Top Broadband Director Warns of Musk Handout in Scathing Email Exit

The director of the largest federal broadband program in US history bid farewell to his colleagues in a spirited email Sunday morning. Among other things, Evan Feinman warned that millions of rural Americans could get stuck with slow internet speeds if rules are changed to favor Elon Musk’s satellite internet company Starlink.

Until March 16, Feinman was the director of the Broadband Equity, Access and Deployment programa $42.5 billion fund passed as part of the Infrastructure Investment and Jobs Act of 2021. In the email, first reported by ProPublica’s Craig Silverman in a Bluesky postFeinman sounds the alarm on proposed changes to BEAD.

“The new administration seems to want to make changes that ignore the clear direction laid out by Congress, reduce the number of American homes and businesses that get fiber connections, and increase the number that get satellite connections,” Feinman wrote.

By satellite, he means Starlink. Amazon’s Project Kuiper is also technically eligible for BEAD funding, but it currently has only two prototype satellites in the sky, compared with over 7,000 for Starlink. (Geostationary satellite internet providers like Hughesnet and Viasat aren’t eligible for BEAD funding because they don’t meet its latency requirements.)

BEAD’s money is distributed to each state by the National Telecommunications and Information Administration, which falls under the Department of Commerce. Under Biden’s administration, the NTIA clearly favored deploying fiber to rural areas, which is widely considered the gold standard internet connection type.

Commerce Secretary Howard Lutnick plans to take a more “technology-neutral” approach to BEAD, according to a report published by the Wall Street Journal. That would benefit Starlink to the tune of $10 billion to $20 billion — up from the $4.1 billion it was expected to get under the old rules.

“Some of the scary scenarios that I’ve been hearing from people close to NTIA and close to the Commerce Department would give 50% of the money or more to Elon Musk,” Gigi Sohn, the executive director of the American Association for Public Broadband, told CNET.

“Lutnick apparently believes, like Trump and like Musk, that paying for fiber instead of satellite is wasted money,” Blair Levin, a former FCC chief of staff and telecom industry analyst at New Street Research, told CNET.

Fiber is expensive in many areas. A spokesperson for the Texas Comptroller told me in a previous interview that some rural households in West Texas would cost as much as $130,000 each to connect to fiber.

How much BEAD money Starlink will be able to get could depend on where the NTIA sets that threshold. A source told me that the SPEED for BEAD Act — a bill introduced in the House earlier in March — originally included a cost threshold of $25,000 per location for fiber, but was later removed. If an area exceeded that number, the state’s broadband office would be able to turn to “alternative technologies” like Starlink.

“This is what (Feinman’s) concerned about,” said Sohn, who worries the NTIA could set a price-per-location that heavily favors satellite. “If we want to come back in five years and say, ‘Oh gee, we still have a huge rural digital divide in this country,’ then that’s what we’ll do.”

Feinman’s email argues that this shift from fiber to satellite would be a “disservice to rural and small-town America.” This comes down to two issues with Starlink’s service: speed and price. It hasn’t proven it can meet BEAD’s speed requirements, and at $120 per month in most areas, it’s also far more expensive than most internet providers.

Neither Starlink or Commerce Department spokespeople immediately responded to CNET’s request for comment.

Can Starlink keep up with the future?

Critics argue that Starlink’s speeds don’t meet BEAD’s speed requirements: 100Mbps download speed, 20Mbps upload and latency under 100ms. The only one of those requirements that Starlink is currently meeting is latency, and it’s still significantly worse than the median in the US.

“This is a once-in-a-lifetime investment in broadband and to give it to expensive, slow service that’s not scalable, that’s not future-proof — it’s just throwing money down the toilet,” Sohn said.

Ookla data shows that Starlink’s speeds have actually dropped as more people have joined the network.(Disclosure: Ookla is owned by the same parent company as CNET, Ziff Davis.)

Starlink has launched thousands of satellites since it debuted in 2019, but it’s also added millions of additional customers. Speeds have dropped even as Starlink sent thousands more satellites into the sky, and it’s currently unavailable to customers in many US cities.

“I’m not sure Lutnick is aware of this,” Levin said. “Starlink has a waiting list. They have a waiting list because they’ve run out of capacity.”

Starlink has said publicly its new satellites will solve the capacity issues, but it hasn’t proven it can do it yet — especially if millions of additional homes connect through BEAD.

“As a future technology, it just doesn’t cut the mustard,” Sohn said.

A rule of thumb I’ve heard a lot in the internet world is called Nielsen’s lawwhich states that a high-end internet user’s connection speed grows by roughly 50% each year, doubling every 21 months. This has been true every year since 1983, and it’s exactly what Feinman is worried about. Starlink may be good enough today — and it hasn’t proven it is by the FCC’s definition — but it may not be able to handle applications of the future.

What’s next?

A lot is in flux right now for BEAD. Lutnick is expected to announce rules overhauling the program any day now, which helps explain some of the urgency in Feinman’s email.

“Reach out to your congressional delegation and reach out to the Trump administration and tell them to strip out the needless requirements, but not to strip away from states the flexibility to get the best connections for their people,” Feinman wrote to his colleagues.

If you’d like to reach out to your elected representatives about changes to the BEAD program, you can download the 5 Calls app in the App Store or Google Play store. The app researches and writes scripts for various issues, identifies the relevant decision-makers, and collects phone numbers for their offices.