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Tuesday, June 30, 2009

Another year, another survey

Funds for Learning has published the results of their Second Annual National E-Rate Survey. It's not as interesting as last year's, because the results are basically the same.

One change is that fewer respondents are using a consultant (18% last year, 16% this year). I'm sure it's not a real change, but it feels good to see the market expanding. Or should I be worried that more applicants are deciding to go it alone?

The biggest nettle for me is that 26% of respondents still believe that the 2-in-5 rule has had a positive effect. What can I do to convince them that it's a failure? Maybe I'll rent one of those billboard trucks and park it outside the hotels where USAC is doing training. Or call a flash mob into the training to chant:
"2-in-5 is 0-for-5!"
or maybe
"What do we want?" "Internal Connections funding!" "When do we want it?" "In whichever year makes sense from a technology management perspective, rather than being limited to twice every five years for each location!"

Saturday, June 20, 2009

So good, I registered twice

I'm feeling the good vibe from the first day of summer vacation for my kids, so I won't even get snarky about this, but check out the USAC home page. It seems that all the registrations for the training sessions in most cities were wiped out some time yesterday (June 19th). So if you were good and registered early, you must register again. I'm sure someone's face is as red as the text on the home page. And here's an idea for whoever handles tech support for USAC: with a little pressure from a screwdriver, you can pop the Delete key right off that person's keyboard. (Oops, and I said I wasn't going to get snarky.)

Fortunately, the registration process is pretty painless, so I didn't mind doing it again.

The hotel registration was a little more trying. If you try to register online for your hotel room, you may find that the discounted rate is only available for the night before training. At least that's the case in DC. So you have to make separate registrations for other nights. It was easier to call.

I think I'll slide a litte rant in: Bethesda?! Is the hotel close to Mel's house, or are they trying to keep us far from the USAC mothership? I don't know any good restaurants out in Bethesda.

Thursday, June 04, 2009

Forgotten GAO report

I managed to finish the recent GAO Report on the E-Rate while my umbilical cord to the Internet was cut off during airplane flights some weeks back, but never got around to posting.

I posted my thoughts on the first twenty pages, so I'll be looking at the rest of the report. (I can't really call it an "analysis" since it's off-the-cuff).

The GAO is all worked up about the amount of undisbursed funding. The opening salvo is that one quarter of the funding committed in funding years 1998 to 2006 was not disbursed. A more correct statement would be that one quarter of the funding committed has not yet been disbursed in the funding year in which is was committed. The differences are:

  1. Much of the $5 billion not disbursed has been rolled into future funding years.
  2. Disbursements are not yet complete for any funding year (I'm sure there are still some appeals from 1998 languishing at the FCC), and nowhere near complete for 2006.

A few pages later, the GAO says that carryover funding will only increase Priority 2 funding if Priority 1 requests don't increase, and "some applicants for Priority 2 services, who would receive funding if aggregate requests and commitments were more consistent with actual disbursements, do not receive funding in the current environment."

Nope, that's just a shell game. If funding remains capped, and Priority 1 requests continue to increase, there will be less funding for Priority 2, period.

It is true that if USAC and the FCC take steps to decrease undisbursed funds (like increasing commitments once they're free of ADA), and continue to carryover undisbursed funds from previous years, it will create a bump in funding, but only temporarily. Eventually, the decrease in undisbursed funds will result in less carryover, and we’ll be back in a situation similar to today.

Next, the GAO looks at participation. I’ve already stated my opinion of their estimates of percentage of participation. They also listed some reasons for the low participation by private schools and libraries, but they missed a reason that I often see: the technology plan. The tech plan requirement is a major disincentive for private schools and libraries.

For most private schools and libraries, E-Rate is the only reason to have a tech plan. Generally, public schools are required to have a tech plan, so for them it’s not an issue. In my experience, libraries don’t have to have a tech plan, though I think this may vary from state to state. And for a small school or library, with a simple voice and data infrastructure, a tech plan is not necessary from a management perspective.

And the tech plan is the most onerous of the E-Rate forms. I know it’s not technically an E-Rate form, but whenever I give a presentation on the application process, I always list it as the first form, because it’s the first piece of paperwork you have to have. It would be better if it were a form, so that it would be more obvious when an applicant had missed a required element. In any case, it is by far longer and more difficult to complete than any of the forms.

I have spoken, for example, with the director of a library with a 90% discount who said that she only made up tech plans when she was planning to install internal connections equipment. It just wasn’t worth the work to cover their phones (like most small organizations, they use Centrex phone lines, so they needed a tech plan until recently) and connection to the state library’s Internet. So they just didn't apply for E-Rate. With a 90% discount.

