Long Lines for Broadband Stimulus

The bread line is getting long as the government moves closer to handing out
billions of dollars in economic stimulus money for new broadband projects.

After a morning session on oversight and accountability for the forthcoming
broadband stimulus grants, the Commerce Department turned its attention this afternoon to the selection criteria for grant recipients, hearing from a gaggle of stakeholders on how it should evaluate as many as 10,000 expected applications.

As each member of the unwieldy 10-person panel stepped to the podium, the first
part of the meeting quickly became a forum for representatives of the various
organizations to air their wish lists.

A representative of the National Science Foundation urged that the agencies
dispensing the stimulus grants give priority to universities and laboratories.

Jacqueline Johnson-Pata, executive director of the National Congress of American
Indians, made the case for linking up disadvantaged tribal communities. The president
and CEO of the National Council on Aging put in a plug for computing facilities and
training in senior centers, and a representative of the satellite industry talked up
the unique benefits of satellite broadband in providing affordable nationwide coverage
with “no unsightly towers or trenches.”

But that parade of special interests could very well be a precursor of what is in
store for the agencies as they commence the grant process, possibly as soon as next
month.

The stimulus bill signed into law last month allocates $7.2 billion to the National
Telecommunications Information Administration, a division of Commerce, and the
Department of Agriculture’s Rural Utilities Service to promote broadband deployment
and adoption. Today’s meeting was the final of six sessions the agencies held to
discuss various aspects of the grant-making process before they begin to finalize
rules.

Then, the agencies will have what Free Press Research Director Derek Turner
described as “the unenviable task of picking winners and losers out of what promises
to be a very large pool of applicants.”

Turner’s group, a media-reform organization that is typically a vocal participant
in broadband policy debates, has proposed a 100-point scorecard, where applications
would be evaluated on criteria such as the connection speed they promise, whether the
resulting network would be affordable and open, and the potential for creating
jobs.

Steve Morris, the associate general council for the National Cable and
Telecommunications Association, also offered a systematic method of ranking grant
applications.

Speaking on behalf of his organization as well as several other telecom industry
associations, Morris outlined a scorecard that would award points for job creation,
the timeliness of construction, construction cost and affordability for consumers and
several other factors.

In a broad sense, NTIA and RUS will have to balance the applications submitted by
established providers with those pitching projects could serve the public interest or
benefit small businesses, which the stimulus bill identified as priorities for the
broadband grants.

“It will be incumbent on all of us to try to balance those two, to do what the act
requires to in terms of small and disadvantaged business and to have merit-based
criteria that would allow NTIA to process applications quickly and get grants out so
that we can get construction going,” said Morris.

John Muleta, founder and CEO of M2Z Networks, spoke as a representative of the
Minority Media and Telecommunications Council. Muleta appealed for the agencies to
take a cue from venture capital firms and support small ventures with novel business
models.

“The idea here is to experiment,” he said. “I think this is a little like venture
capital to get 10 ideas and then one breaks out.”

Speaking on behalf of the satellite industry, WildBlue Vice President Lisa Scalpone
shot back that the intent of the stimulus bill “is not to fund experimental
projects.”

Muleta countered that small businesses are by definition experimental, but
emphasized that they still must be held accountable. Projects without a marketing plan
to help sustain them would be a nonstarter, he said.

It is worth noting that Muleta has been trying to get his own venture, M2Z, off the
ground, promoting a
quirky business model
and an ambitious build-out schedule that many skeptics have
criticized as unrealistic.

To help moderate the disputes between objective and subjective criteria, the
panelists found a rare point of agreement over the idea of enlisting third-party
experts to help advise the agencies in the grant-review process. To avoid obvious
conflicts of interest, any business or professional association would have to recuse
itself from applying for grant money, but the panelists generally agreed that tapping
outside expertise from people in the field could make for a more informed process.

Article courtesy of InternetNews.com

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