Yankee Group: U.S. Broadband Stimulus Plan short by nearly $17 billion

OCTOBER 20, 2009 -- The Yankee Group asserts that the current $7.2 billion in stimulus funds earmarked for extending broadband service across the U.S. is “woefully inadequate” because it represents less than a third of the investment necessary to connect every U.S. household.

OCTOBER 20, 2009 -- The Yankee Group asserts that the current $7.2 billion in stimulus funds earmarked for extending broadband service across the U.S. is “woefully inadequate” because it represents less than a third of the investment necessary to connect every U.S. household. The market research and analysis firm has published a report on the subject, titled “Ubiquitous U.S. Broadband Will Cost At Least Triple the Current Stimulus Package,” that explores several broadband deployment scenarios. The report asserts that even the most bare-bones approach to extending broadband across the country will require funding -- and vendor cooperation -- far beyond what is seen today.

Currently, about 12 percent of U.S. households, including those in some major metropolitan areas, have no access to broadband service, landing the U.S. at 15th in broadband penetration worldwide, Yankee Group says. The report examines four possible approaches to addressing the problem: an ultra-cost-conscious “Discount” option, a leverage-what’s-in-place “Duct Tape” method, a “Pragmatic” middle-of-the-road approach, and an all-fiber-to-the-home “Gold-Plated” scenario. While all reach the of at least one broadband connection per home, none are perfect. And at a minimum, they all require unprecedented vendor cooperation and regulatory foresight, in Yankee Group’s opinion.

“Achieving ubiquitous broadband in the U.S. will hasten economic recovery and put the nation back where it belongs in terms of technology leadership, but it will take a concerted effort on the part of all stakeholders,” says Vince Vittore, principal analyst at Yankee Group and author of the report. “A minimum of $24 billion is required, and that’s only if networks are deployed in the most efficient manner and much of the middle-mile infrastructure already is in place. While the stimulus is a good start, it’s just that: a start.”

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