GAO Supports Broadband to Students

In an interesting move, the General Accounting Office released a paper that suggests that the FCC should expand the use of E-Rate funding to allow wireless connections to student homes. The E-Rate program is one of the major components of the Universal Service Fund. Today the E-Rate program can be used to construct fiber assets to reach schools or to subsidize fast broadband connections to schools that demonstrate the financial need.

Specifically, the GAO “recommended that the FCC assess and report on the potential benefits, costs, and challenges of making wireless access off school grounds eligible for E-rate.” The GAO recommendation went on to discuss the impact of the homework gap that puts students without home broadband at risk for falling behind their peers.

I’m sure that every rural broadband advocate understands this issue and applauds the GAO for making this suggestion. However, this seems extraordinary coming from the GAO and seems outside of their stated scope and function. The GAO is the internal auditor of the US government and is often called the congressional watchdog agency that examines how taxpayer dollars are spent. The GAO routinely provides reports to Congress with ideas on how the government can save money and work more efficiently.

I may have missed it, but I can’t remember the agency ever making policy suggestions of this magnitude to the FCC in the past. This seems like a particularly puzzling recommendation because it’s a suggestion on how to spend existing E-Rate money in a different way rather than suggesting ways for the FCC to save money.

The GAO report does a great job of describing the homework gap. The report discusses challenges that school-age children face in doing homework without a computer. The GAO found that many homes without home broadband rely on cellular connectivity, which is largely inadequate for doing homework. The report points out the shortcoming and challenges on the following chart for the alternatives to home broadband such as libraries, community centers, coffee shops, and outdoor WiFi around schools.

The GAO looked into six pilot projects at schools that tried to alleviate the homework gap using wireless technology to connect to students. The GAO pointed out that in 2016 that two schools asked for FCC waivers in the E-Rate program to provide wireless connectivity to students, but the FCC never reacted to the waiver requests.

The GAO concludes the report by recommending that the FCC take steps to assess and publish the potential benefits, costs, and challenges of making off-premises wireless access eligible for E-rate support. The has already FCC agreed with GAO’s recommendation, so I’m sure there will be an assessment coming in the near-future.

Regulatory Shorts for September 2016

Wi-FiToday’s blog contains a few items that are cautionary tales of things not to do.

FCC Funding for Broadband. The FCC recently rejected three petitions for reconsideration filed by companies that had been awarded the experimental broadband grants last year, but then failed to meet the grant criteria. Two of the companies were start-ups and did not have audited financial statements. Another had an audit but filed it after the grant-specified deadline. The FCC refused to give the three companies the grants since they didn’t meet all of the requirements.

The cautionary tale here is that anybody filing for a grant should make certain ahead of time that they meet all of the requirements. There were a lot of applicants who received broadband grants out of the stimulus funding a few years ago that did not qualify, but for whom the government accepted waivers. However, that was an extraordinary circumstance due to the huge size of the grants and the desire of the government to use the funding. In more normal circumstances it’s exceedingly hard to get a waiver for a company that doesn’t meet all of the qualifications.

Fines for Unauthorized Wireless Connections. The FCC recently fined AT&T $450,000 for using licensed wireless connections that were made without FCC authorization or that had not been properly licensed. These were mostly fixed microwave connections, something that is relatively easy to get licensed.

The cautionary tale is to be sure to take care of the paperwork when deploying wireless systems. It’s becoming fairly routine for companies to deploy microwaves to provide wireless backhaul for point-to-multipoint wireless networks or for serving cellular sites. There are also now licensing requirements for anybody deploying subscriber radios that use the 3.65 GHz spectrum. Failure to obtain the microwave licenses could end up with fines like AT&T just paid. But since there are places in the country where it’s not legal to deploy the 3.65 GHz radios, failure to clear it first with the FCC could even end up in having your systems shut down.

Blocking WiFi. FCC Commissioner Jessica Rosenworcel has asked the agency to investigate a seeming restriction of WiFi for those attending the first presidential debate. Apparently, Hofstra University had blocked people from establishing WiFi hotspots from their cellphones and instead wanted journalists to buy a $200 connection for the evening. The FCC in the past has come down hard on this kind of blocking against Marriott hotels and others. The FCC has levied large fines in almost every such case brought to their attention.

The cautionary tale here is not to block WiFi. Companies and cities are often tempted to do this as a security measure and the technology to block WiFi is readily available. But WiFi is a public spectrum and it’s always against the law to block somebody from establishing their own hotspot.

