Negative manifestations of market-based vs. publicly owned advanced telecommunications infrastructure policy

• Lack of coordinated federal advanced telecommunications infrastructure policy. 
• Highly fragmented deployment of fiber only where most profitable, highest ARPU.
• Advanced telecommunications marketed as “broadband” and sold in individually priced speed tiers.
• Widespread complaints and media coverage of poor access, “slow speeds” high monthly cost, very expensive connection fees quoted by cablecos.
• Localities adversely impacted by advanced telecommunications infrastructure deficits, attempt to address on their own with federal and state grants amid constituent tax/fee resistance due to adverse demographics/socioeconomics. Spawns cottage industry of consultants conducting feasibility studies and high level estimates. Vast majority result in no infrastructure construction or commitment to serve all addresses.
• One time, highly restricted federal and state grant programs instead of permanent high-cost subsidy mechanism.
• No federal or state policy of universal service. Universal service legislation does not advance. Years of dashed political promises of universal service. Sloganeering in lieu of actionable policy.
• Issue muddling, deflection/distraction from infrastructure to secondary issues:
• "Broadband adoption"
• Digital equity/digital skills
• Net neutrality
• Incumbent protectionism via broadband mapping, inflated service area and throughput claims, “ground truthing” speed tests.
• Reliance upon interim technology (DSL over copper) wireless technologies (fixed and mobile wireless, satellite) vs. FTTP.
• Capitulation to investor-owned incumbent provider control of telecom policy. Influence dominates over merits of policy that allow minority shareholder interests to prevail over broader public interest.
• Misapprehension: Complaints of market “monopolies” that fail to recognize telecom infrastructure like other utilities functions as natural monopoly. Feeds into privately owned provider paradigm that advanced telecommunications infrastructure a competitive market and government should therefore not own advanced telecommunications infrastructure.

States should use BEAD mandated coordination with localities to build support for bond funding for universal FTTP, rapid permitting

The National Telecommunications and Information Administration’s (NTIA) Broadband Equity, Access and Deployment (BEAD) program 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 also charged states with developing strategies to ensure universal access as part of their required Five-Year Action Plans due this year.

"The reality is, if we're going to connect every American, including the tens of millions of Americans who now don't have the internet, we're going to have to lay fiber all across this country,” said U.S. Department of Commerce Secretary Gina Raimondo, whose department oversees the NTIA and BEAD. While the Infrastructure Investment and Jobs Act (IIJA) of 2021 appropriates $42.5 billion for advanced telecommunications infrastructure, it won’t achieve this alone. As BEAD guidance notes, states and regions within them are going to have to come up with additional funding strategies such as long term bonds to cover the capital construction costs and potentially initial operating costs of publicly owned fiber in order to ensure universal, affordable access and further digital equity. Publicly owned fiber is particularly needed given the reduced likelihood private, investor owned providers will be able to profitably offer service affordable to lower income households.

States will also have to gain the cooperation of local governments to ease permitting of advanced telecommunications infrastructure. “Eligible Entities and their political subdivisions are strongly encouraged to remove time and cost barriers associated with BEAD projects, including by expediting permitting timelines and waiving fees where applicable, where doing so does not undermine other critical policy goals,” the BEAD Notice of Funding Opportunity (NOFO) states.

GAO: U.S. lacks national strategy for deployment of advanced telecommunications infrastructure, calls for presidential leadership

In a statement this week, the U.S. General Accountability Office (GAO) underscored a report it issued in May 2022 finding the United States lacks a national strategy to guide the deployment of advanced telecommunications infrastructure. Instead, the report found, there are numerous, uncoordinated subsidy programs administered by multiple federal agencies.

The GAO statement once again called for presidential leadership. The Executive Office of the President should develop and implement a unified national strategy, noting as of May 2023, the recommendation has not been implemented. “[A] national strategy could guide the efforts of states and localities implementing programs in coordination with the federal government,” the GAO said. “The roles of states have become even more important as they receive and then distribute funds from new federal broadband programs administered by NTIA and the Department of the Treasury,” it added. The NTIA’s Broadband Equity, Access and Deployment (BEAD) program has charged states with developing strategies to ensure universal access as part of their required Five Year Action Plans due this year.

However, $42.5 billion BEAD allocates to states to subsidize up to 75 percent of the cost of constructing advanced telecommunications infrastructure in areas where it is lacking could run into complications. That’s because eligibility is based on highly granular areas – that could be as small as a few premises -- that might be ineligible for BEAD subsidies because those locations received subsidization from one of many fragmented and overlapping federal programs. Not to mention various state subsidy programs.

We identified at least 133 funding programs—administered across 15 agencies—that can be used to support broadband access, including support for planning and deploying infrastructure, making service affordable, providing devices, and building digital skills. Some of these programs support broadband as their main purpose or one possible purpose, and others can be used for multiple purposes related to broadband. Eligible recipients for these programs range widely and include: internet providers; other private sector entities; nonprofits; tribal, state, and local governments; education agencies; and healthcare providers. Through these programs, federal agencies invested at least $44 billion in broadband-support activities from fiscal years 2015–2020, according to our analysis of agencies’ data.

Given the current lack of an overarching, coordinated strategy ensure universal service, “most of the agency officials and more than half of the nonfederal stakeholders we interviewed said a new national strategy would be helpful,” the GAO stated.