The Federal Communications Commission wants SpaceX to give up a portion of the $885.51 million in broadband funding it was awarded in a reverse auction in December 2020.
SpaceX’s Starlink satellite broadband division was one of the biggest winners in the FCC’s Rural Digital Opportunity Fund (RDOF) grants announced in Ajit Pai’s last full month as FCC chairman. Overall, Pai’s FCC awarded $9.2 billion over 10 years ($920 million per year) to 180 bidders nationwide, with SpaceX slated to get $885.51 million over 10 years to serve homes and businesses in parts of 35 states.
Pai apparently mismanaged the auction, as an announcement yesterday from Acting Chairwoman Jessica Rosenworcel’s office said the FCC has to “clean up issues with the program’s design originating from its adoption in 2020.” The FCC cited “complaints that the program was poised to fund broadband to parking lots and well-served urban areas.” The FCC suggested that SpaceX give up its funding in about 6 percent of the census blocks where it’s slated to get money. Other ISPs are being asked to give up smaller portions of their funding.
The rules that Pai set for the first RDOF auction required funding to go only to census blocks where no providers offer speeds of 25Mbps down and 3Mbps up. A planned Phase 2 auction would target such areas, but the first auction was meant only for places that are completely unserved.
Rosenworcel’s office sent letters to dozens of winning bidders yesterday, suggesting that they voluntarily give up a portion of their funding. The letter to SpaceX stands out for the sheer number of census blocks—about 6,500 in 34 states—where the FCC is challenging SpaceX’s funding. Those 6,500 are among about 113,900 census blocks where SpaceX tentatively won FCC grants.
The letters to SpaceX and other ISPs pointed to concerns “that certain areas included in the Rural Digital Opportunity Fund auction are already served by one or more service providers that offer 25/3Mbps broadband service or otherwise raise significant concerns about wasteful spending, such as parking lots and international airports.”
Lots of folks (including me) have written about the concerns of funding going to odd areas (like the Vikings practice facility) and the ability of a provider to deploy what they have promised. Locally that concerns highlights LTD’s experience providing FTTP. Just yesterday I was in conversation with communities that are in a holding pattern because they are in RDOF areas and subsequently their applications for MN State funding for broadband was turned down last year and now they don’t qualify for funding – because they are theoretically going to be served by RDOF projects.
It’s a good idea to investigate the funds, clearly we don’t want money going to areas where it won’t help or won’t be used to help enough (or as promised) but for communities on the frontlines this game of waiting is getting old.