The Biden administration is getting some corporate help in its $65 billion effort to increase Internet access nationwide: CommScope (COMM) and Corning (GLW) are expanding fiber-optic cable manufacturing capacity in North Carolina to aid the buildout of rural networks.
CommScope plans to invest $47 million to beef up its facility in Hickory, NC, including hiring 250 people over the next five years. Corning opened a new plant at its existing campus there, part of a $500 million investment in capacity since 2020.
For Commerce Secretary Gina Raimondo, whose department is spearheading the agreements, the new commitments boost efforts for the administration’s “Internet for all” initiative by providing cable meant for rural areas. The new plants also aim to create jobs and foster American manufacturing.
“If we are going to connect every American, including the tens of millions of Americans who now don't have the Internet, we're gonna have to lay fiber all across this country," Secretary Raimondo told Yahoo Finance in an interview (video above). "And that's an opportunity to make that fiber optic cable right here in America."
Most of the funding for the “Internet for all” initiative will be allocated through a Broadband Equity, Access and Deployment program, which award grants to states, who in turn will assign contracts and grants for laying of cable and providing of service.
A 2021 report from the Pew Research Center found that 72% of rural Americans had a home broadband connection, compared with 77% in urban areas and 79% of suburban residents. Part of the discrepancy has to do with connectivity; the laying of cable should help. And part of the issue is affordability, which the administration is also trying to alleviate.
Speaking from a public library following a meeting with local residents — many of whom used the facility for connectivity — Secretary Raimondo said: “The librarian who is here just told unbelievable stories about how people, if they want to collect their VA benefits, if they want to do their homework or do their job, [or] do a job interview, they have to come to the library."
The issue isn’t limited to rural areas: During the pandemic, in particular, the ability of students to log on from home during remote schooling was thrown into sharp relief. According to a different study from Pew, 14% of those surveyed said their children had to use public WiFi because they had no reliable home Internet connection. The problem was most acute for lower-income families.
CommScope’s stated that its cable is a new, smaller and lighter cable that’s designed for rural applications since it’s lower in cost and easier to ship.
“We will produce more cost-effective and easier-to-deploy fiber-optic cable, add new jobs and simultaneously strengthen the supply chain in America. This is a trifecta we are thrilled to announce,” CEO Chuck Treadway said in a press release.