Can self-provisioning your internet save you money?

What’s the Holdup?
So the question is, why aren’t more K-12 districts and/or schools rolling up their sleeves and getting into the self-provisioned Internet business? Funding has been the primary obstacle up until now, says Marwell. “Most of them couldn’t afford to built the fiber,” he says. “Mostly it’s the wealthier school districts that have undertaken these projects, namely because the fiber networks themselves are expensive to build. Average national costs for such projects are around $50,000-per-mile, according to Marwell.

“If you consider the district with even just 10 schools–each of which are about 1.5 miles apart –you’re talking about a $750,000 project, give or take,” Marwell explains. “That’s not an easy number of schools to come up with.” In 2015, however, that figure could be within reach for a greater number of schools thanks to recent changes in the FCC’s E-Rate program. “Now when schools can demonstrate that self-provisioning is the most cost-effective option for getting a fiber connection to every school,” says Marwell, “they’ll be able to get their ‘normal’ E-Rate discounts for the [projects].”

The district that has a 70 percent E-Rate discount, for example, would only have to shell out $225,000 for its 10 schools that are 1.5 miles apart from one another. “That represents a massive change in the economics right there,” says Marwell.

Financial constraints aside, some schools just aren’t interested in laying down new fiber in an area where service providers are already present and offering affable pricing for the access. “Many schools just don’t want to have another technical issue to worry about,” says Marwell. “Frankly, if your service provider is charging you a reasonable price ($750-$1,000 per month, depending on capacity), we don’t recommend you go out and try to build a network anyway.”

A Bigger Bargaining Chip
With the revised E-Rate funding plan now including self-provisioning as an option, expect to see more schools considering this choice. In the beginning, Marwell anticipates geographically isolated districts to be among the first to take advantage of the new option, although he’s also seeing signs of interest from other schools as well.

“Going forward, we’ll see more sophisticated districts asking for proposals from service providers while at the same time going out and calculating what it will cost to self-provision,” says Marwell. “That, in turn, will become a price-cap regulator and a bargaining chip for the districts when working with service providers.”

Bridget McCrea is a contributing writer for eSchool News.