December 20, 2002 By Darby Patterson
A land of legendary natural beauty, a hub of international trade and a strategic military site, Alaska has developed a series of innovative technology applications to serve its 600,000-plus widely disbursed residents. The telecom project, which will outsource a range of services formerly operated in-house, continues that trend.
The project includes the distribution of about 20,000 digital phones and a statewide calling plan for public employees that will eliminate most long-distance charges. It also will implement a converged voice, video and data network; improved mobile communications and satellite technologies; a statewide dial-up service; and enhanced video-conferencing capabilities. Bandwidth will be expanded, and the state's system of 231 satellite earth stations will be upgraded to deliver emergency communications and media broadcast services.
These new enterprise services will be used by all of Alaska's executive branch agencies and numerous other state organizations, representing a dramatic break from past policies.
Historically, Alaska's telecom infrastructure has faced problems with interoperability, siloed-systems and redundant equipment. The state had neither an accurate inventory of telecom assets nor the ability to manage related expenditures.
Walsh said involving the private sector was critical for improving the state's telecom performance. "We recognized that with a lot of contracts coming up at one time, the state could think outside the box," he said. Consequently, Alaska released an RFP in 2000 inviting telecom companies to be creative in designing a statewide system to address the need for multiple communications tools.
In December 2001, Alaska Communications System (ACS) was awarded the contract and became the state's private-sector partner in the ambitious project. "We liked ACS because they stressed ownership and a willingness to work with the state to put together an organization to deliver the services," Walsh said, adding that to fulfill the requirements of the contract, the company had to re-engineer its internal culture. "They had to take a different approach. They couldn't think of themselves as a telco. They had to think of themselves as a service organization."
This required a change of perception, according to Jeff Tyson, vice president of ACS. "We have made a lot of effort to align ourselves to the customer view of services rather than the carrier's," he said. "We are a traditional phone company, and we are trying to strike a balance. There are cultural shifts that are necessary for both of us."
ACS came to the project with an established relationship with state government. "It is not that unusual in Alaska to have a pretty good mix of commercial and government customers, because the state and federal governments have a prominent place in our economy," Tyson said.
But the new contract altered the traditional customer-vendor relationship. Under the agreement, state employees displaced by the project had the option of taking jobs with ACS or remaining with the state. Consequently, ACS hired 26 state employees who will work on the telecom project. "It is a management challenge," Tyson added. "How do you build a singular sense of purpose when you are working across the boundaries?"
Despite the difficulties, the telecom contract should generate long-term benefits for both the state and ACS, according to Walsh. ACS committed to investing $29 million to build new infrastructure and launch new services. The company will then leverage that investment by offering the services commercially. "What they proposed was the convergence of voice, video and data on this backbone that they are building for the state," Walsh said. "They will then offer the services to