FCC offers $2 billion for rural broadband projects

The FCC is offering $2.15 billion over ten years to Internet providers for rural broadband projects. The offer is the next stage in Phase II of a Connect America Fund program that incents providers to build broadband infrastructure in rural areas. The money is available to providers that will build in locations where incumbent carriers declined to build and will be distributed through a reverse auction.

In a reverse auction bidders compete for the money with projects instead of vice versa. The projects that meet the most FCC requirements will win the money to help fund the project.  "We now adopt an auction design in which bidders committing to different performance levels will compete head to head in the auction, with weights to take into account our preference for higher speeds over lower speeds, higher usage over lower usage allowances, and low latency over high latency," the FCC said. Providers that commit to faster speeds will have an advantage in the auction.

Phase II builds on the FCC’s success with the CAF subsidy program, which is providing subsidies to carriers to expand 10/1 Mbps broadband service to more than 3 million homes and businesses in rural locations across 36 states. Almost all incumbent carriers accepted CAF money to build broadband infrastructure. Verizon was the only major telecommunications company to not accept the money, walking away from more than $565 million in Federal broadband funding.

Links:

Gigabit Internet with no data caps may be coming to rural America (Ars Technica, May 27, 2016)

FCC Takes Next Steps in Expanding Rural Broadband Access (FCC, May 25, 2016)

AT&T, CenturyLink accept more than $900 million in CAF money (Speed Matters, Aug. 28, 2015)