Highs and lows on the broadband stimulus front

A few weeks ago I wrote a story that was essentially a progress report on the broadband stimulus program, and in the process, I became encouraged that the program was accomplishing what it was intended to do: create jobs and bring broadband to areas without broadband connectivity.

As a result, I read the list of the first 66 winners in Round 2 of the broadband stimulus program released last week with the same sort of eager anticipation that a parent would experience scanning the honor roll posted outside the principal’s door.

I smiled when I recognized some familiar names that deserved to win — such as Rural Telephone, whose CEO Larry Sevier recently talked to Connected Planet about the boost the company’s first round award would give the western Kansas economy.

I was also happy to see that the University Corporation for Advanced Internet Development won funding for its ambitious but also very logical project to interconnect multiple academic and research networks to create a nationwide community anchor network.  That award wasn’t really a surprise, though, considering that the UCAID project proposal seemed to shape the National Broadband Plan goal of bringing 1 Gb/s connectivity to anchor institutions in every community nationwide. As with the NBP goal of bringing 100 Mb/s to 100 million homes, the plan did not detail how that goal was to be achieved. But just as plan crafters knew cable companies were well on their way to reaching the 100 Mb/s goal, perhaps they also knew the UCAID project would go a long way toward reaching the 1 Gb/s goal.

IT managers have a saying: No one ever got fired for buying IBM. And there did seem to be a bit of that sort of thinking behind the first Round 2 awards announcement. Recipients on the list appeared to be chosen, at least in part, based on the likelihood that they would be able to avoid controversy. Companies that had previously borrowed money through the Rural Utilities Service (and presumably had demonstrated they could meet a business plan) were well represented. Rural Telephone, which has been borrowing through the program since the 1950s, is a perfect example.

Outside the telco realm, it may have been more difficult for the RUS and National Telecommunications and Information Agency to confirm an applicant’s track record. But not surprisingly one of the few municipal network operators on the awards list was Bristol Virginia Utilities Board, which already has demonstrated its abilities in a fairly high-profile manner.

I’m not suggesting the agencies involved are not following the criteria they established for the awards, which favor projects meeting certain criteria, such as serving areas with high poverty levels or jobless rates. What I am suggesting is that the award winners that were the first to be announced are not necessarily the ones that came in highest on the rating scale, but instead are the ones the agencies thought would make the best first impression. I don’t believe it was happenstance that awards to Guam and American Samoa were announced near the end of the first round.

With few exceptions, however, I believe most Round 1 awards went to organizations that deserved to win — and there’s no reason to expect anything different in Round 2. Maintaining a positive public image for the broadband stimulus program will be increasingly critical, however, now that lawmakers are considering a funding cut to the program.

That would be a real shame, considering the program’s success to date. And as we noted earlier this week, the impact of a funding cut on broadband deployment would be magnified because many stimulus projects include matching funds and many of the RUS-approved projects are funded as a combination of grants and loans.