Why we should insist on technology-neutral broadband infrastructure funding — GCN
INDUSTRY INSIGHT
Why we should insist on technology-neutral broadband infrastructure funding
We can all agree that nationwide access to high speed, reliable broadband service is critical. While connecting the unconnected has always been important, its urgency became even more evident during the pandemic when much of our work, education, socialization and even health care occurred online. In response to this need, the Biden administration’s infrastructure legislation allocates tens of billions of dollars for funding high-speed broadband service for everyone in the United States, no matter where they are located. If the government is not careful about how it proceeds, it could waste tens of billions of dollars repeating mistakes of the past.
Today, a range of technologies – terrestrial and non-terrestrial, wireless and wired – provide reliable high-speed broadband. Yet some policymakers are seeking, unnecessarily, to limit the use of infrastructure funds to support only broadband fiber deployment. That is a costly mistake that could leave many users without access to high-speed internet for many years, or perpetually. Any funding made available through the infrastructure package must be technology neutral for four practical reasons:
- Deployment cost. While there’s no question fiber provides reliable, high-speed broadband, other technologies also do so without incurring the same deployment costs. Installing fiber is expensive – by some estimates more than 10 times the cost of terrestrial and non-terrestrial wireless broadband services, like fixed wireless or satellite. The high cost of a fiber-only approach to broadband deployment will severely limit the number of users that can be served by fiber (as opposed to the near universal access afforded by wireless technologies). This is an especially important consideration in rural and remote portions of the country where deployment of fiber tends to be even more costly.
- Deployment speed. Also unlike fiber, terrestrial and non-terrestrial wireless services can be deployed very quickly. For satellite broadband, for example, a user can be online within two to three days of placing an order – as opposed to the several years it may take for meaningful fiber build-out to occur. Areas funded solely for fiber could be without access to government-backed broadband for a number of years.
- Operational cost. Even if the infrastructure funding pays the full cost of fiber deployment, there is no guarantee that customers will adopt fixed broadband service at the level necessary to support the long-term operating costs of the fiber network, including the costs of upgrades required to support new technology. History has shown that supporting operation of wireline networks is a high hurdle to clear. For example, in the 1970s, AT&T held a monopoly in phone service, but without enough economic support, its network degraded dramatically. This lack of long-term operational funding remains a problem today. Many “carriers of last resort” in states across the country, especially in rural and remote areas, have sought to shut down their services and transfer their obligations to wireless providers, including satellite operators, because of the economic burdens of operating their networks.
- Competitive impact. Finally, government-subsidized fiber stifles competition and innovation. If the government dubs fiber the chosen technology for subsidies for large portions of the country, other service providers will be discouraged from competing, and the result will be fewer choices, less innovative service and likely higher prices for consumers, even in unsubsidized locations.
By adopting a technology-neutral broadband infrastructure funding scheme, congress and the administration can avoid well-documented pitfalls and outcomes contrary to desired goals of broadband expansion. Only by doing so will they fulfill the objective of delivering timely, affordable broadband services to U.S. residents nationwide.
Gloss