Rural Digital Opportunity Fund

On Jan 15, 2021, Federal Communications Commission Chairman Ajit Pai responded to several Members of Congress regarding the implementation of the Rural Digital Opportunity Fund. Lawmakers advocated for stringent oversight of the auction and encouraged the FCC to require detailed deployment schedules for review to ensure submissions can meet the time frame outlined by the auction.

SpaceX in the waning weeks of the Trump administration won preliminary rights to $886 million in government backing to provide rural broadband service via Starlink, its system of low-Earth-orbiting satellites. The federal government is now planning a final round of vetting before it bets big that Elon Musk’s technology can help close persistent gaps in US high-speed internet service. The FCC is requiring SpaceX and others in line for subsidies to demonstrate their financial and technical wherewithal to build out a network, and Jan 29 was the deadline for submitting those plans.

The first phase of the Rural Digital Opportunity Fund (RDOF) was for unserved markets, so given their high-cost nature it makes sense that affordable fixed wireless played such a large role. In the subsequent round, we expect fixed wireless to play a reduced role in underserved areas, which tend to be more densely populated. Technically speaking, with enough government support, unserved markets can be connected with gigabit speeds via fixed wireless, but execution risks and the ability to secure letters of credit (LOCs) could impede an operator’s ability to deliver on its bid.

CenturyLink and Frontier Communications have again failed to meet broadband-deployment deadlines in dozens of states after taking money from the Federal Communications Commission. The deadline to hit 100 percent of the required deployments passed on December 31, 2020. Both CenturyLink and Frontier informed the FCC that they missed the deadline to finish deployment in numerous states. The carriers won't face the possibility of punishment yet.

In his inaugural speech, President Joe Biden noted the various factions at odds with one another in America, including a rural and urban divide.

The Rural Digital Opportunity Fund is looking more and more like one of the most wasteful projects in Federal Communications Commission history. Critiquing the FCC for awarding more than $2 billion to unproven companies using questionable technologies to serve questionable areas is fully valid. So is raising concerns about awards to a bankrupt incumbent. These two critiques can coexist. Yet FCC Chairman Pai views them as the bread of a “job well done” policy sandwich.

 Rep. Tim Walberg (R-MI), House Majority Whip James Clyburn (D-SC), Senator John Thune (R-SD), and Senator Amy Klobuchar (D-MN) led a bipartisan letter to Federal Communications Commission Chairman Ajit Pai and fellow commissioners regarding implementation of programs to help close the digital divide in rural America. With the recent completion of the Rural Digital Opportunity Fund (RDOF) auction, the letter urges the FCC to ensure recipients of broadband deployment funding can deliver on their commitments. In total, 157 Representatives and Senators joined Walberg on the letter.

This is the twenty-third report in a series prepared by federal and state staff members for the Federal-State Joint Board on Universal Service. The findings are reported in seven sections: Section 1 of the report provides an update on industry revenues, universal service program funding requirements, and contribution factors. Sections 2 through 5 provide the latest data on the low-income, highcost, schools and libraries, and rural health care support mechanisms.

Looking ahead, the biggest challenge facing the long-term health of the FCC’s universal service programs is the way they are funded. We are in a unique position to solve this challenge. Here’s how. Back when I was a Commissioner in 2016, I proposed that Congress should authorize a dividend from the sale of wireless spectrum that would go toward closing the digital divide. Whenever the FCC auctioned spectrum for flexible use, we would set aside 10% of the net auction proceeds for the deployment of broadband in unserved communities. I thought it was a good idea then.

Although satellite Internet technology has advanced far beyond its initial capabilities, some experts have advised that the emerging broadband solution still has limitations that local and state stakeholders should consider. Carl Russo, CEO of telecommunications company Calix, said for “very rural” places that have no access to other solutions, satellite Internet makes sense.