By Shane Tews

Following the passage of the Infrastructure Investment and Jobs Act (IIJA), a
Department of Commerce (DOC) branch known as the National Telecommunications
and Information Administration (NTIA) has been tasked with allocating
$42.5 billion of federal broadband infrastructure funding to state and local
governments through the Broadband Equity, Access, and Deployment (BEAD) program.
This $42.5 billion is part of a larger $65 billion sum that the IIJA puts
toward broadband infrastructure. How can NTIA and the states ensure the money
is spent effectively and that people are held accountable? How can barriers to
broadband adoption be overcome without just throwing money at the issue?

On this episode, I welcomed AEI Nonresident Senior
Fellow Mark Jamison back to the podcast. Dr. Jamison has
previously appeared on the show to talk about tech antitrust issues but is an
internet and telecommunications expert by training. In addition to his
fellowship at AEI, Dr. Jamison directs the Public Utility Research Center at
the University of Florida’s Warrington College of Business—where he also
teaches. Dr. Jamison previously served on the Federal Communications Commission
transition team for President-elect Trump and as a special adviser to the
governor of Florida’s internet task force. He is currently working with the
Florida government to help write the state’s strategic broadband plan.

Below is an edited and abridged transcript of our talk. You can listen to this and other episodes of Explain to Shane on AEI.org and subscribe via your preferred listening platform. You can also read the full transcript of our discussion here. If you enjoyed this episode, leave us a review, and tell your friends and colleagues to tune in.

Shane Tews: Let’s
walk through two arcane topics: the BEAD program and the associated Notice of
Funding Opportunity (NOFO). What is in the NOFO? Can I personally take
advantage of it to get BEAD funding?

Mark Jamison: This NOFO simply notifies people that money is
now available for the BEAD program. To your second point: No, you cannot do
that because a state has to do it. The DOC, with NTIA being part of it, will send
states a grand total of $42.5 billion to implement the BEAD program.

During the COVID-19 pandemic, more programs were launched to
cover the “middle mile” and other issues relating to broadband deployment. Having
a lot of different programs all focused on the same problem is not something
new for DC, however.

Can you explain the
middle mile? DOC Assistant Secretary Alan Davidson (who heads NTIA) said the
middle-mile is the most “shovel-ready” and probably the most important.

I really don’t know if it’s shovel-ready or not. But essentially
the idea of the middle-mile is getting primarily fiber-optic cables out into
rural areas so people can expand broadband access from those cables into their homes,
businesses, and anchor institutions like schools or hospitals. Basically, it’s
getting the internet into an area rather than into the actual buildings people
work or live in. A good way to think about it is like a main highway that gives
smaller roads something to connect to.

You have been working
with Florida on the initial broadband plan that the governor will propose to
NTIA. Tell us what you have been up to there.

I was working on something that is in Florida’s state law:
Every two years, the state must write a strategic broadband plan. This statute
was only put into place recently, so it was time to write the first one. I’ve
talked with the state many times about broadband saying, “Don’t do this; do
this instead.” And they said, “Well, if you’re so smart, then you help write
the strategic plan.” So I did, and we finished that project around May. Now the
people in the governor’s office are putting the finishing touches on our work,
but our plan was not written with the $42.5 billion of BEAD funding in mind. We
didn’t even know the program would look like that.

Once the governor’s office and the leaders of the state
legislature got involved, it was time for the academics to step away. Whether
any of the work that my team and I did sees the light of day is up in the air.

Generally, after a state submits a proposal, there’s a back
and forth with NTIA. Then, the state will need to submit a five-year plan that
involves some more back and forth with NTIA. Eventually, NTIA should say,
“Okay, state X, here’s how much money we will allot to you.” Then it’s in the
state’s hands to utilize the funds well—and I suspect NTIA will stay involved
throughout this final stage.

Are we ready to start
laying fiber all across America? What’s it going to take to make that happen?

No, we’re not ready for that. I don’t know if there is such
a thing as being ready to lay fiber across the whole country because we’re going
to spend $42.5 billion doing something that people are not prepared to do. It’s
not like we have experts in laying fiber-optics, software engineers, or electronics
technicians and laborers sitting out there twiddling their thumbs saying, “Gee,
I wish I could just find a job.” The people we are recruiting are out there
building houses, working a typical 9–5 office job, or doing something else.
Diverting that work over to building broadband will take some effort. So there
remains a notable workforce challenge here.

It can be a challenge
to lay fiber everywhere, especially in the countryside. Are there alternatives
that would allow us to connect these more remote areas?

I would like to leave that question in the hands of the
experts, but the way that I explain it to people is: If broadband is not in a
particular place, it’s because it’s probably not commercially viable. The
purpose of subsidies is to augment an internet service provider’s (ISP) revenues
and potentially make broadband deployment in remote regions more viable. The
customers are the ones who know how much broadband is worth to them, and the ISPs
know how much it costs to provide that service. They’re the ones that are real
experts on it. Sometimes that equation dictates that fiber-optics is exactly
the right solution, whereas in other instances it is not.

Sometimes wireless broadband is the right solution. These
are just antennas that point at each other and send a broadband signal out into
a rural area. We’ve got some in Florida because we have some places where there
aren’t very many people. There are also going to be places where broadband
access is going to be facilitated via satellites. We have a small number of
communities in Florida that are part of Native American reservations; you’re
not going to get fiber-optics out there as they’re out in the swamps. You’re
not going to be able to run a wireless system through a dense swamp, so in this
case, satellite internet is the solution.

Once we get broadband
across America, what do you think the biggest change will be in terms of how
Americans view and use the internet?

That’s hard to say because one of the things we’ve struggled
to understand is why a lot of people reject broadband. We’ve had programs
before that offered broadband for free and people still refused to connect. We’ve
also offered programs where we give them free broadband and a free computer,
but they still refuse to use broadband. We even offered training, on top of the
computer and free internet, and some responded, “How much do I have to pay to
not have to go to those classes?”

If you go back to my grandparents’ times, cars were rarer
back then and not a lot of people drove. But once we built roads to everybody’s
houses, people learned to enjoy that new infrastructure. Broadband is very
similar: Once it is there, people will figure out how they can personally
benefit from it.

The biggest challenge for the BEAD program is making sure
the money is spent well and that people are held accountable. We learned an
important lesson in 2008–2009 during the Great Recession when we had a stimulus
package that had almost $8 billion in it for broadband. After all the money was
spent, we tried to figure out that funding’s impact, and we did not find that
broadband expanded at all. What we found is that the people who got the money
were typically politically connected. There’s equipment out there that is
sitting around in warehouses because the businesses and individuals that
actually know how to do broadband were sidestepped and neglected. Then people
weren’t even held accountable if they didn’t work. Even some government
agencies quit publishing the data from that funding because the results were
flat-out embarrassing.

The post The Challenge of Putting Federal Broadband Funds to Good Use: Highlights from My Conversation with Mark Jamison appeared first on American Enterprise Institute – AEI.