Solution Providers Cheer Added E-Rate Funding, But Obstacles Remain

More federal money will help bring faster Internet and increased managed services to schools, solution providers said, but funding challenges persist for small, rural districts.

The Federal Communications Commission voted 3 to 2 Thursday to increase funding for its E-Rate program, which gives schools money to strengthen their Wi-Fi networks in the classrooms, by $7.5 billion over the next five years, or $1.5 billion a year.

The additional funding will allow eligible institutions to apply for money at a rate of $5 for every square foot of space in their building, up from a rate of $1 per square foot.

[Related: Testing, Standards And Wi-Fi: IT Opportunities Abound In Education]

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The money will advance President Barack Obama's ConnectED initiative, which aims to connect 99 percent of students to next-generation broadband or high-speed wireless in their schools and libraries by 2017.

"They [the FCC] realize the critical role that wireless and the network was playing," said Jeff Hewson, national sales director for the data technology division of Carousel Industries, an MSP based in Exeter, R.I. "Another billion and a half will go a long way."

Education is one of Carousel's strongest verticals, and Hewson said the additional E-Rate funding should bolster Carousel's sales of products and services specifically for wireless networks.

Hewson said the most significant impact will be for E-Rate's Priority 2 program, which covers costs related to internal school building connections such as networks, cables, switches, Wi-Fi and firewalls.

That's good news for Billings, Mont.-based Pine Cove Consulting, which works exclusively on Priority 2 projects, according to company founder and CEO Rick VanCleeve.

Pine Cove's E-Rate business had been completely dead for the past two years since the FCC allocated no money to Priority 2; before that, VanCleeve said Priority 2 money was only made available to schools where at least 90 percent of the students received free or reduced-price lunch.

Things should be different this time around, he said.

"It appears that all districts will see some type of funding," VanCleeve said.

The latest round of funding also incentivizes more managed services activity since it can lower capital expenditures for school districts. Hewson said the changes should allow school districts to get away from owning their own hardware and move toward outsourcing critical infrastructure.

Priority 1 -- which focuses on districts' Internet connectivity to the outside world -- traditionally has been much better funded, Hewson said, but the FCC has rethought its stance as obstacles to broadband become more apparent.

Going forward, Hewson hopes the FCC will eliminate the distinction between Priority 1 and Priority 2 since schools need a complete Internet package.

Spending caps, though, will continue to make it difficult for small, rural districts to fulfill their Priority 2 needs, VanCleeve said. Districts are prohibited from procuring more than $30 per student, per year for Priority 2 tasks, with the exception of those having fewer than 300 students, which can receive $9,200.

But many wireless infrastructure costs such as cable and switches are fixed regardless of the number of students in the district. Plus VanCleeve said it's often more difficult and expensive to find someone capable of installing, maintaining or supporting wireless networks in rural areas.

"I still think the smaller school districts do not get the same benefits as the larger school districts," VanCleeve said. "They can't do everything for $30 per student."