Wireline companies wanting to tap into Connect America funding will have to deliver broadband speeds of at least 10 Mbps downstream and 1 Mbps upstream, the FCC has ruled.
These new speeds, up from 2011's 4 Mbps down/1 Mbps up, make certain that rural consumers get the same broadband speeds that 99 percent of urban Americans receive, the FCC said in a press release.
Other portions of the 2011 provisions also had to be tweaked to accommodate the new speeds. Among these, the FCC said, are provisions:
• Increasing the terms of support for price cap carriers from five to six years and possibly seven
• Increasing flexibility in the build-out requirement as long as recipients reach out to Americans that were previously unserved
• Forbearing from certain universal service obligations in low cost census blocks where price cap carriers are not eligible to receive Connect America support and census blocks where there's competition
• Requiring recipients that decline Connect America support in a state to continue to deliver voice service to high cost census blocks until replaced through competitive bidding by another subsidized carrier that will deliver voice and 10/1 broadband
In a company statement, Windstream praised the FCC, calling the new order "another major step toward expanding robust broadband service to Americans in rural, high-cost areas."
Matt Polka, president-CEO of the American Cable Association (ACA), added that organization's support for the change as well. "ACA may differ with the FCC on select aspects of the program but not the overall direction, and we intend to continue to work with the FCC to ensure unserved consumers get high-speed broadband in an efficient and fiscally responsible manner," said a statement attributed to Polka.
AT&T (NYSE: T), Verizon (NYSE: VZ) and the National Cable & Telecommunications Association (NCTA) opposed changing the broadband definition because 4 Mbps was sufficient, an Ars Technica story said.
Interestingly, while the FCC believes that rural communities deserve 10 Mbps broadband speeds, the nation's most densely populated state feels that 4G speeds meet consumer broadband demands.
The Board of Public Utilities (BPU) ruled earlier this year that Verizon was no longer obligated to provide broadband to New Jersey residents who can access broadband service from cable TV providers or via wireless 4G service. Residents in pockets of the state without cable or wireless broadband were given the option to petition Verizon for service but would only get broadband if at least 35 people in a single census track agreed to sign contracts for a minimum of one year and pay $100 deposits.
Verizon at the time called the ruling "great news for the state's consumers."
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