With the US Government intending to withhold significant funds under its federal rural broadband expansion programme, the country will gamble with the affordability and longevity of what was billed as a generational investment in connectivity. We tell a cautionary tale for other jurisdictions considering a reshuffle of their public broadband investments.
Changes to the public broadband funding through the BEAD programme will result in a per household spending cut of about $175 (£133). While American consumers today face a mixed bag compared to their European counterparts, they are likely to fall behind in access to and affordability of high-speed connectivity in the near future.
By dropping the fibre preference for publicly funded projects, the NTIA will cut the locations receiving fibre down to 65%. Rumoured additional culling of applications based on price indices may lower that proportion further.
Taking back funds budgeted for projects outside network deployment will mean states are unable to make good on plans to drive adoption, improve skills and support other infrastructure projects. The decision to rescind Digital Equity Act funding further guts the comprehensive vision for connectivity set out in the US’ infrastructure funding law.
Despite claims that changes to the broadband plan will save US tax payers $23bn, instead we find they will cost consumers an additional $62.3bn over the 10-year programme term. Both the higher cost of satellite services and the rollback of affordability provisions contribute to higher costs for consumers.
By limiting fibre deployment and cutting funding for adoption programmes, the US is undermining its own economic goal to compete in the digital economy, with a negative impact felt particularly by rural communities.
To date, European governments have avoided the pitfalls of the US by investing in fibre infrastructure and digital skills at scale. The continent should stay the course and seek to grasp the opportunity the US is presenting in hampering its own global competitiveness.
The US is preparing to leapfrog to the back of the pack in public broadband investment
Passed in 2021, the Infrastructure Investment and Jobs Act (IIJA) in the US was one of many commitments made in recent years by governments around the world to boost public spending on expanding broadband access. Within the IIJA, the Broadband Equity, Access, and Deployment (BEAD) programme was set to be a generational investment in extending high-quality connectivity to every corner of the country at costs affordable to consumers. The programme was endowed with $42.5bn (£32.9bn) in funds to be administered by the National Telecommunications and Information Administration (NTIA), equal to a per household spend of $329 (£241). Placed in the context of its transatlantic neighbor, Project Gigabit in the UK which spends about £177 per household on a similar mission of expanding access to quality connectivity, the US appeared poised to provide the investment needed to bring American consumers’ access to high-speed services closer to that of their European peers.
On 6 June 2025, the NTIA, under the Trump Administration, issued a policy notice on restructuring the BEAD programme, requiring states to conduct a new round of grant applications aiming to capitalise on what the NTIA refers to as the “Benefit of the Bargain”, or efforts to cut deployment costs on the original final plans submitted to the agency during the Biden Administration. Under bargain round rules, states were required to consider only cost factors in selecting grant awardees. The NTIA instructed states to no longer prioritise proposals that used fibre or require grant applicants to offer affordable tariffs. Project applications in the new round were only to be judged on their cost per location served and their ability to reach a minimum quality of service: 100/20Mbps speeds with latency less than or equal to 100 milliseconds and the capacity “to adapt to evolving connectivity demands”. While still pending, the NTIA is also rumoured to be considering yet another screening round for states’ BEAD plans aimed at lowering the per location cost of builds, which is likely to have the impact of further limiting the ability of states to award funds to fibre builders. Though the NTIA has been direct in its demands for a technology-neutral BEAD with lower deployment costs and no other grant terms, its comments in recent months suggest an even further rescission of BEAD funds beyond those relating to deployment. The agency appears to be planning to rescind and return all BEAD funds not used for network rollouts to the US Treasury, reneging on the promise that these funds could be spent to support a range of non-deployment projects including driving adoption and building digital skills.
Today, before a dollar of BEAD money has been spent, American consumers experience a mixed bag in comparison to European consumers in accessing and reaping the benefits of high-quality, affordable connectivity (see Table 1). With governments around the world aiming for and investing in ubiquitous gigabit-capable broadband in the next decade, the US’ decision to scramble the priorities of the BEAD programme can be read as a forfeit in the race to develop networks that will support the connectivity needs of the future. If the new rate of deployment spending remains steady among the few states left to submit a new final proposal to the NTIA (namely California), BEAD’s per household spending will drop to about $154 (£117), a decrease of $175 (£133). Such a scaling back of ambition is not unheard of internationally: the Australian Government experienced successive step downs in its vision for a public fibre to the home network via the NBN. However, the sheer scale at which the US appears prepared to squander its opportunity to build next generation networks and empower consumers to adopt the services these networks support now equates to a gamble on the country’s ability to advance digital inclusion and compete globally in the digital economy.
