For more than a year and a half, the nation’s top telecommunications regulator has been stuck in limbo, thanks to a combination of federal dysfunction and industry lobbying. Now the nomination of popular reformer Gigi Sohn to the FCC is facing a full frontal assault by telecom monopolies dedicated to preventing the agency from standing up to monopoly power.

After an inexplicable nine-month delay, President Biden nominated consumer advocate Gigi Sohn to the FCC late last year. Sohn, Co-Founder and CEO of consumer group Public Knowledge and a former advisor to FCC Chairman Tom Wheeler, is well versed in media and telecom policy, and broadly popular across both sides of the aisle. 

Yet since her belated nomination, Sohn has been met with a bevy of telecom, media-industry, and politically constructed allegations designed to derail her nomination, ranging from false claims that she’d harm rural America, manufactured allegations that she hates police, and false assertions that she’s looking to censor conservative voices in media. 

All of these efforts serve one function: to ensure the nation’s top telecommunications regulator remains mired in partisan gridlock and a 2-2 commissioner voting split. Without a clear voting majority, the agency can’t embrace reforms that are widely popular with the public, whether that’s restoring the FCC’s consumer protection authority, or restoring recently-discarded media consolidation rules.

The BEAD Notice of Funding Opportunity (NOFO) released by NTIA is packed with guidance and regulations for how tens of billions in new funding with be spent. Reading the rules closely gives us a sense of who they might advantage, at least early on, and the line NTIA is trying to walk in giving the money the most bang for its buck while also heading off abuse. 

On a recent episode of the Connect This! Show, Christopher Mitchell, Travis Carter (USI Internet), Kim McKinley (UTOPIA Fiber), and Doug Dawson (CCG Consulting) tackled what we know, what we don't, and what's likely to happen as states begin to file their letters of intent to participate in the program. Watch the shorts below to see them tackle Congressional intent, supply chain requirements, who we think will apply for these subgrants, and WISPs and overbuilding.

Watch the full episode here.

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Mountain Connect 2022 got a big kick off this morning in Keystone, Colorado with a Q&A discussion between National Telecommunications and Information Administration (NTIA) Assistant Secretary Alan Davidson and Broadband Breakfast CEO, Editor and Publisher Drew Clark.

Davidson provided a broad overview of the newly released Notice of Funding Opportunity (NOFO) for the $42.5 billion Broadband Equity Access & Deployment (BEAD) program, which set the table for the multitude of break-out sessions that attracted a who’s who of broadband providers, vendors, policy-makers and vendors.

Under the BEAD program, each of the 50 states will be eligible to receive a minimum of $100 million to expand high-speed Internet access, though most states will receive hundreds of millions more as additional funding will be allocated to states based on a formula that takes into account how many unserved households are in each state.

Most States On Board for BEAD

Davidson said that 25 states have already submitted their Letter of Intent (LOI) to seek BEAD funding. In all, 35 states have indicated they will also participate in the program so far as NTIA works with the other 15 states and territories to encourage them to take advantage of the largest ever federal investment in broadband.

The window to request an unprecedented amount of federal funds to support state broadband grant programs is now open for business.

On Friday the 13th, the U.S. Commerce Department’s National Telecommunications and Information Administration (NTIA) officially announced the Notice of Funding Opportunity (NOFO) for the $42.5 billion Broadband Equity Access & Deployment (BEAD) program.

The BEAD program, which is part of the Infrastructure Investment and Jobs Act (IIJA) that was passed in November 2021, represents the single largest federal investment in broadband expansion in U.S. history. The program, according to NTIA’s own definition, is designed to allocate the funds to all 50 states (U.S. territories and Tribal governments) to support “projects that help expand high-speed Internet access … (through) infrastructure deployment, mapping, and adoption. This includes planning and capacity-building in state offices. And it supports outreach and coordination with local communities.”

The Application Process Has Begun

We have documented and discussed the BEAD program on numerous occasions, which you can find here. But the big news that comes with the NOFO release are the application deadlines associated with it.

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States have until July 18 to submit their Letter of Intent (LOI), a required first step for states to receive a minimum of $100 million in BEAD funds. (States will be allocated additional funding based on a formula that takes into account how many unserved households are in each state).

The Biden Administration is poised to celebrate the nation's largest telecommunications monopolies today even as these companies do the bare minimum for digital equity while undermining his administration's broadband agenda.

