Representatives from broadband provider Nextlink met with FCC officials this week in response to a range of criticism the company has received regarding its provisional win in the Rural Digital Opportunity Fund (RDOF) auction.
The company was one of the biggest winners in the auction and will receive $429 million for rural broadband buildouts in seven states if the FCC approves its long-form RDOF application.
Nextlink’s long-form RDOF application has more than 4,000 pages, the company representatives noted in an ex parte letter summarizing their meeting with the FCC.
Nextlink RDOF Win
The RDOF auction awarded funding to cover some of the costs of deploying broadband to unserved rural areas using a reverse auction approach in which funding for an area went to the company asking for the least amount of support. A weighting system favored bids to provide higher-speed, lower-latency service.
Nextlink has come under fire from critics who argue that the company plans to use unproven fixed wireless technology to provide gigabit speeds. In addition, some critics have argued that the company will not be able to scale its operations or that it lacks proper capitalization.
These allegations are “speculative, uninformed and misguided,” Nextlink said in the letter.
Nextlink’s filing notes that the company is profitable and has closed on a $250 million credit facility to help fund RDOF deployments. The company also points to its deployment track record for the broadband buildout commitments it made in the Connect America Fund (CAF) II auction, a previous rural broadband funding auction that served as a model for the RDOF auction.
Nextlink was also a big winner in the CAF II auction and, according to the company, is on track to meet interim and final buildout requirements for that auction using what the company calls a “hybrid” approach that uses a combination of fixed wireless and fiber.
The company said it is already deploying gigabit speeds using both of those technologies. On the fixed wireless side, the company said it is using spectrum in the 80 GHz band to provide point-to-multipoint gigabit service.
The slide presentation accompanying the letter notes that the company obtained spectrum in the CBRS auction to cover 99% of its CAF markets and that the company has increased in-house staff from 263 to 730 since it first began receiving CAF funding in July 2019.
RDOF and CAF Synergy
Nextlink’s CAF funding helped determine where the company bid in the RDOF auction. “Nextlink determined to strategically bid for RDOF locations where we had an operational cost advantage due to proximity with CAF locations,” the company notes in the slide presentation. Synergies include leveraging CAF middle mile and core network investment, as well as personnel and field offices to service RDOF locations.
In an apparent reference to a recent filing by a group of RDOF bidders, Nextlink also argues that third parties should not be allowed to review RDOF long-form applications.
“No third-party entity or trade association is more capable than the FCC to review an RDOF participant’s long form,” Nextlink argues.