A Plan To Fix E-Rate

The federal E-Rate program is in the news again. This time, it is due to a mention in the president’s State of the Union speech. He asked a deceptively simple question: “Why can’t schools have the same kind of wifi we have in coffee shops?” After the speech, press releases went flying from the Federal Communications Commission (FCC) talking about a restructuring plan that will eliminate older parts of the Federal Universal Service Fund (USF) like pagers and dial-up connections.

This isn’t the first time that E-Rate has been skewered by the president. Back in June of 2013, he asked some tough questions about increasing the availability of broadband connections to schools. Back then, I thought a lot about what his aim was and how easily it would be accomplished. With the recent news, I feel that I have to say something that the government doesn’t want to hear but needs to be said.

Mr. President, E-Rate is fundamentally broken and needs to be completely overhauled before your goals are met.

E-Rate hasn’t really changed since its inception in 1997. All that’s happened is more rules being piled on the top to combat fraud and attempt to keep up with changing technologies. Yet no one has really looked at the landscape of education technology today to see how best to use E-Rate funding. Computer labs have given way to laptop carts or even tablet carts. T1 WAN connections are now metro fiber handoffs at speeds of 100Mbit or better. Servers do much more than run DNS or web servers.

E-Rate has to be completely overhauled. The program no longer meets the needs of its constituents. Today, it serves as a vehicle for service providers and resellers to make money while forcing as much technology into schools as their meager budgets can afford. When schools with a 90% discount percentage are still having a hard time meeting their funding commitments, you have to take a long hard look at the prices being charged and the value being offered to the schools.

With that in mind, I’ve decided to take a stab at fixing E-Rate. It’s not a perfect solution, but I think it’s a great start. We need to build on the important pieces and discard the things that no longer make sense. To that end, I’m suggesting the Priority 1 / Priority 2 split be abolished. Cisco even agrees with me (PDF Link). In it’s place, we need to take a hard look at what our schools need to educate the youth of America.

Tier 1: WAN Connections

Schools need faster WAN connections. Online testing has replaced Scantrons. Streaming video is augmenting the classroom. The majority of traffic is outbound to the Internet, not internally. T1/T3 doesn’t cut it any more. Schools are going to need 100Mbit or better to meet student needs. Yet providers are reluctant to build out fiber networks that are unprofitable. Schools don’t want to pay for expensive circuits that are going to be clogged with junk.

Tier 1 in my proposal will be funding for fast WAN circuits and the routers that connect them. In the current system, that router is Priority 2, so even if you get the 10Gbit circuit you asked for, you may not be able to light it if P2 doesn’t come through. Under my plan, these circuits would be mandated to be fiber. That way, you can increase the amount of bandwidth to a site without the need to run a new line. That’s important, since most schools find themselves quickly consuming additional bandwidth before they realize it. Having a circuit capable of having additional head room is key to the future.

Service providers would also be capped at the amount that they could charge on a monthly basis for the circuit. It does a school no good to order a 1Gbps fiber circuit if they can’t afford to pay for it every month. By capping the amount that SPs can charge, they will be forced to compete or find other means to fund build outs.

Tier 2: Wireless Infrastructure

Wireless is key to the LAN connectivity in schools today. The days of wiring honeycombing the walls is through. Yet, Priority 2 still has a cabling component. It’s time to bring out schools into the 21st century. To that end, Tier 2 of my plan will be focused entirely on improving school wireless connectivity. No more cable runs unless they have a wireless AP on the end. Switches must be PoE/PoE+ capable to support the wireless infrastructure.

In addition, wireless site surveys must be performed before any installation plan is approved. VARs tend to skimp on the surveys now due to inability to recover costs in a straightforward manner. Now, they must do them. The costs of the site survey will be a line item for the site that is capped based on discount percentage. This will lead to an overall reduction in the amount of equipment ordered and installed, so the costs are easy to justify. The capped amount keeps VARs from price gouging with unnecessary additional work that isn’t critical to the infrastructure.

Tier 3: Server Infrastructure

Servers are still an important part of education IT. Even though the applications and services they provide are being increasing outsourced to hosted facilities there will still be a need to maintain existing equipment. However, current E-Rate rules only allow servers to serve Internet functions like DNS, DHCP, or Web Servers. This is ridiculous. DNS is an integral part of Active Directory, so almost every server that is a member of a domain is running it. DHCP is a minuscule part of a server’s function. Given the costs of engineering multiple DHCP servers in a network, having this as a valid E-Rate function is pointless. And when’s the last time a school had their own web server? Hosting services provide scale and easy-of-use that can’t be matched by a small box running in the back of the data center.

Tier 3 of my plan has servers available for schools. However, the hardware can run only one approved role: hypervisors. If you take a server under my E-Rate plan, it has to run ESX/Hyper-V/KVM on the bare metal. This means that ordering fewer big servers will be key to run virtual workloads. They cost allocation nightmare is over. These servers will be performing hypervisor duties all the time. The end user will be responsible for licensing the OS running on the guest. That gets rid of the gray areas we have today.

If you take a virtual server under Tier 3, you must provide a migration plan for your existing non-virtualized workloads. That means that once you accept Tier 3 funding for a server, you have one calendar year to migrate your workloads to that system. After that year, you can no longer claim existing servers as eligible. Moving to the future shouldn’t be painful, but buying a big server and not taking advantage of it is silly. If you show the foresight to use virtualization you’re going to use it all the way.

Of course, for those schools that don’t want to take a server because their workloads already exist in private clouds like Amazon Web Services (AWS) or Rackspace, there will be funding for AWS as well. We have to embrace the available options to ensure our students are learning at the fullest capacity.

Tom’s Take

E-Rate is a fifteen year old program in need of a remodel. The current system is underfunded, prone to gaming, and will eventually collapse in on itself. When USF is forced to rely on rollover funds from previous years to meet funding goals even at 90% something has to change. Priority 1 is bleeding E-Rate dry. The above plan focuses on the technology needed for schools to continue efficiently educating students in the coming years. It meets the immediate needs of education without starving the fund, since an increase is unlikely to come, even though other parts of USF have a sketchy reputation at best, as a quick Google search about the USF-funded cell phone program will attest. As Damon Killian said in The Running Man, “Hard times call for hard choices.” We have to be willing to blow up E-Rate as we know it in order to refocus it to make it serve the ultimate goal: Educating our students.


Because I know someone from the FCC or SLD is going to read this, here’s the following disclaimer: I don’t work for an E-Rate provider. While I have in the past, this post does not reflect the opinions of anyone at that organization or any other organization involved in the consulting or execution of E-Rate. Don’t assume that because I think the program is broken that means the people that are still working with the program should be punished. They are doing good work while still conforming to the craziest red tape ever. Don’t punish them because I spoke out. Instead, fix the system so no one has to speak out again.

2 thoughts on “A Plan To Fix E-Rate

  1. As someone who deals with E-Rate every year (IT Dir. for a small public school district) I thoroughly agree and would welcome this type of change.

  2. Pingback: Fixing E-Rate – SIP | The Networking Nerd

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