Telehealth Hubs

A telehealth hub is a location that has been established to provide a place to give the public easy access to healthcare. Today’s blog will focus on telehealth hubs in eastern North Carolina, but there are numerous other efforts being launched across the country. ECU Health is a non-profit academic health care system that serves more than 1.4 million people across 29 counties in eastern North Carolina. Formerly known as Vidant Health, the system partners with East Carolina University’s Brody School of Medicine.

ECU Health launched its Health Hub initiative in May 2023 as a way to bring healthcare closer to where people live. The Health Hub effort is concentrated in Pitt, Martin, Edgecombe, and Beaufort Counties, which are the most underserved areas in terms of local health care in the ECU Health footprint. These counties also still have poor broadband and cellular coverage, making it a challenge for residents to use telehealth.

Health Hubs have been strategically located in the parts of these counties that have the highest level of social vulnerability. Each Health Hub is located in a place that has good access to broadband. ECU Health has located telehealth centers in local churches, non-profits, or businesses willing to provide the space. There are now 21 telehealth sites in these counties. Each hub is equipped with necessary devices, including a computer with a webcam and microphone, and vital sign monitors like blood pressure cuffs, pulse oximeters, and thermometers. This equipment allows individuals to have virtual telehealth visits with doctors in the ECU Health system. Each site also has a Health Hub ambassador who helps residents connect with virtual care services and navigate the resources available to them.

Health Hubs are open to everyone in the community. ECU Health also makes these same services available to anybody who has a computer or smartphone and is able to connect from home. The telehealth visits have been priced at $55 per visit, which is often less than a typical insurance copay.

The hubs serve dual purposes. First, they provide a place for people to conduct telehealth visits, which is vital in a region where individuals have trouble with the transportation costs needed to travel to an ECU Health hospital or clinic. ECU Health has already seen that the telehealth hubs have reduced the number of emergency room visits that were made for non-emergency needs.

The Health Hubs are also a gateway to other community resources. They contain easy-to-read guidebooks that tell residents how to access services related to food insecurity, housing, and employment.

Telehealth hubs are a key link to health care in communities at a time when rural hospitals are closing, and there is decreasing local access to doctors and health services. Telehealth hubs are also needed in communities where people either don’t have access to or can’t afford the cost of broadband or cellular service. Systems like ECU Health understood that rural residents often skipped vital health care visits if they couldn’t afford the cost of transportation or the time off work to travel for routine health visits.

Telehealth hubs are not a replacement for rural hospitals, but they are a vital link to health care. We need a lot more networks of telehealth hubs, because without them we’re going to be seeing big swaths of rural America turned into health care deserts.

Have We Given Up on Expanding Rural Cell Coverage?

The number one concern I hear from most rural counties today is no longer broadband connectivity, but the availability of cellular connectivity. While there may be a few exceptions, I don’t know of any rural counties that have good cellular coverage. All that differs among counties is the degree to which they have poor coverage.

At one point, the FCC had a plan to subsidize more rural cell towers that it labeled as the 5G Fund for Rural America. In August 2024, the FCC adopted preliminary auction rules for distributing up to $9 billion to support new rural cell towers, while also issuing an NPRM that asked for industry feedback on several issues related to the new plan. This was going to be funded out of the Universal Service Fund, in what seems like a replacement use for the second round of RDOF that never happened.

Chairman Carr dissented from the 2024 FCC order, saying that he supported the idea of a reverse auction to build more rural cell towers, but he thought it was premature to announce the new plan until the FCC knew more about the disposition of the $42.5 billion in BEAD grants. He thought it was vital that any new rural towers have access to fiber.

Several big things have happened since August 2024. BEAD got delayed when the new administration completely changed the rules and made the states start over. The FCC has also decided to reexamine the Universal Service Fund from top to bottom, and if you read between the lines, the agency doesn’t seem to be a big fan of ongoing rural subsidies. Congress is also supposedly examining a major rework of the Universal Service Fund and said recently they should be able to propose specific legislation soon.

