Wednesday, December 12, 2018

FCC boosts funding for rural broadband, sets 25/3 Mbps minimum

The FCC will offer up to $67 million a year in additional support for carriers receiving funding through the Connect America Fund’s Alternative Connect America Cost Model, or A-CAM. The additional funding aims to help small, rural providers, known as rate-of-return carriers, to deliver faster broadband speeds and expanded coverage in rural areas. In return for additional funding, the FCC will require providers to expand availability of service offering downloads of at least 25/3 Mbps service, compared to the current 10/1 Mbps standard.The FCC said this new funding has the potential to increase by 100,000 the number of rural homes and businesses with access to 25/3 Mbps service.

The FCC also acted to open a new window for carriers receiving support through legacy mechanisms to voluntarily move to model-based support through the A-CAM II offer, which incentivizes deployment while reducing regulatory burdens.  In return, these carriers would be required to provide 25/3 Mbps service to all homes and businesses whose costs are fully funded through the A-CAM cost model.

In addition, the FCC is increasing the $1.4 billion annual budget for carriers that continue to get support from legacy mechanisms by initiating an annual inflation adjustment, eliminating 2018 cuts mandated by budgetary rules established under the prior Administration, and setting a guaranteed floor of minimum support for each carrier.  In return, legacy providers would be required to expand deployment of 25/3 Mbps service.

FCC Chairman Ajit Pai stated: "Today, we take a major step toward closing the digital divide.  The trees are thick:  We’re substantially reforming the high-cost universal service support program for some of the country’s smallest rural carriers, and the program’s rules are complicated to say the least.  But the forest is easy to see:  We’re helping to ensure that rural Americans can participate in the digital economy. We’re changing the system for rural carriers and consumers alike in three basic ways.  Each will result in material improvements in rural connectivity."