Continuing RDOF Defaults

CenturyLink told the Federal Communications Commission recently that it is defaulting on 41,000 Rural Digital Opportunity Fund locations spread across eight states and 153 Census block groups. There are a number of consequences of this default. First, this has now happened after states made Broadband Equity, Access, and Deployment maps and allocation. That makes it likely that nobody will be bringing improved broadband to the default areas. If the defaults had happened earlier, these areas could have been rolled into the BEAD process. Second, CenturyLink should expect a significant fine. If CenturyLink is fined at the same level as recent RDOF defaults, or around $3,000 per location, the fine will be $123 million. Additionally, roughly half of the RDOF funding has flowed to auction winners, meaning CenturyLink would have to return approximately $65 million of RDOF subsidy to the FCC. This is not likely the end of RDOF defaults. I said at the time it was first announced that RDOF is a badly flawed program. The reality has turned out to be far worse than any predictions.