Starlink’s bid for rural internet subsidies is rejected by FCC has rejected

Starlink’s application for $885 million has been rejected by The Federal Communications Commission (FCC).


FCC’s news release


FCC said in its news release, “2022—The Federal Communications Commission today announced that it is rejecting the long-form applications of LTD Broadband and Starlink to receive support through the Rural Digital Opportunity Fund program.  The Commission determined that these applications failed to demonstrate that the providers could deliver the promised service.  Funding these vast proposed networks would not be the best use of limited Universal Service Fund dollars to bring broadband to unserved areas across the United States, the Commission concluded.”


Public Notice


Their public notice says, “By this Public Notice, the Rural Broadband Auctions Task Force (RBATF), Wireline Competition Bureau (WCB or Bureau), and the Office of Economics and Analytics (OEA) announce they are ready to authorize Rural Digital Opportunity Fund (Auction 904) support for the Auction 904 winning bids identified in Attachment A of this Public Notice.  To be authorized to receive the total 10-year support amounts listed in Attachment A, the longform applicants identified in that attachment are required to submit acceptable irrevocable stand-by letter(s) of credit and Bankruptcy Code opinion letter(s) from their legal counsel for each state where they have winning bids that are ready to be authorized in accordance with the instructions provided below by the applicable deadline – prior to 6:00 p.m. ET on August 24, 2022.”


According to The Verge, “The funding is part of the broader $9.2 billion Rural Digital Opportunity Fund that provides an incentive for telecom companies to extend internet service to rural and underserved locations. In 2020, Starlink won an initial $885.5 million subsidy as part of a Phase 1 rollout of the program. The FCC also rejected LTD Broadband’s bid for the funding after it initially received $1.3 billion in 2020.

How is FCC Planning to Boost Rural Broadband Internet Speeds Via A-CAM Programs?

In a piece of recent news, the FCC has unveiled its plan of boosting rural broadband internet speeds through proposed changes to the A-CAM Program. As per reports, the target is to improve minimum download and upload speeds in areas served by carriers that receive A-CAM support.


Proposed Changes to A-CAM Program


Recently, the Federal Communications Commission announced its plan of boosting rural broadband internet speeds through proposed changes to the Alternative Connect America Cost Model (A-CAM) program. As per reports, the target is to improve minimum download and upload speeds to 100/20 Mbps in areas served by carriers that receive A-CAM support. The current baseline is 25/3 Mbps.

The A-CAM Broadband Coalition proposed the creation of an Enhanced A-CAM program. The goal is to improve broadband speeds to the levels specified in the Infrastructure Investment and Jobs Act (also known as the $1.2 trillion Bipartisan Infrastructure Law) while avoiding the duplication of efforts across various federal programs.


Boosting Rural Broadband Internet Speeds


In order to boost rural broadband internet speeds, the notice of proposed rulemaking, which commissioners approved, seeks comment on how the FCC could bolster A-CAM support under an enhanced program and whether the current A-CAM framework even still makes sense. It is also seeking comments on how to align the Enhanced A-CAM program with Congressional goals and programs at other agencies.

With additional funding and an expansion of the length of time under which electing carriers would receive support, these carriers would increase deployment speeds up to 100 Mbps download and 20 Mbps upload in some of the most challenging and expensive areas to serve in the country,” Commissioner Geoffrey Starks said in a statement. “[Some] consumers served by A-CAM carriers could see a four-fold, 10-fold or even 20-fold increase in their speeds.”

Previously, using funding allocated by the Bipartisan Infrastructure Law, the Biden administration launched a $45 billion project to bring all Americans online by 2030 and eliminate the digital divide. Officials have also teamed up with internet providers to subsidize the cost of broadband for low-income households.