But the biggest change is that there is suddenly huge amounts of money being poured into creating a satellite-based cellular industry. The folks behind that effort are making claims that D2D (direct-to-device) technology will solve the rural cellular issue since everybody will have cell coverage. There are a lot of players suddenly in this space. Not surprisingly, SpaceX / Starlink already has hundreds of satellites in orbit and was recently approved to launch 15,000 satellites. AST SpaceMobile is partnering with AT&T and Verizon. Globalstar originally pioneered Apple’s SOS emergency test service and was recently acquired by Amazon, which recently applied for licenses for 5,105 satellites. Lynk Global has partnered with more than 45 cellular companies worldwide. EchoStar and Viasat have also announced plans to enter the market.

Today’s blog asks if the FCC is now assuming that the commercial sector will take care of the rural cellular issue so they can wash their hands of the issue. I find D2D to be intriguing, but there are still a lot of unanswered questions about D2D’s ability to substitute for local cellular service:

  • Are the D2D providers really aiming to compete where there is no coverage today? SpaceX just paid an astonishing $8 billion for 800 MHz spectrum from Grain Management that is intended for D2D service. But this spectrum is intended to be used at terrestrial towers to reach customers, with the backhaul for the service provided by satellite. This might create a new cellular competitor in urban and suburban markets (or this might be more intended to bring competition to parts of the world where cellular is the only broadband technology). But this application won’t reach any rural customer who is already within range of a cell tower.
  • Can’t Work Indoors. A cellphone transmits at under 0.5 watts of power – the maximum power level set by the FCC. Cell signals lose from 50% to 90% of the signal strength when passing through a wall. While that usually is enough power to reach a cell tower located within 2-3 miles of your house, it’s probably never going to be enough power to reach a satellite.
  • Receiver Limits. Starlink is now achieving data speeds up to 300 Mbps download for home broadband. However, speeds will be far less for an outdoor cellphone due to the tiny size of the antennas. Receivers for Starlink range from 11.75 X 15.7 inches for the Starlink Mini to 22.7 X 20.1 inches for the higher-performance receiver. The typical cellphone has a receiver of around 6.5 X 7 millimeters, meaning that even the Starlink Mini receiver has 2,600 times more surface area for receiving a signal from the satellite than a typical cellphone.

It’s already clear from early tests that this technology is wonderful for providing a connection to 911 for somebody who is outdoors. It seems to work for voice calls. But that’s a far cry from this being a technology that would make rural cell coverage equivalent to urban cell coverage. It’s hard to see this supporting websites and videos, and even so, only outdoors. I fear D2D will deliver ‘good-enough’ connections to allow regulators to decide they don’t need to deal with the issue of rural cellular coverage. But folks who live in rural areas will understand the differences and won’t have much better coverage than they have today.

Courts Invalidate USAC

The Fifth Circuit Court of Appeals ruled last week that the FCC had exceeded its statutory authority  years ago when it established the Universal Service Administrative Company (USAC) to administer the Universal Service Fund.

The case in front of the court involved Consumers’ Research, which challenged the latest FCC calculation of the contribution factor used to establish the fee that telcos pay into the fund. Consumers’ Research had also challenged the FCC’s authority to establish USAC to administer the fund.

To provide some context, Congress established the Universal Service Fund (USF) in the Telecommunications Act of 1996. At that time, after some debate, the FCC decided that establishing a neutral non-profit was the best way to protect the operation of the USF from the impact of politics. It’s hard to understand the Court’s ruling, because USAC never acts on its own and is fully under the control of the FCC. The company is funded out of the fees collected to operate the USF. The FCC has always been free to audit USAC or to change the rules on how it operates.

In day-to-day practice, USAC is truly an administrator. The FCC still establishes the rules for every use of funds. This includes a variety of programs like the E-Rate program for schools and libraries, various programs to support communications for rural health clinics and hospitals, various subsidies that support rural broadband like RDOF and CAF II, and the Lifeline subsidy program that provides a small discount for broadband or cellphones.

USAC doesn’t establish the rules for any of these programs but is tasked with making sure that fund recipients are following the rules established by the FCC, including the ability for USC to audit USF participants. USAC’s primary day-to-day responsibilities are to collect fees to fund the program and to disperse the funds to participants in the various programs.

