - Secure Global System for Mobile (GSM) Wireless Services.
Stream 6 - Secure Code Division Multiple Access (CDMA) Wireless Services.

The first stream accounts for 90% of the wireless business in the GC. For this stream, the new proposed process will qualify two suppliers for contracts of two years each with two one-year options. The top ranked bidder will be guaranteed 60% of the new business while the second ranked bidder will be guaranteed 20% of the new business. The remaining 20% will allow the GoC to track ordering patterns during the contract period and make adjustments to ensure the 60% and the 20% commitments are respected. The decision to qualify two carriers for the first stream will ensure good service and adequate coverage across Canada.

For the remaining streams, one supplier will be selected and will be guaranteed 100% of the business.

The criteria for the selection of successful bidders for Stream 1 will be based on a combination of price and technical merit. For Streams 2 through 6 the basis of selection will be the lowest priced compliant bid. All contractors must be licensed with Industry Canada and offer national coverage.

Q4. How will the government get better value for Canadians through the RFP?

A4. The government will get better value for Canadians by improving how it buys these products and services by:

• Consolidating the contracting of wireless products and services and improving asset management throughout all departments and agencies;
• Standardizing the equipment and services across the government (based on price and feature availability);
• Ensuring more competitive pricing for equipment and services; and,
• Requiring suppliers to bid on the basis of price and technical merit.

Q5. How much is the government currently spending on wireless products and services?

A5. Currently, the GC spends approximately $40 M a year on wireless products and services.

Q6. How will the RFP impact small and medium sized enterprises?

A6. As all contractors must be licensed with Industry Canada and must offer national coverage, this requirement is not likely to be provided by small and medium sized enterprises. However, the proposed RFP does not inhibit the suppliers’ ability to use any subcontractor they wish. Current national service providers include Bell Mobility, Telus Mobility, and Rogers Wireless.

Q7. Has the government consulted with the industry before issuing the RFP for wireless products and services?

A7. Yes. The GC has done two Requests for Information (RFI) with industry for feedback and comments and have incorporated the comments into the RFP. Comments were received from the three wireless suppliers, and industry associations such as the Canadian Advanced Technology Association (CATA), the Information Technology Association of Canada (ITAC), and the Canadian Wireless Telecommunications Association (CWTA). These consultations resulted in some technical amendments to the RFP including the removal of the requirement for local number portability before the March 2007 date required by Canadian Radio-television and Telecommunications Commission (CRTC).

Q8. When will the RFP be issued?

A8. The RFP will be published on the Government’s Electronic Tendering Service (MERX) October 19, 2006 and will close December 15, 2006.