Will BEAD Networks Offer Affordable Service?

The Broadband Equity, Access, and Deployment (BEAD) Program—established by Congress in the Infrastructure Investment and Jobs Act—gives priority to projects that will result in broadband internet access service being offered in areas where service wasn't available before. Given that federal funds will provide 75 percent of the costs to deploy these networks, the chances that competing networks will be built at any time in the foreseeable future are very slim. Absent any market forces to check price increases, what guarantee do taxpayers have that the networks they are funding will offer services they can afford? States, territories, and the District of Columbia (known as "Eligible Entities") are now working on Initial Proposals, a prerequisite for receiving the BEAD funding. Initial Proposals describe the competitive processes the Eligible Entities propose to use to select subgrantees to construct broadband projects. Initial Proposals must describe how Eligible Entities will ensure that every resident has access to a reliable, affordable, high-speed broadband connection. The National Telecommunications and Information Administration (NTIA) oversees the BEAD Program and has asked Eligible Entities to address service affordability for both low-income and middle-class households. In determining whether to approve an Eligible Entity’s proposed definition of “low-cost broadband service option,” NTIA will consider, among other factors, (1) whether prospective subgrantees will be required to participate in the Affordable Connectivity Program, any successor program, and/or any other household broadband subsidy programs; (2) the expected cost (both monthly and non-recurring charges) to a low-income subscriber for a typical broadband internet access service plan after the application of any subsidies; and (3) the performance characteristics of the proposed options, including download and upload speeds, latency, data caps, and reliability commitments. NTIA has also asked Eligible Entities to submit a plan to ensure that high-quality broadband services are available at reasonable prices to all middle-class families in the BEAD-funded network’s service area.