Rural Broadband Valuations Remain High as Investors Move Down Market for New Opportunities
September 25, 2020
- The abrupt shift in 2020 to working from home and remote learning has significantly increased high-speed data subscriptions, representing a new catalyst for the broadband market.
- COVID-19 has exposed the vulnerability of the underserved and unserved, and as a result, Democratic lawmakers have proposed an $80 billion plan to bridge the digital divide. The possibility of new government grants will whet investors’ appetites for broadband assets.
- Investors are starting to show interest in WISPs thanks to their CAF-II awards, new spectrum-sharing business models, and fiber investments.
- While the high-speed LEO satellite market represents a long-term headwind for valuations and M&A activity, we remain skeptical until the business model is proven.
- Given these and other factors, we believe current broadband valuations should remain elevated for the foreseeable future.
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