FCC Prepares Latest Broadband Subsidies

Image: SpaceX

The Federal Communications Commission (FCC) is prepared to award $1.2B+ in new broadband payouts through its Rural Digital Opportunity Fund (RDOF). 

  • The RDOF is intended to reduce the US’s digital divide by subsidizing broadband deployment in rural and underserved areas. The two-phase auction will pay out up to $20.4B to internet service providers over the course of a decade. 
  • Last December, SpaceX won ~$886M in RDOF funding. The only other satellite operator to win Phase 1 funding, Hughes Network Systems, was awarded $1.3M. 

This sixth wave of funding, the FCC’s largest to date, is targeted at broadband deployments in 32 states. But there’s a catch: The FCC will double the number of audits and on-site verification it conducts this year, after claims of unaccountability and lax RDOF funding oversight. 

The backstory: Last year, the FCC sent a letter to 197 winning RDOF bidders—including SpaceX—saying that broadband subsidies could not go toward serving parking lots, airports, or other urban areas. The FCC said its concerns covered areas “where there was evidence of existing service or questions of waste.” 

The fix: Verifications will be targeted at larger dollar and/or higher risk recipients. The FCC will also publish the results of verifications, audits, and speed/latency performance tests online.

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