FCC sets up complementary $2B CAF II auction aimed at rural broadband expansion

In a nearly unanimous decision, the FCC approved a reverse auction that will provide an additional $2 billion in funds to rural broadband providers via the regulator's CAF II program in an effort to accelerate growth.

This item establishes rules for the auction, which the commission says will "harness market forces" to expand broadband in "targeted" rural areas. In addition, the item asks for comments on other issues surrounding the auction so that it can deliver support to unserved communities.

All five commissioners voted for the proposed auction, although Commissioners Ajit Pai and Michael O'Rielly dissented in part.

The FCC's new measure builds on recent programs such as its CAF I and CAF II programs.

In 2015, a number of large wireline operators including AT&T, CenturyLink, Frontier and Windstream accepted $9 billion over six years from Phase II of the Connect America Fund to expand broadband in their rural service areas.  Later in March 2016, the FCC reformed its broadband support for the nation's smallest carriers, providing $20 billion over the next decade.

Specifically, the auction is intended to expand service to census blocks unserved by broadband delivering speeds of 10/1 Mbps in 20 states where the price cap carriers declined last year's CAF-II offer.

The FCC's auction will also address locations across the country with extremely high deployment costs.

Under the plan, the FCC will adopt four technology neutral service standards: delivering 10/1 Mbps speed; delivering 25/3 Mbps and offering a usage allowance of 150 GB a month; meeting an above baseline tier that requires bidders to provide 100/20 Mbps and an unlimited monthly usage allowance; and meeting a Gigabit performance tier that requires bidders commit to provide at least 1 Gbps downstream and 500 Mbps upstream and offer an unlimited monthly usage allowance.

For more:
- see the release

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