Jonathan Spalter

Rural Broadband Auction: Let’s Get it Right and Get it Done

With all the disruption and uncertainty caused by COVID-19, broadband has emerged as the anchor of our national response. It is keeping us connected, working, playing and learning during these uncertain times.

The truth is not everyone has access yet to this transformative and indispensable technology. And they should.

This moment has made clear the urgent need to bring all Americans into the digital era and connect them to the power and promise of high-speed internet. Finishing the job of connecting the 18 million Americans who lack essential connectivity requires bold action.

Broadband providers have always gone above and beyond to serve their communities. What is needed next is a public-private partnership to inject significant new broadband infrastructure funding in still unserved parts of the country – including rural America – to finally deliver broadband service to every American home, school, hospital and business.

Congress and the Federal Communications Commission are meeting this moment by proposing big investments in telehealth, distance learning and programs to accelerate connectivity.

We welcome this.

There is, however, a provision that recently passed the House that while well intended threatens to upend a carefully designed program to target broadband infrastructure dollars to homes and businesses most in need of connectivity.

Let’s back up:

Before the crisis, the FCC adopted a framework for the $16 billion first phase of the Rural Digital Opportunity Fund (RDOF), a landmark project to distribute broadband funds to as many as six million rural homes and businesses.

The goal: narrow the digital divide, maximize rural deployment and target the truly unserved.

Here’s how it works:

RDOF rules call for a reverse auction to distribute support to connect rural homes with a preference for gigabit networks. The reverse auction is structured to produce competitive bidding to ensure the most broadband deployment possible at the lowest amount of government support per bid.

Bang for the buck.

After a lengthy and transparent process, the first phase of the RDOF auction is set for a short five months from now in October, but the House plan seeks to circumvent the auction process by removing some eligible areas before the auction even starts.

Why does that matter?

It’s a little in the weeds, but bear with me:

First, the legislation circumvents the October auction to the benefit of a select group of bidders by changing the rules late in the game after a transparent FCC process establishing auction rules. Potential bidders have been anticipating October as the date they must know which locations they intend to bid on. The accelerated timeframe unfairly favors a handful of participants who may be able to bid for a small service area over those who may be preparing bids on a regional or even national scale and would not be able to take advantage of the legislation’s accelerated process.

Second, the legislation removes serviceable locations from the auction and funds them at 100 percent of the auction reserve price. Locations that may have been subject to competition in October will be favored at the expense of other unserved locations. This means taxpayers pay more to serve some locations at a gigabit than would have been necessary if there was a competitive auction, and less money will be available to serve other locations, which have no service at all.

This approach means wasted money and less broadband. It also could advantage unproven companies who may not deliver broadband today (i.e., some electric co-ops) over providers with extensive experience deploying broadband.

USTelecom members are committed to connecting more consumers in rural America with high-speed broadband as fast as possible, but tossing out a carefully constructed RDOF auction is not good policy.

Instead, Congress ought to work with the FCC to quickly approve all RDOF gigabit-winning bids and get money flowing immediately after the auction concludes.

To bridge the digital divide now, and to ensure American taxpayers get the most return on their investment, Congress should add more funding to RDOF than currently available and fully fund a plan to modernize our national broadband maps (something that will also help connect unserved rural homes and businesses).

There has never been a time where all parties, all political perspectives, have been so aligned in understanding the truly critical role broadband plays for Americans today.

Let’s get this auction right and get it done. The key question post-auction: can we do everything possible (and responsibly) to accelerate the deployment of those RDOF dollars so we can also speed broadband to the unconnected?

We can, and we must.