Analysis

The Infrastructure Investment and Jobs Act will invest billions of dollars in rural communities across the country. Supporting Americans living in rural areas remains a top priority for the Biden Administration, and the law delivers on the President’s promises to work toward delivering affordable, high-speed internet, safe roads and bridges, modern wastewater systems, clean drinking water, reliable and affordable electricity, and good-paying jobs in every rural community.

For years the industry used the word redundancy when talking about how we protected our networks. The primary aspects of redundancy are having multiple fiber routes in place so that areas don’t become isolated if a fiber is cut or having enough spare electronics to quickly recover from problems. But in recent years, we’ve started to talk about resiliency, which encompasses redundancy but means a whole lot more. Resiliency means taking proactive steps to prepare against reasonably expected problems of all sorts.

I was asked an interesting question recently: will fiber help the big telecom companies turn the corner to success? It’s a good question when looking at telcos like Frontier, Windstream, Lumen, and any others who are late to the game for converting copper to fiber. There are a lot of factors that will come into play, so the answer is likely to be different by company. On the plus side is a general consensus by many households that fiber is the best technology. There is a sizable percentage of homes in any market that will move to fiber given a chance.

On February 25, 2022, the National Telecommunications and Information Administration (NTIA) announced the grantees which will receive a collective total of $277 million in Broadband Infrastructure Program funding. NTIA has since published further information on the 13 Broadband Infrastructure Program grantees.

With an unprecedented amount of federal funds to build broadband networks flowing into individual states, lawmakers in some states are doing the bidding of the big monopoly Internet Service Providers and potentially blowing a once-in-a-generation chance to invest in the locally-accountable infrastructure that offers the best chance to bridge the broadband gap for millions of families once and for all.

AT&T and Verizon – two of the nation's biggest 5G mobile network operators – own extensive fiber holdings around the country, and both argue that such ownership is critical to their long-term success. T-Mobile and Dish Network, on the other hand, are building extensive 5G mobile networks (though Dish hasn't yet switched on commercial services) without owning any fiber whatsoever. And, according to both Dish and T-Mobile, that's just fine. So, which side is right?

The current Congress stuck almost 5,000 earmarks costing almost $9 billion into the $1.5 trillion budget that was recently signed by President Biden. An earmark is when each member of Congress gets to designate funds directly to pet projects. There is no reason that earmark spending can’t be used for broadband infrastructure, and it’s likely that there were broadband construction projects buried inside of the 4,962 projects that were just funded this way. The idea of getting an earmark for broadband is intriguing because I’m not sure anybody knows what rules would apply.

The short time frame for many state grants is out of synch with the reality of the way that internet service providers (ISPs) can add customers to a network. Grants generally pay only for the capital cost of assets. The largest cost for fiber grants is likely the cost of the fiber running up and down streets to pass customers. The second largest cost in many grants is the fiber drops that connect from the street to customers. In short, an ISP has two concerns with a grant with a short timeframe. Make sure to ask for enough money upfront.

Dish Network has been quietly building out its new cellular networks and plans to launch in 25 major markets and over one hundred smaller markets before June 2022. This company is shooting to stay on track for its commitment to the Federal Communications Commission to cover 20% of the US population by this summer and 70% by June 2023.

Several core recommendations emerge from this history of broadband policymaking: