Interested in Stimulus Funds? Start Planning NOW!

I have not seen much commentary on this but any company hoping to obtain simulus funds must submit basic information by August 4th, according to the NOFA.

Electronic applications must be submitted between July 14, 2009, at
8 a.m. ET and 5 p.m. ET on August 14, 2009...Paper submissions must be postmarked no later than August 14, 2009, or hand-delivered no later than 5 p.m. ET on August 14, 2009.

The NTIA and RUS prefer electronic applications, saying that electronic applications will be judged faster.

Applicants must have a DUNS number and must be in the Central Contractor Registration (CCR) database (I'll describe how to do this in a later post).

Applicants have to provide a business plan including milestones and a description of offerings and their service area in step one. The business plan must cover at least 15 other topic areas, but the requirements are slightly different for the RUS and NTIA programs.

More later -- but start making plans now!

The Federal Definition of Broadband

The definition of broadband in the Notice of Funds Available (NOFA) (large file here) is 768 Kbps downstream and 200 Kbps upstream.

This definition is out of date. In a complaint in 2005, S. Derek Turner of the Free Press noted in a report that Canada defined broadband as 1.5 Mbps in both directions.

In the past, the definition of broadband was cut low to satisfy the demands of cable operators, who at the time had not built an architecture that could sustain high upload speeds.

At the present time, cable and telephone companies are delivering speeds far higher than those defined as broadband by the NOFA. Even mobile wireless services can achieve double the speeds described in the definition, both in upload and in download speeds, although mobile wireless networks are not built to handle significant demand (see the David Isenberg blog post When is normal use a DOS attack? for one example).

A poor definition of broadband encourages the wrong kind of innovation. There are serious class and race issues on the internet, but this definition encourages most companies to build a slow tier that will deliver cheap service to poor people and to the elderly.

Such a service would satisfy the agencies' goals as they have defined them, but fail to deliver long term growth. Instead, the services built would be obsolete fast, unable to handle the demands of the services of the future such as rich media, medical imaging, the sharing of business presentations -- and participating in government by using the Obama administration's trasparency sites, such as broadband.gov and recovery.gov.

The government can do better -- and it will do better if it funds those companies that promise to deliver real broadband highways, not the slow roads that the NOFA allows.

RUS and NTIA Will Work Together

Liz Zucco of MarketSys told me to take a look at the fine print of the RUS announcement from June 11th (.pdf) and what she said I'd find is indeed there.

The announcement says:

By early summer 2009, RUS and NTIA will publish a joint Notice of Funding Availability (NOFA) in the Federal Register seeking applications for assistance. We anticipate three NOFAs. Timing on the subsequent NOFAs will be dependent upon results from previous NOFAs and our coordination with NTIA and consultation with the FCC as we deploy funds. This implementation plan is subject to change.

What that means is this: there will be a division of labor. It is probable that the RUS will focus on delivering broadband to rural homes and that the NTIA will focus on delivering it to strategic institutions, which the ARRA describes as:

(A) schools, libraries, medical and healthcare providers, community colleges and other institutions of higher education, and other community support organizations and entities to facilitate greater use of broadband service by or through these organizations;

(C) job-creating strategic facilities located within a State-designated economic zone, Economic Development District designated by the Department of Commerce,
Renewal Community or Empowerment Zone designated by the Department of Housing and Urban Development, or Enterprise Community designated by the Department of Agriculture;

The implication is that EVERYONE needs to learn how to deal with the RUS. Many hope to just deal with the NTIA. If you are one of those, start learning about the RUS now.

People want to deal with the NTIA because its brief is more straightforward: it provides up to 80 percent of hardware costs. That's direct cash. The RUS provides loans, and the paperwork for loans involves a detailed business plan, potentially requiring quarterly forecasts for a 20 year period.