How Will the $7.2 Billion Allotted for Broadband Stimulus Be Spent?

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How Will It Work?

Once the NTIA and the USDA create a system for distributing stimulus grants, they will work with the various states to outline the states' needs. The resulting proposals could come in the form of wired or wireless projects--the language of the law doesn't specify any particular speed or technology.

Meanwhile, tech companies, nonprofits, and ISPs will submit grant proposals and the Washington, D.C., entities will broker the final arrangements for funding approved proposals.

Each grant must adhere to principles of openness, including generally recognized provisions of Net neutrality, which require an "open access basis."

To counter potential fraud and waste, the law also mandates a "fully searchable database, accessible on the Internet at no cost to the public, that contains at least a list of each entity that has applied for a grant under this section, a description of each application, the status of each such application, the name of each entity receiving funds made available pursuant to this section, the purpose for which such entity is receiving such funds, each quarterly report submitted by the entity pursuant to this section, and such other information sufficient to allow the public to understand and monitor grants awarded under the program."

Will It Ceate Jobs?

Industry watchers say that the new law is crucial if some 20 million Americans are to obtain the broadband Internet access they need.

Craig Settles, president of and a longtime telecom industry observer, notes that public discussion of the broadband provision and of the larger stimulus package tends to focus on their similarity to New Deal-era public spending on infrastructure projects; but he says that the parallel is inexact.

"Broadband is as vital as roads and highways, but it isn't as much in the building of the infrastructure as in the job creation that comes out of the more physical, like dams and roads and so forth--those old-school infrastructure projects generate a lot of work," Settles says. "Where you're going to have the greatest impact [with the new projects] is after the network is done. It will draw new businesses to the communities; it will enable the businesses that are there to expand their markets."

What's Next?

In coming weeks, the person appointed as Secretary of Commerce by President Obama will appoint an assistant secretary--and that person will bear primary responsibility for overseeing execution of the provisions of Title VI.

"Over the next 60 days, the Department of Commerce and Department of Agriculture are going to write the [Request for Proposal] that puts the teeth into this bill, and the stipulations that the money gets appropriated to where it's needed and that it's open so it's not just the incumbents that are sucking up the money," Settles says.

Many other industry observers--including Harold Feld, a telecommunications consultant--say that the Obama Administration's attention to broadband indicates its commitment to making technology policy a high priority.

"So far, the Obama people who are going to be running this have shown that they have a drive and an appreciation for what broadband can do to transform people's lives," Feld says. "[Obama] has made a relatively minor part of the stimulus bill something that he talks about in every one of his speeches."

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