Broadband Expansion: States and ISPs Drive Growth Beyond Federal Aid

The Facts -

Broadband Expansion Progresses as States and ISPs Take Action

High-speed Internet connectivity is becoming more widespread across the United States, thanks in large part to the efforts of state governments and private Internet service providers (ISPs). The latest research from the Advanced Communications Law and Policy Institute at New York Law School highlights a notable decrease in locations still eligible for federal assistance through the Broadband Equity, Access and Deployment (BEAD) program.

The BEAD initiative, which was endowed with $42.5 billion from the 2021 Infrastructure Investment and Jobs Act, has seen a 69 percent reduction in the number of qualifying locations since its funding was first distributed. Importantly, this reduction is attributed not to the BEAD program itself, but to proactive investments made by ISPs. As stated in the report titled Sizing Up Another BEAD Round Using the Ever-Changing BEAD Map, “None of this is BEAD’s doing as ISPs [Internet service providers] have not sat idly by waiting for funding from this program.”

Currently, 79 percent of the locations initially served by BEAD in 2022 are now covered by various other programs, illustrating the rapid pace of private investment in broadband infrastructure. According to Michael J. Santorelli, director of the Advanced Communications Law and Policy Institute and a contributor to the report, ISPs have invested nearly $90 billion in recent years, supported by additional federal initiatives like the $10 billion Capital Projects Fund.

“Some states added their own funds to bolster the federal funds they had available,” Santorelli noted in an email, underscoring the collaborative nature of these efforts.

California serves as a prime example, with extensive development of “middle-mile networks” that span thousands of miles. These networks enable Internet providers to extend their services to homes and businesses. According to Parisa Soultani of the California Department of Technology (CDT), California has completed 1,250 miles of middle-mile infrastructure with an additional 4,550 miles underway. “CDT coordinates closely with [the California Public Utilities Commission] CPUC to ensure middle‑mile infrastructure can support BEAD-funded last-mile builds,” Soultani explained.

In North Carolina, the American Rescue Plan Act funds have facilitated connectivity for more than 232,000 homes and businesses. The state has allocated $1.53 billion in BEAD funding and is working to finalize contracts for $318 million in BEAD projects resulting from the initial Benefit of the Bargain round.

Indiana is also pushing forward with broadband development by investing $350 million through state grant programs such as Next Level Connections and the Indiana Connectivity Program.

While the digital divide has decreased by approximately 69 percent since the inception of BEAD, Santorelli acknowledges that the task is now “both easier and harder.” Fewer locations require service, yet those remaining are often in remote areas, complicating the task of providing terrestrial broadband connections due to increased costs.

Adding to the challenge are rising equipment and labor costs, potentially extending the timeline for these projects. As for whether these connectivity initiatives are resulting in more home Internet subscriptions, data remains inconclusive. However, Santorelli notes that Internet costs are not climbing as quickly as other household expenses, suggesting that affordability may not be the primary hurdle to broadband adoption. Instead, issues such as perceived value and safety concerns may play a larger role in the decision to forego a broadband connection.

---
Read More USA Works News