Broadband Stimulus — Good Start or Lost Opportunity?

Holding Out Hope for a Bigger, Better Future Broadband Bill

The fact that Barack Obama so effectively used communications technology during his campaign, talks of appointing a CTO and is interested in broadband policy at all has created great hope for many in the tech industry. But the size and scope of the broadband legislation within the now nearly $900 billion economic stimulus package — which could be voted on by the House as early as this week — is pretty disappointing by most accounts.

While the broadband piece of the legislation got a shot in the arm yesterday when the Senate Finance Committee agreed to add a 10 percent tax credit for investments in current-generation technology, as The Wall Street Journal put it, and a 20 percent tax credit for investment in next-generation broadband in only rural and underserved areas, the bill still is far less than many in tech were hoping for.

Rather than the $44 billion to $100 billion that industry groups proposed should be allotted, the proposed economic stimulus plan as it now stands would allocate to broadband initiatives somewhere in the sub-$6 billion (House version) and around $9 billion (Senate version) range. But while many were hoping for broader ranging legislation aimed at spurring broadband upgrades to support higher data rates, the current bill is limited primarily to addressing geographies that are not served or underserved from a broadband perspective.

Still, some folks are just happy Obama and Congress are talking tech at all and hold out hope that broadband will be addressed more comprehensively later. Others are not so sure.

The Cheerleaders

“Some of us may be disappointed at how it turned out, but I think it’s significant that it’s happening,” said Luc Ceuppens, senior director, head of product marketing, High-End Systems Business unit at Juniper Networks Inc. (JNPR) and an xchange blogger. “I think it’s going to keep evolving. The fact that there was talk about redirecting some of the funds from the Universal Services Fund to broadband, I think it’s significant. I think it’s a big milestone. This president is embracing technology like no one before.”

Added Mehmet Balos, executive vice president and chief marketing officer of GENBAND, the current legislation is also good news in that it “is a major boost for rural America.”

Sources have told xchange the current stimulus package should not be viewed as the national broadband policy that’s been mentioned, indicating it’s just the tip of the iceberg. As xchange has reported, former FCC official and Obama transition team member Blair Levin, speaking at the “State of the Net” conference, said the economic stimulus package is meant to address very short-term goals and indicated that further programs will be added down the road.

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