How delays and tariffs could affect BEAD's US manufacturing goals

　　As the federal government considers changes to the Broadband Equity Access and Deployment (BEAD) program, one lingering question is how those changes – and ongoing implementation delays – may impact domestic fiber suppliers that are ramping up their US-based manufacturing to comply with BEAD's existing requirements.

　　President Trump's new tariffs only exacerbate the difficulties. After all, they could impact most US-based manufacturing efforts if they cover the importation of the components used in those manufacturing operations.

　　For background, the $42 billion BEAD program – created in the 2021 bipartisan infrastructure law, or the Infrastructure Investment and Jobs Act (IIJA) – required grant recipients to use materials manufactured in the US, in accordance with "Build America, Buy America" rules. After months of negotiations with the industry over what was and was not feasible to produce here, the former Biden administration's NTIA issued a waiver in early 2024 specifying which products did (optical fiber and fiber-optic cables, for example) and did not (fiber connectors) need to be assembled and/or manufactured in the US for BEAD-eligibility.

　　That led dozens of companies to commit to ramp up domestic manufacturing for the BEAD program. Suppliers that have self-certified their products for compliance with BEAD include Adtran, Ciena, Cisco, Nokia, Vecima and many others (see a full list here).

　　In total, 44 companies in 28 states and 72 communities have committed to manufacturing products for BEAD, according to the Fiber Broadband Association (FBA).

　　"These manufacturers made the investment based on the volumes that they anticipated to support the BEAD infrastructure program. And, you know, understanding that many of these products that they're going to now manufacture in the United States were not being made here, that's a really exciting thing for our country," said Marissa Mitrovich, vice president of public policy at FBA, in a conversation with Light Reading.

　　One such supplier, AFL (America Fujikura Ltd.), which has operated out of South Carolina since 1984, told Light Reading that it has ramped up its manufacturing facility in Duncan, South Carolina, to comply with BEAD's needs. The company, which is a subsidiary of Japanese firm Fujikura, already manufactures and sources fiber in the US, but it also imports fiber from Japan. AFL therefore restructured its supply chain to produce more of its fiber in South Carolina instead.

　　"We made the determination to invest in additional manufacturing capacity in our Duncan, South Carolina, facility – some of that to transition some of the cable that we were getting from Japan and producing more in the US," said Brianna Woodsby, executive director for compliance and governance at AFL. AFL is also "in the process" of on-shoring the production of a proprietary technology invented by Fujikura, to be compliant with BEAD, added Woodsby. (AFL lists its BEAD-compliant products here.)

　　For AFL, this shift in production means the company invested an initial $50 million to increase its capacity and hiring at its Duncan, South Carolina, facility, creating 115 new jobs. The company then recently committed an additional $6 million, which will add 35 more jobs, to continue to expand its cable operations in South Carolina for "Buy America"-compliant builds, said Woodsby.

　　Uncertainty persists

　　But while the Trump administration aims to increase domestic manufacturing, its ongoing efforts to overhaul the Biden administration's rules for the BEAD program to potentially favor satellite technology could pose a threat to the fiber manufacturers already investing in domestic supply.

　　Moreover, the administration's BEAD review is delaying revenue for those fiber suppliers, not to mention the ability to get shovels in the ground. Indeed, a group of bipartisan state lawmakers last week sent a letter to Commerce Secretary Howard Lutnick imploring the administration to end the delays and let states move forward with their broadband deployment plans.

　　"We already know there are three states that are shovel ready that haven't received their final sign off," said FBA's Mitrovich, referring to Louisiana, Delaware and Nevada, which have each announced their BEAD award winners. Longer delays also increase the likelihood of missing another build season. "You can't just build because you wake up one day and want to build," she added, citing weather and seasonal concerns.

　　For AFL and various other vendors, the ongoing delays to BEAD implementation also mean a delayed return on capital investments. AFL is now expecting BEAD revenue to come sometime in 2026, according to Woodsby.

　　With the administration considering changes to BEAD that could reportedly see a significant chunk of funds go to satellite over fiber, it remains unclear what impact that could have on demand for US-made fiber materials. Another supplier, Adtran, which initially committed $5 million to expand and modernize its facility in Huntsville, Alabama, with a plan to create an estimated 300 jobs, told Light Reading that it has room for further investment and hirings "depending on what direction BEAD goes."

　　Then, of course, there is the impact of Trump's tariffs. That evolving situation is making it "hard to make some of these capital investment decisions," said Woodsby. AFL imports some non-cable components from facilities in Mexico, Cambodia and Vietnam. Analyst firm New Street Research said last week that tariffs will increase costs of fiber builds, estimating the average cost-to-pass and cost-to-connect to rise 2% each, and related equipment costs to increase by 5%.

　　According to FBA's Mitrovich, prolonged uncertainty around fiber suppliers' ability to see a return on their domestic manufacturing investment for the BEAD program could have "the opposite effect" than what was intended with the 2021 infrastructure law.

　　"We saw during the pandemic the supply chain kind of stagnated. We saw furloughs. We wouldn't want to see furloughs again. If there's uncertainty, that's certainly a fear," said Mitrovich. "I think the intention of the leaders in Congress right now, the administration, is to invest in the country, create jobs, make us competitive ... These investments are a really positive thing for us."