American Telephone & Telegraph Co. has won a three-year contract to provide long-distance services for state offices in Maryland, the governor's office said yesterday.
The contract is expected to save taxpayers more than $4.1 million over the next three years, a 44 percent savings over current long-distance prices offered by AT&T, the state's primary long-distance provider.
Savings at state facilities are expected to range from 20 percent to 80 percent over previous long-distance charges.
Under the new contract, Maryland's annual long-distance bill should shrink from about $3.2 million to $1.8 million, said Martin W. Walsh Jr., secretary of the Department of General Services.
Because the contract offers volume discounts, he said, Maryland taxpayers stand to reap even greater savings if county and municipal offices decide to share in the bulk-rate plan.
"By using the state's considerable buying power, we will save millions of dollars, which can be used for other critical needs," Mr. Walsh said.
The savings resulted from competitive bidding for the phone service. It was the first time since the 1984 breakup of AT&T that the state had opened its long-distance business for competition.
The Board of Public Works has approved the new contract, which is expected to generate $5.3 million in revenues for AT&T over the three-year period. The board is chaired by Gov. William Donald Schaefer.
AT&T will use computer software and other technologies to route and sort long-distance calls placed by state offices. The calls will be carried over AT&T's regular long-distance network.