The FCC will vote next month on a notice of proposed rulemaking (NPRM) about the 5G Fund that FCC Chairman Ajit Pai initially proposed in December. As previewed at that time, the fund would provide up to $9 billion to help cover some of the costs of deploying service to rural areas, with funding awarded through a reverse auction.
There is one key difference between the new NPRM and what was initially proposed, however, and it involves how to identify areas eligible for the reverse auction.
The idea of creating a 5G fund came about when the FCC in December scrapped plans for a Mobility Fund II reverse auction that would have targeted areas lacking LTE. The plans were scrapped because the commission found too many problems with data submitted by wireless carriers about their coverage areas — data that was intended to be used to determine eligible areas.
An NPRM issued in December asked for input on how to identify areas eligible for the 5G Fund, and the commission apparently has narrowed down the suggestions to two front runners. The new NPRM, if adopted, would ask for input on these two different options.
One option would be to use “current data sources that identify areas as particularly rural and thus in the greatest need of universal service support” and would prioritize areas that have historically lacked LTE or 3G service. Using this approach, the FCC estimates that Phase 1 of the reverse auction could occur in 2021.
The other option would be to wait until the commission gathers and processes information collected through the new Digital Opportunity Data Collection. That process already is underway, with the goal of improving FCC mobile and fixed broadband availability data, which has received considerable criticism. It would seem that this approach would generate the most accurate data, but it would delay Phase 1 of the auction until 2023.
In either case, Phase II of the Rural 5G Fund would occur after Phase 1 and would award support to bring wireless connectivity to areas that are more difficult to serve, such as farms and ranches, and would include at least $1 billion for deployments that would facilitate precision agriculture.
A press release about the latest proposal also notes that the 5G Fund would target areas that “are not likely to be covered by the T-Mobile transaction commitments.” As a condition of FCC approval of its merger with Sprint, completed today, T-Mobile committed to bring 5G to 90% of rural Americans within six years at speeds of at least 50 Mbps.
Today’s press release doesn’t indicate a minimum speed target for the 5G Fund. Perhaps the NPRM includes a recommendation or perhaps the commission is still seeking input on that. A draft of the NPRM should be released publicly prior to the April commission meeting, at which commissioners are expected to vote on the item.
The press release also doesn’t indicate where the $9 billion for the fund would come from, but an FCC official told Telecompetitor in December that $4.53 billion would be repurposed from the Mobility Fund and additional funding would be raised through the Universal Service Fund.
