Making Sense of the NOFA Rules (pt 1)

Update

Finally, the NOFA’s out (click here). It’s 121 flippin’ pages! Be patient while I grab breakfast and try to sort this bad boy out. I’ll post Part 2 of this NOFA assessment as soon as I can.  

 This NOFA is more than a tick list of items that grant proposals must contain, or requirements to which applicants must adhere. It’s the big step off on the long march toward a [hopefully] successful national broadband strategy. It creates a framework for what U.S. broadband looks like as the next decade begins, who benefits from the technology and how strong a foundation is created for Mr. G’s eventual strategy.   

As you plow though the pages, here are a few things to pay attention to so we determine just how good this first step is going to be. 

Definitions

What’s in a word? A lot.

How the NOFA defines “un-served” and “underserved” determines not only where the lion’s share of these networks are built, but also the competitive landscape for telcos, WISPs, cable companies and other service providers.

If a very heavy emphasis is placed (via points, prioritization, etc) just on reaching “un-served” constituents, and un-served is defined as areas currently with no broadband at all, then most of the networks likely will be built in rural areas. Tier 1, 2 and 3 cities may want to send their grant writers home. Tier 4 cities could have better odds if they’re isolated enough. What’s more, incumbents get to relax because they likely won’t see competitors where they currently are the only game in town.

Should the NOFA, however, give balanced weight to building in un- and underserved areas, and the “underserved” definition includes areas where there is existing service with crappy coverage and/or unaffordable rates, then life is good. Urban, small-town and rural America all get a shot at the pot, and the gods of true competition are appeased.

How “broadband” is defined as it pertains to speed (and whether wired and wireless broadband get their own definitions) determines who’s popping the champagne corks. Anything less than 1.5 mbps symmetrical hands a bonus to incumbent telcos and cable companies, and depresses the heck out of broadband advocates. Defining the speed anywhere above 5 mbps symmetric is problematic for incumbents and maybe mesh wireless providers. WiMAX, fiber and consumers in general are going to be loving it.

Benefits for exceeding definitions represent the wild card 

If the NOFA gives bonus points to proposals that exceed NTIA/RUS’ minimum definitions of broadband, there’ll be happier hearts in the Heartland. Given how many communities have shown that they and public utilities can build faster networks at cheaper subscription rates than incumbents, bonus points give these types of networks a boost in the grant game.  

Open access

This is one NOFA element that’ll be either a boon to the drive to get broadband that matters, or a bona fide bust. Either NTIA/RUS go to the heart of why our broadband position in the world sucks and help rectify it through mandated open access, they show no heart by punting to the big guys or they try to have it both ways with some wishy-washy rule. Either of the latter two options is not good for communities.

Be sure to scan through the verbiage to see if, in deference to the new FCC Chairman, the NOFA also takes a shot at cranking up the heat with a little net neutrality support. We see that, it’s Katy bar the door! Communities and smaller providers should make out quite well, but there’ll be bitterness in other quarters. 

Where are local governments in the pecking order 

In the broadband bill that left Congress, the list of who gets priority for receiving grants starts with local and state governments on top and private sector companies last. Dig into the NOFA and see how much it adheres to this prioritization– or not. To me, this ultimately gets to the core of broadband’s ability to be transformative in its impact.

If local government (caveat to follow) is the main recipient, that makes them the major drivers in what broadband looks like in the respective communities that win grants. The networks are more likely to meet the unique needs of their communities, both economic and societal. Unless mandated or incentivized to form public-private partnerships with government as equal partners, rules that favor private sector companies over public entities will produce a mixed bag of networks, with many falling short of broadband’s potential.

The caveat pertains to state governments. I believe project teams for county-wide or even regional efforts within a state can build networks that produce great results when local governments are in the lead. However, the thought of some state governments getting block grants and thus controlling network development gives me the willies. I worry private companies would have too much influence, better projects without “insider pull” will have less, and/or the funding process will take longer to complete.

For example, one state allegedly plans to bring 40 local and regional project teams into a room to do 3-minute presentations each. Best presentations win state backing to participate in a block grant. If true, my only thought is, WTF! That said, reality dictates state involvement, which means it’s another river you should plan to navigate. 

Sustainability

Pay attention to how the NOFA mandates or otherwise influences applicants to come to the table with a plan to financially sustain networks once they’re built. With luck, these rules will instill a widespread understanding that you must treat these networks like a viable business if you want to advance the public good.