People have been talking about closing the digital divide for ages, but the pandemic in 2020 caused the U.S. Congress to start putting real money on the table for this. There are now so many initiatives to close the digital divide that it’s a bit hard to keep track of them all.
The topic is one of many that will be discussed at next week’s Competitive Carriers’ Association (CCA) free, virtual Mobile Carriers Show.
Some of the juicier digital divide initiatives include the Huawei rip and replace plans and the Emergency Broadband Benefit program.
In late December 2020, $1.9 billion was appropriated to carry out the Secure and Trusted Communications Networks Act of 2019. The FCC is in the process of spelling out the rules to distribute this money, for the purpose of ripping and replacing equipment from the Chinese telecom vendor Huawei.
Steven Berry, CEO and president of CCA, said of the rip and replace legislation, “That’s been a big priority for us. We’ve been working with the FCC literally on a weekly basis.”
The FCC is using the professional services firm Widelity to identify all the network equipment that would be reimbursable to telcos who need to replace their Huawei gear.
“Our point has been: just tell us what’s covered and what’s not,” said Berry. “Our carriers are patriotic, but they want to know that when they replace, it meets the requirements.”
Berry said Widelity will finish its study in a matter of weeks and carriers may be able to start submitting their requests for funding in a few months. He isn’t sure the $1.9 billion appropriated as replacement funds will ultimately be enough. “I sort of doubt it in the sense that as we do more inventories of what product is already out there, we may find there’s more out there than we think,” said Berry. “We know it will cost at least that much to cover the wireless carriers.”
Another new source of federal funds will come from the Emergency Broadband Benefit (EBB) program, which was instituted as part of the Consolidated Appropriations Act of 2021. Congress has provided $3.2 billion for the EBB program. Broadband providers that participate will be able to provide discounts of up to $50 a month for internet service and up to $75 a month on tribal lands.
“About 165 service providers have signed up to offer their services under the program, which the FCC hopes to start by the end of April,” writes New Street Research analysts led by Blair Levin.
New Street Research also rounded up a list of a few more programs that could provide telcos with federal funds. These include the American Rescue Plan (ARP) E-Rate Augmentation, which will provide $7.17 billion to reimburses schools and libraries for providing free broadband service to students, staff and library patrons in their homes. “The FCC has until early May to develop rules for the program,” states New Street.
There’s also the ARP Homeowners Assistance program with $9.96 billion in funding. This program will provide grants to states to administer programs assisting homeowners with a variety of payments, such as those related to mortgages, home insurance, utilities and internet service.
In addition, the ARP State/Treasury Fund of $10 billion authorizes the federal Treasury to allocate funds to the states for critical capital projects, including broadband projects. Each state will get 100,000, but beyond that, the funds will be distributed according to formulas.
There is also a new bill in the pipeline — the Accessible, Affordable Internet for All Act — that would invest a whopping $94 billion in expanding broadband infrastructure and connecting Americans. The proposed legislation was sponsored by 30 House and Senate Democrats led by Rep. James Clyburn (D-S.C.) and Sen. Amy Klobuchar (D-Minn).
The Accessible, Affordable Internet for All Act represents the broadband portions of the Leading Infrastructure for Tomorrow's (LIFT) America Act, for which Rep. Frank Pallone (D-N.J.) recently put forth an expansion of that 2019 bill.
All in all, there’s a lot of money on the table (and potentially in the pipeline) for broadband. “In sum, if nothing more were to happen, the action to date would represent the largest federal investment in the broadband ecosystem of all time,” stated the New Street Research analysts.
CCA’s Berry said, “You’ve got more money going into the broadband topic than we probably have knowledge on where and how you can best spend it.”