TDS encouraged by E-Rate reforms, but says voice phase-down could delay VoIP transition

TDS said that the FCC's move to modernize the E-Rate program, which provides discounted telecom services to schools and libraries is producing positive results, but the voice support phase-down requirement remains a concern for its customers transitioning from TDM to IP-based voice.   

In a recent joint FCC filing with the NTCA, the telco said that the various changes to the E-Rate mechanism stemming from the commission's 2014 orders are having a positive effect on schools and libraries it serves in its territory.

A big change is an accelerated approval process for projects. Under the new rules, the Universal Service Administrative Company (USAC) has been approving funding requests from schools and libraries at a faster pace than it had done in previous years, something that enables schools to make upgrades without disrupting students and teachers during the school year.

"This accelerated approval is helpful to E-Rate applicants because they often do not want to move forward with installation of new services until they receive funding approval," TDS said in the FCC filing. "Receiving funding approvals earlier in the funding cycle enables them to install new services and equipment in the summer when school is not in session."

Besides the accelerated approval timelines, TDS' E-rate applicants have noted that the new E-Rate forms are "more visually appealing and as a result expedite the application process." In addition, the E-Rate Productivity Center User Guides and Instructions posted on the USAC websites have driven applicants' use of the portal.

Despite these enhancements to the E-Rate process, TDS and its school district customers are concerned about the regulator's move to initiate a phase-down of support to voice services to free up E-Rate money for applicants to use for broadband connectivity and network equipment and services. Under the new plan, the FCC will reduce voice service discounts by 20 percent, with plans to reduce it by 40 percent in the 2016 funding year.

As a result of the voice phase-down, a number of schools and libraries in the territories TDS serves have either delayed or cancelled planned upgrades of their outdated telephone systems.

"This seems to run contrary to the goals of the E-rate Modernization Order in terms of schools' and libraries' migration to broadband-enabled services generally and to Voice over Internet Protocol ("VoIP") service in particular," TDS said. "Unfortunately, TDS has found that the 20 percent phase down in year one and the prospect of the phase down continuing has had the opposite effect, as schools and libraries face a highly uncertain ability to cover the costs of transitioning to more modern and efficient IP-enabled voice systems."

That's not to say schools and libraries served by TDS aren't interested in migrating to VoIP services. The telco's customers see that managed VoIP service affords them with a number of advantages, particularly during an emergency.

"From the perspective of schools and libraries, managed VoIP services have several distinct advantages," TDS said. "In particular, a number of schools have expressed their interest in the public safety benefits of such technology, such as the ability of school administrators to maintain communications in an emergency, the ability to easily redirect calls remotely, and the ability to utilize direct inward dialing to classrooms, which enables an emergency responder from outside the school to communicate with students and/or a teacher in a classroom during a lockdown."

Other benefits of managed VoIP systems are that a service provider can enable greater redundancy while reducing costs by having the service provider perform necessary maintenance and management of the system.

And while the use of managed VoIP services will vary according to the needs of the particular entity, TDS noted that these services are a better for a school or a library's constrained budget.

"From a budget standpoint, these services are offered through recurring monthly charges rather than a large cash outlay that would be required for a standard PBX/premise-based phone system," TDS said.

TDS has asked the FCC's Wireline Competition Bureau to review the voice phase-down rule that's part of the E-Rate modernization order.

For more:
- see this FCC filing (.pdf)

Related articles:
TDS brings 1 Gig service to Waunakee, Wis., continues fiber network expansion
FCC raises E-rate subsidies to pay for extended education technology program
FCC's Wheeler: E-Rate reforms should address 'closing the rural fiber gap'
FCC approves $2B E-Rate changes aimed at improving broadband and Wi-Fi for schools, libraries

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