Before the federal government announced the winners of broadband stimulus awards in December 2009, conventional wisdom suggested government-run projects would capture most of the money. Stimulus applications from vendors, in this scenario, would face lower priority. The awardees were publicized, and all middle-mile and last-mile grants went to small telecommunications companies. This gave private vendors roughly a $173 million share of the money. Compare that to the $9.7 million governments got for public computing center expansions and broadband adoption programs. Large vendors didn't apply because they found the eligibility requirements too onerous.

Having run themselves ragged meeting a short application deadline, government CIOs suddenly found themselves deflated and doubtful about playing a strong role in the federal government's stimulus agenda, according to Alan Shark, executive director of the Public Technology Institute.

"Any idealistic hope that we may have had has been evaporated by what they funded," Shark said.

Indicators have come from the federal government that state and local agencies will have a little more influence during the second round of funding, set to be disbursed in September. In round two, the federal agencies charged with awarding broadband stimulus money promised to give higher priority to public-private partnerships in which governments gave endorsements. A more developed look at why the federal government snubbed public-sector applicants and what to expect for the next funding window could further illuminate the direction broadband stimulus is moving.

In Over Their Heads

The reason for the seeming shutout of government broadband stimulus applications was a lack of preparedness and expertise, according to Alex Winogradoff, research vice president with Gartner. He was among those vetting broadband stimulus applications for the National Telecommunications and Information Administration (NTIA), one of the two federal agencies tasked with disbursing $7.2 billion set aside in the American Recovery and Reinvestment Act for broadband projects.


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Andy Opsahl  |  Features Editor