‘SPEED for BEAD’ broadband reform bill earning mixed reviews

Though leaders at the National Telecommunications and Information Administration have yet to announce how they’ll modify the $42.45 billion Broadband Equity, Access, and Deployment, or BEAD, program, so far the legislation proposed to amend it hasn’t been as radical as Commerce Secretary Howard Lutnick’s recent censure of its “pointless requirements” and “woke mandates.”

Rep. Richard Hudson, R-N.C., this month introduced legislation called the ‘‘Streamlining Program Efficiency and Expanding Deployment for BEAD Act’’ or “SPEED for BEAD.” In keeping with President Donald Trump’s allergy to diversity, equity and inclusion programs, the bill would swap out “Equity” for “Expansion” in the program’s title, a change that Federal Communications Commission Commissioner Anna Gomez said she disapproved of.

“We must remain committed to prioritizing affordability and equal access. After all, BEAD without equity is just BAD,” she said in a statement this month, dusting off a favorite groaner shared in broadband circles.

The legislation would also make substantive changes to some of the program’s DEI requirements, remove labor requirements related to unions and collective bargaining, and in a move favored by satellite and wireless internet companies, make “all technologies eligible.”

The bill would amend BEAD so that any technology provider that can provide “reliable broadband service” meeting the law’s performance criteria, would be eligible to compete for projects on a level playing field.

Currently, BEAD prefers projects that install fiber optic cable, a technology widely considered to be the gold standard for internet connectivity for its reliability, long life and capacity for high speeds, which some theoretical estimates pin at two-thirds of the speed of light. Other technologies, such as fixed wireless broadband and satellite services, may only be used in BEAD projects if the cost to lay fiber optic cables in a particular region would exceed a threshold set by the project’s state government.

Some opponents of the bill have claimed that, despite its name, SPEED for BEAD may in fact slow the deployment of projects, setting back states as long as one year as they reset their contracts.

‘We’ve had some issues’

But industry groups dealing in technologies other than fiber have been supportive of changes that would eliminate red tape. Grant Spellmeyer, president of the America’s Communication Association, said his members were “ready to get shovels in the ground,” after three years of planning.

Matt Mandel, vice president of government affairs for the Wireless Internet Service Providers Association, told StateScoop that his members value fiber deployments, and often rely on them to support their own technologies, but that they appreciate the technology agnosticism advanced by Hudson’s bill.

“We’ve had some issues with the way the BEAD program has been administered, and we worked with stakeholders and people on the hill to find ways to improve it and this bill does a really good job of getting there,” Mandel said. “The big issues for us are the preference for a specific technology and the potential for overbuilding in areas that already have broadband deployment.”

Mandel also pointed to fiber’s relatively high cost and slower deployment speed, which owes to the need to dig.

“We’re not saying folks in unserved areas should get worse broadband,” he said. “We’re saying set high standards, and as long as you can meet those standards, the technology shouldn’t matter.”

‘Obsolete technologies’

But Christopher Mitchell, director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance, said the technologies used for broadband projects do matter.

“I am in favor of a historic fiber optic investment because I have watched as the federal government has put billions of dollars into obsolete technologies that were not providing the benefits we needed by the time we turned the network on,” Mitchell said. “This is primarily DSL networks. The point of BEAD was to make a generational investment so that we wouldn’t be in a position in five or 10 years to find more taxpayer dollars to throw at the same households that have been subsidized for the past 15 or 20 years.”

Mitchell said the wireless technologies he’s familiar with are refreshed every five to seven years.

“Maybe this money sets up a business model that would work and then the company would continue to refresh the technology on its own, but I’d like to see the economics of that,” he said.

But aside from departing from fiber-first, Mitchell said, many of the bill’s changes are “reasonable,” including eliminating letter-of-credit requirements that favor larger providers. BEAD requires letters of credit issued by banks to ensure contractors can prove they have a percentage of the grant funds on hand. In 2023, the NTIA created waivers and opened additional financial options after companies complained the letter-of-credit requirements were too restrictive.

“This is something that anyone that cares about small businesses is deeply concerned about, because small businesses have more trouble accessing them,” Mitchell said.

Starlink

One of the biggest unanswered questions surrounding the upcoming changes to BEAD is the degree to which it may favor satellite internet companies like Starlink, which is operated by Elon Musk’s SpaceX.

The Wall Street Journal reported this month that Starlink could receive as much as $20 billion in federal broadband dollars under new rules, instead of the $4.1 billion it might receive in a fiber-first BEAD. BEAD’s director, Evan Feinman, resigned last Friday and warned in an email over the weekend that much of the program’s funding would be diverted to Starlink.

“Stranding all or part of rural America with worse internet so that we can make the world’s richest man even richer is yet another in a long line of betrayals by Washington,” Feinman wrote in an email to colleagues, Politico reported.

Mitchell said spending billions on a service like Starlink would be “a waste.”

“Most people from rural America want to see money that will lead to economic opportunities, and although the Starlink is a wonderful technology in a lot of use cases, it will not bring jobs or businesses to rural America,” he said.

Angela Siefer, executive director at National Digital Inclusion Alliance, said Starlink was “amazing” and “a lifesaver” last year in North Carolina in the aftermath of Hurricane Helene, but that capacity quickly dried up as more people connected. As for its application under BEAD, she said, the bottom line is a deal breaker.

“From the NDIA’s viewpoint, we care a lot about affordability of internet service,” she said. “And Starlink is not affordable. Unless they are going to come up with a $30/month Starlink offer and donate that originating tech cost for the equipment, there’s no way it can be affordable.”

According to Starlink’s website, residential service costs $80 to $120 per month, and a $349 hardware kit is currently discounted to $149.

On Monday, The New York Times reported that Starlink had been installed across the White House campus to improve the capacity of its “overtaxed” Wi-Fi network. The Times was unable to verify whether the service, which was kept separate from networks connected to White House servers, was encrypted.

When asked about satellite services, Starlink and the ethics of the U.S. president advertising Musk’s Tesla business from the South Lawn of the White House, Mandel, the vice president of the wireless association, had little to say.

“Satellite is another technology that could work in some areas,” Mandel said. “There are pros and cons to it, and we always talk about the right tool for the right job. Satellite’s another tool in the toolbox.”