Using E-Rate Broadband Off-Campus. Two school districts have petitioned the FCC to allow them to extend broadband that is subsidized by the E-Rate program to students and others living close to the campus. Under current rules, if an E-Rate network is used for applications other than the school, then the cost of the system has to be allocated between the school and other uses. These petitions ask that the FCC allow them to use the school broadband to serve students and other parties that can benefit from the broadband, without having to allocate the costs.

There is both a caution here as well as an opportunity. The caution is to beware if an E-Rate broadband connection is used by more than the school. For example, it’s not unusual (particularly with private schools) to have other organizations or entities collocated with the school. In such a case the E-Rate applicant needs to make sure to allocate the costs between the school and the other entities. Failure to do so could end up with a loss of the E-Rate subsidy. But the opportunity also exists with wireless networks to provide home broadband to students who live close to the school. If these petitions are successful it could open up many possibilities for schools to benefit nearby residents.

Libraries in the Digital Age

LibraryToday’s blog was inspired by reading Libraries: Broadband Leaders of the 21st Century by Craig Settles, a well-known broadband advocate. As someone who hasn’t been to a library for many years his paper surprised me with the number of different ways that libraries are engaged in broadband today.

Probably the best known role of libraries is as a source of broadband for those who don’t have access anywhere else. Libraries today offer broadband at computers as well as WiFi for patrons to use on their own devices. A recent FCC report noted that in most cities anywhere from 15% to 25% of citizens don’t have broadband at home, and for many of them the library is a place they can get access to the web.  This access lets kids do homework, provides job training for those looking to change careers and gives access to government web sites that are increasingly moving input to social systems on-line.

But many libraries go a lot farther. For instance, there are libraries today that are lending mobile hot spots to enable people to have internet access outside the library for a few hours at a time. Many libraries are at the center of efforts to improve digital literacy and they have programs to train people in computer skills and to help them accomplish needed tasks on the web. Many library systems also have training programs in advanced computer skills like coding.

Libraries everywhere want larger faster broadband connections. In many communities the libraries get the same speeds of broadband that are available at homes. And while having a 100 Mbps connection sounds fast, when that much bandwidth is divvied up among a hundred patrons it slows to a crawl. And sadly, there are still a lot of libraries across the country that are served by only T1s or slow DSL connections.

The White House announced a goal in 2013 in the ConnectED initiative to get at least 100 Mbps connection to schools and libraries within five years, with the ultimate goal being gigabit bandwidth. And there has been a lot of progress, but the most recent FCC Broadband Progress Report says that 41% of schools and libraries still don’t have 100 Mbps connections.

Libraries can get assistance to build broadband facilities using the Schools and Libraries portion of the Universal Service Fund, and which is generally referred to as the E-rate program. This fund can be used to subsidize the monthly broadband bills, but can also be used for physical parts of the network like fiber to connect library branches or WiFi systems within a library.

Some communities have been able to really leverage E-rate funding by tying their schools and libraries together into an integrated network and by using libraries to meet educational goals of the schools. It’s generally easier to get funding for schools compared to libraries, but by networking them together you can bring some of that funding in to help improve the libraries and to make them an integral part of the education complex. This leverage can be expanded to be even stronger by linking networks to hospitals and leveraging funding available to improve broadband for healthcare.

Settles makes a case for allowing libraries to participate in the upcoming Lifeline program that will provide $10 monthly subsidies for broadband for qualifying low-income homes. Since libraries are the source of broadband for many low-income people an argument can be made that spending that subsidy at a library can benefit more people than spending it at one home. It’s an interesting concept and would take action by the FCC or USAC, the entity that administers the Universal Service Fund.

Since most cities are still far away from a time when there will be affordable broadband available to everybody, the libraries are likely to continue to be an important part of the broadband solution for most communities. It’s important for library administrators to understand the options available to them to maximize the funding they can get to provide public broadband. Papers like the one written by Settles are an important step in that process.

