Multiple factors align against universal FTTP over near term

Each state and territory then must set up and administer its own broadband infrastructure grant program using the statutory framework to distribute the money to the internet service providers that will be building the networks. Importantly, Congress directed that each state and territory must ensure every broadband serviceable location in its jurisdiction gets connectivity as a condition of receiving the bulk of BEAD funding. (Emphasis added)

https://broadbandbreakfast.com/tim-stelzig-a-new-approach-to-connecting-all-americans-to-the-internet/

The Infrastructure Investment and Jobs Act of 2021 (IIJA) as the 1996 Telecommunications Act before it states public policy intent of universal advanced telecom service. The IIJA placed responsibility on the states to implement it. The IIJA appropriated $43.45 billion for delivery infrastructure to the states as “once in a generation” seed funding under the law’s Broadband Equity and Deployment (BEAD) program.

BEAD required states to develop Five Year Action Plans with timelines to achieve universal service. It also requires states to "rigorously explore ways” to cover the cost of advanced telecommunications infrastructure builds eligible for BEAD subsidies with other sources of funding. BEAD program rules developed by the Biden administration require they include “a comprehensive, high-level plan attain universal service.”

As the plans were filed with the National Telecommunications and Information Administration (NTIA) in 2023, it became clear states would have to come up with significant organic funding sources. Oregon’s plan indicated the state would need nearly five times its $689 million BEAD allocation to build universal fiber to the premises (FTTP) infrastructure at an estimated cost of $3.3 billion deployed over a five year period.

Similarly, California’s plan stated the Golden State is unable to assure timely construction of universal FTTP infrastructure – estimated to cost $9.78 billion including infrastructure hardening in areas with high wildfire risk – because less than half that amount is available as federal and state subsidy funding. The plan offered no strategy to bridge the gap such as a state bond measure.

Consequently, states and also the federal government that assumed office this year are looking to wireless delivery technologies such as fixed terrestrial wireless and low earth orbit satellite. That has sparked controversy over whether dollars appropriated under the IIJA are best invested funding durable infrastructure in line with the bill’s infrastructure focus or emphasizing service delivery to get more American homes connected.

The likely outcome of this debate as far the as the IIJA is concerned will favor the later. The IIJA’s telecom infrastructure funding formula isn’t oriented to infrastructure despite the bill’s purpose and title. Rather, it’s based on need and specifically deepening bandwidth constraints that exist because FTTP has not timely been deployed to replace legacy copper telephone delivery infrastructure incapable of handling ever increasing Internet protocol-based service demand. Only half of all U.S. households had access to FTTP connections in 2024 according to the Fiber Broadband Association’s 2024 Fiber Deployment survey by RVA LLC Market Research & Consulting (RVA).

While the Biden administration nevertheless prioritized funding FTTP, impatience with poor service options in less densely populated areas that have existed for many years as well as short term fiscal conservatism – are combining with the IIJA’s service orientation and the lack of adequately funded state plans to attain universal FTTP to mitigate against universal FTTP over the near term. Another major factor is deteriorated utility poles that increases costs via replacement or resort to more costly underground infrastructure as well as patchwork of pole ownership and access hurdles.