Will Trump pause BEAD?Will Trump pause BEAD?

If Donald Trump wins the US presidential election in November, there's a chance he will pause the $42.5 billion Broadband Equity Access and Deployment (BEAD) program, according to one financial analyst.

Paul Gallant, an analyst with TD Cowen, first suggested in March that Trump might delay the BEAD program to "do a full-scale review of how NTIA is running the program, with an eye toward eliminating red tape and pricing mandates."

In a recent note to investors, the analysts at TD Cowen noted that ongoing delays in the distribution of BEAD money could well push the start date of the program's state-level funding mechanism into the middle of 2025. "While a pause in the program wouldn't be a positive for broadband providers, Trump could look to make adjustments such as preventing any indirect price regulation," the TD Cowen analysts wrote.

BEAD debates

Price regulation in BEAD has been a hot topic in recent months. Alan Davidson, the head of the federal agency (NTIA) charged with administering BEAD, said late last year that the NTIA will not engage in rate regulation at the federal level, as is prohibited. But he would not commit to rejecting state plans that set a low-cost plan requirement.

That position is raising concerns among some lobbying groups. "Congress specifically stipulated that there shall be no rate regulation of broadband," wrote the Center for Individual Freedom (CFIF) to the head of the Commerce Department, which oversees the NTIA. "The NTIA has approved plans for eight states thus far, all of which have included a specific price point or formula to set rates."

CFIF describes itself as a nonpartisan, nonprofit organization with the mission to "protect and defend individual freedoms and individual rights."

Other prominent Republicans have also taken issue with some contours of the Biden administration's BEAD program.

"The Commerce Department's rules governing the expenditure of $42.5 billion in broadband grants will undoubtedly waste taxpayer dollars and leave families waiting on the wrong side of the digital divide," wrote FCC Commissioner Brendan Carr in 2022.

Carr has criticized the administration of the program and its focus on fiber technologies over other networking options such as fixed wireless and satellite.

Trump is reportedly courting SpaceX chief Elon Musk for a role in his possible administration. That could pave the way for SpaceX's Starlink service to receive government subsidies under a second Trump term. The Biden administration has so far mostly prevented Starlink from receiving such funds.

The political calculus

However, other analysts don't believe Trump will delay BEAD funds if he wins the White House from Joe Biden in November.

Blair Levin, a policy adviser to New Street Research and a former high-level FCC official, told Light Reading that BEAD will ultimately funnel money into Republican areas. "Why would he want to delay that?" he wrote.

Levin also argued that Republican governors will lobby Trump to allow them to distribute BEAD funding quickly and without additional oversight. He added that most Internet service providers are close to Republicans in Washington, DC, and will therefore likely reinforce the Republican governors' message.

Ultimately it's unclear how Trump might approach the issue. After all, during his term as president he spearheaded a campaign against TikTok as a threat to national security, but he is now using the platform to connect with voters. Further, one of the items on Trump's failed re-election platform in 2020 was to "win the race to 5G and establish a national high-speed wireless Internet network." His campaign at the time did not clarify what that would entail.

Regardless, a delay in the distribution of $42 billion in BEAD funds would undoubtedly come as a blow to the nation's telecom operators. After all, companies ranging from Comcast to AT&T to Verizon are hungrily eying BEAD as a way to finance their network expansion ambitions.

And those companies' suppliers – from Corning to CommScope – are also hoping that BEAD helps to jumpstart investments in an industry mired in a spending freeze.