Only 65% of eligible locations will now receive fibre connectivity through the BEAD programme
Through the changes made to the terms of reference for BEAD, the NTIA has significantly limited the proportion of fibre that states can deploy (when compared to lower Earth orbit (LEO) satellite and fixed wireless access (FWA) services) and appears to be considering further limits on the permitted price per location that will likely disqualify even more planned fibre builds from receiving funding. By allowing unlicensed FWA services to be considered alongside FWA services using licensed spectrum in determining where sufficient broadband services exist, the agency has also cut an estimated 12-15% of previously eligible locations from receiving BEAD funds. On average, 65% of the shortened list of eligible BEAD locations will now receive fibre, 21% will receive satellite, 12% will receive FWA and the rest will receive cable or some other form of connectivity (see Figure 1). Based on reporting from states which have already submitted updated plans to the NTIA, the agency is further reviewing these proposals against the cost indices calculated by CostQuest, which is the contractor responsible for the FCC’s National Broadband Serviceable Location Fabric dataset. Should the agency enforce rumoured limits on cost per location served using these CostQuest indices, it's likely more BEAD eligible locations will be re-awarded to satellite or FWA service providers.
Looking more closely at the amended plans from one state, Pennsylvania, reveals a reduction in the number of locations eligible for funding, a decrease in the number of households slated to receive fibre connectivity, a related decrease in the overall cost per location and, ultimately, a decrease in the percent of the state’s total BEAD allocation committed to deployment activities. Under the new proposal, Comcast will serve the most households across Pennsylvania, but Amazon’s Leo will take on a significantly higher number of premises (18,000), which combined with SpaceX’s more modest coverage, will result in about 18% satellite assignment for all eligible locations. For its part, Comcast will serve about 80% of its 21,000 awarded premises with fibre and the remaining 20% with cable. In the context of unlicensed FWA services, research suggests that approximately 5% of all previously BEAD eligible premises in Pennsylvania will lose access to programme funding, a relatively low proportion compared to other states. None of the premises served by BEAD, regardless of the technology used to serve, are likely to be eligible for future federal funding opportunities, such as the Rural Digital Opportunity Fund (RDOF) which has also experienced significant shortcomings in delivering on its promise of expanded rural coverage in recent years.
Low earth orbit satellite services have grown in popularity as a relatively quick and lower cost option for deploying connectivity to the hardest to reach communities, and an increasing number of governments have invested public funds into satellite connectivity, with operators having signed agreements with providers for complementary services, especially in the context of direct-to-device (D2D) in mobile. The US would stand alone, however, in considerably increasing the public funding for satellite connectivity as the primary, fixed technology and would almost certainly stress the existing capacity of satellite services. The effective mandate from the NTIA to increase satellite funding through BEAD allocations significantly changes the value proposition of connectivity provided by the programme for states as well as consumers.
The NTIA is reneging on its promise to support consumers in reaping the benefits of network investment
In addition to limiting the deployment of fibre, the NTIA has also expressed its intent to take back any funding that had been earmarked for things other than building networks. Under the original programme rules, states were permitted to use excess funds not used for deployment in their allocation for activities related to driving adoption, improving maps of broadband availability etc. All deployment projects were to be prioritised over non-deployment programmes, and any allocations to non-deployment activities had to be allocated via a competitive grant selection process.
Though a number of states planned to use their full allocation for deployment, others detailed their non-deployment priorities with specific budgets within their total BEAD allocation. Some other states that planned to use their full allocation for network deployment listed possible projects to fund with any leftover money. For example in Georgia, where the Georgia Technology Authority planned to allocate its full funding to deployment, the priorities for possible excess funding included:
Extending connectivity to un- and under-served units within multi-dwelling units (MDUs), particularly in cities;
Supporting digital inclusion programming related to financial empowerment, education and community health; and
Developing a tower grant programme to offer funding to support improved mobile coverage.
