One of the most interesting rules in the BEAD legislation is that broadband needs to be offered to every unserved location in the country – not 98%, not 99%, but all of them. This sounds like a terrific policy goal, but as I’ve been thinking about it, the goal is going to be incredibly hard to meet in many places. This got me thinking about all of the unique situations I’ve seen over the years.
I know an ISP that has already built fiber throughout much of a rural county to reach most households. But there are homes atop mountains and cliffs in the county they didn’t try to serve. These homes use solar power and aren’t connected to the electric grid. It could easily cost a million dollars or more to bring fiber to each of many small pockets of one or two homes around the mountains. Wireless is a likelier technology option, but even that means building multiple towers to reach a tiny number of homes in the remote areas. The real challenge is that even with a 100% grant, serving these remote pockets is always going to lose money since the revenues will never cover the cost of maintenance. I can’t imagine this particular ISP is even slightly interested in tackling these locations regardless of the amount of funding that might be offered – and certainly, no other ISP could tackle it.
This may sound like an extreme example, but it’s not. There are homes throughout the West that are far away from everybody else and will be extremely expensive to reach. There might be even more such homes in Alaska. One of the questions not being asked by the folks who created the 100% coverage requirement is if folks who purposefully built far away from everybody even want a broadband connection. Imagine getting a grant for these locations and the residents don’t want the broadband.
There is another more common situation that must be considered. Many WISPs will be pursuing BEAD grants. In many cases they’ve already won the subsidies to serve large areas with RDOF, and BEAD is a natural way to fill in the holes around those networks. However, in most places, a wireless network won’t reach every home, at least not without a lot of extra effort and cost. There are always homes located in places that are hard to reach from the most likely tower sites. Reaching everybody means constructing additional towers just to reach a few homes.
This also raises the question if BEAD should be used to reach customers in the RDOF areas who will not be covered by those networks. We are all pretending that the RDOF areas will be 100% served when those networks are built – but the RDOF rules didn’t mandate 100% coverage. Folks who will be skipped by RDOF will remain unserved after BEAD.
Any BEAD winner is going to have to pledge to build to reach every unserved home in a grant footprint. But nobody has defined the consequences if a BEAD winner doesn’t reach everybody. Will states mandate that an ISP make the investment to get to the hard-to-reach homes? Will States consider a clawback of funding or big fines for ISPs that fail to reach everybody?
Another issue for states trying to serve everybody is that some unserved locations are located in cities and towns. Every community of any size I’ve looked at has a few such locations. The NTIA mandate to reach everybody includes these locations. Are State Broadband Offices going to seek ISPs to build these tiny pockets?
I think every unserved urban pocket has a story. Many were not built because of a construction impediment. There is one of these pockets in my neighborhood that is surrounded by a university on one side and a park on another – I have to imagine the cable company gave up on it years ago due to the difficulty of getting permits. There are similar unserved pockets for many other reasons. Will SBOs try to find a solution for an apartment owner who wouldn’t let an ISP on the property? What about the household that sits on a private road and won’t give permission to disturb the paving?
The most perplexing thing about the BEAD rules is that the legislation says these places must be served first before a State runs out of grant funding. Many of these tiny pockets are incredibly expensive to reach, and it doesn’t make policy sense to serve a few homes for a huge cost when the same money could instead bring broadband to many more homes in a more normal setting.
This is unfortunately what happens when rules are written by policy people who don’t understand the real world. I expect the architects of these rules would not want to see many hundreds of thousands of dollars of grant money spent to get to one or two locations, but that’s the consequence of the rules that require 100% coverage. I know that many State Broadband Offices are already sweating over this requirement and dread the time in the coming year when they will have to make hard decisions. Do they really fund the isolated few over the many?
Doug,
As always, I enjoy reading your insights on the industry. You noted in today’s article that RDOF did not mandate 100% coverage. However, as I recall from the rules, not only did the FCC mandate recipients serve 100% of the eligible locations in the awarded geography, they mandated that any new serviceable locations in that same geography had to be served as well – with no additional subsidy provided to do so.
There may be a difference in semantics, but the RDOF-eligible areas (census block groups) were considered unserved because each eligible CBG included one or more census blocks that had no reported service at any location within the census block.
Based on my reading of Louisiana’s approved BEAD plan and Mike Conlow’s notes from yesterday, LA seems to be taking a similar approach with their defined eligible service areas (SPAs).
Keep up the great work and Merry Christmas!
The obvious solution you didn’t mention is LEO satellite service, such as Starlink.
It’s likely that if the really remote folks want broadband that they already have Starlink. I’m sure some states will use this as a fill-in solution. But what grant money do you give to a satellite company other than perhaps pay for the cost of the receiver? Also, satellite broadband doesn’t currently meet the Congressional BEAD requirement that since they can’t currently guarantee 100/20 Mbps. You’re talking the common sense solution – the BEAD rules make that an interesting challenge.
Doug, great article. do you know if the 100% comes from the actual written law ( meaning it would take an act of congress to change) or is it just policy which could be changed at any time. — happy holidays
Like the 1996 Telecom Act, there is no explicit policy mandate for universal access to advanced telecommunications in the Infrastructure Investment and Jobs Act (IIJA). The 1996 Telecom Act “expanded the traditional goal of universal service to include increased access to both telecommunications and advanced services …for all consumers at just, reasonable and affordable rates,” but provided no mechanism to ensure it. Instead, the FCC and state public utility commissions must merely “encourage the deployment on a reasonable and timely basis of advanced telecommunications capability to all Americans … in a manner consistent with the public interest, convenience, and necessity” per 47 U.S. Code § 1302(a)
The IIJA states findings by Congress that “Access to affordable, reliable, high-speed broadband is essential to full participation in modern life in the United States,” noting lack thereof “is a barrier to the economic competitiveness of the United States and equitable distribution of essential public services,
including health care and education.”
Th IIJA authorizes the executive branch to require states participating in BEAD block grant funding to propose solutions for the deployment of affordable broadband service” and “how best to serve unserved locations in the eligible entity, whether through the establishment of cooperatives or public-private partnerships; and develop a timeline to attain universal access to advanced telecommunications services.
The National Telecommunications and Information Administration requires states and territories participating in the grant program develop “Five-Year Action Plans” including “a comprehensive, high-level plan for providing reliable, affordable, high-speed internet service throughout the (state) including the estimated timeline and cost for universal service.”