- eSchool News - https://www.eschoolnews.com -

Hosted VoIP: A better call?

With hosted VoIP service, schools have no call-routing equipment or software to house, manage, or maintain on site.

As school districts replace their antiquated phone systems, a growing number of districts are choosing hosted, or “managed,” voice-over-IP service. Besides being easier to manage, hosted VoIP service also enables schools to leverage federal eRate discounts more effectively, its supporters say.

Unlike premise-based VoIP service, hosted VoIP is a cloud-based solution that delivers telephone service over the customer’s data network. The customer has no call-routing equipment or software to house, manage, or maintain on site. Many school districts have welcomed the hassle-free nature of hosted VoIP phone service—and many have found that it’s more cost-effective as well, because it’s often eligible for Priority One eRate funding.

“As their old telephone equipment becomes end-of-life, more customers are switching to VoIP because they realize that, long term, that’s where the industry is going. It doesn’t make sense when buying new equipment to buy something that will have a limited lifespan,” said Harry Cook, lead channel manager for AT&T Business Solutions [1].

Click here [2] to download the full PDF of the eSN Special Report on Hosted VoIP.

Hosted VoIP solutions, like those offered by AT&T, are easily scalable and can be used by multiple customers at the same time, making them more cost-effective and reliable for many users, Cook said.

“There are some economies of scale here. It should be cheaper than a premise-based solution, and … the customer doesn’t have to worry about fixing or maintaining it themselves,” Cook said.

Three years ago, South Bay Union School District [3] in Eureka, Calif., upgraded the phone system at one of its two school buildings to a hosted VoIP service provided by AT&T.

Click here to download a PDF of the eSN Special Report on VoIP.

South Bay is such a small school district that hiring in-house technical staff to manage a phone system would be too costly, said Patty Valtenbergs, the district’s technology coordinator. With approximately 500 students, South Bay is a small school district in the mountains close to the Oregon border.

“The hosted [solution] looked great. I could manage some of the phones, but I didn’t have to worry about the circuits and router,” Valtenbergs said. With hosted VoIP, she can easily assign phone numbers and voice mail using an online interface.

“I wanted to keep it where anybody who has any ability or interest could actually be trained,” Valtenbergs said. “I didn’t want to get complicated.”

With the district’s old private branch exchange (PBX) system, if officials needed any reprogramming or repairs done, they had to call a technician who charged by the hour. Now, any repairs or maintenance costs are included in the cost of the hosted VoIP service. And, being eRate eligible makes the whole phone system really affordable.

“As far as our phone bills [are concerned], with a 90-percent discount [rate], we pay about $40 per month for the entire school site with about 30 phone lines,” Valtenbergs said. “We do have to pay some additional costs for some analog lines, but with the eRate, it’s still cheap. Maybe $15 a month for the analog lines.”

See also:

Hosted VoIP: Does it make sense for your schools? [4]

South Bay did have some initial start-up costs, such as the purchase of the telephone handsets, upgrades to its data network, and purchasing a new All-Call system—an automated notification system that can call stakeholders quickly in the event of a school closing or other emergency situation—for $17,000.

The features of the hosted VoIP system are very robust. “The online management is really nice. I added nine new staff members with ease,” Valtenbergs said. “We’ve got our voice mail, we can check it online, [and] you can have messages forwarded to your cell phone or another number.”

Hosted VoIP is also a big time saver for the technology staff at Hancock Place School District [5] in St. Louis, Mo. This small urban district maintains 200 telephones across three school buildings.

Outsourcing the phone system allows the district’s staff of three to focus on other issues important to teachers and students. Their old system was old and no longer supported.

“When it would go out, I would have to find somebody who could fix it. We couldn’t do any of that internally,” said Michelle Dirksen, director of technology for the district. “With the hosted solution, while it still has that [chance] to go down, we don’t have to take care of it at all. Besides the PoE [Power over Ethernet] switches we had to bring into the district, it’s out of our hands.”

Hosted VoIP service is reliable and is more efficient, Dirksen said, adding: “For us, it was really a time saver. It was something that could be outsourced and not hurt anyone here, and most of the staff here doesn’t even know that we don’t take care of [phone service] here on our end.”

Using the online interface, Dirksen can run reports on telephone usage, change users, assign phone numbers, and more. eRate discounts help make hosted VoIP affordable, too. Installing PoE switches and purchasing the phones were the only up-front costs, Dirksen said.

eRate eligibility

One of the biggest advantages of hosted VoIP is that the monthly cost of the service is eligible for eRate discounts as a Priority One service.

