X

Connect (X)

Tag Archives: Connect America Fund

Federal Money for Rural Fiber Connectivity Certain to Come

By Don Bishop

Gary Bolton, president and CEO of the Fiber Broadband Association.

Congress has under consideration allocations amounting to hundreds of billions of dollars to be spent for extending fiber-optic cable connectivity for wireless communications and internet access, according to Gary Bolton, president and CEO of the Fiber Broadband Association. FBA is a membership organization dedicated to all-fiber-optic broadband. Bolton spoke with AGL eDigest on June 9 about fiber’s funding, its advantages and its future.

Various spending proposals on Capitol Hill for broadband network construction, with an emphasis on rural areas, Bolton said, add up to more than $350 billion. The eventual figure that may flow from legislation that could pass before Congress’ August recess begins could be $100 billion or less, with $65 billion possibly earmarked for broadband expansion.

“The right number from our research and research from CostQuest, looking at what it’s going to take, it’s $100 billion,” Bolton said. “But whatever we end up with, if it’s $65 billion, we’ll make it work. It’s in that range.”

Legislation Bolton mentioned includes the Leading Infrastructure for Tomorrow’s America Act (LIFT America Act), the Accessible, Affordable Internet for All Act and the Eliminating Barriers to Rural Internet Development Grant Eligibility Act (E-BRIDGE Act). He mentioned money already appropriated, including $20.4 billion from the Rural Digital Opportunity Fund (RDOF) and a radio-frequency spectrum auction that awarded $9.3 billion.

“There’s definitely going to be tens of billions, if not hundreds of billions of dollars available to get fiber out there,” Bolton said. “There’s going to be more capex than we can consume really quickly.” Capex refers to capital expenditure, which is money spent on assets, as opposed to operations.

In the office of every House and Senate member that FBA representatives visited, Bolton said, broadband was at the top of the infrastructure legislation priority list. He said that President Joe Biden has said he wants to see fiber connectivity extended to every American home.

“The president did come in starting with the $100 billion, which is the right number, if the president wants to get a fiber to every American, which is critical,” Bolton said. “If you think about 85 years ago with President Franklin Roosevelt, getting the Rural Electrification Act passed — that really transformed the country. Coming out of COVID, being able to make sure that you have digital equity and every American has equal access to fiber is critical to be able to have the communications for the future, and the foundation.”

A challenge Bolton identified involves making sure to achieve efficiency with fiber deployment and to ensure that fiber reaches rural communities.

“The FCC’s first Connect America Fund (CAF) allocation was about $2,500 per location for rural America for 4 megabits by 1 megabit,” Bolton said, referring to internet connectivity throughput speeds of 4 Mbps download and 1 Mbps upload. “At the last round of CAF auction, there was about $2,300 per location, and that was for 100 megabits, on average, so you get an order of magnitude more bandwidth and lower cost per location. These are the locations left behind, so they are the hardest to reach.”

With money from the FCC’s RDOF, Bolton said, the spending worked out to a little more than $1,700 per location, with 85 percent of the awards providing 1 Gbps of throughput speed.

“What we’re seeing is that providers are willing to put gigabit fiber out with much less subsidy,” Bolton said. “With advancements in deployment techniques and the technology, and as time goes on and we get more and more fiber out there, plus a lot of fiber investment — take Charter Communications, for example. They got $1.2 billion from RDOF, and they are going to couple that with $3.8 billion of their own money; so, $5 billion for fiber in the home. We are seeing a lot of private investment get put together with the federal subsidies, and then we have state money on top of that.”

This year, the Fiber Broadband Association has the 20th anniversary of its founding. The association will conduct its Fiber Connect 2021 conference and exhibition on July 25–28 at the Gaylord Opryland Resort & Convention Center in Nashville, Tennessee. Visit www.fiberbroadband.org.

“This will be the biggest fiber conference in the world, this year,” Bolton said. “We will be celebrating the evolution of fiber-to-the-home over the past 20 years.”

Don Bishop is executive editor and associate publisher of AGL Magazine.