The FCC is offering the largest telecom providers $1.7 billion in subsidies to expand broadband to over 8.5 million rural Americans, the FCC said Wednesday.
That is Connect America Universal Service funding the FCC is migrating from traditional phone service.
Incumbent price cap carriers have 120 days to decide to apply for the funding. In areas where the funding is declined, it will be available to competitive carriers like cable operators.
"The offer to the rural operations of the largest telecom providers — known as price cap carriers — would provide ongoing support for networks that can deliver broadband at speeds of at least 10 Mbps for downloads and 1 Mbps uploads to nearly nine million rural residents nationwide," the FCC said in announcing the funding. "The funding represents a 71% increase from current funding for these areas, but is accomplished without increasing the size of the Universal Service Fund — or increasing ratepayer fees."
The funding will be available in areas (actually census blocks) "(a) where the cost of providing service according to our cost model exceeds $52.50 a month, and (b) that are not served by unsubsidized competitors offering service at speeds of at least 4 Mpbs downloads/1 Mbps uploads."
There are buildout requirements for the subsidized build-out: 40% of funded locations must be service by the end 2017, 60% by the end of 2018 and 100% by the end of 2020.