K20 Education Network Update for the Network Advisory

K-20 Education Network Update for the Network Advisory Committee (NAC) February 21, 2014

K-20 Governance

Current Governance Office of the Chief Information Officer (OCIO) General operational and technical oversight to the K-20 Educational Network Consortium General K-20 Operational and Technical Oversight K-20 Operations Cooperative (KOCO) K-20 Engineering & Day-to-Day Operations Engineering Operations Administration Maintenance Provisioning 2

K-20 Operations Cooperative § UW KOCO – – – Monitor Network & Server Status Troubleshoot Network Problems Coordinate Problem Resolution Provide and Analyze Network Performance Data Provide Technical Support § SBCTC KOCO – Manage Video Switched Network and MCUs – Schedule Multipoint Video Resources – Provide Technical Support 3

Network Architecture Upgrade

450 Sites Connected K-12 District/ESD (302) Community/Technical College (65) Public College/ University (33) Public Library (24) Telemedicine Site (5) Tribal Education Center/ Tribal College (11) Independent College/ University (7) TVW Olympia KCTS 9 Seattle Washington State Historical Society • • • Over 300 K-12 districts and Educational Service Districts More than 2, 000 K-12 schools and 57, 000 classrooms Over 1. 5 million students 5

Statewide Fiber Optic Backbone (2005) Seattle University or College Spokane Olympia Yakima Library Pullman School District Vancouver 10 Gbps 6

K-20 40 Gbps Network: Gen 3 (2013) 7

Internet Service Provider (ISP) Fees

Internet Service Provider (ISP) Fees § K-20 is statewide INTRA-net § K-20 Network does not directly procure INTER-net access for customers § OSPI contracts for ISP on behalf of connected K-12 sites § No state subsidy for ISP § No legislatively set rate structure – Estimates provided by OSPI at beginning of year – Actual cost determined at end of year, based on actual, total cost of service – Includes E-rate discounts 9

ISP Usage and Cost History for K 12 10

ISP Cost per Megabit Billed to Endsites 11

K-20 Connectivity Costs

K-20 Co-pay Principles § Established by K-20 Network Consortium § All sites must pay the same amount per unit of transport – regardless of institution size, location, or connectivity methodology § Co-pay is amount needed from connected institutions after state subsidy and E-rate reimbursements § Must be in line with options available in competitive marketplace § Much lower than actual cost to provide service 13

Concerns Regarding Co-pay § FY 14 & FY 15 co-pay structure lowered costs for highest-bandwidth users, but did not address many other concerns: – Calculation difficult to understand – Costs variable throughout year; difficult to plan and budget appropriately – Increased cost for increased use can lead entities to throttle or discourage network use – Doesn’t match the manner in which most vendors charge for services; ripe for misrepresentation and/or unfair comparisons 14

E-rate-Specific Concerns § Concerns were voiced by E-rate eligible sectors (K 12 and libraries) – Currently, all K-20 connected institutions pay the same rates, regardless of E-rate eligibility – Some high-discount sites leaving K-20 for cheaper options that allow for full use of e-rate discount § For co-pay to stay in line with competitive marketplace and meet legislative intent, additional changes to co-pay must be made 15

Co-pay Approach § Total co-pay requirement reduced by $2. 5 M (from $9. 75 M to $7. 25 M) § Allocate the majority of reduction to K-12 § Eliminate utilization-based co-pay (95 th percentile) § Freeze all customer co-pay costs at or below FY 13 totals § Ensure that costs for highest-bandwidth users are reduced to align with marketplace § Invoice annually, rather than quarterly 16

K-12 Approach for 2013 -14 & 2014 -15 OSPI proposed to: § Move to a flat-fee model § Lock in rates through June 30, 2015 § Guarantee that endsite rates will not increase over FY 13 totals § Apply individual district e-rate discount percentages to endsite invoices to more fairly allocate reductions to neediest sites 17

Co-Pay Revenue by Sector $3. 5 3. 28 $3. 0 2. 67 $2. 5 2. 21 1. 95 Millions $2. 0 1. 95 1. 85 Library CTC 1. 56 $1. 5 BACC 1. 39 K-12 1. 21 1. 04 0. 94 $1. 0 0. 68 0. 58 0. 84 0. 75 0. 63 0. 62 0. 64 0. 70 0. 780. 77 $0. 5 0. 18 0. 15 0. 12 0. 08 0. 06 0. 12 $0. 0 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 (proposed) FY 15 (proposed) 18

New Co-pay Benefits & Summary § No more complex calculations § Costs are fixed through June 30, 2015 § Since usage is no longer a factor in total cost, no incentive to throttle or limit usage § Allows for easy comparison with vendor offers § Allows each sector to determine the best way to allocate costs to their institutions – OSPI and WSL can apply individual endsite e-rate discounts to more fairly allocate reductions to neediest sites 19