Rural Broadband

The FCC voted today to establish an Enhanced Competition Incentive Program (ECIP) that will reward licensees that lease, partition or disaggregate spectrum to small and tribal carriers or to carriers serving rural areas.

As a draft order published on the FCC website explains, rewards include:

  • A five-year license term extension for the assignee and assignor in partitioning and disaggregation transactions, the lessor in qualifying spectrum leasing transactions and the assignee in full license assignments
  • A one-year extension of construction benchmarks for all parties, where applicable
  • For those entering into rural-focused transactions, substitution of the assignee’s coverage of the ECIP qualifying geography in lieu of current construction requirements

The ECIP has two “prongs,” FCC officials explained at today’s monthly commission meeting where the order establishing the ECIP was adopted. The two prongs are small carrier/tribal nations and rural-focused.

The small carrier/tribal nations prong is open to small carriers and tribal nations in any location. The rural prong is open to various types of providers but only for rural areas. 

For the small carrier/tribal nation prong, the transaction must involve at least 10% to 25% of the licensed geographic area, depending on the size of the license area. For the rural prong, the geographic area must cover at least 300 contiguous square miles. 

In either case, licensees would have to lease, partition or disaggregate a minimum of 50% of the licensed spectrum depth. 

As FCC Chair Jessica Rosenworcel noted at today’s meeting, some wireless carriers “have access to airwaves that others might be in a better position to deploy.” The ECIP, she said, is “a way to ensure that spectrum in rural areas goes to those most likely to use it.”

As part of the order adopted today, the FCC also adopted a further notice of proposed rulemaking seeking comment on whether to expand ECIP eligibility to allow non-common carriers serving non-rural areas to be eligible to participate in the program and whether to adopt alternative construction requirements for wireless radio licensees generally. 

The ECIP would appear to be a win/win for license holders that can gain some revenue and minimize deployment requirements and for rural areas that currently lack wireless coverage.

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