[Satellite News 02-24-09] The broadband stimulus bill included in President Obama’s American Recovery and Reinvestment Act is having a variety of effects on several sectors of the commercial satellite industry — from the digital TV transition postponed to June 12 to the aggressive push of companies to acquire customers in the government sector.
    The largest boost to the satellite industry comes with the $7.2 billion provided in the bill for broadband development in areas largely served by satellite providers. The stimulus bill also offers grants or funding to companies willing to deploy broadband in unserved markets. The legislation also creates a new broadband technology opportunities program at the U.S. National Telecommunications and Information Administration (NTIA), a unit of the U.S. Department of Commerce that would oversee the distribution of broadband grants. Grant recipients would have to underwrite up 20 percent of project costs, with hardship waivers available when necessary. Another $2.5 billion in broadband grants will be administered by the U.S. Department of Agriculture’s Rural Utilities Service.
    Skycasters, a broadband satellite Internet solutions provider, is making an effort to supply government customers with Internet connections for schools, libraries, rural communities, remote industrial sites, disaster response teams and oil, gas and mining operations to the web.
    Skycaster President Michael Kister is presenting satellite infrastructure as the economically viable solution to potential customers. “There are funds available [in the bill] to build Wi-Fi networks to connect small communities that were previously ‘off the grid’ as far as the Internet is concerned,” he said. “Wi-Fi is often a great solution, but there’s still a missing link. How do you connect the Wi-Fi network to the rest of the Internet backbone? Fiber buildouts can be prohibitively expensive, costing $10,000 to $20,000 per mile, or more, depending on the terrain. Satellite is a viable alternative in these situations.”
    Kister also believes that there are opportunities for satellite in the bill that go beyond the broadband stimulus portion. The highway infrastructure plan included in the economic package provides a potential customer in construction companies. “The reality is that if you are going to do a construction project in the 21st century you need reliable communications to the site — not just cell phones, but real IP communications for e-mailing documents, verifying plans and work orders,” he said.
   
Money for Competitors
Satellite companies are not alone in the fight for stimulus money. The bill also provides a boost to a range of technology companies — some in direct competition with satellite for broadband voice and data projects.
    Google, Microsoft and Cisco Systems all released statements saying that the bill provides them with an incentive to push supporting electronic systems. In an interview with The San Francisco Chronicle, AT&T spokesperson Ted Wagnon said that while AT&T initially was not seeking funds from the stimulus bill, the company is “ready to work with federal, state and local governments on innovative programs to help drive broadband deployment and adoption."
    The economic stimulus package also is having an effect on the broadcasting sector. When the U.S. government delayed the digital TV transition to June 12, it offered tens of millions dollars to commence the DTV converter-box coupon program. In January, the government announced it had run out of money to fund the $40 vouchers for nearly 2.4 million households that were then put on a waiting list. Obama’s stimulus plan injects enough cash to cover the remaining coupons.
    A team of Stifel Nicolaus analysts released a statement Feb. 13 on the firm’s Web site concerning the bill’s affect on network neutrality, which tightens broadband regulations. “Grant recipients would have to meet a host of reporting and other requirements, including network-neutrality type duties,” said the analysts. “Combining provisions of both the Senate and House bills, the harmonized legislation requires the NTIA, in coordination with the U.S. Federal Communications Commission to publish ‘nondiscrimination and interconnection obligations’ for grantees, which at a minimum would have to include adherence to the four broadband principles in the FCC’s 2005 Internet policy statement. We believe the details in this area could prove to be quite contentious.”
    The Broadband Technology Opportunities Program also provides funding for projects involving distance learning and telemedicine. Details of these programs will be updated on NTIA’s Web site.