Charter invests in CTI, takes aim at federal government marketCharter invests in CTI, takes aim at federal government market
Spectrum Enterprise now serves as a subcontractor for connectivity and other services to Core Technologies (CTI), one of a small group of players bidding for Enterprise Infrastructure Services government projects.
November 12, 2020
Spectrum Enterprise, the big business services unit of Charter Communications, is entering the federal government services market in a big way through a partnership and equity investment in Core Technologies (CTI).
Norcross, Georgia-based CTI is one of just nine prime contractors tied to the US General Services Administration's Enterprise Infrastructure Solutions (EIS) contract vehicle. Core Technologies and others in that group are bidding for contracts to build and develop communications services for multiple government agencies.
In 2017, GSA selected a group that would be going after its $50 billion in EIS contracts. In addition to CTI, others companies and organizations selected for the 15-year, mega-contract include AT&T, Verizon, BT Federal, Qwest Government Services and Level 3 (CenturyLink), Granite Telecommunications, Harris, MetTel and MicroTech. In September, CTI reportedly won a potential $482.9 million "task order" to provide voice and conferencing services for the Department of the Interior.
The general aim of this consolidated contract approach is to modernize the telecommunications infrastructure and networks serving federal agencies. EIS contractors underwent a lengthy IT integration and security process to gain one of the coveted slots that enables them to bid on projects.
"This represents a meaningful expand and step forward for Spectrum Enterprise to expand into the federal vertical," Gagan Khanna, VP of enterprise strategy for Spectrum Enterprise, said.
He said Spectrum Enterprise's partnership with Core Technologies has three components:
Serving as an authorized subcontractor for CTI, which effectively will serve as a systems integrator for the EIS projects it bids on and wins. Spectrum Enterprise, which has reach in parts of 41 states, will provide network connectivity to Core Technologies, along with a wide range of services, including broadband, voice and managed services. The equity investment. Charter isn't disclosing how much cash it's putting into CTI. But Khanna said the investment will provide capital that will help its partner bid on task orders and ensure the requisite resources are in place to deliver on projects that are won. Spectrum and CTI have also agreed to participate in the US Small Business Administration’s Mentor-Protégé Program. Tied in, Spectrum Enterprise will provide business development, marketing assistance, hiring best practices and other operational capabilities that will help CTI as it bids for federal EIS contracts. Growth opportunity for Charter
Depending on how successful CTI is at locking in EIS contracts, the partnership could provide a big lift to Charter's commercial services business. Charter pulled down $1.6 billion in total commercial services revenue in Q3 2020, with $617 million of it coming from its enterprise unit. Charter ended Q3 with 272 enterprise "primary service units," adding just two in the quarter. Khanna said Spectrum Enterprise has been doing some background work to help scale up the organization and dedicate resources for EIS projects that come from the Core Technologies relationship. "We have just started down this path and we are extremely excited and optimistic about the potential for us to provide these services," he said. — Jeff Baumgartner, Senior Editor, Light Reading
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