Bridging the Digital Divide - $65 Billion for Broadband in US Infrastructure Bill

The Infrastructure Investment Jobs Act (IIJA) provides $65 billion to expand broadband access and affordability to all Americans. ~$48 billion of that will be distributed by the National Telecommunications and Information Administration (NTIA) to fuel network expansion across every state and territory, giving top priority to unserved and underserved* areas.

If you are a carrier or ISP, the internet is about to get a whole lot bigger, and you can participate in the expansion by disclosing the locations of your fiber and conduits to your state broadband office. If you don’t, you may end up facing publicly-subsidized competition.

If you are a university, hospital, or an organization that may function as what the NTIA calls an “anchor institution” connecting the middle-mile to local communities, you now have the opportunity to build a high-capacity optical network utilizing government budget.

"This is a transformational moment in the history of the web."
Andy Berke, NTIA, Special Representative for Broadband

Notices of Funding Opportunity Coming by May 16, 2022

"…What we affectionately call the NOFO... will officially launch the law’s broadband infrastructure program," says Alan Davidson, Assistant Secretary for NTIA.

This massive project includes four programs; Broadband Equity, Access and Deployment; Enabling Middle Mile Broadband Infrastructure; the Digital Equity Act; and the Tribal Broadband Connectivity Program. This article discusses the first two programs.

The NTIA website offers comprehensive resources such as webinars, lists of state and local broadband agencies and carriers; and an interactive map indicating broadband availability across the USA.

Broadband Equity, Access and Deployment (BEAD) Program - $42.45 Billion

The purpose of BEAD is to provide grants to eligible entities “to bridge the digital divide,” prioritizing unserved or underserved communities and high-poverty areas, and considering speeds of the proposed service, and how quickly the projects can be completed. Proposals do not need to serve only these communities; but they must include them.

Another priority is to build community broadband access by strengthening anchor institutions such as schools or universities, libraries, medical or healthcare providers, or other organizations (including government), to meet the needs of the community.

While a great deal of media attention is focused on last mile projects, BEAD funds can also be used to build middle mile infrastructure wherever necessary.

BEAD grants will be awarded by the individual state or territory, with NTIA overseeing the program, and funding up to 75% of the proposal. Grants may not be used to purchase fiber cable or optical transmission equipment manufactured in China.

Enabling Middle Mile Grant Program (EMMP) - $1 Billion

This is a competitive grant program distributed directly through the NTIA, not the different states. Its purpose is to encourage expansion or extension of the middle mile specifically, to reduce the cost of connecting unserved and underserved areas of the country.

The EMMP does not stipulate whether infrastructure should be based on satellite, fixed/terrestrial wireless, fiber optic cable, or a hybrid network. Every project will be different, based on population, geography, and available community partners.

Middle mile networks must support high-capacity traffic for smooth transport of traffic from the local network, employing path diversity to increase redundancy, especially in data-sensitive applications. In addition, these networks need sufficient capacity to be future-proof, with an easily scalable backbone.

NTIA will fund up to 70% of the Middle Mile project.

Emphasizing Economic Sustainability

An economically sustainable network is the goal. This is defined by the network's post-deployment success, whereby it remains financially viable once the network is operational and the provider is offering services.

To this end, NTIA will cover up to 75% of needed Capital Expenditure (CapEx), with a build-out time of not more than 5 years; while requiring that the post-deployment Operating Expenditures (OpEx) meet with future ongoing revenues.

OpEx should take into consideration development of alternative revenue streams such as backhaul for mobile, transit fees/wholesale offering, and government contracts/uses, and utilization of the fiber infrastructure for other business purposes such as smart grid for utility companies.

Partnerships

To maximize the likelihood of securing federal funding for middle mile projects, applicants are encouraged to enter into creative partnerships between public sector, private sector, and community stakeholders. To manage costs, providers can work with state and local entities, as well as private enterprises to leverage existing infrastructure or planned construction work in relevant areas (e.g., transportation).

Several types of assets can be leveraged to form partnerships.

In broadband networks, or where there is dark fiber, networks may be accessed through infrastructure sharing arrangements, leases, or indefeasible rights of use (IRUs).

Anchor organizations may be in possession of tall infrastructure (e.g., towers, water tanks, or buildings) which can serve as an area node, providing rights to mount wireless antennas, install fiber optic cable, radio, and other network equipment.

The best way to identify potential partners is to contact your state broadband office.

Broadband Asset Mapping

For any broadband deployment, the majority of capital expenditure is for construction of passive infrastructure. If providers are able to leverage existing assets rather than install new ones, they can significantly reduce the cost of deployment. State, county, and local governments wanting to accelerate broadband deployment are all developing comprehensive records of relevant assets.

Requirements for Mapping

Any eligible entity which constructs, improves, or requires middle mile infrastructure using EMMP grant money must share the location of their infrastructure with the Assistant Secretary, the Commission, the tribal government with jurisdiction over the area (if applicable), and the state broadband office for the state where the area being served is located.

Geoff Jordan, Infrastructure Division Chief of the Office of Internet Connectivity & Growth, believes it will be in the carriers’ best interest financially and strategically, to cooperate with state broadband offices. They just need to understand how much network is about to be deployed, and that the carriers themselves will be able to access this newly-expanded network.

NTIA Says the Quiet Part Out Loud

Evan Feinman, BEAD Director:

“...The clear mandate of the programs is to get all Americans access to broadband infrastructure. If there's a question about whether or not a place is served, we're going to err on the side of building service to it, to ensure the goal has been met.

That creates a very clear financial incentive, if in fact there's already network being provided to that location, for the carriers to come [forward]....

They'd prefer not to have publicly subsidized competition…

Whatever amendments you have to make to your Freedom of Information Act for proprietary trade secrets, so that we can build the networks, right up to the edges. These edges are not clean… They’re very unusually-shaped network designs, and so to ensure comprehensivity, we've got to make sure that we get everywhere.”

 

* NTIA Defines: Unserved areas lack access to broadband service offering download speeds of 25 Mbps and upload speeds of 3 Mbps. Underserved areas have less than 100 Mbps download and 20 Mbps upload. The goal is to give every American access to 100/20 or better.