What does this ruling mean? The FCC has to first decide how it wants to respond to the court ruling. It’s been reported in the press that the FCC says the ruling goes into effect in two months if the agency doesn’t  appeal the ruling. If the FCC appeals the ruling, the most routine outcome would be a court ordering business as usual until that appeal can be heard. It’s not certain that the FCC will appeal the case, and if it doesn’t, things get messy very quickly.

The FCC would have to somehow try to take over USAC functions. The agency is not staffed to do so, which would likely result in chaos. It probably wouldn’t be easy, or even possible, for the FCC to somehow absorb USAC staff.

The companies that pay into the USF would be in limbo because the collection process would be disrupted. I picture legal challenges and confusion and possibly lawsuits related to whether telcos owe fees to the FCC, the federal Treasury, or to nobody. Disbursements from the fund would quickly be disrupted. That would be a major problem for the many entities that draw payments from the $9 billion annual fund. It’s hard to picture what happens when schools can no longer pay their broadband bill or ISPs suddenly stop receiving RDOF or other subsidies. Millions of people would likely lose their monthly billing discounts from Lifeline. USAC also has extensive audit powers, and it’s not clear that the FCC could insert itself into existing audits.

The only alternative to the above chaos would be if Congress quickly stepped in to provide some way to keep the USAC functions going. That sounds like a huge challenge in a lame duck session during the holidays. Stay tuned, because this could turn into something extremely messy.

Ookla Speeds by State

Ookla issued one of its periodic reports that looks at broadband speed statistics across the country and ranks the states in terms of overall broadband speeds. The report uses speed test data at the end of the second quarter of 2026.

https://www.ookla.com/research/reports/50-us-state-broadband-speed-report-1h-2026-access-form

As usual, this kind of report has to be taken with a grain of salt since it averages all broadband speed tests from all ISPs and all technologies, so there are a ton of factors that influence a state’s broadband speed. Issues like the mix of people electing slow versus fast packages, the mix of technologies and ISPs, and the degree of competition all impact a given state’s average speed.

In general, speed tests also tend to understate ISP performance. Speed tests not only include customers with good broadband speeds that performs as intended, but speed tests capture the slower speeds due to WiFi issues within customer homes. I’ve always wondered if people having broadband problems take more speed tests than those who have good performance. The good news is that these kinds of issues affect customers everywhere, and so probably average out when comparing states.

The good news across the country is that broadband speeds are improving. When Ookla first published this report for June 2024, there were only ten states with at least 60% of speed tests above the FCC’s definition of broadband speed of 100/20 Mbps. In this latest measurement in 2026, only four states failed to meet that threshold – Alaska, Wyoming, Wisconsin, and Montana. Thirteen states now have at least 70% of speed tests beating the FCC definition of broadband. That’s pretty significant improvement in just two years.

It’s not surprising that the top-performing states in the past, like Connecticut and New Jersey, didn’t see much improvement in broadband speeds – mostly because the states have had a high percentage of homes with the option to buy gigabit broadband. The state with the biggest improvement from 2025 to 2026 was Maine, which grew to 63% of households achieving 100/20 speeds or faster in 2026 compared to 57.6% in 2025.

Ookla just started to track Starlink speeds in 2025 but is already seeing some big improvements in speeds. One of the interesting statistics in the reports is Starlink speeds by state. There are several factors that influence Starlink speeds the most. One is tree cover, and sure enough, states like West Virginia, Tennessee, and Arkansas are near the bottom of the list of state speeds, while plains states are near the top. But the other issue is that Starlink doesn’t have the same coverage everywhere. It’s not talked about a lot, but there are different numbers of satellites in different orbit paths. I assume Starlink puts more satellites in orbits that cross the most potential customers – and we can’t forget that the company makes that decision on the worldwide market, not just the U.S. There may be other issues affecting Starlink speeds – perhaps areas with greater numbers of customers have slower speeds.

