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Broadband Winners and Losers in the US 2021 Infrastructure Bill

by Dan Grossman | Nov 18, 2021

The Infrastructure and Jobs Act, signed into law by President Biden on November 15, includes US $42.5 Billion for broadband infrastructure deployment, through the Broadband Equity, Access and Deployment (BEAD) program. See summary here. The money will be allocated to the states, which will each establish programs to disburse funds for high-speed broadband networks, predominantly for fiber-to-the-home (FTTH) and fixed wireless access (FWA). After the feeding frenzy turns the BEAD money into services for the currently underserved, there will be winners and losers – but mostly winners.

Winners: Fiber infrastructure materials suppliers - Corning, Commscope, AFL, Clearfield, OFS – fiber optic cable, along with all the stuff that connects it together is the second largest cost item in a fiber build, so these players will each see a big share of the BEAD money.

Winners: Broadband engineering and construction contractors – most of the BEAD money will go to contractors to do the design work, permitting and actual construction. Most of that will flow through to the people doing the work and the materials vendors – see fiber infrastructure suppliers above.

Winners: Fiber technicians and tower climbers – skilled labor for building fiber and wireless networks is already in short supply and more projects will make matters worse. There are already bidding wars for talent.

Winners: Wireless equipment vendors - Airspan/Mimosa, Cambium, Ubiquity, Siklu, Tarana Wireless etc. Also, Ericsson, Nokia and Samsung.  All stand to sell into the more sparsely populated areas of the country, where the economics of fiber don’t add up.

Winners: FTTH equipment vendors - ADTRAN, Calix, DZS, and Nokia – obviously, the makers of the equipment at the ends of the fiber network have a lot to gain…

Losers: Huawei and ZTE-- …with the exception of the Chinese vendors, which are excluded from the US market as alleged security threats.

Winners: Electronic and optical components vendors: Broadcom, Marvell, II-XI, AOI, etc. – equipment revenue flows down the supply chain.

Winner: WISPA, The Wireless ISP Assocation
Loser (for now): Fiber Broadband Association – The FTTH industry’s trade group wanted to effectively require that all the BEAD money be spent on FTTH, by defining upload speeds of less than 100 Mbps as “Underserved”. This is a difficult (but not impossible) spec for FWA operators to meet. The Wireless ISP trade group argued for technology-neutrality. The legislation defines ‘Underserved’ as less than 100 Mbps downstream, 20 Mbps upstream, speeds that are readily achievable with FWA. State grant programs, however, can favor symmetrical and/or higher speeds. This battle isn’t over.

Winners: Tier-2 service providersFrontier, Consolidated, Windstream, TDS and others that are in copper-to-fiber transitions. BEAD is expected to enlarge their fiber builds. With home-turf advantages in their footprints, they are well positioned to take a large share of state grants.

Losers: DirectTV, Dish, HughesNet, Viasat – as rural consumers get real broadband, they will cut the cord with satellite TV and go to streaming video, like the already served population. For customers of the slow, high latency, high priced satellite Internet services, high speed broadband can’t come soon enough.

Winners: State governments
Winner: National Telecommunications and Information Administration (NTIA)
Loser: The FCC – The FCC was cut out of the BEAD program, after a less-than-stellar performance administering earlier programs, as well as political horse-trading. Instead, it will be administered by NTIA, which will establish rules and funnel money to state governments to be disbursed as grants to broadband projects. NTIA Administrator Nominee Alan Davidson will be the most powerful person in Broadband.

Winners: Assorted charlatans and grifters – Despite controls in the legislation and the best efforts of the Administration, there will inevitably be waste, incompetence and fraud in the BEAD program. The test will be how much.

Winner: Small town America – Economic prosperity and high-speed broadband availability are strongly correlated. Communities previously left behind will be able to attract knowledge workers that can work from home and want the rural lifestyle. Broadband also brings in lower-skilled jobs that can now be done remotely, e.g., call center agents.

Biggest Winners: The soon-to-be-formerly unconnected - Broadband is a necessity of everyday life, and too many people in the US have had to do without it. BEAD will not connect every single home in the US, but it will bring universal broadband connectivity a lot closer.
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