Christopher Mitchell, Director of the Community Broadband Networks Program at the Institute for Local Self-Reliance, had this to say today about the undue influence of Big Telecom and its effort to block the confirmation of GiGi Sohn as an FCC commissioner: 

As we enter the third year of a pandemic that has supposedly redefined the crucial importance of broadband, the Federal Communications Commission has failed to update the definition of broadband it set in 2015. Few expect the FCC to publish accurate maps of where broadband is until 2023. It might help if President Biden seated his third commissioner. 

The Biden Administration took a painfully long time to nominate the most obvious candidate for the position - Gigi Sohn - and has done precious little to have her confirmed in a reasonable time frame. Though it would be easy to blame Republican opposition, the truth is that it simply does not appear to be a priority for the Administration.

We join the effort to praise all companies that are helping move toward digital equity, but if simply discounting the cost of service from cable and telephone providers were sufficient, we might have less of a problem now, 11 years after Comcast launched Internet Essentials. To actually connect everyone, we will need an effective FCC as well as local engagement. However, some of the very companies being praised by the President today are spending millions in lobbying and ad-blitzes to prevent Gigi Sohn from being confirmed and to stop needed investments.

If they succeed in blocking Gigi, they will have confirmed something else: that they are the actual regulator of telecom services and the Biden Administration is not serious about the lofty goals it set in 2021. 

Freshly proposed legislation in Missouri would prohibit towns and cities from using federal funds to improve broadband access in areas telecom monopolies already claim to serve. It’s just the latest attempt by incumbent telecom giants to ensure that an historic wave of federal broadband funding won’t harm their revenues by boosting local broadband competition.

Missouri SB 1074 - Sponsored by Sen. Dan Hegeman (R., District 12), proclaims that “no federal funds received by the state, political subdivision, city, town, or village shall be expended for the construction of retail broadband internet infrastructure unless the project to be constructed is located in an unserved area or underserved area.” It passed the Senate Commerce, Consumer Protection, Energy and the Environment Committee on April 13th.

According to the bill, the Missouri Office of Broadband Infrastructure would certify the project prior to a political subdivision receiving authorization. Before being authorized, the office would be mandated to check with incumbent broadband providers to ensure that they don’t offer service in the specified area. 

The bill prohibits federal funding for any projects in areas where a single provider already receives funding to deliver 100 Megabits per second (Mbps) download speeds. If it passes, it also allows Internet Service Providers (ISPs) to submit written challenges to grant applicants within 45 days. The Department of Economic Development would then be tasked with determining the truthfulness of each challenge. 

Only if applicants can prove they’re servicing an “unserved” or “underserved” area (which again is defined by flawed FCC Form 477 data that routinely overstates existing coverage and speeds using broadband definitions set at ankle height) will the applications be deemed valid. 

But the bill gives incumbent monopolies even greater leverage in the challenge process, by letting them challenge a deployment if an incumbent ISP has “taken affirmative steps to begin the process of construction to provide broadband,” or “has been designated funding through federal programs to support the deployment of broadband” in the targeted areas.

Although we were initially concerned that certain language in New York’s proposed state budget would lock out municipal broadband projects from being able to capitalize on the federal funding bonanza contained in the American Rescue Plan Act and forthcoming money in the Infrastructure Investment and Jobs Act, the bill that was ultimately signed into law by Gov. Kathy Hochul was amended and has some golden nuggets for municipal broadband.

The recently enacted $220 billion budget bill includes $1 billion for the state’s ConnectALL initiative, which Gov. Kathy Hochul’s office calls “the largest ever investment in New York's 21st century infrastructure (that) will leverage public and private investments to connect New Yorkers in rural and urban areas statewide to broadband and establish the first municipal broadband program of its kind in the nation.”

Cultivating a Municipal Broadband Ecosystem

In part MMM of the budget bill, it establishes a “municipal assistance program … to provide grant funding to municipalities, state and local authorities ... to plan and construct infrastructure necessary to provide broadband services.”

Municipal grant recipients, the bill says, will be required to build broadband infrastructure to “facilitate projects that, at a minimum, provide reliable Internet service with consistent speeds of at least 100 Megabits per second (Mbps) for download and at least 20 (Mbps) for upload.” That shouldn’t be a problem as most municipal broadband projects use fiber optics that can deliver far more than that. 

