Arguing that broadband access should be a fundamental right for all Americans, a tenet of the Obama administration's ARRA (American Recovery and Reinvestment Act) set aside $7.2 billion in funds to extend broadband to more Americans. Tasked with doling out the funds were the Rural Utilities Service (RUS) and the National Telecommunications Industry Association (NTIA). But what would a government funding program be without its own share of criticism and protest?
While $7.2 billion seems like a decent amount of money by some estimates, Insight Research argues that this allocation would enable service providers to basically spend $164 per household for broadband. What's needed is actually $1,500 per household--a figure that really would require an estimated $60 billion. Then, there's of course the protests by who else but the large incumbent ILECs and major cable MSOs two applicants who opted out of going for stimulus monies because of concerns over net neutrality rules.
One of the perplexing issues is a lack of clarity around just what is an 'unserved' and 'underserved' broadband community? Even in densely populated areas such as San Francisco, where both AT&T and Comcast happily serve, a Business Week article this past summer illustrated that there are parts that have little or no broadband. But after multiple delays, the NTIA and RUS finally began doling out funding awards this month to serve four primary purposes: middle mile services, last mile, public computing and sustainable adoption. Besides the snail pace of getting out the funding, one of the other surprises that did stick out about the initial rounds was the lack of awards to smaller cable operators. Out of the 83 that submitted applications only one actually got funding.
All of these factors have people in the industry questioning whether or not the broadband stimulus will really be a success or another over-ambitious government science project?
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Insight Research: Broadband stimulus funding not nearly enough
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