And I know private schools that only apply for phone service so they don’t have to do a tech plan. Those schools count as “participating,” but they are not fully utilizing the program.

My favorite part of the report: 79% of applicants surveyed said that paid consultants were very or extremely useful. We consultants outscored every other resource. The same survey indicated that only about 25% of applicants use a consultant. That means that about 54% of applicants found consultants very useful even though they weren’t using one. That surprised me, but then I thought about it.

Most consultants I know got into the business because they wanted applicants to get funded. A lot of us provide free training and free advice. I don’t keep track of how many people come to my presentations or Webinars or call me with a simple question, but it's in the hundreds.

Another pair of numbers jumped out at me: 67% of applicants said state E-Rate coordinators were very or extremely helpful, but 31% said “do not know/do not use.” That only leaves 2% of people who used a state E-Rate coordinator and found her or him less than very helpful. That tells me that if we could put active coordinators in every state, it would help those 31% who don’t know their state E-Rate coordinators. What if USAC hired a state E-Rate coordinator for each state? Let’s say it would cost $100,000 per state. I’d say it’s $5 million well spent. If states want to continue to fund someone, great; a second coordinator wouldn’t hurt.

The report lists 7 changes to the E-Rate program that were favored by most applicants surveyed. Here’s what I think of the changes:
  1. Put Form 500, service substitutions, SPIN changes online: Yes, yes and yes. I know you can do service subs and SPIN changes through the “Submit a Question” system on USAC’s Web site, but that system is so lame I avoid it whenever possible.
  2. Streamline Priority 1 application: Yes. Here’s what the Priority 1 application process should be: send us your service providers and account numbers. Done. Rely on state laws to ensure competition. Get Block 4 info from the USDA. If applicants want to upgrade service or start a new service, then they can file Block 5.
  3. Multi-year Priority 1 applications: Yup. If you’re not changing service in any way, you shouldn’t have to file anything.
  4. Set dates for application: Yeah, let’s make it May 1 every year. Then we’d see a streamlined application review process.
  5. Reimburse applicants directly: Who doesn’t want this? Well, besides USAC, which would have to send out checks to thousands of applicants instead of hundreds of service providers.
  6. Advisory panel of practitioners: Yes, and the panel is ready: E-mpa®, the association of E-Rate consultants. No one does as many applications as we do. And we’re really nice to boot.
  7. Increase PIA training: I don’t know how much training they get over at PIA, and I don’t often feel that they can’t do their job. My frustration with PIA is with the process, not the people.
I laughed when I read the statement that “agencies that are successful in measuring performance strive to establish measures that demonstrate results, address important aspects of program performance, and provide useful information for decision making.” What are the criteria for success in measuring performance? I’m betting the GAO defined success using the three objectives above, so they’re saying that saying in essence that successful agencies are those that strive for success. Those agencies which strive for other objectives do not meet the GAO's objectives as often.
The GAO also mentioned that “performance measures should cover key governmentwide priorities—such as quality, timeliness and satisfaction.” OK, here are some:

  1. Increase the approval rate. The approval rate has been climbing steadily. Let’s keep it going.
  2. Decrease waste, fraud and abuse (WFA). It just seems like this has to be a goal. And making this a goal would provide incentive for the FCC to make clear that most improper payments are the result of applicants misunderstanding E-Rate arcana, not WFA.
  3. Decrease audit findings. This objective would create an incentive for the FCC to develop an audit process that did not create findings for inconsequential problems, or for problems that do not impact the E-Rate.
  4. Increase the number of classrooms/public areas connected to the Internet. We’ve already got most buildings connected to the Internet; now let’s make sure it’s available in every room in those buildings.
  5. Increase the bandwidth of connections. Applicants are generally increasing the need for bandwidth, and innovative technologies will continue to demand more bandwidth.
  6. Decrease maxed-out BEARs and SPIs. It often happens that an applicant’s actual expenditures exceed the pre-discount amount on the Form 471, which limits the amount of funding that applicant will receive. The GAO is putting great emphasis on undisbursed funds, which pressures USAC to decrease commitments; this measure would provide counterpressure to increase commitments.

