Texas gives out $1 billion to corporate internet providers as part of federal BEAD program
The state of Texas today announced the 17 internet providers (all big corporations) that it awarded $1 billion in grants under the federal government’s Broadband Equity, Access, and Deployment (BEAD) program, ostensibly designed to help companies bring fast internet to remote rural areas, but has instead become a perfect example of crony capitalism, welfare for big corporations that don’t need the money but make the right political donations to the right politicians.
The list of companies that won awards is revealing. Rather than list them all, however, consider these three, the highest, lowest, and most well known:
- Nexstream: $401,831,807 for fiber and fixed wireless to 32,404 locations
- VTX Communications: $2,120,407 for fiber and fixed wireless to 261 locations
- Starlink: $108,787,903 for low Earth orbit (LEO) satellite to 63,887 locations
In other words, Nexstream and VTX got grants of $12,400 and $8,124 for each location it provided service, while SpaceX only got $1,703, even though SpaceX by itself provided service to almost 1/4 of all the locations listed across the entire state, 63K out of 209K total. My guess is that the other companies spread the political wealth judiciously to the right people, something that SpaceX almost never does.
Even so, this distribution is far better than during the Biden administration, when it rescinded its grant to Starlink, claiming it had failed to provide any rural internet service, when in fact it was practically the only internet company successfully doing so. That rescinding occurred at almost the same time Musk revealed he was going to support the Republican Party.
Having noted this improvement, I still think this entire program is the worst sort of Washington corruption, and should be canceled. It is a waste of tax dollars — money we don’t have — going to companies that are already making huge profits from their own customers.
A side note: Five companies applied for grants and were denied, with Amazon’s Leo being the most recognizable. Amazon asked for $1.145 million, but since it hasn’t provided service yet to a single customer, its Leo constellation not yet operational, the Texas Broadband Development Office (BDO) rightly denied the request. Thank god for small blessings!
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