Search ITS   | User Guides |   | Services |   | Policies |   | Forms |   | Help |   | Home |  

About TNS

Principles Guiding the Formation

TNS "Common Good" and "Individual Good" Service Categorizations

Support of Common Good

FQA

Telecommunications & Networking Services Business Model

The Telecommunications & Networking Services (TNS) Business Model was implemented in July 2001 as part of a broader telecommunication services, computer services, and network security services budget model which was developed in response to a looming funding crisis.

Changes in technology and regulation are causing Information Technology (IT) funding issues for all colleges and universities, particularly large research universities. As traditional telephone technologies change, many higher education institutions are finding the funding sources used to fund IT needs have declined. Consistent with this trend, it was determined that Penn State could not rely any longer on a funding scheme that was established years ago, in a voice-centric environment, to sustain the University's shift to a multi-media (voice, video, data) technology intensive environment.

To avoid a funding crisis, and to create a new sustainable budget model, the Provost appointed a committee of Deans to study the problem at Penn State and make recommendations. The Committee on Telecommunications Funding focused on funding needs and services provided by the ITS units of Telecommunications and Networking Services (TNS) and Security Operations and Services (SOS). An underlying assumption during this effort was that Penn State must have a reliable, secure and robust core network with all that implies, yet at the same time, provide the flexibility for individual units to invest in local networking capabilities as they deem best for their own need.

The Committee determined that a new budget model was needed in order to achieve both of these goals over a five-year period. The senior management of the University has approved the Committee's recommendations.

The approved plan that was recommended has a series of principles that were developed and adopted to guide the formation of a new budget model. Those principle include:

• Faculty, students and staff should have access to information services and capabilities that are close to the advancing frontier of technology.


• Equivalent technology and capabilities should be provided at all campus locations of the University.


• Information technology should be focused to improve instructional services as rapidly as possible.
• Services that provide a common good should be centrally funded, including infrastructure that benefits everyone, and capabilities that are most effectively provided centrally for the entire University.
• Units must provide or procure special capabilities required to meet their exceptional needs.
• Auxiliary and service units, and external groups on campus should pay the full cost of information services provided through the University.

TNS "Common Good" and "Individual Good" Service Categorizations

Moving from a primarily cost recovery business model to a hybrid central/cost recovery model, the principles outlined above led to the creation of two broad categorizations for TNS services and business model: "Common Good" and "Individual Good."

Common Good services will be funded through central means, while individual Good services will be charged to individual units using them.

The following are examples of services that fall under each group:

*The Cable/Wiring Infrastructure "Common Good" component is intended to cover two specific items: the replacement of existing Type 2 cable in buildings and the extension of multimode and single-mode fiber to buildings. This "Common Good" service categorization also includes some funds for miscellaneous duct bank upgrades not associated with new construction or major renovation projects. New construction projects and re-modeling projects will continue to have infrastructure costs as part of the project, including extension or relocation of required outside plant services (duct bank, copper, and fiber). Units who wish to proceed with extensive cable/wiring projects earlier than the scheduled time frame may do so at their own expense.

Funding Sources for TNS Business Model

Support of Common Good Services

A variety of funding methods will be used to support the Common Good services. Some Individual Good service rates will be reduced providing funds that will be permanently transferred from individual unit budgets to a central IT budget. A limited amount of new student IT fees will be used to partially support this new model, and a new per-person fee will be assessed on all full time faculty and staff (excluding Technical Services staff) to unit budgets. These will result in modest increases in cost to individual units but provide for continued improvements to Internet Access, Computer and Network Security, and Core Infrastructure and Backbone Network upgrades.

Support of Individual Good Services

Individual Good services still follow the cost recovery business model. In general, individual units are charged for the one-time procurement/installation of systems (e.g., LAN), monthly recurring expenses (e.g., dial-tone, voice mail, equipment maintenance), and relevant usage expenses (e.g., long distance) for the Individual Good service.

