A broad coalition of Republican and Democratic senators and representatives have sent a letter to the FCC asking the commission to thoroughly vet RDOF auction winners. At stake is $9 billion in rural broadband funding awarded through the reverse auction, which was completed last year.
The letter was championed by Senators Amy Klobuchar and John Thune, as well as Representatives James E. Clyburn and Tim Walberg. Also signing the letter were an additional 153 senators and representatives.
Service providers were required to submit a short-form application in order to participate in the auction, which awarded funding for an area to the bidder that committed to deploying broadband to unserved locations in the area for the lowest level of support. A weighting system favored bids to provider faster service with lower latency.
Vet RDOF Winners
Winners are now required to submit long-form applications that include more detailed information about their companies and their deployment plans. As the FCC reviews the long-form applications, the legislators urged the commission to “validate that each provider in fact has the technical, financial, managerial, [and] operational skills, capabilities and resources to deliver the services that they have pledged for every American they plan to serve regardless of the technology they use.”
The signatories warned of potential long-term consequences if the FCC were to fail to make those validations.
“Without proper due diligence today, we fear that we will not know whether funds were improperly spent for years to come.”
The letter also urges the commission to “make as public as possible the status of its review and consider opportunities for public input on the applications.”
Two groups representing rural broadband providers applauded the legislators’ letter.
“There is far too much money at stake and far too many consumers on hold to gamble on confidential promises about unproven service capabilities that might only be found to fall short years from now,” said Shirley Bloomfield, CEO of NTCA—The Rural Broadband Association, in a prepared statement.
The National Rural Electric Cooperative Association issued a similar statement, saying it “strongly supports lawmakers’ call for a thorough vetting of long-form applications and additional supporting submissions, because we are concerned that some RDOF winners do not have the technical and financial capability to provide the service promised, short-changing rural Americans who desperately need fast and reliable broadband service.”
Rural broadband providers represented by NTCA and NRECA are most likely to deploy fiber broadband technology, which is a proven technology that is widely viewed as the most future-proof option. The downside to fiber is its higher cost in comparison with fixed wireless and satellite options.
NTCA and NRECA members may have been underbid by providers planning to deploy fixed wireless and satellite technology, particularly if those providers bid in the speed and latency categories with the most favorable weighting factors.
Why the Worry?
As Telecompetitor has noted, the 10 biggest RDOF winners won a combined 76% of the total funding awarded. Four of those winners are companies that traditionally have used fixed wireless technology who bid in the highest speed category (1 Gbps downstream), at least for some areas.
Fixed wireless equipment manufacturers persuaded the FCC that they had equipment capable of supporting gigabit speeds, although the technology is relatively unproven, especially for rural areas. Perhaps recognizing that, the big fixed wireless RDOF winners left themselves the option of deploying fiber broadband to meet their buildout requirements – one of them even bid to use fiber broadband exclusively for gigabit deployments. But some stakeholders have questioned whether some of the winners can afford to deploy gigabit fiber for the level of support awarded.
Also among the top 10 RDOF winners is satellite broadband provider SpaceX, whose technology also is relatively unproven. The company is in the process of deploying a constellation of non-geostationary satellites to support its bid in the second-highest speed category – 100 Mbps downstream.
Importantly, SpaceX also bid in the low-latency category. While the FCC prevented operators of traditional geostationary satellites from bidding in the low-latency category, the commission opted not to categorically prevent non-geostationary satellite operators from making those bids.
Even if the commission does thoroughly vet RDOF winners and some of the winning bids are rejected, perhaps on a technology basis, another concern is that the commission may not award the associated funding to the next lowest bidders but instead may roll that funding into the next RDOF auction.
The second RDOF auction will target unserved areas that were not eligible for inclusion in the first auction or that didn’t have a winning bid in that auction. It will not take place until the FCC completes a new effort to gather more accurate broadband availability data, which could be a lengthy process.