Incoming Congress, administration could revamp direction of BEAD from sell to buy side subsidization

Longtime telecom blogger Doug Dawson speculates the $43.45 billion Broadband Equity, Access, and Deployment (BEAD) Program funded by Infrastructure Investment and Jobs Act (IIJA) of 2021 could see its appropriation reduced to $10 billion under the incoming Congress and Trump administration. Dawson further postulated that reduced allocation could instead of subsidizing fiber to the premise (FTTP) landline delivery infrastructure go toward Starlink LEO satellite service.

If there is a big political movement to undo President Biden’s signature accomplishment [the IIJA], then infrastructure spending of all types could be curtailed, and it’s naïve to think that broadband spending couldn’t get swept into a bigger effort to cut spending. It’s not hard to imagine cutting the program to $10 billion, giving the money to Starlink, and declaring rural broadband to be solved.

https://potsandpansbyccg.com/2024/11/12/the-new-administration-and-bead/

Since LEO-delivered Internet requires far less infrastructure than deploying fiber delivery infrastructure, it calls into question whether subsidies are even needed to deploy it to reach homes and small businesses lacking fiber connections. They recover their costs through relatively high service charges. For example, Starlink runs $120 per month with a one-time hardware cost of $499.

If Dawson’s $10 billion scenario comes to pass, we could see that reduced appropriation converted from sell side to buy side subsidization since households lacking fiber access could find those costs unaffordable, limiting access and impeding BEAD’s programmic goal of promoting universal service.

But LEO service may come with some significant limitations since it requires a clear sky that may not be available at homes and small businesses in heavily wooded areas. "If they try putting BEAD mostly in the LEO basket, lumberjacks will be replacing drilling crews," writes Chris Scharrer of DCS Technology Design. "The idea of Starlink being a cure-all for the nation is literally, not seeing the forest through the trees."