Overall, Starlink speeds are improving. In June 2025, no state had 50% of Starlink customers meeting the FCC 200/20 Mbps definition of broadband. In the 2026 report, seventeen states now exceed 50% of speed tests faster than 100/20 Mbps. The state with the biggest improvement was South Dakota, which now has 58.2% of customers exceeding 100/20 Mbps, compared to 37.1% a year earlier. Ookla notes that the size of the sample in South Dakota is so small that both numbers might not be reliable.

Finally, Ookla looked at rural broadband performance. Only three states didn’t see an improvement in rural speeds between 2025 and 2026. One can presume that much of this is due to the broadband networks that were being built as a result of ARPA and CPF broadband grants. Maine, Wyoming, Vermont, and Wisconsin saw the biggest improvements in rural speeds.

Hourly Broadband Billing?

Starlink recently announced plans for some interesting billing options. First, they will consider allowing customers to resell bandwidth to their neighbors by setting up small local grids. They are also considering allowing for billing by the hour, day, or week. What’s interesting about this is if this introduced in the U.S., it would allow for broadband billing in ways that already happen in many other parts of the world.

As an example, I’ve done some work in Nigeria, where customers struggle to afford broadband, and only businesses and relatively wealthy people buy unlimited monthly plans. The vast majority of broadband is provided by cellular carriers. There are a number of options for buying broadband for short periods of time. Unlike here, there is no loyalty to a specific cellular company, and a customer can choose to buy what is commonly called a daily plan from multiple cellular companies, and many people carry multiple SIM cards. These daily plans are most commonly sold in one- or two-day increments. The bandwidth on the daily plans is relatively small, with a daily cap of something like 240 MB, which might support WhatsApp messaging (which everybody uses), emails, or light browsing for things like shopping. Carriers also sell more robust data packages. For example, a customer can buy a plan for a specific app like TikTok or Facebook/WhatsApp for the day or month. Carriers also sell night plans by the day that provide enough bandwidth to download movies when the network isn’t busy.

There is a growing amount of fiber being constructed in Lagos and other cities. In Lagos, the government builds and leases out a conduit network to lower the cost of market entry for ISPs. Fiber networks deliver slower speeds than in the U.S. but are still far more robust than cellular data. Fiber providers also sell daily or weekly plans.

I can’t recall ever hearing of anybody in the U.S. trying hourly, daily, or weekly billing before. I recall some municipal Wi-Fi networks that tried to sell WiFi access that way to visitors and most failed at it. In the early years of airport WiFi, short-term billing plans were also being pushed.

If Starlink markets short-period billing in the U.S., it is a tacit recognition that a lot of people can’t afford a monthly subscription. Selling broadband by the day is broadband rationing and will lead to the kind of customer behavior I’ve witnessed in Nigeria, where customers save up broadband tasks for when they buy a daily plan. While this is better than not having broadband, it’s second-class broadband for those who can’t afford a full-time broadband subscription. Considering the number of households struggling with paying essential bills, there is likely a market for this.

The idea of allowing a customer to become a hub and share with neighbors is interesting. This is already a lot more common than you might imagine. It’s common for neighbors in apartment buildings to split a broadband bill and share WiFi through the walls. I know of examples of neighboring houses sharing broadband by running a cable or setting up a point-to-point wireless link between homes. Starlink is suggesting that people formalize this, including providing a discount for the home that becomes the main hub.

This is more of an urban idea than a rural one since homes need to be relatively close to share the signal from a common Starlink receiver. This could be a way for Starlink to crack the urban market by allowing several neighbors to share a connection to save money.

Starlink is clearly familiar with these kinds of models since it works worldwide. The company would have little chance of competing in Nigeria and many other African countries if it doesn’t allow for the way that people already buy broadband. It’s going to be interesting to see if the company really pushes these two ideas in the U.S.

Is Regulation Still Shaping Competition?

I was recently reading some older regulations related to copper, and this reminded me how regulation was used for many years to shape competition, or to be more precise, regulation was used to protect monopoly providers from competition. It got me to ask the question if regulation is still doing the same thing.

