The federal government is spending $42.45 billion, distributed via the states, through the Broadband Equity Access and Deployment Program (BEAD) to connect every American to high-speed internet. Established under the Biden administration, the program has been reformed by the Trump administration, which refocused it away from government-built networks and toward incentivizing private providers to close the digital divide.
As a free-market watchdog, I’m concerned that state governments have a track record of wasting taxpayer resources. Government programs are largely inefficient. The best way to truly expand broadband is by incentivizing private industry to expand and upgrade existing networks, not by building government networks that compete with the private sector. Do you really want the DMV running your broadband internet? The answer is no!
But private companies have hit a snag as they try to expand. The roadblock? Government-backed monopolies.
Decades ago, utilities invested in poles and infrastructure to expand electricity access. As telecommunications evolved, providers began renting space on these structures to minimize costs and avoid infrastructure duplication. But that monopoly status was created and sustained by the government. Federal taxpayer dollars funded rural electrification through programs like the Rural Electrification Administration, handing utilities the infrastructure base they control today. In exchange, regulators were supposed to hold them accountable. Instead, state Public Service Commissions have rubber-stamped rate increases while shielding utilities from competition—allowing them to socialize costs onto captive ratepayers while pocketing the profits.
Now, those same utilities are shifting their maintenance costs to private broadband providers on top of normal rental fees, charging expensive “make-ready” fees—including for network upgrades, pole replacements, and engineering surveys—before lines can be attached. Simply put, many power companies use their monopoly position as a bottleneck to make it as difficult and expensive as possible for broadband providers to use existing poles.
According to Pew, “virtually every state identified permitting processes as a possible obstacle, with many narrowing in on pole attachments.” As Virginia State Delegate Scott Wyatt put it, “The cost of adding lines to poles is increasing…original negotiations and contracts were $30,000 a mile, and now those prices have changed to $90,000 a mile.”
States have gotten so desperate with these delays that they’ve been forced to use their own funds to stand up Pole Replacement Funds to incentivize pole owners to fix their poles. Those are a good short-term fix, and I encourage all states to use some of their BEAD funds to do the same, but they are not a long-term fix. That’s where a recent FCC ruling comes in.
The FCC’s Rapid Broadband Assessment Team (RBAT) issued a landmark ruling in Comcast v. Appalachian Power Company, finding that pole owners cannot generally charge private providers for replacing “red-tagged” poles that are already unsafe, deteriorated, or scheduled for replacement. Those costs should instead rightfully fall on the owner, orat least be shared among all those who stand to benefit. With pole replacements costing anywhere from $600 to upwards of $6,000, this is no small matter.
In other words, broadband companies will only have to pay costs caused by their specific needs—which is fair. This full Commission underscores the FCC’s commitment to clearing barriers and keeping broadband projects moving. And while Appalachian Power’s service area is limited to parts of Tennessee, Virginia, and West Virginia, the ruling will have broad implications for states across the nation.
This approach will foster growth, allow smaller competitors to flourish, and increase the supply of providers willing to service rural communities, which means lower prices for consumers and more choice. It’s refreshing to see the FCC holding monopoly utilities to account while embracing free-market principles.
But the FCC ruling alone isn’t enough. State Public Service Commissions must finally do their jobs: hold utilities accountable for maintaining the infrastructure they were given public subsidies to build. That means issuing meaningful fines when poles deteriorate beyond safe use and refusing to approve rate increases for utilities that fail to keep their networks in good repair. Ratepayers shouldn’t be forced to subsidize utility negligence twice—once through higher bills, and again through federal broadband funds. Every dollar wasted propping up negligent monopolies is a dollar that could be connecting a rural family to the internet.
Hannah Cox is the cofounder and president of BASEDPolitics and owner of Athens Media.
