FCC Denies Mercury’s RDOF Waiver Request
Provider now faces over $25M in penalties for defaults.
WASHINGTON, August 20, 2025 – The Federal Communications Commission showed no mercy when it tore into Mercury Broadband.
“Mercury’s decision to bid on areas, win support, apply for support, and then default has potentially delayed the deployment of broadband to tens of thousands of Americans living in high-cost areas,” the commission wrote Tuesday. Referencing Mercury’s claim that it would be “unfair and inequitable” to not grant the provider a waiver, the commission turned Mercury’s words against it, arguing that “it would be unfair and inequitable to apply a different [penalty] calculation to Mercury.”
The FCC’s sharp rebuke came after the broadband provider, headquartered in Mission, Kansas, asked the FCC to waive an estimated $25 million in penalties for defaulting on more than 92,000 Rural Digital Opportunity Fund locations.
In late 2020 Mercury won $68 million to serve over 167,000 locations with broadband infrastructure in an RDOF reverse auction. After defaulting on nearly 45,000 locations during the pre-authorization window, it exited the final review process with $61 million in promised RDOF support and an obligation to serve 122,000 locations with those funds.
More defaults came. By the end of November 2024, it had completely withdrawn from the program in Illinois, Kansas, and Missouri, and had defaulted on over 64,000 locations in Indiana and Michigan collectively. Despite warnings from the FCC that the company would be subject to penalties for its defaults, the company defaulted on more than 14,000 locations in Ohio in December.
The broadband provider sought relief from FCC-imposed penalties in May, arguing that the $25.1 million penalty would go against the public interest. Evidently, the Commission wasn’t convinced.
“We are not persuaded it would serve the public interest to now revisit these rules and take a different approach for Mercury because Mercury has made a business decision to default on serving a large number of locations and now finds it too expensive to pay the required support recovery,” the FCC’s notice, attributed to AJ Burton, associate bureau chief of the Wireline Competition Bureau, stated.
The agency’s displeasure was evident throughout its 11-page notice. It noted that Mercury waited “until right before” it was required to start paying back RDOF funds before making a waiver request, and stated several times that if Mercury was not comfortable with the RDOF’s default penalties, it should never have participated in the program. Though it called Mercury’s request to be subject to a lighter penalty “creative,” it also called it "unprecedented” and ultimately declined to grant Mercury’s request.
Mercury now faces over $25 million in penalties and clawed-back funding. It is only one of several providers that have defaulted on their RDOF obligations and later sought relief from the fines. Tuesday’s notice signaled that for those ISPs, relief may not come. Towards the end of that notice, the FCC made its position regarding those providers clear.
“Bidding carriers knew what to expect if they were authorized and then later chose not to meet their obligations associated with their winning bids,” the FCC wrote.
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