Municipal Networks and Incumbent Providers Will Compete for Grant Funding in 2023

WASHINGTON, December 28, 2022 — The emerging preference for fiber over competitor technologies is likely to continue in the coming year, with municipal networks playing an important role, said panelists at a Broadband Breakfast Live Online event Wednesday.

“I always think of fiber going into a town as rippling,” said Sean Buckley, editor in chief at Broadband Communities. “It’s not just fiber to the home — it’s fiber to the tower, the business, the school, et cetera.”

Buckley and others were reacting to Broadband Breakfast’s 12 Days of Broadband, a monthly report that included articles about the 12 top issues for broadband in 2022. The first of the 12 days articles was about how “Fiber Finds Its Footing, Offering Future-Proof High Speeds,” by Drew Clark, editor of Broadband Breakfast and moderator of the Wednesday session. Clark said that the strength of the case for fiber was gaining momentum with the federal bipartisan infrastructure investment in broadband.

In many areas, smaller community broadband networks are challenging the monopolies held by large incumbent players.

“Lots of folks are fed up with sort of having no choice or having only one provider, and lots of communities are becoming much more aware of the community broadband model and are looking at exploring that,” said Sean Gonsalves, senior writer for the Institute for Local Self-Reliance’s Community Broadband Networks Initiative.

Gonsalves pointed to Fairlawn, Ohio as a successful example of the community broadband model. The municipal network has been so successful that they recently upgraded all customers to a higher speed tier and simultaneously dropped prices, now offering a symmetrical gigabit connection for $55 per month.

Incumbent networks are sometimes hostile to emerging community broadband networks, Gonsalves said, citing an email where an incumbent network executive said their top challenge was preventing municipalities and nonprofits from accessing grant funding.

Some states will probably “shovel their hundreds of millions of dollars to the big incumbent providers, and then 10 years down the road, people will be scratching their head wondering why we still have the digital divide,” Gonsalves said.

Despite the significance of the $42.5 billion Broadband Equity, Access and Deployment program, it is unlikely to be enough to give the whole country access to high-speed connectivity, panelists agreed.

In the coming year, it will be interesting to see whether states “adhere to the letter and spirit of the BEAD law, which says that you’re not able to exclude municipalities and the like from getting access to those to those grant funds,” Gonsalves said.

In some remote areas, fiber’s cost might outweigh the benefits

Federal funding is giving fiber a boost over competitor technologies, but it isn’t necessarily a universal solution.

Deploying fiber to rural areas can be extremely expensive, said Linda Hardesty, editor in chief at Fierce Telecom. For example, a company in Alaska received a $33 million grant to run fiber to just 211 homes and five businesses — meaning that the cost per passing would be more than $200,000, according to Fierce Telecom.

“That exorbitant cost is the reason why fiber has never been run to places like that before, because private companies couldn’t make a business model out of that,” Hardesty said.

Most rural fiber deployments cost far less than the Alaska project, but several other grant winners are undertaking projects that cost tens of thousands of dollars per passing, which Hardesty noted is still exorbitant compared to the typical deployment cost of less than $3,000 per passing.

Proponents argue that the long-term economic and societal benefits of bringing fiber to rural areas outweighs the upfront costs, Hardesty said.

“It’s more expensive to build bike lanes than it is per mile than it is to lay fiber,” Gonsalves said. “Roads, water systems, schools — these are all projects that municipalities take on all the time and so in my mind it’s not really a question of the cost per se. It’s really a question of political will.”

Setting aside the issue of cost, Hardesty questioned whether or not the government is responsible for deploying fiber to remote locations in the first place.

“The government helped get electricity to places that are really remote, and broadband is practically as much of a necessity now as electricity is,” she said. “But then others would say, if you choose to live in a really remote location… you’d have to pay for getting plumbing out there. So why should the government have to pay for your broadband?”

Another challenge in fiber deployment is the broadband workforce shortage, Buckley said. Several industry organizations and community colleges are working together to design and offer training programs, but there is still a need for skilled fiber technicians.

Our Broadband Breakfast Live Online events take place on Wednesday at 12 Noon ET. Watch the event on Broadband Breakfast, or REGISTER HERE to join the conversation.

Wednesday, December 28, 2022, 12 Noon ET – New Year Recap: Biggest Stories in Broadband

Join the Broadband Breakfast team and our guests to discuss the biggest stories in broadband in 2022. Plus, we’ll make predictions for what to expect in 2023. We’ll discuss:

• The first year of implementing the Infrastructure Investment and Jobs Act.
• How broadband and the hybrid workforce are adapting to the post-pandemic reality.
• The role of the national broadband map and challenges to it.
• Key moments in the ongoing fight about online content moderation.
• The future of broadband infrastructure development in the face of a number of workforce and supply chain challenges.
• And more!

Make sure to tune in for this special year-in-review Live Online.

Panelists:

• Sean Buckley, Editor in Chief, Broadband Communities
• Linda Hardesty, Editor in Chief, Fierce Telecom
• Sean Gonsalves, Senior Writer and Editor, Community Broadband Networks Initiative, Institute for Local Self-Reliance
• Drew Clark (moderator), Editor and Publisher, Broadband Breakfast

Sean Buckley is the Editor in Chief of Broadband Communities. Buckley comes to the magazine publishing and conference company after serving nine years as Senior Editor at FierceTelecom, a daily online newletter. He also oversaw FierceInstaller, a weekly publication chronicling trends in network installation. Prior to coming to FierceTelecom, Sean spent eight years at Horizon House publications, serving as senior editor and later as Editor in Chief of Telecommunications Magazine and Telecom Engine. He also had a one-year stint at Current Analysis tracking public sector IT trends.

Linda Hardesty is editor-in-chief at Fierce overseeing the telecom group comprised of FierceWireless, FierceTelecom and FierceVideo. She’s been a trade journalist since the mid-1990s covering the business and technology of telecommunications networks. Prior to Fierce, she wrote for SDxCentral, Communications Technology/CableFax and Cable World.

Sean Gonsalves is a longtime former reporter, columnist and news editor with the Cape Cod Times. He is also a former nationally syndicated columnist in 22 newspapers, including the Oakland Tribune, Kansas City Star and Seattle Post-Intelligencer. His work has also appeared in the Boston Globe, USA Today, the Washington Post and the International Herald-Tribune. In October 2020, Sean joined the Institute for Local Self-Reliance staff as a senior reporter, editor and researcher for ILSR’s Community Broadband Networks Initiative.

Drew Clark (moderator) is CEO of Breakfast Media LLC. He has led the Broadband Breakfast community since 2008. An early proponent of better broadband, better lives, he initially founded the Broadband Census crowdsourcing campaign for broadband data. As Editor and Publisher, Clark presides over the leading media company advocating for higher-capacity internet everywhere through topical, timely and intelligent coverage. Clark also served as head of the Partnership for a Connected Illinois, a state broadband initiative.

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