Changes to the E-rate Program

Indianola_High_SchoolThe FCC recently revised the rules for the E-Rate program which provides subsidies for communications needs at schools and libraries. They made a lot of changes to the program and the rules for filing this year are significantly different than what you might have done in the past. I’ve made a list below of the changes that will most affect carriers and you should become familiar with the revised rules if you participate in the program. Here are some of the key changes to the program from a carrier perspective:

  • Extra Funding. There is an additional $1 billion per year set aside for the next two years for what the FCC has called Internal Connections. This means money to bring high-speed Internet from the wiring closet to the rest of the school. This might be new wiring, WiFi or other technologies that distribute high-speed Internet within a school.
  • Last Mile Connections. It’s also possible to get funding for what they call WAN / Last-Mile connectivity. This would be fiber built to connect a school to a larger network such as one for a whole school district.
  • Stressing High-Speed Connections. The target set by the FCC is that a school should have at least 100 Mbps per 1,000 students and staff in the short run and 1 Gbps access in the long run. It is going to be harder to fund older slower connections even for very few poor schools. As a carrier you need to be planning on how to get connections that meet these requirements to schools if you want to maintain E-rate funding.
  • Things No Longer Funded. One of the ways the FCC will fund the expanded emphasis on higher bandwidth is by not funding other items. The fund is going to focus entirely for the next few years on funding things that promote high-speed connections, so they will no longer fund “Circuit Cards/Components; Interfaces, Gateways, Antennas; Servers; Software; Storage Devices; Telephone Components, Video Components, as well as voice over IP or video over IP components, and the components, such as virtual private networks, that are listed under Data Protection other than firewalls and uninterruptible power supply/battery backup. The FCC will also eliminate E-rate support for e-mail, web hosting, and voicemail beginning in funding year 2015”.
  • Combining Schools and Libraries. For the first time it will be possible to combine the funding for a school and library that are served by the same connection / network.
  • Eliminating Competitive Bidding for Low-Price Bandwidth. A school does not need to go to competitive bid if they can find a connection of at least 100 Mbps that costs $3,600 per year (or $300 per month) or less.
  • Eliminating a Technology Plan. There is no Technology Plan now required for applying for Internal Connections (in-school wiring) or for providing WAN connections.
  • Simplifying Multi-Year Contracts. Subsequent years after the first year of a multi-year contract will require less paperwork and have a streamlined filing process.
  • Simplifying the Discount Calculation. The discount can now be calculated on a per school-district basis and not per school within the district. The FCC adopts the definition from the Census that defines urban areas to be the densely settled core of census tracts or blocks that met minimum population density requirements (50,000 people or more), along with adjacent territories of at least 2,5000 people that link to the densely settled core. “Rural” encompasses all population, housing, and territory not included within an urban area. Any school district or library system that has a majority of schools or libraries in a rural area that meets the statutory definition of eligibility for E-rate support will qualify for the additional rural discount.
  • Requiring Electronic Filings. All filings will need to be electronic, phased in by 2017.

These are a lot of changes to a fairly complex filing process. CCG can help you navigate through these changes. If you have questions or need assistance please contact Terri Firestein of CCG at tfireccg@myactv.net.

Funding Broadband to Schools

Indianola_High_SchoolFCC Chairman Tom Wheeler recently announced that he was going to try to funnel $5 billion over the next five years to upgrade the bandwidth inside schools. He is proposing to do this as part of the E-Rate program by changing the things that fund will pay for. I think this begs the question of how and why the FCC has the funds available to pay for this sort of expenditure. So following is a bit of a primer on the E-Rate program.

The E-Rate program is part of the federal Universal Service Fund (USF). Since the 1960’s there was a universal service fund that was administered by AT&T that provided funds to support the expansion of telephony into rural places. This was funded by a small surcharge on interstate long distance calls.

But when AT&T was broken up the funding for USF got murky and so Congress changed the administrator of this funding as part of the Telecommunications Act of 1996. In the Act the Congress directed the Congress to create the Universal Service Administrative Company (USAC) who collects and disburses funding for universal service. USAC is still funded based upon interstate telecommunications. Most telcos pass these fees along to customers on their bills, although this is not mandatory and companies could fund this out of their fees.

The Universal Service Fund has four major components. The High Cost Fund pays to support providing telephony in rural places where the costs are much higher per customer than average. The Low Income Fund pays for some of the installation fees and also some of the monthly fees for telephone lines for low income subscribers. The Rural Health Care Fund provides subsidies for rural tele-health and tele-medicine. And the Schools and Library Funds provides subsidies for Internet access and telecommunications services and infrastructure for schools and libraries.

The USF is undergoing major change due changes ordered by the FCC in Docket 11-171 in 2011. The fund is being transitioned to be called the Connect America Fund and will divert the High Cost Fund to be used to support rural broadband instead of rural telephony.

The Schools and Libraries Fund is commonly referred to as the E-Rate program. This program was started in 1997 where the FCC determined that, “telecommunications services, Internet access, and internal connections, including installation and maintenance,” for schools and libraries were eligible for discounted rates. The E-Rate program will pay from 20% to 90% of the cost of eligible services based upon the poverty and the urban/rural nature of the population supported by a given school. The Fund pays the neediest schools and works its way through the list of applicants each year until it runs out of funding.