Telephone and related services were heavily regulated since the early days. Some states regulated telephone service as early as the 1870s, at a time when some cities saw a mad confusion of competitive copper wires being constructed like the picture on this blog in downtown Pratt, Kansas. Federal regulation of telephone began with the Mann-Elkins Act in 1910, which classified telephone companies as common carriers. In the 1913 Kingsbury Commitment, AT&T agreed to interconnect with independent telephone companies. In 1934, the Communications Act of 1934 moved telephone regulation into the newly formed FCC. States regulated telephone rates until the early part of this century, when most states backed out of the ratemaking role. The FCC and states together regulated massive parts of the telephone industry, and some of those regulations remain, but are dying with the dismemberment of copper networks. Telephone regulation is fading away with the death of copper networks. VoIP has largely been deregulated for years, although a few grant programs have required grant recipients to offer voice.

Cable companies began to be built in the 1960s and 1970s and were largely unregulated at first. Many cities and some states regulated cable companies through franchise agreements in order to stop a profusion of cable companies trying to get into the rights-of-way. The federal government stepped into cable regulation in 1984 with the Cable Communications Policy Act that explicitly recognized the authority of local governments to manage cable franchises and solidified cable companies as exclusive monopolies.

There is a lot of sentiment to deregulate cable companies to put them on the same footing with streaming providers. Cable companies would love to get out of regulations that force them to always carry local broadcast TV stations. Cable companies would really like to demolish the standard where they pay hefty franchise fees to use local rights-of-way that are greater than other users of the same facilities. It’s likely that cable regulations will eventually die as the percentage of the people who buy linear cable TV continues to decrease.

Broadband has only ever been saddled with minor regulation, although you would think they are regulated heavily by listening to the biggest ISPs. There has never been any attempt to regulate rates, although there are regulations related to consumer billing rights, privacy, and things like broadband labels.

So what’s left? Cell carriers are not heavily regulated outside of the rules that define how they can use any particular slice of spectrum. There are minor regulations related to consumer protection, and public safety considerations like Kari’s Law. The cell carriers didn’t need any regulatory approval to launch the massive FWA home broadband business, and just started to do it without any FCC approval.

Satellite companies are regulated in terms of the orbits they are allowed to use and the frequencies they can use to communicate between satellites and Earth. But there is very little regulation of the broadband products they offer, and the FCC and the Space Bureau have recently blessed using satellites for direct-to-device cellular service.

The one interesting place where regulation still rears its head is in the way that federal agencies decide how to spend federal broadband funds. The act of picking winners and losers took a serious turn when NTIA declared that satellite broadband was equivalent to terrestrial broadband. Declaring satellite to be equivalent to terrestrial technologies is a convenient way for NTIA to brag that they have finally solved the rural digital divide. NTIA has also decided that any electric cooperative that wants BEAD funding must submit to FCC pole attachment rules, A move in the opposite direction from light-touch regulation.

After thinking about it, I conclude that other than in the world of grants, there is almost no effective regulation in place today that favors one technology over another. Folks in the industry tend to focus on programs like BEAD that get a lot of press but forget that the locations covered by BEAD are a tiny fraction of the total homes in the country. For everything other than grant-funded networks, the trend seems to be toward reduced regulation over time.

The WiFi Dilemma

A recent article in Telecompetitor describes a new white paper from Parks Associates and TechSee that reports that broadband customers with poor WiFi are six times more likely to say that they will change ISP. This finding documents something that all ISPs know and is what I call the WiFi dilemma. ISPs can deliver great bandwidth to the home, but customers judge them by the performance inside the home.

The report is based on 8,000 surveys of Internet households that were conducted in late 2025. The results are stated in terms of the net promoter score (NPS), which is a standard used in many industries that is based on the degree to which customers would give a good rating of a company to their friends and neighbors.

The results of the survey are sobering for any ISP. Customers who have WiFi dead spots in their home had an NPS of -17. Customers with slow perceived download speeds had an NPS of -19. Customers who had a negative customer service experience had an NPS of -19. Customers who had all three problems had an NPS of -28.

