FCC Chair Jessica Rosenworcel has shared a proposal for a reverse auction that would award up to $9 billion in funding to cover some of the costs of deploying 5G mobile wireless service in rural areas where such service does not exist today. According to a commission press release, those areas include 14 million homes and businesses.
The commission has been planning this program, officially known as the 5G Fund, for several years. Launch of the program was delayed because the commission wanted to have accurate data about unserved areas. Collecting that data was part of the FCC Broadband Data Collection (BDC), which kicked off in 2022. The BDC has yielded more granular information about where fixed and mobile broadband is and isn’t available.
Proposed rules for the 5G Fund call for up to $900 million in incentives for incorporating Open RAN into funded deployments. The commission has been quite keen on Open RAN, viewing it as a means of spurring the development of low-cost radio access network (RAN) equipment to fill the void left now that the U.S. government is attempting to remove equipment from certain Chinese vendors from U.S. networks.
Some rural providers have RAN equipment from one of those vendors – Huawei – in their networks and the government has made funding available to replace that equipment – although some stakeholders say more funding is needed.
The FCC 5G Fund Proposal
The 5G Fund proposal would require adoption by the five-member FCC commission in order to become a reality. The FCC press release did not indicate when the commission would vote on the proposal, nor did it reveal when the proposal would be made publicly available.
An earlier proposal about the fund, however, called for limiting eligible areas to resolution-9 hexagons that have broadband serviceable locations and/or roads and that lack unsubsidized 5G service.
In a prepared statement, Rosenworcel made an oblique reference to roadways.
The plan, she said, is “to expand the 5G service in rural America to where it is needed more – where people, live, work and travel.”
The proposed rules will be found in a Second Report and Order.
If the rules are adopted, the FCC will hold its first reverse auction since the 2020 Rural Digital Opportunity Fund (RDOF). That auction was controversial because a large percentage of winning bidders did not ultimately receive funding or build the networks for which they received funding, thereby leaving areas that were expecting to get high-speed broadband unserved.
The commission undoubtedly learned some hard lessons from the RDOF auction and likely will take steps aimed at making the 5G Fund auction more successful – such as requiring applicants to provide detailed financial data before they can participate in the auction.
The Competitive Carriers Association, which represents rural wireless companies, weighed in on the 5G Fund proposal.
“Details such as eligibility, accurate mobile map data with a robust challenge process, and the timing of a 5G Fund auction are key to avoiding harmful 5G gaps and ensuring the most rural customers are able to share in the benefits of 5G,” said Tim Donovan, CEO of CCA, in a prepared statement.