What the FCC is doing as part of Chairman Wheeler’s announcement is to look at the definition of what is eligible for reimbursement from the E-Rate program. These definitions haven’t been upgraded for a long time and the fund pays for things like pagers and telephone lines (although one has to imagine the payments for pagers must be very tiny).

The FCC now wants to divert some of the fund to help pay for the basic infrastructure at schools to deliver broadband to the classrooms. President Obama has announced a policy goal, referred to as ConnectED, of bringing faster broadband to all of the schools in the country. His goal set a near-term goal of bringing 100 Mbps connections with a near-future goal of bringing gigabit speeds to schools

The FCC is responding to those policy goals with this change in the E-Rate funding. In Docket WC 13-184 the FCC had looked at some of these issues and had noted that there was a challenge in getting bandwidth from the wiring closet of schools into the classrooms. The FCC now wants some of the E-Rate funds to be used to rewire schools or to deploy other technologies that can bring bandwidth to where students can use it. It certainly is important for this fund to keep up with the times. It makes a lot more sense to use these funds to improve bandwidth at schools rather than to continue to pay for telephone service and for T1 lines. .

Faster Internet for Schools and Libraries

On July 23 the FCC released a Notice of Proposed Rulemaking in WC Docket No 13-184 that asks questions about modernizing the E-rate program for schools and libraries. The E-rate program has been around for a few decades and has been used to bring broadband to schools and libraries.

But last month President Obama announced a ConnectED initiative that has the stated goal of bringing a minimum of 100 Mbps and a goal of 1 Gbps to 99% of students within five years. This NPRM is in response to that initiative.

A 2010 FCC survey showed that only 10% of schools had speeds of 100 Mbps or greater. 48% of schools had speeds less 10 Mbps. 39% of schools reported cost as the barrier to better speeds while 27% cited the cost of installation as a barrier. And the situation is worse in our libraries. In a 2011 survey by the American Library Association only 9% of libraries have speeds of 100 Mbps or faster while 25% still have speeds of 1.5 Mbps or less.

There is clearly a need for revised E-rate funding. In the most recent year there were requests for funding from schools of over $4.9 B from a fund that is at an annual cap of $2.25 B. The E-rate program is funded today as part of the Universal Service Fund that gets fund by a surcharge put on a wide variety of telecommunications end-user bills.

The FCC has laid forth new goals for the E-rate program and also suggested a number of specific changes. The new goals include 1) That schools and libraries have affordable access to broadband in order to meet the goals of ConnectED; 2) that the effectiveness of the E-rate funding is maximized, and 3) that the administration of the program is streamlined.

The FCC seeks comments on the specific speed requirements needed for schools and libraries. They offer the target established by the State Education Technology Directors Association (SETDA) which suggests that K-12 schools should have at least 100 Mbps per 1,000 students by 2015 and 1 Gbps for every 1,000 students by 2018. For libraries they offer the State Library of Kansas recommendation that all libraries should have 1 Gbps connectivity by 2020.

One of the issues that the NPRM looks at is how to get the bandwidth around the school once it’s delivered to the side of a school. This is a significant issue because today’s wiring technologies and wireless technologies have a steep drop-off in data speeds over even short distances. So the NPRM looks for comments on how to best get the bandwidth to classrooms.  The State E-Rate Coordinators Association (SECA) has suggested that this issue is of high enough importance that it ought to be at the top of the priority list for E-rate funding.

The NPRM asks questions about increasing the efficiencies of buying broadband. This includes consortium purchasing and other bulk buying opportunities. The larger school districts are able to negotiate better rates today than small school districts due to the fact that they serve a significant number of schools. There must be ways for neighboring districts to band together for efficiency (although local politics is often a barrier to this process).

The NPRM also asks what the funding should be used for. It suggests that funding be transitioned to support only broadband. The funding is currently used for a number of other purposes which were allowable under the old rules.  For example, in the most recent funding year there were requests for $260 M to subsidize telephone lines.

Finally, the NPRM looks at who is eligible for the E-rate program. Today the program pays for some portion of eligible costs based upon the percentage of student enrollment that is eligible for a free or reduced price lunch in a given school. The school gets a discount based upon that factor and must then match between 10% and 80% of the cost. The NPRM looks at alternate eligibility requirements including (1) revising the discount matrix to increase certain applicants’ matching requirements; (2) providing support on a district-wide basis; (3) revising the approach to supporting rural schools and libraries; (4) incorporating a per-student or per-building cap on funding into the discount matrix; (5) providing more equitable access to priority two funding; and (6) allocating funds to all eligible schools and libraries up front.

