The Wireline Competition Bureau recently released a draft Eligible Services List (“ESL”) for FY 2015 funding requests for schools and libraries under the E-rate program, and is seeking comment on the draft list for funding year 2015.  Implementing the new E-rate rules, the ESL outlines the category one and two services that will qualify for the upcoming funding year.  The list also looks markedly different from past years and was designed to be more user-friendly.

The ESL specifically limits “internal connections” to those broadband connections and services that are necessary for high-speed access.  Managed wi-fi services are also prominently featured on the form and may include LAN/WLAN network services, diagnostic services, network monitoring or helpdesk support.  The ESL includes caching as an eligible category two service, and the Commission seeks comment on the “necessary software or equipment” required for caching and whether the ESL should also cover caching services, in addition to any software or equipment.

As expected, the ESL notes that voice services as subject to a “phase down” per the Commission’s rules.  Providers should be aware that although wireless telephone services (like cellular voice) may be eligible for funding, E-rate dollars cannot be applied to data or text messaging plans.

As a reminder, a recent FCC decision excludes handsets from E-rate funding.  This will likely present an issue for providers as it will force these groups to cost-allocate eligible and ineligible services.  Unfortunately, the Commission has not given additional guidance about how service providers should approach cost allocations.

We urge service providers to review the Commission’s Public Notice along with the Eligible Services List, and submit comments to the Wireline Competition Bureau.  In particular, providers offering managed wi-fi and caching services – two of the newly added eligible services – should carefully review the descriptions to determine if these services are adequately described.  Comments are due September 3.  Reply Comments will be due September 18.