The issue is profitability (similar to the post office problem) -- if your house is in a rural area with low density, it's not worth it for a private industry actor to bid on your linkage. In many parts of the US, the only ways to get mail is through USPS (FedEx & UPS just don't service unprofitable routes). However I think internet access is a human right and a public good no matter where you live or can afford to live (imagine raising children who would never have access to at least broadband-level speed -- how would they function in a 21st century economy?) - and the infrastructure can only be provided equitably if the government steps in and subsidizes away the profitability problem.

That's a good point. The law can have an exception for communities that get less than 5 bids. If that happens the gov't builds the infrastructure.

I don't follow. How do you propose that the gov't build the infrastructure? A: get bids, award the task to highest bidder... :)

Profitability should be automatically part of the bid. It doesn't mean the bidders pay the government, it could be the other way around too.

It would be same as the regular bidding process.

Except that the gov't picks and pays for the contract (construction), instead of the local residents.

For service and maintenance contract the gov't would subsidize the monthly fees (which are expected to bee higher than a high density city)