The Federal Government’s Bipolar Approach Toward Satellite Broadband

U.S. policymakers have declared it explicit Federal policy that all Americans should have access to broadband services. Massive programs have been created, and over one hundred billion in taxpayer funding either has or is in the process of being used to entice and incentivize private broadband providers to reach every last unserved location. Yet, several of the earlier programs took a dim view of a key broadband offering for unserved households: satellite broadband services. After many twists and turns, the latest and biggest program (known as Broadband Equity, Access, and Deployment (BEAD)) under the Biden Administration finally realized that certain satellite broadband offerings can and likely will be part of the solution, at least in hard to reach areas of the country. This evolutionary thinking is heartening and necessary if all unserved Americans are to obtain broadband coverage. It is reasonable to assume that the next Administration will happily embrace this approach. 

Satellite broadband has been around for multiple decades but it has had a spotty performance history. In its early days, it was not uncommon for satellite providers to overpromise and underdeliver. And those primitive satellites had difficulty keeping up with the needs of broadband consuming public. Recent years have seen a striking change with the deployment of exceptionally more capable satellites with greater speeds and capacity from various players are a multitude of altitudes. Moreover, new satellite fleets at lower elevations – Low Earth Orbit (LEOs) satellites – have dramatically lessened transmission delays, expanded performance, and improved affordability, particularly in rural areas too difficult or expensive for terrestrial networks. LEO broadband services also are extremely cost efficient for government subsidy purposes, even with its cost of consumer terminals, and have very rapid consumer connectivity timelines.

Recognizing the modern capabilities of satellite broadband is not a slight to any other technology. Fiber-based broadband will continue to play a prominent role given its advantages in speed and capacity. Additionally, fiber will continue to serve as a critical component that supports the deployment of other broadband offerings, like wireless technologies. Likewise, wireless broadband – be it licensed or unlicensed approaches – is growing in popularity given its speed to market, mobility, price points, and functionality. Clearly, fixed wireless access has proven exceptionally popular with consumers. In essence, the wide assortment of technologies, including terrestrial fiber and wireless broadband and space satellite offerings, is a blessing as competition among providers is bringing enormous benefits to the market for many consumers.

For Federal broadband subsidy programs, however, policymakers’ rigidity for one preferred technology is preventing broadband from reaching all unserved locations in the near-term. Take for instance, the Federal Communications Commission’s (FCC) Rural Digital Opportunity Fund (RDOF). In my previous role, I personally spent time and capital ensuring that satellite broadband was not precluded from bidding in RDOF. But just a few years later, the FCC rejected a LEO satellite provider’s long form application, in part, due to supposed performance shortfalls in speeds and ability to meet the program’s requirements. Tellingly, the agency referred to LEO broadband as “nascent.” This same troubling view may be embedded in other FCC programs and decisions, like its 5G Fund, 706 Report, and more. 

Thankfully, the National Telecommunications and Information Administration (NTIA) has proposed a slightly more enlightened approach for its BEAD program as it pertains to LEO satellite broadband. Due to a reexamination of LEO satellite broadband’s capabilities and the fact that numerous states have indicated that they will be unable to reach all unserved residents within current funding limits, satellite broadband and other alternative technologies are being looked at as a real solution for unserved areas that are otherwise uneconomical to serve with fiber broadband. Importantly, NTIA’s draft BEAD Alternative Technology Guidance clarifies that in extremely costly unserved areas, LEO satellite broadband would be eligible for program participation and subsidy funds. Specifically, NTIA is implicitly acknowledging and declaring to state eligible entities that LEO satellite broadband meets BEAD’s speed and latency requirements, network outage limitations, and other service obligations. And that, the technology has an important role to play in closing the gap in those areas beyond the reach of wired or high-fidelity fixed wireless solutions. It’s quite possible that this represents measurable progress over the FCC’s review.

The dichotomy in regulatory views of LEO satellites also applies to how broadband deployment and adoption is measured and estimated. Existing approaches by the FCC (i.e., Section 706 Inquiry and Report), the U.S. Census Bureau (i.e., the American Community Survey), and the Census Bureau and U.S. Department of Labor (i.e., Current Population Survey) are dated, often delayed, and prejudiced against LEO satellite broadband. In contrast, the newest effort by NTIA and the Census Bureau, referred to as the Local Estimates of Internet Adoption (LEIA)), is being crafted to target more-precisely the adoption rates for low population density locations. Forcing coordination among all of these efforts is probably unadvisable given the risk of delays and inferior information production, but given satellite broadband’s growing importance in the marketplace, LEIA’s advanced vision – depending on final resolution – might be on a more appropriate and helpful path in the short-term, and more importantly, for decades to come.

Support for an inclusive view that LEO satellite internet should qualify as broadband for federal measuring purposes and the like has been quite extensive. For instance, recent written comments by the Information Technology Industry Council stated that the expanded capabilities and capacities of satellite broadband and fixed wireless technologies “should lead to a reconsideration of how the federal government classifies and counts what constitutes ‘broadband’ in our national statistics. . . . If not updated, current classification methods, particularly those employed by the Census Bureau in the Current Population Survey and American Community Survey, risk painting an incomplete picture of broadband availability by not grouping all fixed, high-speed broadband with other high-speed technologies like fiber and cable.”  Similarly, the Commercial Spaceflight Association argued in submitted comments that “LEO broadband providers are currently deploying low-latency, high speed coverage to broad swaths of underserved communities in the United States without the need for costly and prolonged infrastructure deployment. . . . [I]t is essential to use updated data that accurately reflects current broadband usage nationwide.”  And Parker Sheppard of the Heritage Foundation stated that, “Satellite internet is increasingly an option for high-speed internet in rural communities that may have limited availability of wired connections.”  Even Paul Winfree, President & CEO of the Economic Policy Innovation Center, who has expressed skepticism at federal broadband adoption programs provided that, “We recommend updating the methodology to include satellite internet users as part of broadband adoption rates. This adjustment will better reflect the reality in many rural communities, where satellite services play a key role in internet access.”

The Federal Government’s discriminatory treatment in broadband measuring has not gone unnoticed on Capitol Hill as well. Just weeks ago, future Senate Commerce Committee Chair Ted Cruz, Senator Marsha Blackburn, and Senator Cythia Lummis sent a letter to NTIA and the Census Bureau arguing that, “While millions of Americans rely on these technologies, particularly in rural and hard-to-reach areas and in times of disaster like the recent hurricanes, [these] agencies have deliberately excluded such households from a new census data project about U.S. broadband adoption.”  These Senators also made clear that, “If NTIA and the Census Bureau plan to continue using modeling as a technique to estimate broadband adoption, it is essential that they account for households that have adopted broadband through satellite and wireless technologies, in addition to those using wired services.” It will be telling to see the agencies’ responses when submitted and made public. 

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The differences between the FCC and NTIA’s approach to LEO satellite broadband, not to mention other Federal broadband subsidy programs and measurement techniques, is disconcerting. Perhaps it can be explained based on the timing of applicable decisions. As policymakers become more knowledgeable and comfortable with LEO broadband service, the disparity in treatment should lessen. To the extent it is driven by something more, the Federal government needs to get on the same page and recognize that satellite broadband’s capabilities, particularly those of LEO providers, are sufficiently impressive to meet its standards today and only going to increase as technology advances. More importantly, policymakers would be wise not to create false perceptions of inferiority at the same time they permit it to deliver benefits to unserved Americans in challenging situations. If changes are not made soon, hopefully the next administration will appropriately recognize the reality of the current marketplace and consumer interest.