The U.S government recently unveiled draft guidelines outlining permissible equipment purchases from outside the country under the Broadband Equity, Access and Deployment (BEAD) programme. The Department of Commerce’s National Telecommunications & Information Administration (NTIA) has long delayed this clarity concerning waivers regarding the ‘buy American’ rules, which govern this $42.45 billion initiative.

Unsurprisingly, the draft rules infer that waivers will be few, aligning with President Joe Biden’s State of the Union address in January. He stressed the importance of buying American for various government-funded connectivity projects within the U.S, a thrust that the NTIA reiterated, particularly pointing out little need for waivers in fibre-optic glass and cables sectors within BEAD.

The news of limited waivers could potentially disappoint industry insiders concerned about the challenges in procuring American-made equipment and the related expenses. However, the NTIA does propose one crucial waiver: although fibre optics must be U.S-produced, the glass used in their lining can be sourced overseas.

The NTIA notes in the draft document that “Optical fibre and fibre optic cable are likely to see the highest levels of expenditures…” Given the existing domestic production, worries exist about the sufficient supply, especially for small to medium-sized ISPs, during the peak demand in the BEAD programme deployment.

The spotlight for many foreign vendors will likely be on electronics, identified by NTIA as the “second largest segment of equipment used in BEAD fibre broadband deployments.” With the current manufacturing groundwork in Southeast Asia, the NTIA discerns that relocation of certain component production to the U.S is conceivable. Resulting from such considerations, the proposal to implement waivers for all electronics, including semiconductors, has emerged. Four critical product areas, however, are excluded: Optical Line Terminals (OLTs), OLT line cards, optic pluggables, and Optical Network Terminals (ONTs).

As a foreshadowing of this significant shift, Nokia recently announced a partnership deal with Sanmina Corporation. The collaboration aims to manufacture diverse fibre broadband products in Wisconsin, aligning with BEAD’s buy American objective. Similarly, Adtran revealed an expansion of its U.S production of OLT equipment at an Alabama plant, intending to align with BEAD as well.

The draft rules’ evolution and implementation will be closely watched by many, especially as the deadline for feedback is fast approaching on September 21. As the telecommunications industry adjusts to the new guidelines, more strategic partnerships and manufacturing shifts to align with the BEAD programme are anticipated. The American-made drive is hence gathering noticeable momentum, solidifying the domestic industrial capacity while promoting equity, access, and development in broadband connectivity.



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