Comments in the NPRM are due to the FCC by September 16, 2013. CCG Consulting will probably be making some comments in the Docket, so if you have anything you want to say let me know and it can be included in our filing.

Broadband and Schools

Satellite Internet dish attached to a...

English: Satellite Internet dish attached to a building in rural America (Photo credit: Wikipedia)

Earlier this month President Obama announced an initiative to get 1 Gbps or at least 100 Mbps broadband to 99% of schools within five years. The new plan is being referred to as ConnectEd and the citation takes you to a posting on the White House web site that outlines the program.

The program will have several components. The one that will be most familiar to the readers of this blog is that the program will provide improved connectivity through the E-Rate program that is part of the current Universal Service Fund. The E-Rate program for years has been providing subsidies to bring broadband to schools and libraries in the poorest communities. One has to imagine that the FCC is going to expand that program to include money to build fiber in rural communities. It’s not clear yet how it will work, but the administration has said that the NTIA (National Telecommunications and Information Administration) will take a lead in moving the program forward.

The second component of the plan will provide more training for teachers to be proficient in the technology that broadband will bring to the schools. This will be done with funding through Title II and Title VI programs through the Department of Education.

I don’t think there is anybody who can fault the goal of this plan which is to make sure that kids have access to broadband at school. Certainly students at schools that do not have broadband access will fall behind everyone else.

But for rural areas this is not enough. Over the last few years there has been a number of ‘middle-mile’ fiber networks built as part of the BTOP program using money from the 2009 Stimulus program that built rural fiber. The middle-mile projects built fiber through rural areas and also connect to ‘anchor institutions’ in those areas, meaning schools, universities, libraries and government buildings.

But in far too many cases those are the only places that got broadband out of the billions of dollars that were spent to build fiber. This is not a blanket indictment of the BTOP program because in some cases that fiber has been an incentive for carriers to build last mile fiber or wireless networks to serve rural customers. But I am also aware of many examples of BTOP fiber networks that bring fiber through a rural town, connect a school and a City Hall and nobody else.

And in many of those communities the existing broadband is poor or non-existent. It is very typical to have some sort of broadband in the towns in rural counties – generally DSL supplied by the phone company or cable modems supplied by a cable company. But in most cases the broadband in these towns is far slower than what is routinely available in big cities. But one generally only has to go a mile or two outside of these rural towns and the broadband stops. There are hundreds of counties that have this situation.

And in a lot of these areas without landline broadband there is also inadequate wireless broadband. Fiber is needed to provide broadband to cell towers if we want to use them to provide 3G or 4G data. Most rural cell towers were built along highways to serve cars and are not built where people live. And so in many rural areas there is no effective broadband.

And so it leads me to ask if there is not some way to help the communities around the schools while we bring broadband to the schools. 100 Mbps or 1 Gbps to a school is a great thing and I applaud this effort. But are we really helping rural students if once they leave school they don’t have enough broadband to do homework?

The original BTOP program that built fiber through rural communities did not go far enough. We need some way in this country to now build the rest of the fiber network and connect everybody. I would be a lot more excited about this announcement if it said that we were going to bring fiber to 99% of rural homes in five years.

I work with a lot of rural communities trying to get funding to build fiber and it is tough. These projects suffer from having a large infrastructure cost per household due to the sparse population in rural areas. These projects have a hard time getting funded through traditional funding sources like municipal bonds. If the federal government really wants to help rural areas get fiber they should be looking at ways that would help get rural fiber projects funded.

I don’t think it’s necessary for the federal government to step in and hand out the money to build rural fiber. That would probably just give us more BTOP programs and networks. But there are concrete steps the federal government could take that would make it easier to get this done. Rural communities are willing to pay for fiber themselves, but that desire is meaningless if nobody will lend them the money. So the best way to help rural America get broadband is to make it easier for rural communities to do it themselves. That is going to mean something like loan guarantees or lower interest rates for these projects.

The federal government already operates a ‘bank’ to provide rural broadband at the Rural Utility Service (RUS) that is part of the Department of Agriculture. But that money is so hard to obtain by rural governments that it might as well not exist. It would be easy to make the RUS into a functional program – it just takes the will to make it work.

In the last year we have had two big announcements at the federal level about broadband. One was to promote gigabit cities and now we will have broadband to 99% of schools. I am still waiting for the announcement that matters – to bring broadband to people.