Despite ranking last in the nation in broadband connectivity, the West Virginia Department of Economic Development (WVDED) also recognised in its original BEAD plans that its constituents face a range of barriers in adopting digital services, even after fixed connectivity is made more accessible. The authority therefore originally planned to allocate $145m (£109m) in BEAD funds to address four core connectivity programmes otherwise outside the deployment remit, including:
Developing a database and supporting the upgrade of telephone poles throughout the state;
Upgrading legacy and obsolete equipment throughout the public WVNET network for government;
Funding mobile infrastructure in "target corridors” lacking 4G or better coverage from a national operator; and
Offering an educational credentialing programme to grow the broadband workforce.
The decision to go back on the promise of non-deployment funds to be used at states’ own discretion coincides with the Trump Administration’s separate decision to rescind $2.75bn (£2.1bn) in funding under the Digital Equity Act, which was also passed as part of the IIJA. States will now be hard-pressed to fund adoption and inclusion programmes, as well as non-BEAD eligible connectivity infrastructure projects, that would allow consumers to reap the benefits of network investment. Additionally, without the option to reinvest BEAD funds unspent on deployment, states run the risk of failing to connect premises that may have been wrongly excluded from BEAD maps or may go unserved in the event a provider defaults on their existing commitment to build there, such as through the Rural Digital Opportunity Fund. Existing research estimates that there may be as many as 1m premises that will remain unconnected after BEAD builds under the new programme rules.
The NTIA’s claimed savings could directly cost consumers $62.3bn over the length of the programme
With the change to deployment fund rules and the rollback of nondeployment funds, the affordability mission central to the original legislative text underlying the BEAD programme will be largely lost. As states are restricted from grading applications based on operator’s commitments to offering affordable tariffs and the pending clawback of nondeployment funds will limit spending on subsidising broadband access, consumers will lose out on potential relief aimed at addressing the US’ (in)famously expensive broadband prices as a barrier to digital inclusion. A large number of consumers are also likely to only be able to access satellite services, either as a result of losing eligibility for BEAD builds due to existing satellite access or due to the deprioritisation of fibre projects. These consumers will have no choice but to adopt more expensive satellite-based services, including significant equipment costs, and without pricing protections or direct subsidies from funds like the lapsed Affordable Connectivity Program (ACP), will be less likely to be able to afford adopting the connectivity that their taxes paid for.
The NTIA has claimed it will save American tax payers a significant amount of money in cutting deployment costs and rescinding nondeployment funds from states. If planned spending by states holds for the few yet to submit final BEAD plans under the revised terms, the NTIA would reclaim more than half (approximately $22.6bn or £17.2bn) of funds allocated by Congress for the programme, which the agency describes as a savings to tax payers. When considering only the additional cost of satellite over fibre, consumers making use of these services will face annual bills that are $408 (£310) more expensive, or $4,429 (£3,365) over the 10-year term of BEAD services, adding in the one-time cost of equipment. That equates to approximately $3.3bn in additional costs for consumers over the programme term.
The affordability provisions that were rolled back by the Benefit of the Bargain round would have represented an even more significant savings to consumers. The former BEAD affordability rules were written largely in tandem with the terms for the ACP, which provided direct-to-consumer subsidies to lower the monthly costs of connectivity and encouraged a number of operators to offer tariffs that matched the value of the subsidy ($30 or £22), effectively making broadband free for the 23.3m households that enrolled. Taking Pennsylvania’s definition of an affordable tariff from its original BEAD proposals, we estimate that a previously eligible household will now pay an added $255 (£190) per year for their connectivity, without even counting savings if the ACP had been extended. We estimate that the households that were previously enrolled in the ACP stand to pay $5.9bn (£4.4bn) more collectivity for their connectivity each year than they would’ve under prior BEAD rules, or $59bn (£44bn) more over the 10-year programme term. Adding our estimate of the additional costs of the loss of affordability rules to the costs of increased satellite usage, we estimate that US consumers face a total added bill in the range of $62.3bn (£47.4bn) over the course of the BEAD programme, more than double the return the NTIA claims it will provide to the Treasury (see Figure 2).