The eRate annually provides more than $2.25 billion in discounts on telecommunications services, internet access, and the equipment (“internal connections”) needed to bring connectivity into classrooms. Schools and libraries are eligible for discounts of up to 90 percent of the cost of these services, depending on the percentage of their students who qualify for free or reduced-price lunches and whether they are located in an urban or rural area.

See also:

Hosted VoIP: Does it make sense for your schools? [6]

There are two types of eRate-eligible services: “Priority One” services are ongoing services that typically are billed monthly, such as telephone service and internet access, while “Priority Two” services are one-time infrastructure investments such as wiring, routers, switches, file servers, and other internal connections.

In processing the thousands of eRate applications it gets from schools and libraries each year, the Universal Service Administrative Co. [7] (USAC) first pledges funding to meet the demand for all eligible Priority One requests. Then, if there’s any money left over, USAC funds as many requests for Priority Two services as it can support, starting with the neediest applicants—those who quality for the highest discount percentage—and working its way down the discount scale.

Because of the high demand for eRate funding, however, USAC rarely has enough money left to fill requests for funding on Priority Two services from applicants who qualify for discounts below the 80-percent threshold. That means most applicants are more likely to receive funding for Priority One services than Priority Two services. If a school district were to install and maintain its own VoIP network, this would fall under Priority Two services for the purposes of eRate funding.

On the program’s Eligible Services List, USAC refers to hosted VoIP as “interconnected VoIP.”

“We’ve gotten tons and tons of questions since 2005 about hosted VoIP services, or managed VoIP services—that’s another term that is used,” said Brian Stephens, senior technology and regulatory analyst for the eRate consulting firm Funds for Learning [8].

“They can be eligible for support,” Stephens said of hosted VoIP services. However, he added, “there are some fairly specific eligibility regulations tied to those services—and so it’s not really accurate to say, universally, any type of hosted VoIP service is eligible for Priority One funding, because each vendor … has a slightly different definition of what [is meant] by a hosted service, or what is included as part of that service offering.”

Stephens said it’s important “to take a detailed look at the functionality and the technology behind [the service] to make sure it satisfies all of the applicable eligibility requirements.”

The actual handsets, the physical phones themselves, are considered end-user devices and are never eligible for eRate support, Stephens said.

“We hear of a lot of creative ways applicants and service providers try to shoehorn handsets into a funding request, but from a regulatory standpoint, if a service includes phones, there has to be a cost allocation for those phones,” he said.

See also:

Hosted VoIP: Does it make sense for your schools? [6]

There are very specific rules regarding the amount, type, and configuration of equipment that can be included at a school or library location as part of a Priority One service. To qualify for eRate discounts as a Priority One service, there can be very little hardware deployed at a school or library location.

“The takeaway for applicants is that we are seeing an increasing amount of scrutiny by USAC during funding request reviews,” Stephens said. “We are seeing questions like, ‘Can you give us the make and model of all of the equipment that may be included as part of your Priority One request?’”

USAC is evaluating closely to make sure hosted VoIP services meet all the requirements, not only to be classified as an “interconnected VoIP” service, but also to ensure all of the on-premise equipment rules are satisfied, Stephens said.

Writing detailed RFPs

Cook said he believes hosted VoIP is a better option for many schools, but “the trick is to make sure that [customers] have a full understanding of what’s included in the service and what’s not.”

He advises school customers to structure their Requests for Proposals (RFPs) in such a way that the total costs for implementing hosted VoIP are clearly outlined, so bids can be compared accurately.

Any hosted VoIP solution has five parts that need to be addressed, he said. Not all of these parts are eRate eligible, but they might be necessary for implementation:

  1. The VoIP cloud and its distribution pipe (potentially Priority One eligible);
  2. On-network communications riding over the customer’s wide-area network, and prioritization of network traffic (potentially Priority One eligible);
  3. Off-net communications, or outside of the WAN—including public switched telephone service and 911 emergency service (potentially Priority One eligible);
  4. Local-area network upgrades required to support VoIP (potentially Priority Two eligible); and
  5. End-user equipment, such as the IP phone sets (not eRate eligible).

“Every customer should understand these parts to make sure that an apples-to-apples comparison is done during bid evaluations, as some vendors may bid cloud-only [services] and others may bid a total solution,” Cook said. “Without understanding this, the customer may be surprised during installation, as funding for potentially eligible parts of the solution was never requested.”

A former editor for eSchool News, Cara Erenben is now a freelance writer living near Toronto.

See also:

Hosted VoIP: Does it make sense for your schools? [6]