Significant recent events lead New Street Research to believe the fallout from the “Buy America” provisions of using BEAD grants for broadband deployments have been reduced. If strictly applied, the Buy America provisions of the Infrastructure Law would cause “such significant delays” that the program might end before the money is deployed to connect all, writes New Street Policy Advisor Blair Levin in a client report.
“The question for the government was whether those Buy America requirements apply to 100 percent of the covered inputs necessary for broadband network construction, or whether it can be waived for specific inputs,” writes Levin. Though most of the deployment costs like labor and fiber can be obtained in the U.S., many critical network components cannot. Broadband switching and routing equipment, dense wave division multiplexing transport equipment, and broadband access equipment are exclusively sourced from Asia, notes NSR.
Nokia’s announcement last week that it will manufacture fiber-optic broadband products and optical modules in the U.S. for use in the BEAD program helps change that equation, notes Levin. So too, does a statement from a Commerce Department official saying the agency is working on creating other potential American sources for broadband components.
The official also said a “limited waiver” from the Buy American provisions may be allowed, according to NSR. The officials said there would be a filing window for a limited waiver later this summer.
NSR believes the combination of the Nokia news and the availability of a limited waiver “should be sufficient to assure all the stakeholders in the BEAD process that the Buy America requirements will not cause a delay for any projects,” writes Levin.
By Leslie Stimson, Inside Towers Washington Bureau Chief
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