The changes to the BEAD programme will hobble American competitiveness for generations
Taking both affordability and quality of service concerns with non-fibre based technologies into account, the US’ decision to limit the ability of states to support fibre deployment will disproportionately harm the economic development of rural communities. 42 of the 50 states across the US average a rural population density or less across their BEAD locations, meaning rural homes, businesses and community institutions will be the primary stakeholders impacted by the Benefit of the Bargain changes. Many local rural governments, awarded COVID-19 recovery funding in years prior, committed some of that public money as matching funds to BEAD applications committed to building fibre and extending connectivity that would serve their communities’ needs. With states no longer able to consider this input from communities in evaluating BEAD proposals, this funding as well as the influence of local leaders will largely disappear from the BEAD process, meaning a programme targeted at rural communities will be increasingly unresponsive to rural needs.
Beyond the preexisting economic pressures on small and remote communities across the country, the inability to guarantee reliable, future-proof fibre connectivity will further hamper these regions’ economic development prospects. Local authorities have reported that businesses expect fibre connectivity over satellite or FWA, and economic development offices consider fibre the “gold standard” in attracting investment into the high street through to larger industrial projects. Particularly if BEAD is still to be believed as a generational investment in connectivity for the whole country, the failure to deliver fibre now to rural communities could hamper the ability to attract new businesses and retain existing firms for decades to come. As the potential productivity gains of emerging technologies, such as AI, remain a core justification for continuing to deploy advanced networks, it appears more likely that rural communities will be systemically excluded from accessing these benefits, further widening the gap with urban peers accelerating cycles of economic decline.
More widely, cutting nondeployment funds that states had planned to support adoption, including digital inclusion and literacy programming, will severely limit the social and economic impact of the BEAD programme. Given the existing skepticism among many rural consumers about the utility of satellite connectivity in particular, non-deployment funds could have been committed as a critical link in communicating the value of advanced connectivity, regardless of the underlying technology. Seeing how successful adoption of digital tools is closely linked to how each consumer views the usefulness of them, local anchor institutions could have been empowered to develop specific and responsive programming that meets the needs of residents. Instead, the likely delay or cancellation of digital inclusion programming stands to deepen existing inequities and reinforce barriers to adoption. Particularly as the US seeks to retain and reassert its global leadership in the digital economy, the shortcomings of BEAD are likely to give way to a weakening foundation of domestic digitisation, in industry and through a skilled workforce, even as US firms export their services abroad.
Europe should stay the course in continuing to invest in fibre connectivity and the skills that consumers need to adopt it
Across Europe, governments have largely avoided the pitfalls of the NTIA to date. Network rollout funds – including the UK’s Project Gigabit, Germany’s Gigabitstrategie and France’s Plan France Très Haut Débit – all maintain an explicit preference or requirement of fibre connectivity in programme funding terms. While these terms for fibre preference were largely defined prior to the growth in LEO viability, they still align with the much more limited role that EU leaders and Member States envision that satellite will play in the connectivity landscape. These network development funds have also been matched with funding for digital skills programming at the EU-level, through the Recovery and Resilience Facility, the Digital Europe Programme and the European Social Fund Plus. Though the UK lags in governmental support for digital adoption, the Digital Inclusion Action Plan published in February 2025 suggests that the country is reprioritising skills and inclusion as a matter of both equity and economic imperative. Even the title of the EU’s policy agenda on digitisation, the Digital Decade programme, reflects how the bloc has grasped the generational shift underway and invested in ushering in a new era of connectivity to reap its accompanying social and economic benefits.
Thinking in terms of lessons to be learned from BEAD, Europe should view the NTIA and the wider Trump Administration’s agenda as a cautionary tale. As the EU debates the future of telecoms regulation as a tool to achieve its Digital Decade targets through the Digital Networks Act, the US is both evangelising the need for global leadership in connectivity while undermining its policymaking agenda to achieve it. More generously, the Trump Administration could simply be optimistic about the potential improved technical capacities of alternative technologies that may drive fiercer competition and is opting to forgo a grander ambition for BEAD in favour of trusting the eventual workings of the market. That approach would still ignore issues with digital inclusion, however. Even so, the US would stand out amongst its peers in either foreseeing a massive shift in the telecoms sector that will upend the value proposition of fibre connectivity in the near future, or more likely, massively misjudging the critical juncture at hand that will dictate both domestic and international advantages in the digital economy to persist for decades to come.
