Small operators balk at special conditions in broadband stimulus money

What if the government held a $7.2 billion cash giveaway and nobody came? The deadline for the initial round of funding for the $7.2 billion broadband stimulus program is Aug. 14 and early indications are that small cable operators may sit out the program in fairly large numbers. As one long-time small cable-system operator who requested anonymity put it: “There are a lot of strings on that money.”

The broadband stimulus was carved out of the nearly $800 billion federal bailout package — officially called the American Recovery and Reinvestment Act — to help bring broadband service to rural markets. The funding is expected to be doled out in three tranches: One that expires on Aug. 14, a second towards the end of the year and a third set tentatively for the spring of 2010...