LECs, Cable Change Minds About Broadband Stimulus

Two incumbent phone providers, and some cable operators, have changed their minds about pursuing broadband stimulus funds.

Most notably, AT&T Inc. (T), Qwest Communications International Inc. (Q) and Comcast Corp. (CMCSA) have applied for government grant money, months after eschewing money available in the first broadband stimulus round.

This week, though, the companies all divulged that the second funding stage appeals to them. For Qwest, that means seeking a $350 million grant from the Rural Utilities Service. The Denver-based Baby Bell wants to bring broadband access of 12mbps-40mbps to rural areas of its 14-state region.

AT&T and its cable rivals, meanwhile, have pulled an unprecedented move. They’ve all formed the Broadband Adoption Initiative and are asking the Obama Administration for $52.11 million to offer discounted broadband to 250,000 users in low-income housing. USTelecom is among the groups supporting the proposal.

AT&T, Qwest, Comcast and others previously shunned taking part in the broadband stimulus – part of the 2009 American Recovery and Reinvestment Act – because they didn’t like provisions including network-sharing requirements. Some of those rules were changed for the second funding round, however.

Round 2 applications are due at the National Telecommunications & Information Administration today, and to the Rural Utilities Service on Monday.

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