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.
“After careful legal, technical, and policy review, we are rejecting these applications. Consumers deserve reliable and affordable high-speed broadband,” said Chairwoman Rosenworcel. “We must put scarce universal service dollars to their best possible use as we move into a digital future
that demands ever more powerful and faster networks. We cannot afford to subsidize ventures that are not delivering the promised speeds or are not likely to meet program requirements.”
“Starlink’s technology has real promise,” continued Chairwoman Rosenworcel. “But the question before us was whether to publicly subsidize its still developing technology for consumer broadband—which requires that users purchase a $600 dish—with nearly $900 million in
universal service funds until 2032.”
In the initial auction results announced December 7, 2020, LTD Broadband won $1,320,920,718.60, and Space Exploration Technologies Corp. (Starlink) won $885,509,638.40.
Although LTD was a relatively small fixed wireless provider before the auction, it was the largest winning bidder in the auction, submitting winning bids in 15 states. Subsequently, it failed to timely receive eligible telecommunications carrier status in seven states, rendering it ineligible in
those states for support. Ultimately, the FCC review concluded that LTD was not reasonably capable of deploying a network of the scope, scale, and size required by LTD’s extensive winning bids.
Regular readers will know this is bittersweet news. LTD was awarded the opportunity to apply for $311 million to deploy fiber in Minnesota. On the one hand, this is $311 million that is unlikely to come back to Minnesota in the same way. On the other hand, many people were suspect with LTD’s ability to meet what they proposed. In Minnesota, the MN PUC recently agreed to look into revoking LTD’s credentials here; these credentials were required to get RDOF money. The FCC had previously proposed fining LTD for violating requirements.