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Moving Forward On the E-rate Modernization Path

by: Julie Veach, Chief, Wireline Competition Bureau

March 6, 2014

Delivering on the announcement made by Chairman Wheeler in his Digital Learning Day remarks, the Wireline Competition Bureau released today a Public Notice seeking more focused comment on a set of key issues initially raised in the E-Rate Modernization NPRM.  Chairman Wheeler has laid out a timeline for an order in the coming months that would be effective in time for Funding Year2015.  Today’s Public Notice is an important mile marker on the road to E-rate modernization. 

The Notice seeks to strengthen the record on four important issues: (1) how to best structure the program in a way that places a greater focus on connectivity inside the walls of classrooms and libraries in an equitable manner to all eligible schools and libraries; (2) whether and how to establish a one-time deployment initiative within the structure of the existing program providing targeted additional funding for those schools and libraries who remain without access to a high-speed broadband connection; (3) phasing out or reducing support for legacy voice services; and (4) ideas on potential demonstration projects.  Additional focused comment on these topics will help the Commission tackle some difficult issues necessary to accomplishing the program goals laid out in the E-Rate Modernization NPRM.  While we seek answers to these questions, by no means does this Notice represent the full set of issues that may be addressed in a future order.     

The record illustrates a clear consensus that delivering 21st century broadband to schools and libraries requires an emphasis not just on broadband connectivity to buildings but also on the internal networking equipment that delivers that broadband to every student and library patron device.  The proliferation of Wi-Fi-enabled devices in schools and libraries means that “priority two” internal connections are every bit as important as connectivity to the building.  However, E-rate support for internal connections has declined in recent years in the face of increased demand for “priority one” telecommunications and Internet access services.  This problem reached a breaking point in Funding Year 2013 in which the Commission was unable to fund any internal connections requests.  Commission staff are working hard to find solutions to address this problem head on, and today’s Notice seeks comment on how we can best meet this critical objective.  

Of course all the Wi-Fi connectivity in the world does you no good if you don’t have a high-speed connection to your school or library.  Thus, the Notice also seeks focused comment on a one-time deployment initiative within the structure of the existing program to connect those remaining schools and libraries that do not have access to a scalable broadband connection capable of meeting our 21st century digital learning goals.

As Chairman Wheeler pointed out last month, a little known fact about today’s E-Rate program is that only about half of the program’s funds go for broadband connectivity.  Thus, modernizing E-rate to make it a broadband program necessitates a thoughtful examination of whether E-rate should continue to support voice services.  The Public Notice therefore seeks comment on phasing out support for voice services over a five year period, and also invites comment on alternative proposals.  For example, rather than phasing out support completely over time, we are also interested in perspectives on whether we should continue to support voice, but at a lower discount level or at a per-line capped amount. 

The final section of the Public Notice seeks comment on demonstration projects to test different approaches to meeting the goals of the E-Rate Modernization NPRM.  We hope to tap the creativity and innovative thinking that we see across the E-rate landscape to identify ways to cost-effectively deliver high-capacity broadband.

As we seek answers to these important policy questions, we are simultaneously moving forward with a detailed and rigorous internal data analysis effort.  Working with E-rate supported companies, schools and libraries, we are working to better understanding current connectivity levels and pricing, as well as the potential one-time and recurring costs of paying for scalable high-speed connections to and within all schools and libraries.  We have repeatedly emphasized the Commission’s commitment to data-driven decision making throughout the E-rate modernization process.  Several providers, state education and procurement agencies, and individual districts have already provided detailed data that has informed our understanding of the current state of play for schools and libraries.  We thank them and encourage all parties with data on school and library connectivity and/or the costs of Internet access and transport, fiber deployment, and local area network equipment to file that data in our record. 

Though today’s Public Notice is an important step in the E-rate modernization process, there is still much work to be done.  We continue to move toward an E-rate modernization order in the coming months and we encourage all E-rate stakeholders to continue to work with us.  The E-rate program has been a vital asset for our nation’s schools and libraries since its inception.  With your input, we can modernize the program so that it remains a vital asset for schools and libraries in the digital age.

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