To put those numbers into perspective, the average broadband customer without any of these problems had an NPS of +22. That’s a big difference compared to customers with problems, because a positive NPS means a customer has an overall positive opinion of an ISP, while a negative NPS means they don’t. Most importantly, 43% of customers with all three problems said they were likely to change ISPS, while only 7% of customers without these problems were thinking of changing ISPs. I wrote a blog recently that talked about how poor economics had increased churn rates across the country. But poor broadband performance has always been a major cause of churn.

Why did the blog header call this a WiFi dilemma? If an ISP requires customers to use its WiFi router, then any WiFi issues inside the home are going to be completely blamed on the ISP. If ISPs allow customers to bring their own WiFi routers, ISPs are still going to be blamed when those routers are out of date or configured poorly.

ISPs face myriad WiFi issues with customers. A lot of houses need WiFi extenders or a mesh network to reach all parts of the home, and a lot of ISPs don’t help customers go through the painstaking process of placing extenders in the optimum locations. Even when an ISP helps a customer set up a WiFi mesh network to work well, customers change things to disrupt the WiFi. One of my favorite stories is from a technician who visited a home complaining about poor bandwidth, only to find that the homeowner had put the router behind a heavy metal file cabinet.

Customers often have WiFi problems that are related to the performance of the devices like TVs or computers that are connected to the WiFi. Customers don’t understand how the WiFi signal weakens with distance and from passing through walls and are unhappy when speeds are slower at the far ends of the house from the WiFi router. Technicians get frustrated when they find customers using WiFi routers that are several generations old – that might have been bought at a yard sale.

The dilemma ISPs face is how much effort to put into keeping customers happy with poor WiFi. Truck rolls are expensive and can’t solve some of the issues. Helping customers remotely to solve WiFi issues is time-consuming and can be frustrating for both parties.

Unfortunately, many ISPs have trained customers that speeds matter more than performance, so these issues are likely to get worse as WiFi routers get older and customer expectations grow higher. I know a lot of ISPs who deal with this issue well, through dedicating technician time to keep customers happy, but many ISPs have decided they can’t afford that effort.

How Stable is the Internet?

DE CIX, which claims to be the world’s largest Internet, cloud, and AI exchange operator, surveyed 400 of the largest IT and telecom infrastructures in the U.S. and the U.K. and reached some troubling conclusions. While 96% of those surveyed felt comfortable about the reliability of their own network, the average response was that network operators expect to spend an average of 11.5 hours per week over the next two years resolving network connectivity issues. That’s more than a workday every week diagnosing connectivity issues. One-tenth of respondents spend between 20 and 41 hours per week dealing with connectivity issues.

Just under half of the IT teams surveyed already spend more than ten hours per week troubleshooting cloud connectivity issues. The most typical problems reported include downtime or reliability issues (26%), latency or slow performance (28%), and security vulnerabilities/DDoS attacks (27%).

When asked to list their biggest concerns over the next year, the IT teams listed: latency (28%); security vulnerabilities (27%); downtime and reliability (26%); cost of connectivity (24%); data sovereignty (23%); staff expertise (22%); and visibility into data flows (20%).

The cost of network outages can be staggering. According to a study released in July by Gartner and the Ponemon Institute/Emerson, the losses for an outage for various industries is:

  • Enterprise & Data Centers: $300,000 to $540,000 per hour (with major incidents exceeding $1 million).
  • Finance & Banking: $1 million to $5 million+ per hour due to high-frequency trading and continuous transactions.
  • Auto Manufacturing & Industrial IoT: 2.3 million per hour due to assembly line freezes.
  • Retail & E-Commerce: $1 million to $2 million per hour in direct lost checkout revenue.
  • Healthcare & Hospitals: $474,000 to over $3.2 million per hour.
  • Small-to-Medium Businesses: $8,000 to $25,000 per hour.

DE CIX says these findings are particularly troubling in a world where many businesses and applications are increasingly reliant on AI, which needs low-latency uninterrupted connections. It seems likely that as AI becomes more prevalent, the impact of outages will be more widespread and cost more than estimated above.

