October 22 2014 Moderator Noelle Ellerson Associate Executive Director Policy amp Advocacy Presenter Aleck Johnson Vice President EdTech Strategies LLC Sponsored by Logistics Remember to phone in to access the audio for todays webinar ID: 658203
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Slide1
E-rate 2.0: Understanding the New Category 1 Services
October 22, 2014Slide2
Moderator:
Noelle Ellerson
Associate Executive Director, Policy & Advocacy
Presenter:
Aleck Johnson
Vice President
EdTech Strategies, LLC
Sponsored by:Slide3
Logistics:
Remember to phone in to access the audio for today’s webinar.Slide4
Webinar Participation:
We have allotted time
for
Q&A
, but you can submit questions at any time.Please use the chat window to submit questions.Slide5
Background
E-rate 2.0 Order (released 7/14/2014) replaced Priority 1 and Priority 2 with Category 1 and Category 2
Historically Priority 1 included Telecommunications and Internet Access
Recent changes diminished the distinctions between the twoE-rate 2.0 focuses on broadband servicesNon-broadband services subject to significant cutsSlide6
The New Category 1
New Category 1 focuses on broadband includes fewer services and breaks down the distinctions between Telecommunications and Internet Access
Non-broadband voice services subject to phased elimination through decreased discounts
Discounts drop 20%/yr. starting in FY2015Other non-broadband services eliminated entirely“Savings” will allow greater funding of Category 2Slide7
Category 1 vs. Priority 1
Before E-rate 2.0:
Priority
1Broadband Internet/Digital Transmission ServiceWebsite HostingLeased Wide Area Network ServiceEmail ServiceLocal Phone ServicePaging ServiceLong Distance Phone ServiceCustom Calling FeaturesCellular Phone ServiceCellular Data ServiceVoice Over IP ServiceVoicemail Service
All services eligible at same discount rateSlide8
Category 1 vs. Priority 1
After E-rate 2.0:
Category
1Broadband Internet/Digital Transmission ServiceWebsite HostingLeased Wide Area Network ServiceEmail ServiceLocal Phone ServicePaging ServiceLong Distance Phone ServiceCustom Calling Features
Cellular Phone ServiceCellular Data Service*Voice Over IP (VoIP) ServiceVoicemail Service
Bold – still eligible at full discount ratePurple
– eligible at reduced discount rate until phased outRed – eliminated from eligibilitySlide9
Category 1 Services
Discounts on voice/telephone services reduced 20%/yr. starting in FY2015
Decreases until 0% discount reached
Other non-broadband services eliminated
Cellular Data*Website HostingEmail ServicePaging ServiceVoicemail Service
Components of Voice Services Directory AssistanceText Messaging900/976 call blocking
Custom calling ServicesDirect Inward DialingInside Wire MaintenanceSlide10
The New Category 1:
Financial Impacts
Lots of data available from various groups on what this will mean
Different assumptions, different data setsDifferent agendas and spinAccurate data still somewhat difficult to come by – shifting goal posts, shifting definitions, using data for purposes other than what was originally intendedSlide11
The New Category 1:
Financial Impacts
Official Estimates from FCC of “savings”:
Funding Year“Projected Savings” per yearFY 2015$342MFY 2016$582MFY 2017$789MFY 2018$937MFY 2019
$968MSource: WCB & OSPP Staff Report, WC Docket 13-184, Rel. August 12, 2014Slide12
The New Category 1:
Projected Impacts
Keep in mind: “Projected Savings” are funds that will no longer flow to applicants for C1 services
Unless applicants discontinue services or cut costs associated with those services, these are costs that are shifted dollar for dollar to applicantsSome groups have estimated “savings” of $1.1B to $1.3B annuallyA Little Bit of Context: EETT in 2002 was $700.5M. EETT in 2010 was $100M. Slide13
Category 1 Impacts:
Two Quick Estimates
Impact of E-rate 2.0 varies from entity to entity
Depends on the services currently/previously purchasedChanges in discount rate methodology may modify slightlyAssumptions:Cost of services remains the sameEntities continue to purchase same servicesC1 is fully fundedCurrent rules re: reducing discounts, eligible services stay in placeCellular 50% eligibleSlide14
Category 1 Impacts:
Medium School District
Medium sized district
