2025 Rural Broadband: The Impact of BEAD Funding

Drive through rural areas today, and you’ll notice big changes—fiber optic networks being laid, 5G services appearing where they never existed before. These aren’t just minor improvements; they reflect a bigger societal shift in how rural areas?compete on the world stage.

A decade ago, a small town in Iowa struggled with dial-up. Today, thanks to state and federal broadband grants, that same town has high-speed broadband. Remote work, online education, and telemedicine are now part of daily life in rural communities. In 2023 alone, rural telecom companies secured $950 million in broadband grants, a 50% increase from 2022, transforming how these areas live and?thrive.

?However, progress comes with challenges. In 2023, operating expenses for rural telecom providers rose 3%, while revenues grew by just 1.2%. It’s like running a small farm—input costs rise, but you can’t charge more. Telecoms face similar difficulties as they roll out new services while grappling with rising costs.

The way these companies generate revenue is also changing. Traditional phone services (POTS), once a major source, now account for less than 6.9% of revenues, while internet services make up over 26%. For some, like a provider in North Dakota, broadband has become the core business, and those who adapted early now benefit from faster speeds and future-proof business models.

Midsize telecoms - those earning between $5 million and $25 million—are outperforming larger ones. They’re more agile, allowing them to move quickly in deploying fiber, growing revenues, and offering new services. While larger companies remain stuck in planning, smaller providers, like those in Colorado, are already expanding their networks.

Financially, many rural telecoms are solid, with an industry-wide equity-to-assets ratio of 80%. The BEAD program (Broadband Equity Access and Deployment), backed by $42.45 billion, is essential for further expansion. BEAD funding is more than just support; it’s the backbone of connecting rural America to the digital future.

The rural telecom industry is evolving rapidly. Those who embrace change and invest in broadband now will lead the way into 2025 and beyond.

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Written by Tom Carroll , Director Pre-Sales