U.S. Utilities Are Poised To Disrupt Telecom Monopolies Thanks To Biden COVID Relief & Infrastructure Bills

As noted previously, I've got some mixed feelings on the Biden COVID relief and infrastructure bills' plan to throw more than $50 billion dollars at U.S. broadband. Mostly because we still haven't mapped U.S. broadband properly (meaning we don't know where money should be prioritized), and the U.S. has a rich history of failing to police subsidy fraud by the nation's biggest telecom monopolies.

U.S. regulators and lawmakers generally don't spend enough time attacking (or, often, even acknowledging) the real cause of shitty U.S. broadband: monopolization and the rampant state and federal corruption that protects it. In part because those monopolies are bone-grafted to our first responder networks and intelligence gathering, making them technically part of the government.

At the same time, I've spent much of 2022 directly talking to dozens of towns, utilities, cooperatives, and small ISPs that are going to immensely benefit from what they're calling a once-in-a-lifetime infusion of broadband funding.

In Tennessee, for example, the state just got done doling out $446 million in grants thanks to the Tennessee Emergency Broadband Fund, itself only made possible due to the American Rescue Plan Act. And despite this being Tennessee, a state that's no stranger to kissing AT&T's ass, more than half of the money doled out went to cooperatives and local city-owned utilities keen on expanding broadband access:

The Tennessee Department of Economic and Community Development (TNECD) awarded $446.8 million to 36 applicants, who are now tasked with deploying improved broadband service to 150,000 unserved homes and businesses across 58 Tennessee counties. All told, TNECD said that 218 applicants applied for a total of $1.2 billion in broadband funding.

Many utilities are already spending big bucks to upgrade their internal smart metering and infrastructure using fiber. It's just a skip and a jump to expand access to these fiber networks to the general public, and the massive infusion of grant money is helping to make the decision much easier.

That's not great news if you're a regional telecom giant like AT&T and Comcast, keen on protecting your longstanding regional monopoly. Both companies even went so far as to buy a Tennessee state law that prohibits utilities from expanding broadband beyond their existing utility footprints, lest companies like AT&T face something vaguely resembling broadband competition.

Even that didn't stop the success of city-backed utilities like Chattanooga's EPB, which routinely wins awards for offering fiber broadband that's much faster and much cheaper than anything provided by regional incumbent telecom monopolies. Numerous utilities that received this latest round of funding were inspired by EPB's success, and the nationwide accolades the service has received.

Again, this is happening in Tennessee, a state where giants like AT&T have long enjoyed a solid political stranglehold over the state legislature and what passes for state consumer protection regulators. And it's happening despite the GOP's venomous opposition to any municipal-based broadband alternatives, and widespread opposition to both the infrastructure and COVID relief bills.

Again, the problem comes in making sure this money is actually being spent on what these companies, utilities, and cooperatives are promising they'll spend it on. And that's difficult when broadband maps suck, what remains of your state regulatory apparatus has been hijacked by telecom giants keen on ripping off taxpayers, and the FCC's voting majority has been hijacked by telecom lobbyists.

Still, if these utility-backed efforts can have anywhere close to the impact we've already seen from utilities like EPB, it's hard to not see the potential disruption as predominantly positive. Especially since this isn't just happening in Tennessee - it's happening in most of the states in the country.

Make sure to read our recent Techdirt and Copia report on how cooperatives, utilities, and municipally run open access fiber networks are a key path toward finally breaking the longstanding telecom monopoly dominance that's left U.S. broadband an expensive, mediocre mess for the better part of the last thirty years.