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Bridging the Digital Divide – The Infrastructure Bill’s Hope for Broadband Expansion

For several decades, the need for broadband expansion throughout the nation has been clear–so clear that policymakers have considered such infrastructure improvements for nearly 20 years. But the recent pandemic served as a catalyst for change in this regard. With businesses closed and communities in lockdown, online activities increased substantially. In many instances, access to high-speed Internet was a necessity, especially in areas like education and healthcare. And it’s for these reasons that the current $1.2 trillion infrastructure bill includes a substantial amount for broadband expansion.

(The pandemic proved to be a boon for the healthcare industry–read how in this Bold story.)

At the present time, however, the broadband infrastructure bill allocations have yet to be approved. Despite the obvious need to bridge the nation’s digital divide, some policymakers are leveraging one agenda for another. Many remain hopeful the broadband infrastructure bill will eventually pass, even if it requires a separate piece of legislation. But many businesses involved in telecommunication are forging ahead with broadband expansion regardless. Certainly, government supports would greatly accelerate this process. But either way, it appears states and companies are investing increasing efforts to bring high-speed Internet to all.

“COVID taught lots of government officials why you need every school kid to have broadband in their homes and why rural areas need it for health care.” – Blair Levin, Wall Street analyst and Lead Author of the National Broadband Plan under President Obama

Understanding the Broadband Infrastructure Bill

The current legislative proposal for broadband expansion under focuses on a few key areas when it comes to the digital divide. Out of the entire $1.2 trillion of the infrastructure bill, roughly $65 billion is being allotted to broadband development. The largest portion of these funds, totaling $42 billion, is to support development of high-speed Internet where it doesn’t exist. This money will be provided to states in an effort to expand Internet services in rural areas. States decide which Internet service providers (ISPs) receive funding based on their proposals. This lion’s share portion of the broadband infrastructure bill targets the most pressing digital need currently.

The remainder of the allotments related to the broadband infrastructure bill supports other areas of need. Approximately $14.2 billion will go toward creating a permanent subsidy for low-income households. Each household will enjoy a $30 per month allotment for broadband Internet services. These subsidies hope to deter ISPs from redlining low-income communities where they believe they will earn fewer profits. The bill also includes nearly $3 billion to go toward state programs associated with the Digital Equity Act. These programs allow states to provide digital literacy education and support net neutrality access. Without question, this degree of funding will certainly boost the nation’s broadband expansion almost overnight.

“Out of [the pandemic] crisis is opportunity. With this crisis, we’ve ended the days where we talk about broadband as a ‘nice-to-have.’ Policymakers everywhere now understand it’s a ‘need-to-have’ for everyone across this country.” – Jessica Rosenworcel, Acting Chair of Federal Communications Commission

Accelerating Broadband Expansion Progress

Currently, many states are already taking initiatives throughout their own broadband infrastructure bill programs. State funding in areas like New York, West Virginia, Florida, and elsewhere recognize the needs that the pandemic highlighted. At the same time, major ISPs are also committing to broadband expansion. Some of these companies represent smaller entities while others are major telecommunications giants. In fact, the FCC has already noted around 180 companies are jockeying for broadband infrastructure bill funding. Many assume some form of legislation will eventually succeed, and thus, they are preparing in advance.

Some dude working on a server station
Broadband expansion means giving greater Internet access–and information access–to everyone.

Several major companies have already announced significant plans for broadband expansion. Charter Communications operates in multiple states presently as an ISP. It is currently enhancing its network efficiencies and acknowledges that government subsidies would help greatly. AT&T is planning to self-fund its own fiberoptic network for broadband expansion to millions. It hopes to reach an additional 30 million households by 2025. Also, Frontier Communications has adopted a Build Gigabit Program, targeting 10 million new locations by 2025. It has also partnered with AT&T to expand broadband access to 25 states in total. While these plans are already in place, the broadband infrastructure bill would help fast-track these objectives.

“With Frontier building out its own fiber network where we are not building, we’ll be able to work together to provide large business customers with the high-speed, low-latency data connectivity they need to grow and thrive.” – Scott Mair, President, Network Engineering and Operations, AT&T

Additional Requirements of the Broadband Infrastructure Bill

Initially, there was significant debate over what speeds defined broadband Internet among policymakers. However, the current version of the bill requires upload speeds of 20 mbps and download speeds of 100 mbps. Understanding this, this allows for not only fiberoptic networks but other types of Internet service infrastructures as well. Specifically, these requirements allow coaxial cable networks as well as satellite service networks to participate. This is noteworthy because it expands potential ISPs available, including SpaceX’s Starlink network. Under the current broadband infrastructure bill, all would be eligible for funding supports.

The latest infrastructure bill also requires ISPs to be more transparent in relation to their services. Specifically, each company must disclose each of the Internet service levels and their associated prices. Also, for ISPs receiving federal government support, funds may be withheld if customers experience long service outages. Federal grants also insist that ISP recipients provide Internet services to low-income areas regardless of profitability. Policymakers in favor of these stipulations believe this will deter many of the practices that currently affect equitable access.

