The FCC is moving ahead with plans to hold a reverse auction that will award nearly $2 billion in Connect American Fund support over the next ten years to expand rural broadband.
Specific dates have not yet been announced, but the Commission indicates the auction will commence sometime next year. To prepare, the FCC is seeking comment on proposed application and bidding procedures, including how interested parties can qualify to participate in the auction, how bidders will submit their bids, and how the FCC will process bids to determine the winners and support amounts.
According to the Commission, the auction will be the first of its kind, and is expected to draw interest from parties that have not previously participated in an FCC auction. Funds awarded in the proceeding will go toward expanding and supporting deployments of fixed broadband and voice services in rural areas.
The Connect America Fund offers $198 million in annual support over the course of 10 years, disbursed each month in equal installments.
To be eligible for funds, participants must commercially offer at least one voice service and one broadband service that meet FCC benchmark requirements. Expansion projects must offer service to 40 percent of the designated locations in a state by the end of the third year of funding, with 100 percent of areas covered by the sixth year. Bids will be accepted in four service tiers, with a minimum tier of 10 Mbps downlink speed and a maximum tier with downlink speeds of 1 Gbps.
The FCC has laid out a total budget of $2.15 billion for the Phase II auction, and Chairman Pai in April designated a Rural Broadband Auctions Task Force to oversee implementation of the Connect America and Mobility Fund Phase II proceedings.
“Commencing these auctions as soon as possible is a top priority for the Commission as we seek to close the digital divide,” Pai commented at the time. “As with other proceedings, we believe we must engage with the public and be as transparent as possible throughout the duration of these two auctions, including identifying potential problems early on and fixing them ahead of time.”
Filed Under: Industry regulations