FCC Takes Next Steps Toward Expanding Rural Broadband Access

The Federal Communications Commission set key rules for a competitive “reverse auction” that will provide nearly $2 billion for rural deployment over the next decade. In the upcoming Connect America Fund Phase II auction, providers will compete for support to expand broadband to unserved areas, along with voice service. The auction rules established today aim to maximize the value the American people will receive for the Connect America Fund dollars spent by balancing deployment of higher-quality services with cost efficiencies. The action focuses on census blocks unserved by broadband in 20 states where the nation’s largest carriers – known as “price cap” carriers – declined last year’s Connect America Fund offer of support. Also included in the auction are locations across the country with extremely high deployment costs. The Order balances incentives for deployment of higher-quality services with cost efficiencies by establishing auction “weights” that credit bids by companies offering more robust service.

Specifically, the Order:

• Establishes bidding weights to compare bids across performance tiers set in 2016
• These weights account for the value of higher speeds, higher usage allowances, and low latency
• But the formula used to rank bidders balances these performance goals with the need to reach as many consumers as possible within the FCC’s budget for rural universal service support