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At Rural Broadband Association NTCA, Pai Touts Improvements to Rural Broadband Auctions

Liana Sowa

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Photo of Federal Communications Commission Chairman Ajit Pai in May 2018 by the FCC

September 21, 2020—Speaking Thursday at the fall conference of NTCA, the Rural Broadband Association, Federal Communications Commission Chairman Ajit Pai highlighted recently-announced improvements to the upcoming Rural Digital Opportunity Fund auction.

The RDOF will provide $20.4 billion over 10 years, in two phases, to support the deployment of fixed broadband networks. Up to $16 billion of the fund will be awarded in the auction that is scheduled to begin on October 29, 2020.

But Pai highlighted what he described as improvements that the auction, as opposed to prior funding through the Connect America Fund:

  1. The FCC is more than doubling the minimum speed bidders must deploy. Previously, it had been 10 Megabits per second (Mbps) down, 1 Mbps up. Now it is 25 Mbps down/3 Mbps up.
  2. The FCC will place greater weight on bids coming from providers that offer faster speeds and lower latency up to gigabit speeds.
  3. When the number of bids remaining in the auction falls below the available budget, the FCC will award support to the best-performing network.
  4. The FCC has reduced the size of letters of credit that winning bidders will need to secure to provide networks with more funds free for deploying services.

“It isn’t cheap to provide rural broadband,” said Pai, “The FCC is doing our best to be an effective partner to make sure rural customers can get the same modern broadband services as their urban counterparts and get them at affordable rates.”

Pai – who had just come a hearing of the House Communications subcommittee at which Democrats excoriated the FCC – boasted that since he came into office, the FCC has “overhauled [its] universal service program for rate of return carriers,” as well as created a new Alternative Connect America Cost Model that “rewards efficiency and provides more value for each taxpayer’s dollar.”

The ACAM program is especially significant for those concerned about rural broadband, such as attendees at the NTCA conference, Pai said, because it “gives carriers predictable support they need for carriers in these high cost areas.”

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