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FCC Issues Draft Eligible Services List With Short Time to Comment

The Federal Communications Commission August 13 issued its draft eligible services list for the 2005 E-rate funding year, and gave stakeholders until August 23 to file comments on it.

The FCC said, “We emphasize to commenters that this proceeding is limited to determining what specific services are eligible under the Commission’s current rules; it is not intended to be a vehicle for changing any eligibility rules.”

In an order that the FCC adopted last December, it instructed the Universal Service Administrative Company to submit a draft of its updated eligible services list by June 30 each year. The Commission said it is committed to adopting the final eligible services list at least 60 days before the start of the filing window for Form 471 applications. Based on the timetable for previous years, that would require the final version of the list to be adopted in early September.

The draft list does not include any dramatic new changes in eligibility, but is organized in a slightly different format than before. Each product type includes a description and then USAC’s position on its eligibility. In the case of the internal connections category, the product type also includes a designated “function,” which tracks the categories of the pilot, voluntary online eligible services data base that the Schools and Libraries Division is working with equipment manufacturers to create.

The definition of eligible maintenance and technical support has been modified, in keeping with an order that the FCC issued last December. The draft eligible services list said that “Basic maintenance services are ‘necessary’ if, but for the maintenance at issue, the connection would not function and serve its intended purpose with the degree of reliability ordinarily provided in the marketplace to entities receiving such services without E-rate discounts. Basic maintenance services do not include services that maintain equipment that is not supported or that enhance the utility of equipment beyond the transport of information, or diagnostic services in excess of those necessary to maintain the equipment’s ability to transport information.”

The listing continued: “The following products and services are generally eligible: repair and upkeep of eligible hardware, wire and cable maintenance, basic technical support and configuration changes. The following product and services are ineligible: on-site technical support, 24-hour network monitoring, network management, help desks and technical support contracts that are more than basic maintenance.”

USAC retained the language of a separate listing under “Technical Services” in the “Miscellaneous” category that specified that maintenance is eligible only as a component of a maintenance agreement or contract for eligible services and the services are cost-effective. The eligible products and services, it said, must be identified according to product name, model number and location.

It was noted that “IP-enabled services are the subject of an open proceeding at the FCC to determine, among other things whether certain types are telecommunications services.” But until that is resolved, Voice Over IP services will remain ineligible as a service, although “otherwise eligible internal connections components may include technology for providing real-time or near real-time voice or video over IP,” the same position the FCC held for the 2004 funding year. In addition, USAC continued to say that those seeking cable modem service should apply under Internet access, pending the eventual outcome of a case before the federal courts involving that service offering.

Among the other changes from the last version of the eligible services list, which was published in October 2003:

  • USAC proposed that bridges, “a data communication device that connects two or more network segments, often translating information from one type of network protocol to another, were eligible “if used for an eligible purpose.” A similar position was taken on gateways, defined as “a network device that acts as an entrance to another network, and often is used to connect two otherwise incompatible networks.” However, when such devices are used for “caching, prosy servers or other ineligible function,” they are not eligible.
  • USAC said that Interface or Edge Devices, what it defined as “a physical device that can pass packets between a legacy type of network and an ATM network,” were eligible. Such devices may be a router or Ethernet-to-ATM switch that directly connects to an ATM network.
  • USAC said that standalone intercom systems are still not eligible; however, “an intercom system that is an integral part of a PBX, Centrex, or key system can be included as an ancillary component” and can be eligible if it meets the test for ancillary use. 

Despite the arguments of some E-rate stakeholders, the document did not propose changing the FCC’s position that technology plans are required when applicants seek support for PBXes, key systems or Centrex systems. Nor was a change proposed in the FCC’s position that caching components, when priced separately, were ineligible for support.

The lengthy list can be reviewed by clicking here. Comments on the list can be filed electronically at After the first round of comments, the deadline for reply comments is August 30.


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