Current State of Affairs

As of November, the currently proposed infrastructure bill has passed the Senate and is awaiting a House vote. However, despite bipartisan support of broadband expansion, links to other infrastructure programs threaten its passage. For long-time advocates of such measures, they believe now be the best time for a broadband infrastructure bill to pass. But the farther away it gets from the peak of the pandemic, the less likely this becomes. In order to bridge the nation’s digital divide, it’s clear the current bill would be advantageous. But ultimately, it may still fall upon businesses’ shoulders to make broadband expansion a reality.

 

The official Bold Business survey results are clear: most favor work-from-home over going back to the office. Read more in this important Bold story!

The Space Economy and the Orbital Real Estate Boom

In the last year, several space-related companies have made major breakthroughs related to space travel. Blue Origin, SpaceX, and Virgin Galactic have each demonstrated what the future of space may offer. Likewise, dozens of highly-advanced space and technology companies that want to provide an array of services are jockeying for position. But one thing will be required for all of these companies to excel in space, and that’s a commercial space station. Destinations in space and space habitats will be essential for a variety of activities. This not only includes scientific research and tourism but also manufacturing and even media entertainment. Fortunately, several innovative companies are taking on this challenge.

(Read more about Virgin Galactic winning the billionaire space race in this Bold story.)

The reason that a commercial space station is important is because the current International Space Station will soon be retired. Similarly, most expect a boom in space-related activities in the coming decade. Certainly, space transportation is a rate-limiting factor in this regard. But once this has been resolved, space habitats will be required in order to advance discovery further. In this regard, roughly a dozen companies have already made proposals for creating a commercial space station. And while all may not succeed, it’s clear that the orbital real estate market is heating up. In fact, by decade’s end, there’s likely to be a number of space habitats to support a burgeoning space industry.

“One of our key theses for the industry is that the last 10 years have been defined by building access to space, the next 10 years will be about destinations.” – Dylan Taylor, CEO of Voyager Space

Collaboration Is the Key to Commercial Space Station Development

Without question, the International Space Station has played a major role in the advancement of space technologies. But the days of NASA and other government entities providing sole support for these endeavors have come to an end. Instead, major entities are partnering in an effort to share not only expertise but funding support as well. Space transportation companies like SpaceX and Blue Origin can make substantial contributions to the development of space habitats. But they are unable to go it alone from both a financial and technical expertise perspective. Collaborative alliances therefore make sense, which is exactly what many current commercial space station projects are doing.

To cartoon dudes chilling in a space station
The next commercial real estate boom is going to be inside an orbiting commercial space station.

Of course, NASA is playing a role in supporting the development of space habitats for the future. As part of its Commercial Low earth Orbital Destinations program, NASA has committed to $400 million in investments. But already, nearly a dozen applications for this support have been submitted by commercial space station projects. Plus, even if awarded to a single project, a significant amount of additional funding would be required. Naturally, companies realize this, which is why numerous partnerships have since formed. And thus far, it appears three major groups appear most likely to be among the first to develop a commercial space station.

“The station will open the next chapter of human space exploration and development by facilitating the growth of a vibrant ecosystem and business model for the future.” – Statement by Blue Origin

Partnerships Pursuing Orbital Space Habitats

In the last year, a few notable partnerships have announced their plans to build a commercial space station. In each case, key players bring their own unique expertise to the table in an effort to expedite the process. With this in mind, three major groups look to be among those taking an early in in creating space habitats in low-orbital space.

  • Sierra Space Project – Sierra Space is a division of the Sierra Nevada Corporation. Recently, it announced plans for a commercial space station called Orbital Reef, which can host up to 10 people. Described as an off-world, mixed-use business park, Orbital Reef has several contributors. This includes Blue Origin, which will provide core modules, utility systems, and its New Glenn launch system. Other notable partners include Boeing, Redwire Space, Genesis Engineering, and Arizona State University. Each brings specific value to the table ranging from station operations to technical and research guidance.
  • Axiom Space Project – Interestingly, Axiom Space has tremendous experience in house in supporting space habitats. It has been involved in supporting NASA’s International Space Station for several years. In addition, the company served as a service provider for SpaceX Dragon’s recent missions, brokering passage and training space travelers. Now, Axiom Space has raised $150 million to develop its own commercial space station. Though its approach is not highly publicized, it’s likely it will continue to partner with SpaceX. It has projected it will offer space habitats by 2024.
  • Starlab Project – Another project with the goal of commercial space station development is Starlab, which has 3 key players. Lockheed Martin is involved and will provide technical expertise related to operations and integrations. In addition, Nanoracks, which has also been intimately involved in the International Space Station, will contribute to design and construction. And lastly, Voyager Space, which is the majority owner of Nanoracks, will provide private funding support and capital. Starlab is expected to offer space habitats for commercial use by 2027.

 

“We do not want a space station gap. Everybody in the industry, in the community, understands that we cannot have a period where the United States lacks a space station, or space stations, in low Earth orbit.” – Jeffrey Manber, CEO of Nanoracks

An Understandably Pricey Real Estate Market

The investments and capital required to realize even a single commercial space station are tremendous. For this reason, funding from multiple sources will be essential. This will not only require partnerships and NASA support but additional private and public investments as well. Regardless, it is essential that space “real estate” be developed in order for the space economy to become a reality. Numerous companies appreciate this, which is why various options for space habitats are being proposed. It will certainly be interesting to see which of these come to fruition in the coming years.

 

Curious about the monetization of sub-orbital travel? Read more about Bold Business’ Space Economy series here!