Trouble spending $7.4B? Naaah

August 29th, 2009 by · Leave a Comment

So did the non-participation of Verizon (NYSE:VZ, news, filings), AT&T (NYSE:T, news, filings), and q harm the industry’s ability to find projects to spend the first $4B in stimulus funds the RUS and NTIA are offering?  Are you kidding?  As the Friday deadline closed and the applications piled up, the number came to $28B requested, 7 times the amount available.  That’s a lot of projects proposed by people who aren’t troubled by the network neutrality strings that might be attached.  The breakdown:

  • 1490 applications for network infrastructure grants totaling $23.2B
  • 320 applications for promoting broadband education etc totaling  $2.5B
  • 360 applications for building public computer centers totaling $1.9B

They say there will be a searchable database of all grants which will allow us to look in more detail.  For example, it would be interesting to see how much of the infrastructure applications are aimed at the ‘middle mile’ versus the ‘last mile’, but that will have to wait.

Of course, that’s how much has been requested, reality will be somewhat different.  If the RUS and NTIA award their entire initial $4B mandate, then each dollar requested has about a 14% chance of being granted.  It’s certainly competitive, but it’s still harder to get into Yale.

One thing we can conclude from all this (if we didn’t already know) is that the $7.4B being offered is a drop in the bucket.  It doesn’t even come close to bringing broadband to everyone.  However, if the industry spends it well then it seems likely that the Obama administration will sing the program’s praises and come up with more money later on.  (Err, borrow more money from China … you know what I mean)  So it is imperative that those awarded this money put it to immediate and constructive use!

Does anyone have an idea how long it will really take them to make their decisions?  At least with the Ivy League we know when to expect the letter in the mail…

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Categories: Government Regulations · Metro fiber

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