The US Air Force and Zenith Data Systems Inc have come to a mutual decision not to renew the Desktop V contract, less than a year after the troublesome contract was won. Officials at the Air Force’s Standard Systems Group said that, although Zenith had made improvements to the service it was offering over the past two months, both parties had decided that customers would benefit more if the contract, for personal computers, was not extended. Herndon, Virginia-based Zenith said it has fulfilled all the terms of the contract and will continue to bid for government tenders in the future, but decided it wanted to be freed from its responsibility to the government, because the regulations imposed within the agreement were too stringent and prevented it from developing new products and services for the commercial market. Air Force customers will still be able to have access to Desktop V services via its agreement with Hughes Data Systems, part of GM Hughes Electronics Co, which was jointly awarded the agreement with Zenith. Last year Zenith faced allegations against it that the contract was awarded unfairly and that the tender was incorrect, although these were eventually quashed by the US General Services Administration’s Board of Contract Appeals (CI No 2,945). The government is said to have valued Desktop V at over $1bn, split between both contractees. The Standard Systems Group’s executive director Robert A Frye said: ZDS is committed to completing delivery on existing orders, and fulfilling all other contractual obligations.
