HomeMy WebLinkAboutReduced Pricing SheetAT&T (formerly BellSouth Business Systems) has offered the City of Miami reduced pricing for
their Wide Area Network (WAN) services based on the City of Miami Beach contract with
AT&T. AT&T is the City of Miami's current WAN provider as per City of Miami resolution R-
04-0005 which expires December 2008. The City of Miami Beach recently contracted with
AT&T for WAN services after a formal Request for Proposal process and lengthy negotiations
which culminated in a contract agreement in October 2007. This recent contract with the City of
Miami Beach covers two major WAN products: the technological newer and more reliable fiber
based, Metro -Ethernet service and the legacy copper based Frame -Relay service.
It is in the best interest of the City of Miami to utilize this City of Miami contract as a purchasing
vehicle for several reasons. First, the City of Miami Beach contract pricing is significantly more
cost effective than the City of Miami's current WAN pricing from AT&T. Second, the City of
Miami's current contract with AT&T will expire December 2008 while the City of Miami
Beaches contract runs through October 2013. Finally if the City of Miami were to go through its
own RFP process, it would likely produce very similar results, since we are dealing with a very
limited selection of vendors — only AT&T and Comcast are able to provide these services and
both were respondents to the City of Miami Beach RFP. However the time frame for going
through with this process would delay our implementation of the new pricing structure for a
minimum of 6 — 9 months, effectively costing the city of Miami (conservatively) over $10,000
per month, or approximately $60,000 - $90,000. In addition the City of Miami would the
additional cost of the RFP (advertising, personnel time, coordination of outside evaluators).
The favorable pricing is reflected by comparing the monthly cost of the WAN services currently
utilized by the City of Miami:
Service
Existing
Pricing
Frame -Relay 256k $290
Frame -Relay 1.5mg $427
Frame -Bundle 3mg $1030
Metro -Ethernet 10mg $1026
Metro -Ethernet 100mg $1900
Proposed % City Monthly Yearly
Pricing Savings Sites Savings Savings
$271.50 25% 4 $290 $3,480.
$348.75 18% 61 $4775 $57,300
$682.5 33.7% 4 $1390 $16,680
$756 26% 15 $4050 $48,600
$1358 28.5% 4 $2168 $26,016
If the City of Miami were to utilize the City of Miami Beach's contract with AT&T, significant
cost savings would be realized. Were the existing City of Miami WAN capacity remain constant
with zero growth, the estimated savings from the new AT&T offering is over $150,000 per year.
But over the past 5 years the WAN capacity has grown over 10%, so assuming minimal growth,
the estimated savings exceeds $200,000 per year in the second year.
It is recommended that the City of Miami approve the new AT&T contract utilizing the existing
contract between AT&T and the City of Miami Beach as a purchasing vehicle for the City of
Miami's Wide Area Network services.
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