Amazon and SpaceX Undercut Competition in Tennessee BEAD Bidding
Average LEO bids were $228K, a fraction of the $2.7M requested by fiber providers, on average.
July 23, 2025 – SpaceX and Amazon didn’t just show up to Tennessee’s "Benefit of the Bargain" broadband grant round – they undercut the competition into oblivion.
The state released data on the 541 applications it received under the Broadband Equity, Access, and Deployment program’s new funding round for public comment on Tuesday, offering one of the first looks at how the Trump administration’s June 6 policy overhaul may play out at the state level.
SpaceX’s Starlink and Amazon’s Project Kuiper flooded the Tennessee office with applications, submitting more than twice as many broadband grant applications as fiber builders, while requesting on average about 10 times less in funding - at least according the application areas.
The data released by Tennessee did not include the number of locations each provider proposed to serve, making it difficult to compare cost-effectiveness on a per-location basis.
Still, the sheer scale of applications low-Earth orbit providers submitted could increase their chances of capturing more project area units in Tennessee. LEO providers submitted 335 applications in Tennessee, far outpacing fiber (153), cable (40) and fixed wireless (13).
Consider “Anderson 1,” a project area in Tennessee’s Anderson County. In the initial BEAD round, only Comcast applied. Now, it’s a four-way shootout between AT&T, Comcast, Starlink, and Project Kuiper.
In that project area, AT&T has requested $4.4 million to lay fiber, while Comcast was asking for $3.1 million to extend its cable network. But Starlink and Kuiper have proposed to do the job for a fraction of the price, at $473,000 and $342,000, respectively.
Again, lacking the number of locations each provider proposed to serve, a head-to-head cost comparison was not available at this time.
Under the Trump administration’s revised BEAD rules that favor the lowest-cost option, the satellite options may begin to look more attractive.
What does it mean to prioritize the lowest-cost option?
Under the June 6 rules, when multiple applicants propose to serve the same project area, states must prioritize the lowest-cost option, unless another proposal was within 15% of that lowest-cost bid on a per-location basis. Only then, can states consider secondary criteria, such as proposed network speed or scalability.
In battleground project areas like "Anderson 1," LEO bids were about 90% cheaper, and in Dickson County, one of the most fiercely contested regions with more than 20 applications across just three project areas, Starlink offered a $1.76 million bid in "Dickson 1," nearly 60% below the lowest competing fiber proposal.
A side-by-side comparison of the applicants from Tennessee’s initial BEAD round and the Benefit of the Bargain round shows just how dramatically the playing field has shifted.
Many providers significantly reduced their funding requests, including Amazon’s Project Kuiper, which slashed bids across the board. In "Benton 1," for instance, Project Kuiper dropped its ask from $115,000 in the first round to just $6,600 in the round just conducted.
Shrinking pool of eligible service locations?
These price drops may reflect not only a more aggressive pricing strategy, but also a shrinking pool of eligible service locations. Tennessee initially required providers to serve 100% of the addresses in each Project Area Unit, but under the Trump administration’s June 6 restructuring, states may no longer impose that requirement.
According to data posted by the Tennessee Department of Economic and Community Development, roughly 7,000 locations have fallen off the eligibility map, lowering the total from around 51,000 to 44,000.
It’s too soon to say how Tennessee will score each proposal.
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