The Federal Communications Commission tossed more money into the digital divide, and more importantly, finally delivered a uniform definition of broadband regardless of where people live.
Now, when the FCC talks about broadband it means 25Mbit/s upload and 3Mbit/s download; well, those operators that participate in legacy funding programs still can target 10Mbit/s down and 1Mbit/s up, but the agency is actively encouraging providers to switch to the new program. And, in time, all participating service providers must speak the same broadband-speed language.
Of course, in many regions of the United States and across the world, gigabit broadband is becoming the de facto standard. Urban residents in particular, along with a growing number of suburbanites who have multiple providers from which to choose, can opt for true high-speed broadband at competitive pricing. In less populated areas, a growing number of coops and utilities are stepping in to serve customers separated by miles, even tens of miles. (See The $70B Digital Divide Conundrum and ADTRAN Plows Resources Into Serving Rural Coops.)
The FCC is giving operators a raise, too, increasing support back to the "intended maximum of $200 per location," FCC Chairman Ajit Pai said in a statement. "But critically, this increase is now tied to requirements that those carriers deploy 25/3 Mbps service -- the FCCís definition of 'broadband -- to additional locations in their service areas. This will mean full digital opportunity for more than 100,000 homes and businesses."
In sum, carriers that receive Connect America Fund's Alternative Connect America Cost Model (A-CAM) monies will get an additional $67 million annually. Those remaining in legacy mechanism will receive an annual adjustment for inflation that eliminates 2018 tax cuts, increases the $1.4 billion yearly budget and sets a guaranteed floor of minimum support. To receive these financial benefits, providers must expand deployment of the higher minimum service, the FCC's Report and Order stated. (See FCC Awards $1.5B to 103 Providers for Rural Broadband.)
By July 2021, the FCC will cut the maximum per-line subsidy to $200 from $250 as it was under former chairman Tom Wheeler's reign. Likewise, the committee is eliminating a capital expenditures rule and determined a market-based auction is the best path to eliminating unnecessary spending to legacy providers serving areas also served by operators not participating in tax-funded programs. This, the FCC said, can save up to $12 million each year.
The Report and Order includes a Further Notice of Proposed Rulemaking for comment on how to structure an auction and how to address conversions to broadband-only lines. It also wants input about inclusion of a tribal broadband factor for legacy providers.
— Alison Diana, Editor, Broadband World News. Follow us on Twitter or @alisoncdiana.