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A $5 billion bounty: How to use eRate support for Wi-Fi


The eRate will provide $5 billion over the next five years to help schools and libraries install Wi-Fi and other technologies needed to deliver broadband within their buildings; here’s how

[Editor’s note: This is the first in a series of articles examining the new eRate rules and how they will affect schools.]

Wi-Fi
Because of the five-year funding cap, K-12 technology leaders will have to think strategically about their Wi-Fi needs.

The FCC’s new eRate rules set aside $5 billion over the next five years for the equipment needed to extend broadband access within schools and libraries, including routers, switches, wireless access points, wireless controllers, and other Wi-Fi equipment.

The new rules include changes that will spread this funding to a large number of applicants, ensuring support for schools that haven’t received eRate discounts on internal connections before. Here’s what you’ll need to know to take advantage.

From ‘Priority 2’ to ‘Category 2’ services

According to a recent Consortium for School Networking (CoSN) survey, 57 percent of K-12 chief technology officers believe their networks aren’t robust enough to support digital learning—and 40 percent of classrooms don’t have Wi-Fi or other broadband access.

To address this problem, the Federal Communications Commission has undertaken the largest reforms to the eRate in the program’s 17-year history.

The FCC approved the first of these sweeping changes in a 3-2 vote on July 11. Two weeks later, the agency issued a 176-page document, called the Seventh Report and Order, describing these changes in more detail.

The eRate offers discounts ranging from 20 percent to 90 percent of the cost of telecommunications services, internet access, and internal connections (such as routers, switches, and Wi-Fi equipment) to eligible schools and libraries. Now indexed to inflation, the program will supply more than $2.4 billion in discounts this year.

The FCC’s new rules target $1 billion of this funding to Wi-Fi equipment and other internal connections for each of the next two years, and the agency promises another $3 billion for internal broadband connections in the three years after that.

This move is significant, because until now these services were called “Priority 2” services and were funded only after all requests for Priority 1 services (telecommunications services and internet access) were met.

However, that left most schools without any eRate funding for Wi-Fi equipment and other internal connections.

The FCC’s Seventh Order changes the description of these services from “Priority 2” to “Category 2.” To spread the Category 2 funding to the broadest number of applicants possible, the FCC has taken two key steps: (1) It has limited the maximum discount on these services at 85 percent, and (2) it has capped the amount of funding that applicants can receive on these services within a five-year period.

(Next page: More details about the five-year funding cap—and new rules on eRate-eligible equipment)

For schools, the cap amounts to $150 per student on the pre-discount cost of services over five years.

For instance, a school with 1,000 students that qualifies for a 60-percent discount could buy up to $150,000 in Wi-Fi equipment next year, receiving $90,000 in eRate funding to offset the cost—but then it would be ineligible for further Category 2 support for the next four years.

To ensure that smaller schools can buy the minimum amount of Wi-Fi gear they need, the FCC created a “funding floor” of $9,200 per building. (Again, this refers to the pre-discount price of equipment.)

So, a 60-percent discount school with only 50 students would not be limited to $7,500 in Category 2 services over five years; instead, it could spend up to $9,200 and receive up to $5,520 in eRate support.

The FCC has put a lot of thought into these figures, taking into account both the fair-market cost of reasonably equipping classrooms with Wi-Fi and the number of K-12 classrooms nationwide—and the agency believes its calculations will extend Category 2 funding to meet the needs of any school or district.

But only time will tell for sure, and the FCC plans to reassess these new rules after two years.

Changes in eligibility of equipment

The FCC’s Seventh Order transforms the eRate from a telecommunications program into a broadband program that supports the delivery of high-speed internet service to and within school buildings.

To set aside money for Wi-Fi and other internal connections over the next five years, the FCC has made significant changes to the kinds of services that are eligible for eRate support.

For instance, funding for all voice-related services—including plain old telephone service, toll-free service, and even voice over IP (VoIP)—will be phased out over five years. eMail, voice mail, and web hosting no longer will be eligible for eRate discounts beginning next year.

Also ineligible next year are all products and services that fall under these categories: Circuit Cards and Components; Interfaces, Gateways, Antennas, and Servers; Storage Devices; Video Components; and Data Protection Components, other than firewalls, uninterruptable power supplies, and battery backups.

Caching servers, which store information locally so it can be accessed more quickly, will still be eRate-eligible. The FCC views these devices as tools to help school systems optimize their network performance—resulting in “more efficient use of eRate funding,” the agency said.

Support for the basic maintenance of internal connections is still available as well, but only if the equipment is eligible under the new program rules—and only if schools haven’t exceeded their five-year limit on Category 2 funding.

Because of this five-year cap, K-12 technology leaders will have to think strategically about their Wi-Fi needs—and they should look at purchasing equipment with a five-year life cycle in mind.

(Next page: More advice for school leaders; reaction from some eRate observers)

Some Wi-Fi manufacturers sell wireless access points that can be upgraded easily by switching out the antennas or upgrading the software that controls the system. While this would simplify upgrades within the five-year life cycle of equipment, K-12 technology leaders should allow for these upgrade costs when planning their needs.

A ‘good first step’

When estimating schools’ Wi-Fi needs, the FCC used figures submitted by CoSN and EducationSuperHighway, among other organizations.

Keith Krueger, CoSN’s chief executive, thinks the FCC’s per-student cap should be sufficient to meet most districts’ needs. He called the new eRate rules “a good first step” in transforming the program into a vehicle to support broadband access in the nation’s classrooms.

John Harrington, chief executive officer of the eRate consulting firm Funds For Learning, agreed. He said the $150-per-student funding cap might not give schools everything they need, but “it will certainly go a long way” toward addressing their Wi-Fi needs.

Harrington thinks schools would have been better served by a “single-cap system” that did not remove support for voice services, but instead placed a per-student cap on the entire program and gave school leaders the flexibility to use the funding as they wanted. Still, the revised eRate program is “much better than what we had three months ago,” he said.

Both Krueger and Harrington noted there is still uncertainty about years three and beyond of the FCC’s plan.

“We’re pleased that the FCC has a plan to fund [Wi-Fi connections] for the next two years,” Krueger said. “Now, they need to come up with a long-term plan.” This plan, he added, needs to involve raising the annual funding cap on the eRate as a whole.

The FCC is seeking further comments on this very subject, as well as other steps it can take to improve the program. Initial comments are due Sept. 15, and reply comments are due Sept. 30. All comments should refer to filing “WC Docket No. 13-184,” and schools can file comments electronically here: http://fjallfoss.fcc.gov/ecfs2/.

Part two of this series will look at how the new eRate rules could foster the growth of a new market segment: managed Wi-Fi. Part three will examine the impact that ending eRate support for voice services will have on schools. Watch www.eschoolnews.com every Tuesday this month for more information.

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