The broadband industry faces a problem it’s never really had before: it’s awash in federal taxpayer money. But questions remain as to how recipients should spend that money and what we should do when it runs out in the next few years. In the last COVID-19 response bill in late 2020 and then the stimulus bill (the American Rescue Plan or ARP) from early 2021, Congress authorized hundreds of billions of dollars for states to spend on digital equity and for the Federal Communications Commission (FCC) to provide low-income broadband support.

Specifically, ARP provided $388.1 billion in flexible funding, for which a variety of “digital equity activities are eligible” according to Brookings. The late 2020 omnibus funding package, meanwhile, provided $3.2 billion for an Emergency Broadband Benefit (EBB). The Brookings analysis also determines that a combination of states, territories, tribal governments, schools, libraries, and the Department of Commerce can spend about $255 billion of it on physical network buildout (most of it through 2024, but some of it through 2030 or “until expended”). The most substantial funding stream among the nine found in ARP is the “Coronavirus state fiscal recovery fund,” which provides $219.8 billion through 2024 for states, territories, and tribal governments to spend on anything broadband-related from physical network buildout to device support and digital literacy training.

That $255 billion figure is almost 30 times the amount the FCC spends each year on all of its infrastructure deployment programs—and these new funding streams from ARP are in addition to what the FCC provides and in addition to the EBB. The EBB itself is an extra pot of money for the FCC to distribute directly to broadband providers serving low-income subscribers to help defray the costs of their broadband subscriptions. In that sense, it is a bit like the existing Lifeline program the FCC runs, but it provides $50 per month per household ($75 on tribal lands) versus about $9 per month per household for Lifeline. The EBB also provides up to $100 for a household to spend on a laptop, desktop, or tablet, if the household contributes more than $10 and less than $50 toward the purchase price.

As for business as usual at the FCC, the Commission awarded $9.1 billion through its Rural Digital Opportunity Fund (RDOF) reverse auction in November 2020, where companies bid to provide the best quality service to certain geographic areas for the lowest price. The FCC says 85 percent of winning bidders promised to provide gigabit service and “nearly all” locations to be served by RDOF-supported buildout would provide speeds of 100 MBps upload / 20 MBps download (100/20).  In the next round, RDOF Phase 2, the FCC will dole out another $4.4 billion to reach the remaining unserved, partially served, and underserved census blocks. These are all funds set to be distributed but that has not had any effect yet.

All of this paints an unfamiliar picture. There are hundreds of billions of dollars making their way to their intended recipients, to be spent on a variety of broadband deployment and adoption projects. It may seem like a targeted and cautious approach—including making sure the FCC’s maps are as accurate as possible—is less important now that there is so much money is in the system. But we urge policymakers to account for a few important considerations as they contemplate their next investments:

  • Consider providing even more resources for workforce development and broadband adoption programs
    • $388 billion is a lot of money to make available for broadband adoption and other programs, but much less than that will likely go toward just broadband or upskilling. Closely monitor the impacts those funds are having on local communities and act to fill the gaps left after ARP money is deployed
  • Be thoughtful about the respective roles of government and the private sector in building and maintaining broadband facilities
    • For example, we supported the E-Bridge Act, which would make small changes to Economic Development Assistance (EDA) grants to allow private companies to participate in public-private partnerships to take on EDA funded projects like broadband. Similarly, legislation should ensure a role for private sector expertise to meet evolving broadband needs driven by the always-improving mobile software and devices our members make
  • Don’t sideline the most cost-effective technologies that can provide solid connections that work best for localities
    • Fiber is among the most expensive options and works well in some areas but could be ill-suited for remote locations in particular. Sometimes, the best option is something like Starry Connect’s Wi-Fi-based service, which provides 30/30. Even some of America’s most densely populated cities fall short of gigabit service in every corner. A policy that prioritizes services with gigabit or 100/100 symmetrical speeds to receive federal support ignores what are often better options while potentially resulting in redundant services in areas that already have excellent and affordable connections
  • Continue to work on the maps until they show in fine detail where broadband is available and affordable—and where it is not
    • Compiling an accurate picture of the served, unserved, underserved, and partially served parts of the country is still a worthy endeavor. Going forward, the FCC, Congress, and other policymakers need to understand where the problem areas are on an ongoing basis. The work will not end after the recent federal broadband funding rounds and even if we are fortunate enough to see substantial investments in the infrastructure package

These are just a few priorities to help guide important negotiations on broadband provisions that could be added to the infrastructure bill. App Association members have a real stake in ensuring that their clients and consumers all across the nation can access affordable, high-speed broadband, and we want to help policymakers find the right path forward to accomplish this important goal.