Why Comprehensive Digital Opportunity Programs Beat Subsidized Broadband Network Overbuilds

Local governments across the country are using federal government funds from sources like the American Rescue Plan’s Capital Projects Fund, as well as various state broadband funds, to make once-in-a-generation broadband investments—and are facing an important choice: Should public funds support the construction of new broadband networks in areas that already have service? Or should they be used to connect and support the people who remain offline? These questions are especially relevant as NTIA recently announced an expedited timeline of the BEAD program, with projects expected to start in full next year. 

In our new paper—Avoiding the Overbuild Trap: Adoption, Not Overbuilding, Drives Connectivity and Digital Opportunity—we urge policymakers to implement comprehensive digital opportunity programs encompassing deployments to unserved and underserved areas and a suite of programs to boost rates of broadband adoption. With broadband coverage now reaching the vast majority of U.S. households, the greater and more pressing challenge is ensuring people actually subscribe to and use high-speed internet connectivity. 

State and territorial broadband offices are recalibrating their BEAD programs in response to NTIA’s June 6 Policy Notice. NTIA rightly noted its concerns about efforts to fund projects to overbuild private networks and is currently developing guidance on use of BEAD funds for non-deployment projects. As we explain in this paper, non-deployment projects focused on increasing broadband adoption provide a significant return on investment and should be prioritized. 

The Bigger Gap Isn’t Availability — It’s Adoption 

Today, more than 94% of U.S. households have access to high-speed internet connectivity. Yet over 21% of adults still don’t subscribe at home. That gap is widest in rural areas, but it cuts across all geographies and demographics—often driven by a gap in digital skills, trust, or relevance; or – to a lesser extent – affordability, rather than high-speed network availability. 

Publicly funded overbuilds miss this reality. They’re proposed on the premise that adding one more – government subsidized – competitor to a market will improve competition or drive down prices in places where service already exists and naturally lead to higher adoption rates. But these investments do little to help the people who are still offline. 

Why Subsidized Overbuilds Fall Short 

We reviewed broadband overbuild proposals in communities like Vineland, NJ; Falmouth, MA; and Knoxville, TN. We assessed these examples against Vernonburg Group’s framework for broadband funding principles. In each case, most residents already had broadband access. Yet local plans proposed tens of millions of dollars in new construction—while overlooking the fact that 25–30% of households weren’t subscribing to existing available service.  

 The paper outlines how overbuilds often:

• Fail to meet funding program principles of equity, efficiency, and sustainability

• Discourage private sector investment and reduce long-term network viability

• Introduce conflicts of interest when municipal governments compete with broadband providers

Adoption-Focused Programs Deliver Greater Impact

Unlike comprehensive digital adoption programs, publicly funded network overbuild projects are generally commercially unsustainable and rarely demonstrate long-term benefits to competition, service quality, or affordability.

In contrast, digital opportunity investments—such as service and device affordability subsidies, digital navigator programs, and digital skills training—directly address the real reasons people remain offline.

These programs are not only more targeted and impactful, they’re also much more cost-effective. For example, a five-year fiber overbuild for a suburban community of 10,000 households could cost approximately $15-54 million, while a comprehensive digital opportunity program could cost between $7-9.5 million, well below the low-end of the fiber network estimate.  

 Recommendations for Local Policymakers

The paper includes a detailed illustrative Digital Opportunity Program budget as well as several examples and resources to help guide policymakers.

Local governments aiming to close the digital divide should:

• Use data to target investments: Focus infrastructure funds on truly unserved areas; use adoption data to guide programming.

• Avoid overbuilding where service exists: Direct funding toward unmet needs, not duplicative networks.

• Support long-term solutions: Build digital opportunity programs that can scale and sustain impact over time.

• Engage all stakeholders, including ISPs community partners: Understand barriers from all perspectives to design more effective, inclusive strategies.

Read the Full Paper

This is a critical moment for broadband policy — and for local leaders to make wise, forward-looking decisions with limited public funds. The paper includes a detailed illustrative Digital Opportunity Program budget as well as several examples and resources to help guide policymakers.

Read the full publication: Avoiding Subsidized Overbuilds
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