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Sunday, March 16, 2014

E-Rate getting hipper?

How big an E-Rate geek am I?  The only think I know about SXSW 2014, a super-cool annual arts/culture/technology extravaganza, is that Commissioner Rosenworcel talked about the E-Rate there.  Let's see if it fleshes out her E-Rate 2.0 ideas.  She broke it down into 3 sections, so let's do the same.

  • "In the near term, we want to have 100 Megabits per 1000 students to all of our schools. By the end of the decade, we want to have 1 Gigabit per 1000 students to all of our schools."  Nothing new there.  It's a little slower climb to 1 Gbps than the SETDA suggestion, but faster to 100 Mbps than ConnectED.
  • "...simply bringing these kinds of speeds to schools makes it incrementally less expensive to deploy higher-speed broadband to the homes and businesses nearby."  Well, at least she didn't say "anchor institution."  I'll grant that in some cases, if a school pays a carrier to lay new fiber, it could lower prices a little.  But where fiber exists, the amount of bandwidth a school purchases does nothing to lower prices for anyone else.  It could increase prices by increasing demand on a finite supply of fiber, but I doubt that's the case very often.
  • "I want us to reduce the bureaucracy associated with E-Rate."  Hear! Hear!
  • "I would like to see multiyear applications."  That sounds like a fine idea: if the terms of a 3-year contract are the same, why do I have to keep submitting 471s?  Don't look for a huge benefit, though: most schools do not have all their services on multi-year contracts starting and ending at the same time, so now they'll have to keep track of which contracts have to go on a 471 which year.  Look for a lot of "oops, I forgot that the multi-year contract which will auto-extend 6 months from now had to go on this year's 471" appeals to the FCC.
  • "...more incentives for consortia...."  Why?  "When schools work together they can navigate the process together and benefit from more cost-effective bulk purchasing."  E-Rate purchasing already layers FCC rules on top of state law, and now you want to add in a bunch of independent local government agencies trying to coordinate efforts?  And there is no evidence that consortium purchasing is more cost-effective, except a few anecdotal opinions. 
  • "...greater transparency during the review process....  Critics have charged that our existing process is a bit opaque...."  A bit opaque?!  700 pages of secret rules is more than a bit opaque.  Keeping secret the records from application review is more than a bit opaque.  The FCC consistently denies FOIA requests, in part because it says that the routine processing of funding applications by a for-profit subcontractor to a non-profit contractor to the FCC is a law enforcement action.
Spending Smart
  • "...better accounting practices that the FCC has already identified will free up for more E-Rate broadband support...."  The practices have been "identified," but not "made public," so I can't say for sure what the practices are.  I'm guessing that they're going to take advantage of the ADA exemption to oversubscribe the fund, knowing that applicants won't actually spend all the funding they request.  That is not adding to the fund.  That is taking future rollover funds and using them this year.  So we'll get a bump in available funds for a couple of years, until the oversubcription causes the rollover funds to dry up.
  • "...we need to make sure that all E-Rate support is focused on high-speed broadband.  To that end, the time has come to phase down the estimated $600 million this program now spends annually on outdated services like paging."  What's in that $600 million?  I'm betting the amount is calculated using the amounts in this table.  I don't see how to get to $600 million without throwing out telephone service, including cell phones.  
  • "At a minimum, we need to restore the purchasing power of this program by bringing back what inflation has taken away....that is nearly $1 billion. But we should go beyond this...."  That's good news!  The early rumors swirling around E-Rate 2.0 and ConnectED seemed to be about increasing the size of the program, but Chairman Wheeler seemed to putting that on the back burner.  That's bad news; if all the other reform gets done before the funding is increased, I worry that funding won't get increased.  Keep up the pressure on this one, Commissioner Rosenworcel!
I didn't really see anything new, but I don't really disagree with anything the Commissioner said, except maybe encouraging consortia.  I'm glad she's supposed to be leading the reform agenda.

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