Despite announcing with much fanfare back in December 2014 that the FCC had changed its rules to permit schools and libraries to obtain E-rate funding to self-provision fiber, it appears that USAC has only just approved an application for a school seeking to purchase and operate its own fiber network—the only such approval to date to our knowledge.
In its Second Report and Order in its E-rate modernization proceeding the FCC “equalized” the treatment of lit, dark, and self-provisioned fiber by permitting schools and libraries to receive E-rate funding for dark or self-provisioned fiber for the first time, including the electronics necessary to utilize dark and self-provisioned fiber.
The rule change permitting the funding of self-provisioned fiber was an underlying assumption girding the FCC’s cost model to keep spending in the E-rate program within its new $3.9 billion annual budget. The model assumed that a significant number of schools and libraries would choose to self-provision the fiber necessary to deliver high speed broadband services necessary to deliver modern educational services to the nation’s K-12 students. A brief review of the different models for provisioning fiber in a school district may help to explain why this has not panned out as hoped in the FCC’s 2014 order.
|Fiber||Electronics||Operation, Maintenance & Upgrades|
|Self-Provisioned Fiber||Owned by school/library||Owned by school/library||School/library’s responsibility|
|Dark Fiber||Leased from third party||Owned by school/library||School/library’s responsibility|
|Lit Fiber||Owned by service provider||Owned by service provider||Service provider’s responsibility|
A last-minute addition to the 2014 order required E-rate applicants to make “apples-to-apples” comparisons when considering self-provisioning or dark fiber options by including the costs of electronics needed to light both dark and self-provisioned fiber, and that the applicants solicit proposals for lit fiber anytime they seek dark or self-provisioned fiber solutions. At the time, many in the industry predicted that after making such comparisons, schools and libraries would realize that they were ill-equipped to operate, maintain and upgrade broadband fiber facilities. With self-provisioning, there is the added burden that the school and library must act as its own contractor in having the fiber built.
If self-provisioning were a more attractive option, we would have expected more approvals at this point in the funding year. A recent survey by Funds for Learning, however, indicates that the vast majority—88%—of respondents declined to apply for E-rate funding for self-provisioned networks.