FCC Sets Stage for CAF Phase II Reverse Auction

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The FCC has adopted a Report & Order and Further Notice of Proposed Rulemaking implementing a reverse auction that will allocate $2 billion of Connect America Fund (CAF) Phase II support aimed at expanding broadband access in certain rural areas.  The auction is specifically intended to deliver broadband access of at least 10/1 Mbps speeds to unserved census blocks in 20 states where price cap carriers declined CAF support as well as locations that have extremely high deployment costs.  The new CAF Phase II auction rules include:

  • Four technology-neutral service standards ranging from a minimal tier of 10/1 Mbps speeds and at least 150 GB of monthly usage to a Gigabit performance tier of at least 1 Gbps down / 500 Mbps up and an unlimited monthly usage allowance.
  • A $215 million annual support budget.
  • A six-year buildout requirement with interim requirements beginning at year three.

The order also provides a framework for a Remote Areas Fund auction to address those areas that receive no winning bids in the CAF Phase II auction. The Further Notice of Proposed Rulemaking portion of the item solicits comment on certain public interest objectives of the auction, though a forthcoming auction comment public notice will invite comment on specific auction procedures. The Report & Order and Further Notice of Proposed Rulemaking has not yet been released.

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