E-Rate 2.0: Advice for Companies Navigating Changes to the Program

Managing Editor


Many school and library officials cheered the Federal Communications Commission’s recent overhaul of the E-rate program, which is bringing billions of dollars in new support for improved Web connectivity, and recasting its priorities in some significant ways.

But what do the vast changes mean for technology providers? A new guide, published by the Software and Information Industry Association and prepared by a leading consulting organization on the E-rate, aims to guide businesses through the new landscape and offer practical strategies for anticipating applicants’ needs.

The “Guide to the E-rate 2.0,” provides advice to vendors, background on the program—including the application and funding process— details on the changes the FCC has made over the past 18 months, and a list of technology eligible to be supported through the program.

The new policies approved by the FCC prioritized spending on broadband and wireless connectivity, and internal connectivity within buildings, while de-emphasizing support for other services deemed to be antiquated, such as phones, text-messaging, and paging. The agency also raised the program’s yearly funding cap from $2.4 billion to $3.9 billion, among other changes.

(For a clear-yet-cool-looking cheat sheet on the changes, see my colleague Ben Herold’s visual-friendly explainer, “The E-rate Overhaul in 4 Easy Charts.”)

The guide, which was written by Funds for Learning, an Oklahoma-based group that consults schools and libraries on the E-rate, also offers companies tips for leveraging the program to their advantage.

Here are just a few of the tips the report offers to companies about business opportunities and implications from the revised E-rate: 

  • Know the overall market. E-rate dollars do not flow as grants to schools and libraries, but rather provides discounts on telecommunications services. Businesses should have an understanding of how many school districts and libraries are applying for E-rate discounts. Here’s a tidbit: the average funding requested from districts is $301,251; from library systems, it’s $37,559, according to preliminary, 2015 funding-year data. 
  • Keep an eye on 470s. 470 forms, posted on the Universal Service Administrative Company website, describe the E-rate goods and services schools are seeking. That information can provide vendors with obvious, critical insight on the needs of E-rate applicants.
  • Monitor which applicants are actually using E-rate discounts. Strange as it sounds, not all applicants who secure discounts end up using them—either because of turnover of their E-rate coordinators, or delays in receiving funding, or other reasons, explained John Harrington, Funds for Learning’s CEO. Knowing which districts are making use of discounts gives vendors information on which vendors are investing in technology, what they bought in the past, and what they might still need.
  • Compliance matters. E-rate applicants, among other requirements, have to show that they’ve bought or have plans to obtain the resources—such as software, staff development, and electrical capacity—necessary to carry out their E-rate plans. If companies understand these needs, the report says, it can open new, ancillary business opportunities. 

Those are just a sampling of some of the report’s recommendations. Companies looking for other, detailed advice on how to make sense of the new E-rate landscape can look at the free executive summary of the report, or they can be obtain the full document by going through the SIIA, which is providing it at a cost for non-members of the organization.

[UPDATE: I’ve revised the post to make clearer readers’ options for downloading the E-rate 2.0 document.]

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