How much of the ConnectALL money will be allocated for the municipal grant fund has not yet been determined. But, community broadband advocates should not lose sight of the significance of the broadband ecosystem that is being cultivated in conjunction with other parts of the budget bill.

With an unprecedented amount of federal funds to build broadband networks flowing into individual states, lawmakers in some states are doing the bidding of the big monopoly Internet Service Providers and potentially blowing a once-in-a-generation chance to invest in the locally-accountable infrastructure that offers the best chance to bridge the broadband gap for millions of families once and for all.  

Two weeks ago we wrote about the anti-competition broadband legislation making its way through the State Legislatures in Illinois and New York as state lawmakers across the nation establish high-speed Internet grant programs.

That trend looks like it’s continuing in Michigan where Democratic Gov. Gretchen Whitmer and the state’s GOP-dominated Legislature recently reached a deal to pass a nearly $5 billion spending bill.

While the “Building Michigan Together Plan” is being “celebrated” by the governor’s office as a way to “grow the economy, create jobs, and benefit families in every region of the state,” the main supplemental spending bill, known as Senate Bill 565 (SB 565), may sink some hope community broadband advocates have for leveraging the windfall of federal funds the Great Lakes State is getting from the American Rescue Plan Act (ARPA) and the forthcoming funds in the Infrastructure Investment & Jobs Act (IIJA).

Protecting Incumbents from Competition

Now that the fight over federal funding to expand broadband access has been largely settled with the passage of the American Rescue Plan Act (ARPA) and the Infrastructure Investment and Jobs Act (IIJA), states and local communities are preparing to put those funds to work.

The Biden Administration had initially hoped to tip the scales in favor of building publicly-owned broadband networks as the best way to boost local (more affordable) Internet choice, and inject competition into a market dominated by monopoly incumbents. And while the Treasury rules on how Rescue Plan money can be spent does give states and local governments the ability to do just that, the rules for how the IIJA’s Broadband Equity, Access, and Deployment (BEAD) program can be spent have yet to be finalized by the National Telecommunications and Information Administration (NTIA), the agency in charge of allocating those funds to the states.

Predictably, the big monopoly incumbents are focusing their lobbying efforts on state lawmakers as states funnel those federal funds into state broadband grant programs. In some states, Big Telco is getting the desired result: the shunning of publicly-owned network proposals to shield monopoly providers from competition. Of course, we expected some states – especially those with preemption laws that either erect barriers to municipal broadband or outright ban such networks – to shovel most of their federal broadband funds to the big incumbents, even though they have a long track record of over-promising and under-delivering. 

But while we might expect Florida and Texas to favor the private sector and stealthily move to shut out projects that are publicly-owned, we’re surprised that the first place it’s happening is actually Illinois and New York.

Illinois Lawmakers Thumb Nose at Federal Law

This week’s episode of our Community Broadband Bits podcast is particularly insightful for communities considering how to leverage the broadband expansion funds embedded in the Infrastructure Investment and Jobs Act (IIJA) passed in November 2021.

Although the funds will likely not be allocated to state grant programs until the end of 2022/early 2023, the time is now for state and local leaders interested in building community-owned networks to best position themselves to take advantage of this once-in-a-generation investment.

Christopher is joined by Nancy Werner, General Counsel of the National Association of Telecommunications Officers and Advisors (NATOA), an under-the-radar organization that advises local government officials on telecommunication issues.

During the conversation, the two talk about NATOA and its role in supporting community broadband projects with a particular focus on how the Broadband Equity, Access and Deployment (BEAD) program contained in the infrastructure bill is structured. Christopher and Nancy zero in on exactly how BEAD grant money can be used. Although the bill was written to first focus on mostly rural communities who do not have access to minimum broadband connections of 25/3 Megabits per second, they delve into the nitty gritty of how the funds can be used to prioritize bringing high-speed Internet access to multi-dwelling units even in densely-populated urban centers.

As Christopher notes:

This is important because this is a question of whether we are going to spend the vast majority of this money in areas that are more rural … or if we are going to spend any money in urban areas ... It is incontrovertible that we have neglected the many more millions of people in urban areas. This is a time to make sure that we are not just picking one or the other.

The show ends with an exploration of the promise and shortcomings of taking a simplified approach to setting Right-of-Way and franchise fees, which are areas that are notoriously difficult waters to navigate as new networks are being built.