How is the government's broadband money really being used?

Raw Story:

When Congress included $7.2 billion for broadband in last year's stimulus bill, its goal was to bring high-speed Internet connections and information-age jobs to parts of the country desperate for both things.

Now as the government awards the money, some phone and cable companies complain that not all of it is being used to bring broadband to places that lack it. Instead, these companies say, much of the money will fund new networks in places where they already offer service.

From the Blue Ridge Mountains to the Great Plains, some local phone and cable companies fear they will have to compete with government-subsidized broadband systems, paid for largely with stimulus dollars. If these taxpayer-funded networks siphon off customers with lower prices, private companies warn that they could be less likely to upgrade their own lines, endangering jobs and undermining the goals of the stimulus plan.

"It is extremely unfair that the government comes in and uses big government money to harm existing private businesses," says Gary Shorman, president of Eagle Communications, a Kansas cable company with about 16,000 customers.

[...]Of the 140 awards made so far, 108 will help pay for broadband networks. And roughly 70 percent of them cover areas already served at least in part by existing broadband providers, according to a U.S. Telecom Association analysis of data that existing carriers have filed with the government.