FCC announces proposal to invest $20.4 Billion in US rural internet

Ajit Pai, Chairman of The Federal Communications Commission (FCC) has announced a proposal for an initiative, the Rural Digital Opportunity Fund, which will see $20.4 billion allocated over ten years toward the development of high-speed broadband in rural areas in the USA.

The money will be distributed through the newly created fund using a reverse auction for price cap carriers. Providers that are awarded revenue will be responsible for creating infrastructure to produce “up to gigabit-speed broadband in the parts of the country most in need of connectivity,” according to the FCC.

Funds for this new initiative will be repurposed from The Universal Service Fund (USF), a practice where fees and subsidies are collected by the FCC from communication service providers. The trust was created in 1997 with the objective to establish telecommunications services throughout America. The Rural Digital Opportunity Fund aims to distribute broadband to four million houses and small businesses.

Additionally, the FCC plans to free up more spectrum for 5G and will begin to auction off wireless spectrum in the upper 37 GHz, 39 GHz and 47 GHz bands, staring 10 December 2019.  Pai said in his statement “America must win the race to 5G” and freeing up spectrum will be critical to achieving that goal,” The announcement was made at The White House alongside President Trump, who added, “my administration is focused on freeing up as much wireless spectrum as is needed.”

The Federal Communications Commission estimates that currently 20 million Americans are lacking high-speed internet and say this places a restraint on economic growth.