Speed Gains Surge as Rural Build Costs Climb

According to Ookla Speedtest Intelligence data, the broadband industry crossed a major milestone in the second half of 2025. A report from Ookla Editorial Director Sue Marek shows that 45 states and the District of Columbia are now delivering the FCC's minimum standard of 100 Mbps download and 20 Mbps upload to 60% or more of users, up from 38 states six months earlier. The number of states hitting that threshold for 70% or more of users more than doubled, from five to 13. This progress did not come cheaply, however.

Two forces drove the gains. First, Rural fiber expansion accelerated significantly. The Fiber Broadband Association and Cartesian report that rural coverage more than doubled from 21% in 2021 to 45% by mid-2025, with 12.8 million rural locations now passed.

Second, federal funding program deadlines drove build completions across the country. In Montana, for example, publicly-funded builds drove the state's share of users hitting 100/20 Mbps from 41% to 54% in six months, the largest improvement of any state in the second half of 2025.

According to the FBA/Cartesian Fiber Deployment Cost Annual Report, for the contractors and operators executing those deployments, the financial challenges are growing, with a direct connection to the rural buildouts. 

The terrain, extended routes, and make-ready complexity that define many rural builds pushed costs to their highest levels since FBA and Cartesian began tracking them.

Median underground deployment reached $18 per foot, up 3% year-over-year, while aerial costs climbed 14% to $8 per foot. Labor accounted for 72% of underground costs and 64% of aerial, running $12.23 per foot underground. 92% of respondents reported higher costs in 2025. 88% expect costs to rise again in 2026.

In some cases, make-ready costs reached 150% of the original construction budget. Additionally, permitting delays extended timelines by roughly 20% on average, and up to 18 months in the worst cases.

A March 2026 analysis by NTCA and Cartesian, based on member-operator data, found that without Universal Service Fund (USF) support, rural operators face EBITDA margins ranging from negative 35% to 12%, depending on density and scale.

A 60% USF reduction leaves the smallest operators at approximately 1% EBITDA. At that point, once replacement capex is figured in, cash flow turns negative.

The analysis also found that network operating expenses in extremely rural areas run 44% higher than in more densely populated markets, with technician shortages and truck rolls that can take 10 to 15 times longer than in urban markets as the primary drivers.

As BEAD funding rolls out and prices peak, the locations left unserved may be even more expensive to reach.

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