Rural Area with Rainbow

The FCC released over 80 pages of authorized bids in the Rural Digital Opportunity Fund (RDOF) auction late last week. All but part of one page were bids for Mercury Wireless, which had funding released for deployments in Indiana, Michigan, Ohio, Illinois, Missouri and Kansas.

When Telecompetitor spoke to Mercury CEO Garrett Wiseman on Friday, the company was still going through the list, but he confirmed that some of the authorizations were for gigabit fiber broadband and some were for 100/ 20 Mbps fixed wireless. Those were the two types of bids that Mercury Wireless made in the auction.

Wiseman said these were the first RDOF authorizations the company received. The company also had winning bids in Iowa and Nebraska.

The other authorized bids were for FiberLight and MEI Telecom.

RDOF Authorization Process

The RDOF auction, which was completed in late 2020, tentatively awarded $9.2 billion to cover some of the costs of deploying broadband to unserved rural areas. It was a reverse auction, with funding tentatively awarded to the company that committed to deploying service in an area for the lowest level of support. A weighting system favored bids to deploy higher-speed, lower-latency service.

Getting RDOF authorization is a two-step process for winning bidders. After the FCC has reviewed and approved a winning bidder’s long-form application, the company is put on a ready-to-authorize list, at which time the company has about two weeks to submit a bankruptcy opinion letter and a letter of credit, which the FCC also reviews prior to putting the company on an authorized list.

The FCC previously authorized RDOF funding for numerous other companies, although several of the largest winning bidders have not yet appeared on a ready-to-authorize list.

The idea of using a reverse auction to award funding has fallen out of favor with policymakers, in large part because of certain things that occurred in the RDOF auction. Critics say the commission should have screened bidders more thoroughly before the auction, rather than waiting until after the auction when long-form applications were submitted, to gather certain details about bidders and their projects. Critics also argue that limits should have been placed on how extensively companies could bid based on the companies’ deployment track record.

Since the RDOF auction occurred, the federal government has made vastly more funding available for broadband deployments, but rules for the new programs call for awards to be made based on a merit system rather than on a reverse auction.

The FCC is slated to hold a second RDOF auction after the agency completes the process of updating the National Broadband Map, which is designed to provide more granular information about where broadband is and is not available in the U.S. and it will be interesting to see what changes are made to the rules for the auction when planning for that auction begins.

The latest RDOF authorizations list can be found at this link.

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