Colorado Broadband Funding Faces Major Overhaul, Fiber Optic Plans Halted

Federal mandate shifts focus from fiber to lower-cost wireless and satellite

Colorado’s ambitious plan to expand high-speed internet access across rural areas has been dramatically altered by a federal rule change. Local internet providers are scrambling after a compressed application timeline and a new directive prioritizing cost over technology, potentially sidelining fiber optic infrastructure in favor of satellite and wireless solutions.

Sudden Deadline Sparks Provider Scramble

The state’s $826.5 million in federal broadband funds, part of the national Broadband Equity, Access, and Deployment (BEAD) program, now requires providers to reapply for grants. This abrupt shift, compressing a six-week application period to a mere two weeks, has left many organizations overwhelmed. A crucial rule modification mandating “tech neutrality” has effectively prohibited giving preference to fiber optic technology over wireless, satellite, or even older DSL services.

Leslie Mastroianni, executive director of the Southern Colorado Economic Development District, expressed the difficulty: “It was a rough spell.” Her organization halved its original ten applications. “We are fortunate that the ISP (SECOM) has the capability to incorporate new priorities into our project design. There are other ISPs that take great pride in their fiber capabilities and were unable to make those adjustments.” Some companies have withdrawn entirely from the process.

Federal Directive Prioritizes Cost Savings

The U.S. National Telecommunications and Information Administration (NTIA) issued a policy notice on June 6, known as the “Benefit of the Bargain” round. This directive shifts the program’s emphasis from the best available technology to the lowest cost option for the government. This change occurred after Colorado had made significant progress with its initial BEAD rollout, aiming to bring 100 Mbps download and 20 Mbps upload speeds to underserved areas.

Brandy Reitter, executive director of the Colorado Broadband Office, described the impact: “Basically, we had to rescind all of our work, so, a full start over. It modified the grant program and gave us 90 days to start over (and) execute a new grant application.” She voiced concerns about the accelerated vetting process for the 130,000 locations seeking funding, now reduced to 45 days from the original nine months.

“We would never, ever run a grant program in 90 days under normal circumstances, especially for a billion dollars.”

—Brandy Reitter, Executive Director, Colorado Broadband Office

Shift Towards Satellite and Wireless

The recent application period saw a significant decline in fiber optic proposals, dropping from 64% to 40% of applicants. Conversely, wireless solutions now constitute the majority. Notably, 29 new companies have entered the bidding, including eight applications from Elon Musk’s Starlink satellite internet service.

Satellite companies are requesting $363 million, while fixed-wireless providers seek $60 million. Fiber internet companies have requested $464 million, according to Colorado Broadband Office data. Starlink, praised for its speed in rural areas, is now considered a strong contender. However, a recent Ookla report indicated that only about 17.4% of Starlink users in the U.S. met the federal government’s minimum speed requirements.

Amazon’s Project Kuiper service is also slated to launch later this year, promising download speeds of 400 Mbps, adding another low-Earth-orbit internet option. As of July 2025, Starlink’s service availability map shows service is active across Colorado.

Fiber Advocates Raise Concerns About Long-Term Quality

Despite the shift, some providers remain committed to fiber. Jordan Wehe, co-CEO at Jade Communications, stated, “Our focus is on providing strong, resilient service and the best way to do this in remote Colorado is buried fiber optics.” However, Brian Worthen, CEO of Visionary Broadband, acknowledged the competitive landscape: “We saw the NTIA guidance… And we realized that most of the BEAD program is now satellite’s to lose.”

Providers who submitted initial applications faced significant costs, with some spending tens of thousands of dollars on grant writers and engineers. Shak Powers, regional projects manager at Region 9 Economic Development District, noted the financial burden on these companies for the first round of applications.

FTI WIFI, for instance, spent an additional $10,000 to reapply, reducing their project costs by swapping some fiber for wireless and removing locations now served by other providers. Bill Blackford, general manager of FTI WIFI, expressed concern about the program’s direction: “Because ultimately, the way the new bargain round works is the cheaper projects are more likely to get funded even if they don’t create long-term infrastructure, which is kind of the point of the (BEAD) program.”

The Colorado Broadband Office must now review applications for overlap before submitting a final proposal to the NTIA by September 4. Officials anticipate construction may not begin until late 2025, with a real risk that underserved communities could receive the same substandard service they have today.