Will Wireless Be the Broadband Stimulus Winner?

istock_000007177867xsmallToday is the due date for municipalities and companies to apply via mail for a piece of the $4 billion being released in the first tranche of the broadband stimulus program, (those filing electronically get another week to get their applications through clogged servers). Roughly half of the folks I’ve interviewed have decided to wait for the second and third rounds of funding before applying. Moreover, it appears that wireless is winning out over wireline.

Glenn S. Richards, a partner with Pillsbury Winthrop Shaw Pittman LLP, had eight clients that planned to apply as of last week, but said today that only three of them were able to pull together their submissions in time. Of them, one application is for sustainable adoption (by a wireless provider) and two are for broadband infrastructure projects (one wireless and one wireline). Others who counsel municipalities say their clients were hard-pressed to make this deadline as well, so will wait for the next rounds. The first round of grants has been a somewhat rushed process because the full $7.2 billion in stimulus funds is supposed to be allocated by September of next year. The rules governing the first round came out on July 1, giving applicants 45 days to get their applications together.

Of those that are applying, many are wireless companies — something Rich Wonders, vice president of strategic marketing for Alcatel-Lucent, had forecast after viewing the rules associated with the grant-making process. TowerStream, a WiMAX provider, confirmed that it’s applying for a grant, and most of Glenn’s eight interested companies are wireless providers. Which makes sense given that the rules don’t favor wireline providers trying to upgrade their lines in this round. As Wonders said last month,

“I believe the object is by end of first round to produce a map of the United States that shows the entire U.S…as having 768 kbps service,” Wonders said. “This round has less to do with advanced broadband such as fiber and fourth-generation wireless, and is more binary — a place either has coverage or it doesn’t.”

Additionally, most of the larger broadband providers aren’t planning to file, according to an article today in the Washington Post. I’ve emailed the National Telecommunications and Information Administration to get more information about what types of projects it’s seeing as well as the number of applications that have made it in so far. Though the computer troubles that have delayed electronic filing may make that number difficult to get.

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