Happily, the Big Phone Companies Are Not Pushing for Stimulus Money

Carl Weinschenk

The Washington Post offers a feature that says the big carriers are more likely than not to stay away from applying for broadband stimulus funding. These companies don't want the type of PR that hit the financial services sector. They don't like provisions in the law on Net neutrality, and don't really care to offer services in underserved urban and rural areas. And these companies simply don't need the money.

That's good news. The hope is that they don't apply for the funds.


The phone companies have a fiduciary duty to think of themselves and their investors first. It logically follows that they won't act in the interest of their subscribers (or potential subscribers) if there is a conflict, and will resist when forced to do things that they deem not to be in their best interests. This foot dragging is an underlying theme in the history of interconnection, the government-mandated prying open of phone company networks a decade ago.


Their disinterest in serving all the people -- not just the cream of the financial crop -- is proven by the simple fact that there still are huge gaps in the level of service offered to vast tracts of the American landscape. The visceral reaction to the gripes from the telephone companies, who have spent decades trying to squelch competition using Machiavellian means that would make the insurance industry proud, is to tell them that their services aren't required.


The bulk of the broadband stimulus money should go precisely where it seems to be heading-to small entrepreneurial companies who truly are interested in bridging the urban and rural digital divide. There are many small telcos, telecom co-operatives and vendors who have been in there pitching for years. The road is rocky, however, as the sudden possibility of getting government money actually is slowing ongoing work in the short term.


It will get interesting as the deadline portion of the stimulus application process is arriving. Originally, all of the first wave of paper and electronic applications were due today. The government has extended the deadline for electronic filings by a week. It's quite a process: Rachael King's BusinessWeek story-posted at MSNBC-details a difficult and detailed application process for small entities that generally are unaccustomed to the level and detail that big carriers have whole departments dedicated to filling out.


It promises to get no easier. Craig Settles told me last month that the process for reviewing the applications, which will rely on volunteers, seems a bit dodgy.


The problems are to be expected, however. This is, after all, a government program. So counterintuitive demands and time-wasting procedures are par for the course. Those issues will be exacerbated by the less polished nature of both the applicants and those who will assess those applications.


The bottom line is that companies and municipalities trying to get a slice of the stimulus funds should hang in there-and be glad that they most likely won't have to battle the big phone companies for their share.

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Add Comment      Leave a comment on this blog post
Aug 17, 2009 8:11 AM M Ellard M Ellard  says:

You're right - the application process on this isn't easy - hopefully it will not scare the entrepreneurial folks away.

Read an interesting article on where to apply/tools available specifically to address government app requirements - looks like luckily there's a way to get through this with a little less pain: 



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