BEAD’s job is both ‘easier’ and ‘harder’ amid funds release, research finds

States will soon be able to apply to connect unserved locations under a massive federal broadband program, but researchers warn that the path to close the digital divide remains fraught, even though much progress has been made.

The National Telecommunications and Information Administration said earlier this month that states could apply for extra funding under its Broadband Equity, Access and Deployment program out of the approximately $21 billion it says is left over from the original pot of $42 billion.

NTIA estimated that could mean thousands of new locations are eligible for funding under BEAD to get connected, whether it’s because they have been defaulted on in other federal or state broadband programs; they were wrongly removed during the NTIA’s challenge process; or they have come to light in newer versions of the Federal Communications Commission broadband map.

But researchers warned that this new round of BEAD funding comes as the landscape has shifted significantly since it was approved under the 2021 infrastructure law. A report from the Advanced Communications Law & Policy Institute at New York Law School estimated that as many as 1 million locations could still be eligible to be served under this second round of BEAD funding.

And while that news is encouraging, as it means plenty of progress through other federal programs, state efforts and  internet service provider initiatives, those behind the report warned that the road ahead is still very complex.

“We're at a point now where NTIA's and BEAD's job is both easier because there are fewer locations to serve, but also harder because the ones that are left tend to be the more expensive and further-flung locations that had kind of been beyond the reach of ISPs' wherewithal to serve them without these grant funds,” said Michael Santorelli, ACLP’s director and an author of the report.

Meanwhile, ACLP’s report found that the number of locations still eligible for BEAD funding has declined by 69%, while, of the locations that needed BEAD funding in December 2022, 79% are now either served locations; are no longer serviceable; or have been covered by a federal program other than BEAD.

But Santorelli warned that different policy changes have made it more difficult to determine whether a location is served by broadband internet. That includes the very definition of what speeds constitute broadband, which the FCC revised in 2024 to download speeds of 100 megabits per second and upload speeds of 20 megabits per second, a four-fold increase from the 25/3 Mbps benchmark set by the FCC in 2015.

However, since BEAD was approved before that FCC rule change, it still uses the old definition of broadband speeds. Santorelli warned that the focus on unserved locations in this latest round of funding could mean leaving behind others that have connectivity under the old measure.

“NTIA appears to be focused on just that smaller number of locations that don't have 25/3, which potentially leaves 600,000 or so locations that would, according to the FCC's definition of broadband, be left out of the equation and potentially left without broadband service through BEAD,” he said.

The way that broadband programs sometimes overlap and sometimes don’t has repeatedly caught the attention of the Government Accountability Office, which in a report last year called on the various agencies that provide broadband grants to better coordinate with each other.

Meanwhile, lawmakers are trying to put their own stamp on the issue. The House Energy and Commerce Committee last week marked up a bill mandating that NTIA provide a “national strategy to close the digital divide,” something supporters said is necessary due to the lack of coordination at the federal level.

ACLP estimated that, depending on how the NTIA’s application and funding formula shakes out, this second round of BEAD funding could cost anywhere from $5.3 billion to $8.8 billion, leaving as much as $15.7 billion still unspent. And while ACLP had previously recommended that some savings be spent on a second BEAD round, this announcement does little to quell uncertainty around the remaining dollars.

Other suggestions for the money have included mitigating any provider defaults; supporting network resilience; and spending on digital literacy. Some groups have previously urged a renewed focus on connecting communities’ anchor institutions like schools, libraries and other facilities, while others have argued states should be allowed to spend the leftover cash how they see fit to close the digital divide, in line with the letter of the law, or some assert that Congress should have a say.

In an op-ed for Route Fifty last week, Mike Saperstein, senior vice president of government affairs at the Wireless Infrastructure Association, argued the best path forward is for states and localities to work out where their most acute needs are, and how non-deployment funds can help.

Given all that, ACLP said BEAD remains a “work in progress,” much like every other effort to close the digital divide.

“BEAD will ultimately be judged not only by how many miles of fiber are built or how many locations are connected, but by whether communities are better able to communicate, work, learn, respond to emergencies and grow,” Saperstein wrote. “Non-deployment funds can help make that happen.”