The big Internet network carriers all brag about their reliability, but in a world where large multi-hour outages are becoming routine, there is nobody around who is delivering 5 nines (99.999%) reliability – the long-time standard for a high-quality network connection. I still see backbone contracts that guarantee major uptime, but every such contract now comes with wiggle room language that says that the carrier selling you a circuit is not responsible for outages caused by somebody else.

I’ve written before about the increase in big network outages. Verizon has already had two major outages this year, one in January and one in August. We’ve seen the negative results of major outages. Airports shut down. Numerous businesses stop functioning.

As good as our backbone networks are, they are complex, and network connections must pass through multiple nodes to cross the country. I think it would be ironic if the biggest Achilles’ heel of AI turns out to be the long-haul fiber networks and the Internet hub system in the country.

Price Competition

Maybe for the first time ever, we’re seeing some real price competition affecting the largest ISPs. The big ISPs have seen competition in some markets for the last decade, but in many markets, competition really seems to be making a difference.

Fierce Network recently quoted Comcast CFO Jason Armstrong as saying that he is seeing irrationally low prices from some fiber overbuilders who are selling gigabit broadband for as little as $30 – $40 per month. He says that it costs Comcast as much as several thousand dollar to convert an HFC customer to fiber, and that he can’t understand the rationale behind selling fiber broadband that cheaply.

He still said in the same article that he doesn’t think that customers will leave Comcast broadband to switch to FWA cellular wireless. I’m a bit mystified by that statement. The three FWA carriers have been adding a million new customers per quarter to FWA, and those customers have to come from somewhere. Ookla noted in a recent article that 70% o FWA customers are in urban and suburban areas, and it’s hard to believe that a lot of those customers aren’t coming from a cable company. I think FWA is succeeding in urban areas because of price. A customer that bundles FWA wireless with a cell plan can buy home broadband for as little as $35 per month. In today’s tight economic times when people are getting price conscious about everything, that seems like a significant savings for a household. FWA speeds aren’t terrible and customers within a mile of a cell tower can routinely see download speeds between 100 Mbps and 300 Mbps, and faster in some markets.

Competition is also forcing marketing moves by other big ISPs. Verizon recently announced that it is going to bundle fiber home broadband with cellular service on a single bill. I bought FiOS fiber from Verizon in 2007 and I have been wondering since then why the company didn’t bundle the two services. At that time, I had AT&T cellular, and I would have considered changing to Verizon if they had offered me an incentive – but no offer ever came.

I understood in 2007 why Verizon didn’t offer a bundle. Verizon was structured in distinct product silos, and the fiber FiOS, the copper DSL, and cellular businesses each operated separately. When Verizon launched fiber FiOS it didn’t even buy voice from the legacy telco and installed its own new softswitches. It’s taken the company twenty years to finally decide that bundling could be beneficial for customers and the bottom line. For the last five years, Comcast has been doing well bundling broadband and cellular in Verizon markets, and its still taken this long for the Verizon to fight back with its own bundle. One thing I tell clients you can always count on with the big telcos is that they are the exact opposite of nimble. Perhaps that’s starting to change a little.

It’s also possible that the day will come when satellite joins the competitive fray. Starlink is not a serious threat in urban areas today because of a capacity issue and the number of customers it can handle in a given area. Starlink speeds are also slower than the other urban technologies. But this might change when Starlink launched enough next-generation V3 satellites to improve speeds and capacity. And nobody knows what’s going to happen to the satellite market when Amazon LEO finally joins the fray. If Amazon decides to compete on price, it will put a lot of pressure on Starlink to match – and there are urban customers who might be willing to buy satellite broadband if the price differential isn’t a lot. There are already some urban folks buying Starlink because of its mobility. I know several people who buy Starlink so they can take their broadband along with their camper, and they use it as home broadband when they are back home.

Five years ago I predicted that broadband would routinely be priced at $100 or more, and there are noncompetitive markets today where that is the price. But there are a whole lot of markets now, where prices are a lot lower than that. Of course, none of the big companies price strictly by market any more – they price by customer and neighborhood, so what we’re really likely to see are competitive and non-competitive neighborhoods in cities, with my bet that the low-income neighborhoods will be paying the most for broadband.

