Thursday, December 11, 2008

Broadband Stimulus Coming?

The Telecommunications Industry Association and Communications Workers of America have sent U.S. congressional leaders the outlines of a broadband deployment incentives program which they suggest be made part of any economic stimulus package passed by Congress early in the new year.

The proposal emphasizes tax incentives and direct grant. Specifically, the groups suggest allowing wireless broadband deployments to expense 75 percent of investments. Alternatively, the groups suggest a 15 percent investment tax credit for networks capable of 1.5 Mbps downstream/384 kbps upstream.

They suggest and 100 percent expensing or a 20 percent investment tax credit for new infrastructure capable of 3 Mbps downstream/1 Mbps upstream. the groups also recommend a 40 percent investment credit for a network providing 5 Mbps downstream/1 Mbps upstream.

For fixed broadband infrastructure, the groups suggest 50 percent expensing or a 10 percent investment tax credit for networks capable of 3 Mbps downstream/1 Mbps upstream, 75 percent expensing or a 15 percent tax credit for 25 Mbps downstream/5 Mbps upstream, or 100 percent expensing or a 20 percent tax credit for 50 Mbps downstream/20 Mbps upstream infrastructure.

They further propose a 40 percent investment tax credit for a network providing 100 Mbps downstream/20 Mbps upstream.

For satellite broadband infrastructure, which plays a special role in national broadband deployment, tax benefits associated with particular service capabilities remain to be determined, the groups now say.

The groups argue for investment in four segments: fixed broadband, wireless broadband, satellite broadband and broadband core and backbone transport.

The proposal also suggests “direct grants” for rural broadband deployments. TIA suggests a $25 billion grant program for deployment of broadband infrastructure in unserved areas.

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