  1. Decrease time between Form 471 and start of funding year. It would create more flexibility for applicants, put pressure on PIA to streamline application review, and end the requirement that applicants illegally sign contracts before budgets are approved.
  2. Require that all Priority 1 applications be approved within 90 days of submittal. Increase the time frame to 180 days for all applications filed in the last two weeks of the window. It would be a real incentive for applicants to apply early, and another incentive for PIA to streamline the application process.
Customer satisfaction
  1. Simplify the application process. Reduce the paperwork, create forms that collect all the information needed. And if you can’t collect all the information needed on a simple form, then simplify the rules to reduce the information needed.
  2. Increase applicant satisfaction. Every time an applicant hits “Submit” on one of the online forms, they get one of those annoying popups that offer a $25 discount on a magazine subscription if they’ll fill out a customer satisfaction survey.
  3. Increase public satisfaction. Every year, survey the public to see what they think of the program. The public is, after all, paying the piper. USAC’s outreach now mostly preaches to the choir; they should expand to include the public at large. Get positive news stories out there. I want to see E-Rate billboards on the NJ Turnpike. Provide incentive for applicants to publicize the amount of E-Rate funding they get.

FCC takes a bite out of crime

Kim Friends over at CSMG recently pointed out to me that that Judy Green (convicted of fraud in connection with the E-Rate) got a 10-year debarment, plus 3 years of probation, during which "USAC shall review with heightened scrutiny any applications in which Ms. Green is involved during her probation period, and shall conduct automatic annual audits on Ms. Green’s E-Rate activities during each of the first three funding years, upon her re-entry into the E-Rate program." Now that's a real debarment. Of course, Ms. Green will be in jail for 7.5 of those 10 years, but at least the debarment is longer than the sentence, and there is a 3-year probation, too. (In another recent case, the prison sentence was 5 years (plus 3 years of probation), but the debarment is only 3 years.) I'm glad to see stiffer debarments.

Wednesday, June 03, 2009


Check it out! The proposed ESL for 2010-2011 has been posted. And we have 3 whole weeks to comment (plus another week for reply comments). This is great news! Could it mean an final ESL in the summer? Will we actually get 60 days between the release of the ESL and the opening of the filing window, as required by regulation?

I'll be filing fullsome comments later, but here's my shoot-from-the-hip reaction to the proposed changes, based on the Public Notice:
  1. List Ethernet under digital transmission: Yup, not a rule change, just improved clarity on the list
  2. Text messaging eligible: Good. How would we pull those charges out of cell phone bills?
  3. Interconnected VoIP elegible under Telecom Services and Internet Access: Another fine clarification. Now let's get VoIP designated as "Basic Telecommunications" in order to be technology-neutral.
  4. Password-protected Web pages eligible: I'll have to read the list to find out exactly what it says, but this whole Web hosting thing gives me a headache.
  5. WLAN controllers eligible: These were eligible, so it's good to see them on the list.
  6. Interconnected VoIP user licenses eligible under internal connections: Oy. I hope that this is just an error in the Public Notice. How are licenses to use interconnected VoIP, which is a Priority 1 service, an internal connections item? I'm hoping they mean licenses for applicant-owned VoIP phone systems, not interconnected VoIP service.
  7. Unbundled warranties eligible: Again, putting something already eligible on the list is always good.
  8. Virtualization software eligible: Virtualization is going to be a major headache, because the purpose is to allow several different servers to sit on the same hardware, and to allow servers to be moved between hardware platforms more easily. Server eligibility is already more complex and limiting than most clients want to deal with, and virtualization makes it much worse. Good thing I still remember how to multiply fractions.
  9. Broadcast messaging ineligible: I'm OK with that, and happy to see the ineligibility of emergency notification system clearly delineated.
  10. Power distribution units ineligible: I don't even know what they mean by this.
  11. Video-on-demand (VoD) servers ineligible: Oh, this will be a firestorm. There are some VoD salespeople whose business plan is E-Rate-dependent. This would be a major change, and an unjust one.
  12. Softphones ineligible: Not a rule change, just a clarification of a good rule.
  13. Interactive white boards ineligible: Did people really need this spelled out? Those white boards are so end-user.
  14. E-mail archiving: This is good, because there are some really expensive email solutions that schools would buy if they could get 90% off.

All in all, lots of clarification, not much change. Which I think is just fine.

Monday, June 01, 2009

Finally commissioning new commissioners?

The Wall Street Journal is reporting that the Republicans have finally decided on their nominees for the FCC, which should clear the logjam in nominees. We could be looking at a full FCC this summer.

I don't think the E-Rate has much of a transition-related logjam but maybe we'll finally get some decisions on the program changes that the FCC sought comment on in 2005. However, since those changes were clogged up long before this transition, I'm not hopeful.

The new Republican nominee, Meredith Attwell Baker, seems OK: she has solid experience in government and telecom, her father-in-law is James Baker, and at least one trade journal called her "collegial and genial." Experienced, connected and nice; what more could we want?