California State University and GTE today announced that they will not pursue the completion of the proposed public-private partnership known as the California Educational Technology Initiative (CETI).

In announcing the end of discussions with GTE, CSU Chancellor Charles B. Reed said, "We are disappointed that after careful risk analysis, CSU and GTE mutually concluded that the financial plan of the proposed partnership could not meet the needs of all of the partners involved. GTE has negotiated in good faith, and I applaud the way the team has comported itself throughout this process. The CSU now will review all its options. No university can maintain its academic quality and remain competitive if it is not on the cutting edge of technology. The CSU will spend the next several weeks assessing potential new funding sources and developing new approaches with current and new industry participants."

Thomas W. Muldoon, president of GTE Government Systems, the business unit that has been leading the GTE negotiations with the CSU said, "We too regret that we have been unable to arrive at a financial plan that is both responsive to the CSU and responsible to our shareholders. GTE desires to continue to support the CSU in its efforts to meet its technology requirements, albeit via means other than the CETI partnership."

CETI was a proposed $250-$300 million partnership between the CSU and private companies to develop a systemwide information technology infrastructure to link the 22 CSU campuses. It was designed to provide students, faculty and staff with additional network-based services and applications to enable them to succeed in the highly competitive global economy of the 21st century.

The CSU sought private, outside funding after the state's previously expressed inability to provide the necessary funding.