Where We Are — Funding, Supply Chain and Workforce
Funding
The US Government committed to fund fiber projects to underserved areas and boost existing infrastructure to ensure universal high-speed internet for anyone regardless of location and economic situation. The Infrastructure Act created multiple funds totaling $65 billion for project support. The first round of this money is flowing. Subsequent rounds are currently bound in governmental red tape and awardees hope to receive their funding sometime in the next 12-18 months. Programs include:
- Broadband Equity, Access & Deployment Program (BEAD), $42.5 billion, Title I. Formula-based grant program for unserved and underserved areas of the USA.
- Digital Equity Act, $2.75 billion, Title III. - Digital Equity comprises three programs for the planning and implementation of programs to build broadband capacity.
- TRIBAL, $2 billion, Title II. Technical Amendments to further the current Tribal Broadband Connectivity Program.
- Enabling Middle Mile Broadband Infrastructure, $1 billion, Title IV. This effort aims to extend middle mile capacity to reduce the cost of serving unserved areas.
- FCC to administer $14 billion for the Affordable Connectivity Program.
- USDA to administer $2.0 billion via the Rural Utilities Service Administration to fund projects in rural areas.
- $600 million for state and local governments to use for funding private activity bonds for rural broadband projects.
Supply chain
In 2022, the swell of COVID’s effects on supply chains and workforces has no end in sight. The slowdown in raw material production is causing shortages and long delivery times for fiber-optic cable (60 weeks or more) and plastic resins for OSP boxes and pedestals (30 weeks or more), just to name a few.
Manufacturers are doing their best to improve lead times in spite of the unprecedented increase in new orders and continued shortages and delays at every level of the supply chain. Sharp rises in oil prices have driven plastic-based products up in price and original project estimates are consistently over budget and delayed beyond original completion dates.
Workforce
Baby Boomers are retiring in large numbers, 10,000 per day, which is creating a large gap in many industries. The labor drain is most notable in the fiber-optic installation segment, typically made up of senior technicians who have been in their current role for 15+ years.
Significant numbers of the North American workforce shifted from working in the office to working from home as a result of COVID-19. This relocation forced service providers to expand their network capacity to support the change in internet connectivity from large corporate locations to millions of residences. This massive transformation would be daunting with supply chain and product shortages but was made even more so with a lack of trained workforce to handle the required installs.
What Are the Best Practices for the Current Fiber Market Conditions?
- Ensure your network design is standards-based with alternative hardware suppliers, so you are not reliant on a single vendor. A standards-based universal design will enable components from different vendors to reside in your network and give you the ability to have backup vendors if product lead times become problematic.
- Analyze your workforce to understand its current capabilities. Every service provider can only be as good as its workforce. Supporting subscribers and building out fiber networks requires the ability to perform at high levels each day. If your workforce is aging, get plans in place to supplement potential retirements before they happen. Having new hires acclimate to the work crew when it is not stressed helps maintain output levels.
- The shortage of experienced technicians has driven salaries sky high. Contractors are winning out by offering larger compensation packages due to the glut of work and shortage of employees. Some contractor organizations are more appealing to the workforce due to a more relaxed and flexible work environment compared to many of the large corporate service providers.
- Training, training, and more training helps get an individual employee’s performance to normalize at higher levels versus their less trained counterparts. When deploying fiber optics, speed often becomes a negative factor, most often centered around fiber hygiene, aka cleaning the fiber and connectors during the prep stage. Good sound standards-based training that is followed consistently is the key to a successful fiber technician. Most top-tier technicians have been dealing with fiber for 15+years, some back to the 1990s. Years ago, fiber deployment was an exacting skill that was long and laborious compared to today’s metrics. These experienced techs had to learn as the technology was still in its infancy which required them to be exacting in their work. Today’s technicians are fortunate, as the technology and fiber are more forgiving but still require much more diligence than copper and coaxial installations.
- The advancement of outside plant (OSP) hardware has the best of intentions as some designs are “pre-connectorized” and “plug and play,” eliminating some steps in the field by technicians in an effort to decrease installation time. Although these products have their advantages in today’s environment, the impact is that both have added financial costs and a degradation of skill set for the technicians. This higher cost for the hardware, and now longer lead times, have many projects slowed or stalled as a result. Some installation crews don’t have the ability to splice effectively to work though these roadblocks, leaving service providers at the mercy of their vendors.
What can we do to make the adjustments for success?
Based on telecommunications history, we know that it can take many years before a fiber-optic build out is complete. Supply chains will remain stressed for a few years and the skilled workforce will need to significantly grow to keep up with the Boomer retirements over the next 7-10 years.
Newer technologies that add value across all aspects of the business are the most effective technologies to deploy. For example, there are all-in-one splicers that enable new and existing technicians the ability to quickly ramp up their fiber skills, perform consistently at higher levels and faster speeds, as well as significantly reduce training times.
These fusion splicers are outselling traditional fusion splicers among some suppliers and are being embraced by the new generation of technicians who are part of a technology-driven workforce. From world-class space technology companies, telephone and cable companies, co-op water and electric companies and municipalities, the new generation of workforce managers recognize the need to modernize fusion-splicing tactics just to keep their labor pool satisfied.
A significant number of network operators have moved away from higher-priced pre-connectorized cables as a result of enhanced workforce skills and are building custom lengths onsite with connectors and a box of cable. The capability to build custom lengths onsite eliminates 12–20-week lead times for much higher priced pre-connectorized alternatives. Investing in a strong workforce provides a broader range of capabilities within the organization and enables the use of lower-priced options, bringing a broader range of capabilities within the organization while reducing capex. This strategy will redirect the higher costs associated with pre-connectorized gear back into the workforce, the most important component of any network build.
Dave Schuman is vice president of service provider markets at UCL Swift North America. He has more than 20 years of experience supporting fiber-based solutions to the service provider space at the network transport level as well as the outside plant and customer premise space. Schuman has also been cited in industry magazines with articles that discuss best practices for fiber installations and copper/coax-to-fiber workforce transformation solutions.