TMCnews Featured Article

August 28, 2009

Applications Outnumber Broadband Stimulus Funds 7:1

By Gary Kim, Contributing Editor

Broadband stimulus applications outnumber funds available in the first round by about an order of magnitude, an analysis by USA Today finds.
The federal government has received more than 2,200 applications, totaling $28 billion, in a funding round of $4 billion.
Since applications can run as long as 500 pages each, it will take some time simply to read each of the applications, which raises doubt about the goal of getting the first projects funded in about two weeks.
Executives say they are aware they have to get the decisions made "fast and right," but recent experience with other "stimulus" funds suggests the two goals might be incompatible. Though there remains great debate about the matter, averting the banking crisis--at great cost and possibly questionable efficiency or effectiveness--happened fast, and if it averted a banking crash, might ultimately be deemed to have been "right."
The banking crisis might be a case where “fast” was more important than “right.” What cannot be addressed is whether some other courses of action would have yielded equivalent results, at less cost, or with fewer side effects. Beyond that, almost everything about the other "stimulus" programs now is suspect.
Some of the funds got out "fast" but seem not to have accomplished much. Other spending will not occur for years, when its "need" is difficult to determine.
Broadband stimulus funding likely will face similar criticisms, so maybe getting it "right" is more important than getting it done "fast."
There will be many unhappy applicants. But some projects obviously will make sense, and will be somewhat easier to assess.
In most cases, rural areas suffer from inadequate backhaul bandwidth, so providing that bandwidth should allow competitors and incumbents to increase access bandwidth.
But that might take some time, in many cases. The easiest measurable changes will happen when terrestrial or other wireless systems are used to quickly extend access to un-served locations. We will be able to measure changes in penetration, for example.
Training-related projects will be harder to measure, other than by citing the number of users trained, or the hours of training provided. That said, some things that are the "right" thing might not be as measurable as other things that are measurable, but of questionable relevance.
All that noted, the big problem right now is that too many requests, for too much money, now sit in the hands of evaluators. The good news undoubtedly is that most projects have been developed using "good grantsmanship rules." Applicants have asked for more than they need or actually want, expecting that even a slimmed-down project will meet their needs.
"Fast" awards might in this case be the enemy of the "good."

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Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.

Edited by Tim Gray