Frequently Asked Questions

1. Why is this change being made?
2. How was the new budget model developed?
3. What were the findings of the Committee on Telecommunications Funding?
4. What are the basic components of the new budget model?
5. What is the source of the additional central funding required by the new budget model?
6. What is the transfer of dollars funding source listed under the new budget model?
7. Are all budgets being treated the same for the transfer of dollars required under the new budget model?
8. Are all campus locations affected by the new budget model?
9. Will there be a change in the monthly charge for TNS-maintained LAN's?
10. How is the $100 per-person fee that is assessed to units counted?
11. What is the impact of the new budget model on my specific unit?

1. Why is this change being made?
   The current budget model used for telecommunications was established in 1985, when voice services provided by regulated monopolies were predominant. Over the past few years, technology and regulations have changed considerably. The current model will not sustain the investments required for new networking needs.

2. How was the new budget model developed?
   In late 1999, the Provost appointed a committee of deans to review telecommunication needs and recommend a budget model to meet those needs.

3. What were the findings of the Committee on Telecommunications Funding?
   The Committee determined that the current model was too dependent on traditional telephone service charging, and that these services are declining in both use and margins. It also found that increased security needs as outlined by Security Operations and Services should be folded into any new telecommunications model. To help develop a new model, the committee established a set of guiding principles to use in crafting a new budget model.

4. What are the basic components of the new budget model?
   The new model encompasses services provided by Telecommunications and Networking Services, and Security Operations and Services. These services were categorized into either Common Good or Individual Good. Common Good service will be centrally funded while Individual Good services will be charged to the unit using them.

5. What is the source of the additional central funding required by the new budget model?
   There are four sources:
   1. New central allocations.
   2. A portion of the student IT fee.
   3. A new fee, assessed to each unit, based on all full-time faculty and staff of $100 per year per person. (The new fee will not be assessed against Technical Services or wage-payroll staff)
   4. A transfer of dollars from all General Funds Budgets and Auxiliary/Service Budgets.
      

6. What is the transfer of dollars funding source listed under the new budget model?
   Some of the costs now incurred with services offered by Telecommunications and Networking Services will become centrally funded. This will allow TNS to lower the service charges associated with these services. A projection of these decreased charges, using actual charges as billed in FY 99-00, was made. The difference between the actual billed amount and the projected amount will be moved from each budget and added to the new central source of funding.
7. Are all budgets being treated the same for the transfer of dollars required under the new budget model?
   No. All academic budgets will have 75% of the charge reduction difference transferred to the central funding. All non-academic budgets will have 100% of the reduction difference transferred to the central funding.
8. Are all campus locations affected by the new budget model?
   Yes. This new model applies to all campus locations. There are different billing methods and charges in effect at different locations so some aspects will differ based on location. The $100 fee will apply to full time personnel at all campus locations, and the method of transferring dollars will be the same everywhere. Since some campus locations pay directly for certain services, the amount of reduced charges will vary from location to location.
9. Will there be a change in the monthly charge for TNS-maintained LAN's?
   No. Since local area networks are considered an individual good, monthly maintenance charges for TNS-maintained LAN's will remain the same. For LAN's installed under the $15.8M Telecommunications Infrastructure Project, the charge is $4/month/port. For all other TNS-maintained LAN's, the charge is .75%/month of the total cost of the installed LAN components, plus $10/month if the LAN is under full TNS maintenance.
10. How is the $100 per-person fee that is assessed to units counted?
    The annual $100 fee is based on the number of full-time faculty and staff in each unit as of September 30, 2000. Technical Services staff are excluded from the count.
11. What is the impact of the new budget model on my specific unit?
    Unit-specific budget information will be addressed with Budget Executives during April and May to help them facilitate internal planning as well as to help them to better understand the total impact of the new budget model on their specific area/budgets.

The Pennsylvania State University © 2004. All rights reserved. Alternative Media Statement and Nondiscrimination Policy
This site maintained by Telecommunications and Network Services, a unit of Information Technology Services.
Provide site feedback to TNSWebmaster@mail.tns.its.psu.edu. 07/27/07