FCC moves forward on Rural 5G Fund

By Kelly Hill August 29, 2024

Collected at: https://www.rcrwireless.com/20240829/5g/fcc-moves-forward-on-rural-5g-fund

The Federal Communications Commission plans to “reignite” the $9 billion Rural 5G Fund, moving forward with new rules for the program, which has been languishing since 2020.

According to the FCC’s National Broadband Map, more than 14 million homes and businesses nationwide lack access to 5G.

“With the progress we’ve made in mapping broadband service availability, there is no reason to wait to put the 5G Fund to work connecting households and businesses in rural communities across the country,” said Chairwoman Jessica Rosenworcel. “We are ready to use every tool available to make sure that those who live, work, and travel in rural America have access to advanced, 5G mobile wireless broadband services.”

Let’s take a second to step back to 2020, when the Rural 5G Fund was proposed under then-FCC Chairman Ajit Pai. It was meant to make sure that rural areas—typically the last to be built out by commercial carriers—wouldn’t have to wait for 5G because the government would help to subsidize 5G deployment, by repurposing money from the Mobility Fund II program (which fell apart over after a lengthy challenge process which resulted in the commission finding that the coverage maps it was working with, based on data they requested from major mobile network operators, were overstated — in some cases, significantly.)

But the program ultimately was delayed so that the FCC could go through the lengthy process of revamping its data collection requirements and creating new broadband maps that would be more accurate, on which to base Rural 5G Fund awards.

“As we finalize the details for the 5G Fund, we are confident that our conclusions below are solidly grounded in the improved mobile coverage data obtained in the Broadband Data Collection (BDC), which is reflected on our new National Broadband Map and provides us with the most comprehensive picture to date about where mobile broadband service is and is not across the entire country,” the agency said in its newly passed order on the Rural 5G Fund. “Unquestionably, the Commission’s decision to wait to proceed with a 5G Fund Phase I auction until we had these data to rely on has dramatically improved our understanding of where high-speed mobile broadband service is being provided and has significantly enhanced our ability to hold a successful 5G Fund auction. We are now far better informed regarding which communities lack mobile broadband service.”

The FCC established rules for the Rural 5G Fund back in 2020. In the meantime, a number of other federal programs came into existence that were meant to close the digital divide and set new standards for speed, while providing additional funding for fiber infrastructure on which wireless depends; and T-Mobile US, following its 2020 acquisition with Sprint, also has had to meet specific rural build-out requirements as part of that merger.

Under the original rules, the first phase of the $9 billion fund was to be the largest: up to $8 billion in funds nationwide to “areas lacking unsubsidized 4G LTE or 5G mobile broadband” — but only required the networks built to meet mobile broadband speeds of 35 Mbps in the downlink and 3 Mbps in the uplink. (Since then, the FCC requirements has reset its broadband definition, with much higher speeds for long-term goals.) Phase II of the Rural 5G Fund was expected to inject another $1 billion — along with any unawarded funds from the first phase — to specifically target deployment of 5G for precision agriculture.

The Rural 5G Fund was expected to set aside $680 million specifically for tribal areas—with have received significant broadband investment related both to FirstNet expansion and the Broadband Equity, Access and Deployment (BEAD) program (which did not exist when the Rural 5G Fund was first established). It also established a 5G Small Carrier Fund that would offer up to $2 billion over a 10-year period to current legacy support recipients which had 500,000 or fewer subscribers. (See “Things to know about the proposed Rural 5G Fund, Parts 1 and 2 from RCR Wireless News coverage at the time.)

The new rules look much the same for the program, but increases the budget for the first phase: For Phase I of the 5G Fund, the Commission will hold a multi-round reverse auction to distribute up to $9 billion to bring voice and 5G mobile broadband service to rural areas of the country “unlikely to otherwise see unsubsidized deployment of 5G-capable networks”. But the new rules also include up to $900 million in incentives for incorporating Open RAN in 5G Fund-supported networks, plus an increased reserved amount for Tribal communities, and requirements around cybersecurity and supply chain risk management.

With the new order, the FCC said, “We advance the Commission’s extensive efforts to modernize high-cost support for mobile broadband services and proceed with confidence that we are stretching our limited universal service fund dollars to support advanced, 5G mobile wireless broadband service to as many areas where Americans live, work and travel as possible.”

Commissioner Brendan Carr, a Republican, dissented from the Commission’s action, arguing that moving forward with the Rural 5G Fund before BEAD deployments are extended, puts “the cart before the horse.”

Commission Anna Gomez, a Democrat, countered that “This order recognizes both the importance to potential bidders of knowing where the Broadband Equity, Access, and Deployment (BEAD) Program will support fiber deployment and the reality that we cannot wait until every dollar is awarded to start moving this parallel effort forward. The cost of delay to rural consumers has to be part of the equation.”

Rosenworcel, in her comments on the order, said in part: “It is time to set out a clear path forward to reach those in this country who lack adequate wireless service. Waiting any longer to modernize our approach to universal service support for wireless communications only consigns communities without signals to many more years on the wrong side of the digital divide. We are doing this now because for the first time we have comprehensive data about the state of wireless service across the country. To put a finer point on it, we now know exactly where there are mobile dead zones. … The 5G Fund for Rural America will be data driven like nothing that has come before.

“We are doing this now because the universal service support system for wireless communications needs reform,” she continued. “The agency has been calling for modernizing this system since 2011. In the intervening years, mobile connections have only grown more essential, not less. Continuing to rely on a system that was cobbled together for an earlier wireless era and pays for networks in areas where there is already unsubsidized 5G service no longer makes sense.”