Top 3 takeaways from Fierce’s panel on broadband affordability

U.S. Broadband Summit, Washington DC – Fierce’s first-ever U.S. Broadband Summit kicked off Wednesday with a panel discussion about a somewhat controversial subject: broadband affordability.

It seems like wanting everyone to be able to afford broadband would be a no-brainer, but the industry has concerns about things like a slide into rate regulation and getting a return on their (very expensive) investments. So, what did a panel of state broadband officials and ISPs have to say about the matter as it relates to the $42.5 billion Broadband Equity, Access, and Deployment (BEAD) program?

Here’s a roundup of the key takeaways.

1) Broadband expansion and affordability are inherently in tension

Claude Aiken, Chief Strategy Officer and Chief Legal Officer at Nextlink Internet, went ahead and put it bluntly. Affordability and expansion are two concepts that are just naturally at odds.

On one hand, you have ISPs who are preparing to drop billions on network construction, often in areas that are sparsely populated – a setup which naturally means lower ROI. At the same time, though, they’re trying to meet affordability requirements that have the potential to cut into an already dwindling ROI.

It’s a tough situation to be in, but Meredith Williams, AVP of Executive Branch at AT&T, said state officials can help by not adding additional requirements to their build plans that will pile on more costs for operators.

2) But “BEAD without Equity is just BAD”

The quote is from Aiken, but Sabrina Roach, Founder of consulting company Make Digital Equity, explained the idea a bit more.

The BEAD program comes with an affordability clause, requiring participating providers to offer at least one “low-cost” option to subscribers. While some operators might default to offering a $30 per month plan based on the assumption that the full cost would be covered for the most vulnerable consumers by the Affordable Connectivity Program (ACP) subsidy, Roach noted there are a BUNCH of people who don’t qualify for the subsidy who are still considered low-income.

Using Washington State as an example, she said there are around 400,000 people who qualify for the ACP (Government data shows around 324,000 are already enrolled). However, there are an additional “quarter million” people who are not eligible but who still do not meet the state’s self-sufficiency standard, Roach said. That standard defines the income a working family needs to make ends meet.

Thus, she said, exploring the equity component with providers to help close these gaps will be key to making BEAD a success.

3) Something’s got to give – or does it?

If there’s too much strain in the tug-of-war over cost to build versus affordability versus coverage goals versus technology choice, something has to give, right? Maybe. And just where exactly the compromise point will be will depend on the state, Williams said.

That’s because the federal government has given states leeway to build plans specific to their local needs, she explained. For instance, fiber is the government’s preferred technology, but some states may opt to use less-expensive fixed wireless technology to reach more people. It just depends on what their top priority is.

As far as Ohio is concerned, the state’s Broadband Chief Peter Voderberg said it’s number one goal is reaching every citizen.

“The only thing I care about is universal coverage,” he said, adding his office will do “whatever it takes” to resolve the necessary tensions both internally and with operators to achieve that.