~10,000 studentsRelatively low poverty (40% discount, NSLP 16%)Applies for local, long distance, web hosting, Internet, and WANDoes not apply for cellularSlide15
Category 1 Impacts:
Medium School District
Funding Year
Total CostDiscountDistrict CostChangeFY2014 $195,494.96 $86,017.78
$109,477.18 $- FY2015 $195,494.96 $65,199.36 $130,295.60
$20,818.42
FY2016 $195,494.96 $46,602.48 $148,892.48 $39,415.30FY2017 $195,494.96
$28,005.60
$167,489.36 $58,012.18FY2018 $195,494.96 $28,005.60 $167,489.36
$58,012.18
FY2019
$195,494.96
$28,005.60
$167,489.36
$58,012.18
Total P1/C1 reduction over 5 years is
$234,270.27Slide16
Category 1 Impacts:
Medium School DistrictSlide17
Category 1 Impacts:
Education Service Agency
Serves ~20 school districts, plus private schools
Medium poverty – discount rate of 60% (NSLP 45%)Files separate applications for WAN (providing service to districts, private schools, and ESA) and voiceESA spends very little on voice, having moved to an internally hosted VoIP solution (previously would have been ~$100k higher) Does not apply for web hostingTotal cost of non-WAN/Internet services is ~$158k/yr.Slide18
Category 1 Impacts:
Education Service Agency
Funding Year
Total CostDiscountIU 13 CostChangeFY2014 $157,797.60 $96,256.54
$61,541.06 $0.00FY2015 $157,797.60 $37,669.68 $120,127.92 $58,586.86FY2016
$157,797.60
$18,834.84 $138,962.76 $77,421.70FY2017 $157,797.60 $0 $157,797.60 $96,256.54FY2018
$157,797.60
$0 $157,797.60 $96,256.54FY2019 $157,797.60 $0
$157,797.60
$96,256.54
Total P1/C1 reduction over 5 years is
$424,778.16Slide19
Category 1 Impacts:
Education Service AgencySlide20
Category 1 Impacts
Impacts will vary dramatically based on the services applied for in the past
Districts using cellular data, web hosting, email services will be hardest hit initially
Voice services phase in could spread impact over several years depending on discount rateSlide21
Category 1 Summary
Major changes in both services eligible and discounts for eligible services
Elimination of some services and discount reductions for others means most applicants will see less reimbursement/discount (in $ terms) than would have been the case prior to E-rate 2.0
Impact a function of the services sought and whether applicants can move to more cost effective solutionsMoney “saved” in Category 1 will likely mean more money available for Category 2Slide22
Future Presentation
10/29/14 – Understanding the New Category 2 Services
Archives of this presentation and previous introduction to E-rate 2.0 presentation available on AASA website
Send questions to erate@aasa.orgSlide23
About Blackboard
Our Mission: Reimagining Education through Technology
Leading provider of K-12 web
hostingPartner of nearly 1 out of 3 districts in the U.S.Solutions for all of your education technology needs:Teaching & LearningParent & Community EngagementSlide24
What We Know…
E-Rate is changing.
School communication is changing.
Parent & community expectations are changing.These changes bring both great challenge and great opportunity. Slide25
Communication Trends
77%
of parents use a smartphone
89%
of their time on these devices is spent using mobile appsSlide26
Meeting Parents Where They’re At
Top
5
Parent Communication Preferences for Staying Involved
Provided by Blackboard Solutions
Email
Parent Portal
School Web Sites
Text
Messages
Mobile App
Slide27
How Blackboard Can Help
K-12 Central
A custom, branded mobile app for your district or school keeps your community connected anywhere, anytime
Edline
District, school, and classroom websites—simplified through a single platform that connects your entire learning community
Connect
Fast, reliable notifications to parents via phone, SMS, email and social
!
Data
Parent Engagement SolutionSlide28
Introducing Bb-Rate
What is Bb-Rate?
A special offer to help schools and districts deal with funding changes for web-hosting
Each offer is customized to meet your district’s specific set of needsWhy Bb-Rate?Maintain web hosting discountsWork with a single provider for integrated communication solutionWebsite hosting + Notification + Mobile Communication AppSlide29
Discover Bb-Rate
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announcingbbrateSlide30
Aleck Johnson
EdTech Strategies, LLC
ajohnson@edtechstrategies.net
Questions? Send them to
erate@aasa.org