Charter and Elon Musk among big winners of FCC $9.2bn broadband funding

The FCC has allocated US$9.2 billion worth of funding for high-speed broadband rollout in rural areas and a number of major names are among the big winners.

Three companies scored north of $1 billion: LTD Broadband, Charter Communications, and the Rural Electric Cooperative Consortium. LTD Broadband successfully bid for $1.32 billion of funding to cover more than half a million locations across 15 states. The firm has been around for a decade and currently provides wireless broadband services in parts of Minnesota, Iowa and Nebraska. It describes itself as the fourth-largest WISP in the US.

LTD Broadband is a minnow compared with the firm that will receive funding for the most locations though. Cable giant Charter will cover 1.06 million locations in 24 states and its share of the funding allocated comes in at $1.22 billion.

Arguably the most interesting company on the list of winners is Elon Musk’s SpaceX, which will roll out broadband coverage across the largest number of states – 35 – and has secured $885.5 million to help it do so. SpaceX is in the process of deploying an initial 12,000 satellites to provide broadband services, of which it has launched just shy of 1,000.

Amidst a raft of self-congratulatory paragraphs extolling the benefits of the Rural Digital Opportunity Fund to those living in the locations covered, the FCC noted that “a broad range of providers successfully competed in the Phase I auction, including cable operators, electric cooperatives, incumbent telephone companies, satellite companies, and fixed wireless providers.”

Indeed, the regulator shared a list of 180 successful bidders, ranging from those picking up funding worth hundreds of millions of dollars and more – as outlined above – to companies looking to bring high-speed Internet to a handful of communities and seeking single-digit thousands of dollars to support their initiatives. Towards the top end of the scale, there were many household names, including DoCoMo Pacific, Altice USA, Cox Communications, Cincinnati Bell, Frontier Communications, and CenturyLink.

Overall, bidders won funding to cover 5.2 million unserved homes and businesses with high-speed broadband, with close to 99% of eligible locations having been taken up. 99.7% of locations will gain broadband speeds of at least 100 Mbps downstream and 20 Mbps upstream, with 85% getting Gigabit broadband, the FCC said.

The auction represents phase one of the $20.4 billion Rural Digital Opportunity Fund, or RDOF, unveiled by the FCC in August. The first phase made as much as $16 billion in funding available, although this sum was whittled down to $9.2 billion through the competitive bidding process.

The additional $6.8 billion that was not needed in phase one will be rolled into the second phase of the process, which will cover partially-served areas and the handful of areas not taken up in phase one. As such, phase two will allocate up to $11.2 billion in funding.

The funding is technology-neutral, hence bidders can connect up their coverage areas however they choose. They do have some rules to adhere to though, including a requirement to reach all their assigned areas within six years and incentives to build out as quickly as possible. So if you live in rural America and all you want for Christmas is high-speed broadband, you might be in luck…a few festive seasons from now.