Covid-19 Relief Package: Congress Sets Aside $7 billion for Broadband Expansion

The pandemic has shown us the opportunity costs of the digital divide. Citizens without reliable, high-speed internet often can’t attend class or work remotely, shop online, or access telehealth services.

In the recently passed coronavirus aid package, Congress tucked away $7 billion in funds for broadband expansion efforts. The breakdown, per Axios:

• $3.2 billion for a new program that provides a $50/month broadband subsidy for low-income families
• $1.9 billion for “rip and replace” of Huawei and ZTE equipment
• $1 billion for Tribal areas
• $300 million for rural areas
• $285 million for communities around HBCUs
• $250 million for an FCC telehealth program
• $98 million for broadband mapping

“Rip and replace” = shorthand for removing Chinese-made telco gear from U.S. networks. Smaller, rural U.S. carriers sourced competitively priced 4G parts from these Chinese network gear manufacturers. Replacing those 4G parts—and adding new 5G ones—doesn’t come cheap.

And laying new fiber could be even worse. That’s why we expect internet service providers to increasingly tap wireless technologies like 4G, 5G, and low Earth orbit satellites. It’s a good time for SpaceX’s Starlink to be running its “Better than nothing Beta.”