Connecting the Unconnected in Rural U.S.

Some 700,000 U.S. rural homes and small businesses will gain access to high-speed internet access for the first time through the Federal Communications Commission’s Connect America Fund Phase II auction, auction results released today show, and more than half of those 713,176 locations will have service available with download speeds of at least 100 megabits per second.

Connecting 700,000 homes in a nation with perhaps 138.3 million housing units, that might not sound like much. But the 250,000 most-isolated rural locations account for about half the estimated cost of connecting seven million U.S. homes in rural, hard to reach areas.

Of course, the most-isolated areas likely always will be among the best candidates for satellite or other wireless access platforms. Perhaps three million rural locations already buy satellite internet access.

That “cost to reach” logically implies that the great bulk of new investment under this program will support extension of service to new locations that are not the most-isolated, as that provides the greatest efficiency. In other words, service providers logically will connect the new locations in some proximity to current networks, rather than taking on the most-difficult, most-expensive areas .

According to plan, 53 percent of all homes and businesses served with support from the auction will have broadband available with download speeds of at least 100 megabits per second. Some 19 percent will have gigabit service available. And 711,389 locations—all but 0.25 percent—will have at least 25 Mbps service.

It appears a great many of the providers are ISPs using fixed wireless.  

Providers must build out to 40 percent of the assigned homes and businesses in a state within three years of becoming authorized to receive support. Buildout must increase by 20 percent in each subsequent year, until complete buildout is reach at the end of the sixth year.

The auction allocated $1.488 billion in support to be distributed over the next 10 years to expand rural broadband service in unserved areas in 45 states. A total of 103 providers will get funds.