After two years of anticipation, the floodgates are opening for BEAD Programs. Since October of 2024, 22 states have opened up their BEAD programs, with 12 of those opening up between January 1 – 20. The sheer pace of activity puts even more pressure on service providers to: quickly identify their priority targets for subsidized-broadband expansion; assess the financial implications fully; and build an agile yet thorough process to respond to the fast-growing opportunities. Without these capabilities in place, they may miss out on grant opportunities and open the door to a competitor who is better prepared. In this post, we discuss how the combination of automation and expertise is the winning formula for success.
The stakes are high and the implications of success, or lack thereof, will impact service providers for years to come. Fiber roll outs set a new record last year: reaching 10.3 million new homes, up from 9.1 million new homes marketed to in 2023, according to data compiled by Michael Render, CEO and principal analyst at RVA LLC. It is clear that fiber is the engine driving growth in our industry. Cable is losing share as fiber accelerates and fixed wireless cannot compete in terms of reliability and service. As a result, broadband providers must expand their fiber footprint to stay competitive.
All this means that competition and pressure on capital are intense! So how can service providers ensure they respond promptly to bid opportunities, armed with credible network plans and confidence in business cases, using a bid preparation process designed to maximize their chances of success? According to McKinsey, automating resource-intensive processes, and leveraging AI to make crucial decisions quickly, can help.
What’s Your Best Build Opportunity?
Identifying the best build opportunities is crucial for providers looking to maximize the impact of BEAD funding. This involves evaluating a wide range of data points, including the presence of existing competition, available technologies, proximity to both your fiber and competitors’ infrastructure, and the density of the area. Demographics and income levels are also key, as they help gauge the feasibility of long-term customer acquisition and retention. Beyond serving BEAD-eligible locations, it’s essential to assess the opportunity to extend the network’s reach to additional non-subsidized homes along the route, increasing the return on investment. This requires advanced data analysis and strategic planning to eliminate unattractive options early and focus resources on areas with the highest potential for success. Such a targeted approach ensures efficient use of resources while maximizing both coverage and profitability in network deployment efforts.
Leveraging Technology to Assess Technology
Once you’ve identified the best opportunities, the next step is understanding the business case in your chosen market. Traditionally, assessing all of the different factors that go into a market expansion business case – technology viability, local terrain and topography, addressable market, and competitive concerns – has taken months. But in the world of BEAD grants, service providers must respond to bids in a particular PFA (Project Funded Area) much more quickly – typically within four to eight weeks – significantly raising the risk of miscalculation without the right data and tools.
Understanding build costs requires an in-depth consideration of a range of technology and deployment factors to get a full picture. There are two key questions to start with:
- Are there assets already in place, such as utility poles, that are viable without intense “make ready” to use in deployment. This is especially critical in rural communities.
- Can you reach all the target households with fiber within a sustainable cost or budget or is fixed wireless a viable supplement to fiber to reach those outlier locations? This is especially true when seeking a state or community subsidy for a build to a predefined set of households.
Once the viable technology and deployment options are understood, and the first level plan has been constructed, more detailed analysis can be conducted to determine the cost to build for each location.
As an example, a service provider recently undertook an expansion, building a business case that assumed 100 percent aerial deployment of fiber. The construction contractor countered with a plan that required a completely underground deployment, increasing costs by4-5 times. Leveraging our AI-driven Fiber IQ™ solution, VCTI was able to identify which routes could leverage utility poles for aerial deployments, including pole locations that could be easily “made ready” without a huge investment – and which routes truly required digging. And, our ability to analyze soil down to six feet provided accurate costs for underground deployment. All without rolling any trucks out or expending hundreds of man-hours doing physical inspections.
Expertise + Automation = Success
The average grant application requires approximately 160 man hours to complete, placing a significant burden on teams unaccustomed to this volume of work. For a service provider pursuing 20 projects across four states, this adds up to 3,200 hours of effort within a tight deadline, since most state BEAD programs require a four to eight week turnaround.
VCTI’s automation and expertise simplify this challenge by identifying the best opportunities, optimizing network routes to maximize pass-by potential, and delivering comprehensive plans. This includes network design, cost estimation, and financial analysis for all 20 applications, ensuring providers can meet deadlines efficiently while enhancing their business cases for competitive funding opportunities.
When it comes to BEAD, the need for speed can result in a range of assumptions that can derail the business case quickly. But service providers who choose speed over accuracy do so at their peril – and face two potential negative outcomes: 1) they can submit a bid that is so conservative that they risk not winning; or 2) they can win a bid only to find out once construction begins that their planned budget is woefully inadequate, leaving them to decide whether to proceed and go way over budget, or to abandon the project and the grant.
Luckily, you no longer have to choose between speed and accuracy – with our technology and expertise, you can have both.
Download the case study below to learn how VCTI helped one service provider win 75% of their bids!
