- Internet development programs cost billions but is not yet available
- Lack of program effectiveness can even determine election results
- Government support is dwarfed by the efforts of private business
Internet development programs cost billions but is not yet available
In 2021, US President Joe Biden's administration passed the Infrastructure Investment and Job Creation Act, which included spending as much as €42.5 billion on the Internet. This includes USD 42 billion for the Broadband Equity, Access, and Deployment (BEAD) program.
The program targeted rural areas with insufficient internet access, which would finally be given internet access. However, to date, not a single new settlement has been connected to the internet under this costly program[1].
The BEAD programme requirements identified that US states and territories have until the end of 2023 to submit investment and deployment plans. Although all have done so, it is now being announced that, in the most optimistic terms, the system will at best not be deployed until 2026.
Lack of program effectiveness can even determine election results
For example, in Virginia, as in many other states, not a single dollar spent on Internet development has been used. In fact, it was only in July of this year that the State of Virginia received the news that it had been approved for funding for the program at all. This was more than 10 months after the application was submitted to Washington and almost three years after the law was signed. This only shows some of the mistakes made by the Biden administration.
In a recent speech at the Democratic Party's national convention, Biden described his broadband program as historic, calling it a national expansion 'not unlike what Roosevelt did with electricity.' Kamala Harris, the current Democratic presidential candidate, was also instrumental in developing and promoting the program as Vice President. Now it may become a bad publicity stunt for her.
And experts believe that the program's failure could have political consequences, especially in Virginia, a swing state that has voted Democratic in the last four presidential elections but is now a target of the Republican National Committee. Polls have shown that the Republican and Democratic margins here are small, with all polls within the margin of error.
Some Republican members of the state's congressional delegation have already publicly accused the Biden administration of inaction on this costly issue. Terry Kilgore, a veteran Republican legislator and member of the General Assembly, says it is an embarrassment for politicians trying to defend the program. He said his constituents in the southwest of the state were eager to improve their poor internet access and have been hoping for funding since the bill was signed into law, but that has not happened[2].
Brendan Carr, a senior Republican commissioner at the Federal Communications Commission (FCC), is also outraged, pointing out that the Biden administration received billions to bring high-speed internet to millions of Americans, and a few years later, not a single new household is connected.
Government support is dwarfed by the efforts of private business
Between 2021 and 2023, internet access in US households grew from 80% to 83%. This increase was mainly driven by new connections in areas where internet access has historically been difficult or the cost of accessing it was considered prohibitive[3].
Thus, an additional 13 million new users came online during the period without spending a single dollar of the federal program.
Why is that? When states use a federal subsidy to provide access in areas without internet access, they have no incentive to ensure that the technology being deployed is appropriate for the area and that customers need and want what is provided. For example, many rural areas without internet access have no need for fiber optic cable, which is a priority for BEAD funding.
Additional investment in private networks is expected to increase internet access further by 2026, making public support almost unnecessary.
Private providers are expanding where they can sustainably grow their market in a way that provides the most appropriate choices to their customer base. Starlink is a prime example of this. So often, a private provider's flexibility means much more appropriate coverage in a given area at a significantly lower fraction of the cost.
