Cable companies in position to capitalize on federal broadband funding

Former Federal Communications Commission chairman Tom Wheeler argued incumbent cable operators are in prime position to scoop up federal broadband funding and have little to fear from potential overbuild activity. Speaking about the looming congressional infrastructure package, Wheeler acknowledged each state will have discretion over how to allocate the broadband funding allotted to them, leaving some uncertainty about what their priorities in terms of speeds and access technology will be. However, he asserted incumbent operators are best positioned to help close the digital divide. Wheeler said the idea that there are “massive areas of virgin unserved territory” in the US is a “myth” and instead the reality on the ground is that there are “pockets of served areas surrounded by unserved.” The former FCC chair pointed to Charter Communications’ success in the Rural Digital Opportunity Fund Phase I auction as an example of these economics at work.  “I think there is a very strong position that the incumbents have, particularly the cable incumbents because of their hybrid infrastructure and their reliance on fiber," Wheeler concluded. "I don’t think we’re going to see a whole heck of a lot of overbuilds.” Wheeler also flagged concerns that President Joe Biden won’t be able to install a permanent FCC chairperson and fifth member before Acting Chairwoman Jessica Rosenworcel is forced to leave in 2022.