States See Broadband Workforce Facing a BEAD Timing Problem

States trying to beef up their broadband network-related workforce see a potentially worrisome gap between people graduating from broadband trades training programs and the future delivery of broadband equity, access and deployment (BEAD) money. Also Friday, during the Broadband Nation Expo, Jonathan Adelstein, TWN Communications chief strategy and external affairs officer and former Wireless Infrastructure Association head, said the investor community is cautiously warming to BEAD-related investments. The Telecommunications Industry Association and Fierce Network staged the event at National Harbor, Maryland.

State broadband officials said states want the capacity to use local labor for initial network builds, as well as ongoing upkeep. But with permitting for BEAD projects likely pushing construction starts well into 2026 in many cases, training and recruitment efforts are on somewhat shaky ground, said Oklahoma Broadband Office Chief Strategic Officer Edyn Rolls. Pointing to a 2023 study of workforce needs for fixed broadband providers, Rolls said states also face "a bit of a conundrum" as 20% of those workers are expected to be engineers or managers -- jobs that have more significant educational requirements than pure technical jobs such as installers.

Peter Voderberg, head of the Ohio Department of Development’s BroadbandOhio program, said the state is worried about labor availability not just for broadband network expansions but also in areas that would support those expansions, such as pole replacement crews. He pointed to a company with a two-year backlog of 155,000 pole replacement permits because of its inability to find pole workers. Ohio, he said, is trying to support training programs for those broadband attendant jobs.

Rolls said the earnings potential of such jobs could make a difference. While internet infrastructure is “not seen as something that’s sexy … six figures is sexy,” she said. Jackson, Mississippi, City Council President Aaron Banks said local elected officials must be better informed about workforce needs, since they are communicating daily with local residents. In addition, Banks argued, local government and the private sector should collaborate on workforce issues. Jackson suggested tapping military veterans as a well of talent that could have interest in such careers.

Adelstein said capital markets were over-exuberant in the early part of the decade toward broadband investments, throwing money at business plans. However, inflation and the slowing economy caused a retrenchment. He said pending deals like Verizon's purchase of Frontier and the T-Mobile/KKR acquisition of Metronet demonstrate "a new enthusiasm." But investors are "more picky" than a couple of years ago. He said with BEAD money soon to start flowing to subgrantees, investors are warming up to further investments. He predicted a consolidation in the telecom industry over the next several years between large wireless and fiber companies. In addition, he anticipates smaller fiber operators enlarging their networks as a good investment opportunity.

AlixPartners last week said telecom is experiencing "a surge in M&A activity" and that as many as one in four of the more than 1,900 small and mid-sized fiber operators "will be potential M&A targets." AlixPartners said: "Industry leaders will aim to expand their footprint by swallowing smaller operators, incorporating their tech infrastructure and customer bases for cost-effective growth." Smaller fiber operators "are recognizing the level of resources required to effectively monetize network assets and build a commercial engine. Some will be better off selling part or all of their business to focus on a finite set of priorities."

Expo Notebook

While fiber is the preferred technology for BEAD projects in California, the state believes it can't provide universal access without using alternative technologies such as fixed wireless. This is due to the state’s geography and the high cost of serving rural areas, said Darcie Houck, California Public Utilities Commission commissioner. She said California will almost surely receive BEAD applications involving municipal broadband. It seems unlikely California will have excess BEAD money for nondeployment purposes. "It's going to be tight."