Issuing a statement yesterday,  the company said “Although Mitel has been advised that there are legal grounds to seek judicial review of the City’s decision, we have concluded that it [...]]]>

Mitel won’t sue the city of Ottawa over aVoIP contract award that went over to Bell Canada and Cisco, reports the Ottawa Citizen.

Issuing a statement yesterday,  the company said “Although Mitel has been advised that there are legal grounds to seek judicial review of the City’s decision, we have concluded that it would not be in the best interests of Mitel, the City, nor its taxpayers to proceed further with this matter.”

Last week, Mitel was threatening to sue the city of Ottawa, but after much review, the city decided to soldier on,  advised by its procurement people that Mitel’s protests were not valid and by its lawyers that Bell Canada and Cisco likely had the better case to sue if the procurement process — worth $7 million (CN) – was restarted.

Mitel invested significant time and energy trying to get a do-over for the Ottawa VoIP contract, first offering $2 million (CN) worth of VoIP phones as a “gift” in exchange for getting exclusive rights for it and its partners to supply VoIP services.  When that didn’t work, it withdrew the gift and started threatening to sue if the procurement process wasn’t overturned, as it started an extensive lobbying campaign that included hiring the former mayor of Ottawa to talk to city officials.

Mitel has waged a concerted PR and lobbying effort to get the current procurement thrown [...]]]>

The city council of Ottawa voted 16-5 to award a $6 million (CN) VoIP contract to Bell Canada and Cisco yesterday, reports The Ottawa Citizen.  Will Mitel now sue over how the contract was handled, as it has threatened?

Mitel has waged a concerted PR and lobbying effort to get the current procurement thrown out, even going so far as hiring former Ottawa mayor Bob Chiarelli to press the flesh with councillors; Chiarelli has declined to speak with the Citizen on the work he has done on behalf of Mitel.

Ottawa city staff and advisors, including an independent procurement expert, have reviewed and rejected Mitel’s positions on all points, ranging from an allegation that Cisco had an unfair advantage on the VoIP bid because it had earlier won a contract this year to upgrade the city’s computer systems to a $2 million “gift” offer of VoIP phones in exchange for exclusive rights to supply VoIP telephony to the city.

In [...]]]>

First the carrot, now the stick: Since the city of Ottawa wouldn’t accept a “donation” of IP phones from Mitel in exchange for getting exclusive rights, Mitel is now claiming that it didn’t know the city’s computer network had been upgraded to carry VoIP calls; ergo, Cisco knew and had a competitive advantage.

In a late Friday letter, Mitel Networks chief exec Don Smith claims that they didn’t know that Ottawa had upgraded its data network for VoIP calls until oh, Wednesday of last week.  Piling on in the PR battle, Mitel chairman Terry Matthews is appearing on Tuesday before the city’s economic development committee and is expected (i.e. someone is talking off-the-record) to tell the committee that the city hasn’t been true to its own procurement process.

Needless to say, Matthews wants the city to cancel the current worth-up-to-$7 million (CN) bid awarded to Bell Canada and Cisco and launch a do-over.

Both sides are lining up lawyers to duke it out.  Bell Canada’s lawyers are demanding Ottawa finalize a contract for the new phone system while Mitel’s bottom-feeders have warned city officials that it faces “substantially less likelihood” liability if they cancel the current deal than stick with it.

According to an internal report by the city, investments made to upgrade its computer network didn’t offer any advantage to any of the bidders involved in the process; the city simply made basic “vendor agnostic” infrastructure improvements to support VoIP.

In May, Mitel first offered $2 million (CN) in free phone hardware to Ottawa as a “gift” in exchange for it and its partners to become the city’s sole supplier of VoIP technology after losing a bid on a contract to supply VoIP equipment and services.  Of course, Bell and Cisco weren’t pleased at the offer and a city official said the the offer smacked of “bid fixing” given that the phone contract had already been awarded to someone else.  Mitel withdrew the offer.

The [...]]]>

Mitel backpedaled on a $2 million (CN) offer of free phone hardware to its hometown city of Ottawa.  Mitel had offered up the “gift” in exchange for it and its partners to become the city’s sole supplier of VoIP technology after losing a bid on a contract to supply VoIP equipment and services.

The earlier IP telephony contract put out by Ottawa – and won by Bell Canada and Cisco –is worth $4 million to $7 million (CN) in VoIP equipment and services.

Mitel Chairman Terry Matthews made the offer to Ottawa Mayor Larry O’Brien in a letter. The mayor brought the offer for examination to the city council’s economic affairs committee, who voted to suspend the procurement process to figure out exactly what to do with the offer and what sort of strings were precisely attached.

The “donation” was defined as 10,000 newer Mitel phones to replace about 7,000 older Mitel phones plus another 3,000 phones bought from other companies. In exchange, Matthews wanted the city to work with Mitel as the “sole communications partner for current and any new locations over the next several years.”

Needless to say, Bell Canada and Cisco were not pleased at the “gift” offer.

A ruling by an independent “fairness” commissioner hired to act as a referee in the bidding process said that accepting the donation would “failure to meet a reasonable standard of fairness in procurement.”  Upon hearing of the ruling, Matthews immediately withdrew Mitel’s offer.

An official involved in the bid was worried that the offer smacked of “bid fixing,” but said the city would be more than happy to accept such a gift under different circumstances in the future.