Several people have asked me recently if cellular companies will be pursuing BEAD grants. It’s an interesting question that I don’t think anybody other than the cellular carriers know the answer. But it’s an intriguing question since it’s a possibility.
Until recently, cellular companies didn’t have a product that would have qualified for broadband grants. BEAD and other grants are awarded to ISPs that serve homes an businesses, not cell phones. But the introduction of the FWA product line has created a broadband product that might qualify for grants.
Cellular companies pass the first sniff for BEAD grants since the wireless technology uses licensed spectrum. The NTIA says it does not consider wireless broadband using public spectrum to be reliable.
The next hurdle to winning grant funding would be for cellular companies to convince state grant offices that they can deliver broadband speeds greater than 100/20 Mbps. That’s an interesting challenge for a cellular carrier. From what I’ve seen, customers living close to a cell site can easily exceed those speeds. I’ve talked to a few people getting over 200 Mbps download on FWA – but each happened to live close to a cell site.
But speeds on FWA decrease rapidly with distance. I’ve talked to customers who are less than two miles from a cell site and aren’t seeing download speeds of 100 Mbps. But that doesn’t disqualify a cellular carrier from pursuing grants. BEAD allows for grants that cover small areas, theoretically as small as a single home.
More interestingly, there is no reason that a cellular company couldn’t propose a grant to build new towers to expand the faster coverage and also the fiber lines to feed the towers. It’s not hard to picture a network in rural areas where this might be the lowest cost solution. One has to wonder if a cellular company would ever want such a network – that’s a lot of cell sites to maintain that likely each only serve a small number of customers.
Another issue to consider is that cellular carriers are currently providing priority to cell phones over FWA customers. If the network gets busy, cell phones customers get the requested broadband, and FWA customers get throttled. Broadband offices might deem this to be disqualifying in areas with any significant population – but this seems like far less of a concern in a rural setting where cell sites probably rarely get overstressed.
Yet another issue is the ability of a grant winner to serve everybody in the footprint. Unless a grant area has extremely low density, it’s likely that the cell site doesn’t have the capacity to give everybody unlimited home broadband.
Another interesting issue to consider is how mapping plays into this. I’ve heard a lot of comments from folks who are claiming that T-Mobile and Verizon are already claiming fast speeds in a lot of places. Folks are saying the coverage areas claimed in the FCC maps seem a lot larger than the reality. It’s not hard to understand the motivations for cellular companies to claim fast speeds since it helps with marketing. This is particularly important for T-Mobile, which reached an agreement with the government as a condition of the Sprint merger to cover a large percentage of the country with faster speeds.
But claiming high speeds and claiming coverage areas that are larger than reality are counterproductive to seeking grants. An ISP can’t ask for grant funding for a place it says already has fast broadband.
The more important question for the industry is how the FWA claims of current speeds and coverage might hurt other grants. Will broadband offices not award grants in places the cellular companies claim to already have fast broadband? The emergence of the FWA technology is so new that I suspect most state broadband offices haven’t come to grips with that question. Many states have been creating their own broadband maps in recent years, and FWA technology has not been factored into those maps. This is just one more complication for broadband offices – as if they needed another issue.