New BEAD – Much Ado About Nothing

In my opinion, the BEAD grant program has been a rolling disaster since it was introduced. We saw how a good grant program works when the Capital Project Fund program operated by Treasury quickly dispersed infrastructure money and put it to use. Both programs were authorized around the same time, yet most of the projects funded by CPF are completed, or will be soon since a few projects got an extension until next June.

By contrast, BEAD construction has barely started. There are numerous reasons for BEAD delays, with the most recent delay when NTIA lost a year when it switched to the Benefit of the Bargain rules that drastically halved the funding awarded for infrastructure.

One of the original elements of the BEAD legislation was that money that wasn’t spent on infrastructure would be rolled into what the legislation termed non-deployment funds, which were intended to support broadband functions that supplemented and aided broadband. Many states expected to spend most or all of their BEAD funding on infrastructure, but after the Benefit of the Bargain, there is now over $21 billion of non-deployment. NTIA has been promising for the last year that it would issue guidance to states on when and how that funding can be used. NTIA held listening sessions earlier this year and asked for public input about how to best use the non-deployment funds.

To the surprise of nobody who has been following the BEAD trainwreck, NTIA pulled a fast one with the non-deployment funds. Rather than giving guidance on the $21 billion of non-deployment funds, NTIA has instead determined that some tiny portion of the non-deployment funds can now be used to build more infrastructure. That sounds really good on paper, because who’s not in favor of building more infrastructure?

As you might expect, because this is BEAD, the new grant process is complicated. First, NTIA is developing a list of eligible locations for the new funding. Some of these will come from ISPs that have already refused to accept the first round of BEAD. But it’s hard to think NTIA will find many other meaningful unserved locations. The agency has already claimed victory several times over the last year, saying that BEAD has basically solved the rural broadband gap – so NTIA doesn’t believe there are any pockets of locations that were missed by the original BEAD.

Once the list of locations is published, there is a tight time frame for states to deal with the new BEAD round. States will have 30 days to validate the locations. Next, each state would have to hold another quick map challenge process. As a reminder, the map change process was probably the most dysfunctional part of the original BEAD process – anybody who took part in the map challenges knows it was a disaster, end to end. After the map challenge, states have to submit their final locations to NTIA for approval, after which the states can hold a 90-day supplemental bidding round. I’m sure that NTIA will want to review tentative awards before they are made. States will then have to contract with grant recipients for the new awards. That likely means modifying existing BEAD lines of credit, and who knows what else. It’s hard to see this entire process playing out in less than a year, particularly since there are several steps that include an NTIA review and approval. It’s hard to see any of this new BEAD money being freed to ISPs until sometime into 2028.

All of this is a very convenient delaying tactic for NTIA, since it takes NTIA off the hook for providing guidance for the bulk of the non-deployment funds until the new infrastructure spending has been completely resolved through signing contracts with grant winners.

There is another little twist to consider in that infrastructure awards will be made at the average cost per location from the first round of BEAD. By definition, since all states have made awards for satellite broadband, the new BEAD average award will be lower than what was originally awarded for fiber. Add to this the fact that inflation has made it more expensive to deploy any terrestrial broadband technology, and I doubt that many fiber ISPs will be willing to take new awards a year from now at lower levels than the Benefit of the Bargain grants.

I titled this blog Much Ado About Nothing, because that’s what I expect out of it. I have a hard time seeing any meaningful numbers of locations getting infrastructure in the process, meaning only a small fraction of the non-deployment funds will be used in this process.

I’m hoping this will be my last blog on BEAD, because the process has grown too obtuse to keep writing about. This seems like a scheme for NTIA to delay any discussion about using the $21 billion of non-deployment savings for several more years. I expect most ISPs to ignore this new process, but states are going to be obligated to try to make the awards to somebody. Wouldn’t it be ironic if this ends up making new grants to the satellite providers at a much higher amount per location than what they accepted with the original BEAD? My inner conspiracy voice wonders if that’s the real intention of the new rules.