Gigapower Exec Pitches Value of Open Access Networks to Maximize BEAD Money Efficiency
The open access model allows multiple ISPs to use the same infrastructure. That could benefit Gigapower.
WASHINGTON, September 13, 2023 – Gigapower is in talks with state broadband offices about potentially building out open access infrastructure with grants from the Broadband Equity, Access and Deployment Program, the company’s CEO said Wednesday.
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“I think that when the time comes for BEAD, this platform will be a perfect fit,” Bill Hogg, the company’s CEO, said at a Broadband Breakfast Live Online event.
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That’s because consumers could still choose from multiple internet providers offering different services at different price points, all on BEAD-funded Gigapower infrastructure, Hogg pitched. The traditional ISP-owned infrastructure model would only bring service from the provider that won a state contract to expand their network, he claimed.
“They like the idea that multiple ISPs will be able to bring choice to their constituents,” he said of state broadband officials. “They don’t have to pick a winner or a loser.”
Gigapower, a joint venture between AT&T and the investment firm BlackRock, is already slated to build a 1.5-million-location open access network. That means it will own and operate a fiber network while allowing multiple internet service providers to use that network to connect individual homes and businesses.
Spawned from the Infrastructure, Investment, and Jobs Act, the BEAD program allocates $42.5 billion to subsidize broadband infrastructure – primarily fiber – in areas that still lack adequate internet service because of geographical barriers or low population density. After submitting initial proposals by the end of the year, states will be able to start doling out this money to fund projects.
Gigapower is actively looking to add more service providers to its lineup, Hogg said.
“We fully intend to have other ISPs on the network,” he said. “We’re having good discussions with potential future tenants.”
Benefits of open access
AT&T will be the first tenant on the open access network, part of its deal with Blackrock. The telecom is looking to reach more people as quickly as possible, said Erin Scarborough, its president of broadband and connectivity, but building out fiber is costly and expensive. Making use of a network outside the company’s existing infrastructure will make it easier to expand into new areas and was a key motivator for investing in the project.
“That’s one of the key tenets of this agreement and why we were looking to do it,” Scarborough said.
The open access model is a departure from the norm in American telecommunications. There are regional open access networks like Utah’s UTOPIA Fiber, but large ISPs have traditionally opted for the security of owning and operating their own networks.
“When you start thinking about operating more efficiently with less capital, sharing networks has always made sense,” Hogg said. “We think that this model is going to break down the historical bias telecos have had about not controlling all the assets.”
Despite the company’s investment in the project and first-provider status, Scarborough and Hogg were emphatic that AT&T will not have a management role over the network.
“We are the network operator,” Hogg said of Gigapower. “We own the assets. We own the negotiation for the commercial terms.”
