When the NTIA made it clear that it was going to change the BEAD rules, I wrote a blog that I called, somewhat tongue-in-cheek, the BEAD Bingo Card. That blog listed a range of options for how NTIA might modify BEAD – from canceling the program to leaving it largely intact.
On June 6, NTIA issued a BEAD Restructuring Policy Notice that defines how BEAD is going to work, and wouldn’t you know it – NTIA went with an option I had not considered. I would classify the NTIA’s solution as “RDOFing the BEAD process.” By that, I think NTIA adopted the worst features of RDOF. The Notice makes the following major changes to the process of choosing BEAD grant winners:
- Any technology that can deliver 100/20 Mbps broadband today is now eligible to win a BEAD grant. While there is a caveat that a winning technology must have the capability over time to scale to support rural 5G and other wireless needs, there is no specific commitment required by a grant winner to make future upgrades.
- The new process requires State Broadband Offices to consider eliminating any BEAD locations that are already served by unlicensed fixed wireless. If a WISP already claims a speed of at least 100/20 Mbps in the FCC maps for a BEAD location, the WISP can certify that it is providing served speeds and these locations are removed from BEAD. This could conceivably eliminate millions of BEAD locations from BEAD grants.
- The primary criteria for picking a winner is the requested BEAD funds per eligible location. Whoever asks for the least amount of money wins. Broadband Grant Offices can consider speed to deployment and broadband speeds, but only if a grant application is within 15% of the lowest bid. This feels like a one-round reverse auction.
Recall that RDOF included a fiber preference, and that preference resulted in a lot of electric cooperatives and others winning RDOF funding to build fiber. Since BEAD will now allow fixed wireless, LEO satellite, and FWA cellular wireless to compete head-to-head with fiber, it seems likely that fiber only wins in places where no other technology is seeking funding. We can only guess how many fiber grant requests that will kill – but it’s not hard to imagine these rules killing 80% or 90% of fiber awards. It’s going to boil down to how much BEAD funding the wireless ISPs and satellite companies will pursue. The more interesting dynamic will be the bidding battle between fixed wireless and satellite – because both can easily underbid fiber projects.
State Broadband Offices can require wireless and satellite providers to swear they will have the capacity to serve everybody, but every ISP that decides to pursue BEAD will make this promise. They know there will be no realistic consequences of not meeting the commitment five years down the road – there has never been any serious enforcement of federal grant performance in the past, and there is no reason to believe that will change. The BEAD grant will be awarded and built, and everybody will forget about the original intent – except the households who still don’t have good broadband.
This completely tosses away the idea that BEAD would be used to build networks that will last for the rest of the century – some of the winning BEAD projects will be behind the rest of the country the second they are built.
This Notice also ignores the second big purpose of the BEAD grant program – it was a jobs program which was to provide a lot of good jobs to build and operate networks. It’s clear to me that the NTIA wants to spend as little as possible of the $42.5 billion money. The U.S. Department of Commerce wants to take credit for saving money and doesn’t care about getting good broadband to rural areas. This Notice has a clear message: Congress said we have to build broadband everywhere, so we’ll build what is barely adequate for today and ignore what’s needed for the future. This Notice punts the rural broadband gap down the road for the next generation to solve.
There will be lots of articles published today talking about the mechanics and timing of the revised BEAD, and I might write about that in a future blog. The bottom line is that every State that already started the BEAD grant selection process has to start over with a grant round that allows every technology to compete head-to-head.
There are a lot of different issues to unwrap inside this Notice, and I plan to to write a series of blogs looking at the ramifications of this Notice for different national stakeholders. So stay tuned.
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Nailed it, Doug. This was our impression as well. It’s a shame that this will end up being a wasted opportunity to bridge the digital divide.
I have many thoughts, too many to leave here. But this change to the BEAD process exceeded all my hopes. America was built by people who went all in on a dream, and the country has largely rewarded that effort. The original scope of BEAD turned that completely on it’s head. I’ve spent over a decade building our Wisp along with a couple other guys. I’ve repeated this many times in many places but I’ll say it again. From day one, until current, and with no plans of anything different looking into the future, we have 100% satisfied the people in our coverage area. Wireless tech has evolved to meet the need for well over a decade and it is continuing. We have essentially zero churn. When people connect with us, they stay connected until they die or move away. The big ISP industry screems at everyone you *MUST* have a gigabit a second or you will fall behind and not be able to keep current. Really? Show me the numbers. 70% of our clients are still on 25 Mbps down, 10 Mbps up. No complaining, no buffering, no frustration. Our 100 Mbps service is $10 / month more. I offer it over and over, very few people take it. Can someome tell me what we are missing? Not losing people to competition, not getting slow speed/buffering complaints, not getting many takers on speed upgrades, getting rave verbal reviews, and people continue calling us for service day after day. Yet we get told by the big ISP’s that we’re not providing relevant broadband service. We haven’t really advertised at all, simply word of mouth. The major ISP’s are pumping ads like crazy, they are losing clients every day. They are our best advertisement and the reason we hardly need to do anything other than be there to pick up the angry clients and resolve their issues. We listen, we fix their WiFi, not just to the CPE drop but clear to their end user devices like phones and TV’s. America doesn’t need to spend a lot of money, and it doesn’t need to spend a dime on the last mile. As smaller ISP’s we can’t build interstate fiber connections. We are happy to pay reasonable prices or even pretty expensive prices for uplink connectivity. Take that BEAD money and put a small % of it into building better IX’s and core fiber connections. Let us guys that actually know our area do the last mile delivery. I know more about our area than any big ISP tech or manager ever will. No contest. Unfortunately we don’t have any public rating system at our company, too local, too much just word of mouth. But I have zero doubt’s it would be anything less than 5 star. Someone tell me where we are doing it wrong here…