Broadband Stimulus Q&A: 'Be Prepared'

The American Recovery and Reinvestment Act has passed into law and it has been deemed that broadband development projects will get $7.2 billion, distributed to applicants via the National Telecommunications and Information Agency (NTIA) and the U.S. Department of Agriculture Rural Utilities Service (RUS) program.

Ever since, the government and industry stakeholders have been having a back-and-forth about the particulars — who, what, when, where, why and how — of doling out the broadband stimulus dollars. Juan Vela, director of solutions marketing and strategy for Occam Networks, helped me parse some remaining questions about the stimulus.

Last Mile: Now that the economic stimulus is approved, what can municipalities expect to see of the broadband stimulus process?

Juan Vela: There has been a lot of interaction with potential stakeholders. So far, much of the dialog between the industry and government has been defining who will get the stimulus, what the unserved and underserved areas are, the terms of the stimulus and what broadband means.

Many in the industry are pushing for a more aggressive stance on the definition of broadband. Right now, the FCC defines it as 768 kilobits per second (Kbps). There is talk of going up to 100 megabits per second (Mbps) or even 1 gigabit per second (Gbps) to compete with the rest of world. Currently, 768 Kbps by anyone’s standards is not broadband, but the most basic of services.

In addition, while the term “unserved” is clear, being areas that have no access to broadband services, “underserved” is more undefined.  

LM: Specifically, how will rural communities be affected?

JV: The use of broadband in rural areas for the advancement of education and healthcare has become very important. Broadband provides the end-user with the availability of services that they do not have access to in rural or remote locations such as advanced training classes, which can make rural communities more competitive in education. It makes health experts more available to rural residents. Getting access to doctors is still a scheduling challenge, but the patients have better access through broadband.

There is also an impact on the small and medium business (SMB) community. A business can be located anywhere, and with access to broadband infrastructure they compete on not just a local level, but on a national and even a global scale. Broadband makes rural communities more competitive in the world and can lure businesses to the community with advanced speed services. Broadband makes rural communities relevant, and it spurs investment in community, which spurs growth in the economy and job growth. It’s a self-sustaining cycle.

LM: How much funding will be available per project?

JV: I haven’t heard of a specific dollar amount per project. There have been general guidelines for projects from the RUS and NTIA. Both advocate that applicants fund their project all at once and come with a complete project plan. If an applicant comes with a project to be deployed as multiple phases, it will not be looked at as favorably.

The way that Occam has advised its customers is to say, Get as much funding as you can in the first application. We advise customers to look at the landscape of their infrastructure, look at the rules of the grants and think big. That way when they go to the committees to secure funds, they can show completeness and have an aggressive timetable with regard to securing funds and meeting deliverables.

There will be three phases of funding. Phase 1 will be April to June. Phase 2 will be October to December. Phase 3 will be April to June 2010. Every state will be given at least one grant.

LM: What steps do communities need to take to get funding?

JV: Communities need to understand their demographics, define who is getting broadband and who is not, and what percentage of the people are unserved or underserved. They need to understand what competitive landscape looks like. Communities need to understand the schedule of construction and installation.

The funding dollars need to be distributed between now and September 2010, and projects need to be substantially complete within two years from the time the funds are delivered.

They also need to understand who in the government and in their area will help them process the application.

LM: Who do see benefiting from the stimulus first, private service providers or public entities? Will private service providers be more willing to work with municipalities now?

JV: As far as for who wins, it will be the provider who knows how to navigate system best. That’s why it’s important to understand the application process and rules. Stay abreast of what is going on. Be informed.

There are some opportunities for partnerships between private providers and municipalities, and there are some creative ways to do that. There is some opportunity for traditional service providers to work with municipalities. There could be a mini market that springs up to that effect. Municipalities are good at providing infrastructure and providing a utility. Providers are good at providing services and dealing with customers. Willingness to work together is usually the biggest challenge. The stimulus has the potential to open that up.

Occam recently launched a microsite within its Web site to address broadband stimulus. The company is staying abreast of regulations and is using the site as a means to communicate its expertise and to offer perspective. The site, www.occamnetworks.com/bsp, will help visitors understand the applications process and possibly how Occam can help them in that regard.