Connect America Fund Phase II Auction Results Released

WASHINGTON — Over 700,000 rural homes and small businesses will gain access to high-speed Internet service 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 Mbps.

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 won support from the Connect America Fund to expand broadband in rural areas where, absent this funding, this type of broadband expansion and ongoing service would not be economically feasible.

First-of-its-Kind Auction
“The successful conclusion of this first-of-its kind auction is great news for the residents of these rural communities, who will finally be able to share in the 21st-century digital opportunities that broadband provides,” said FCC Chairman Ajit Pai. “By tapping the mechanisms of the marketplace, the Phase II auction served as the most appropriate and cost-effective way to allocate funding for broadband in these unserved communities, bringing the highest-quality broadband services to the most consumers at the lowest cost to the ratepayer.”

The auction encouraged innovation and deployment of robust service by giving providers the flexibility to use any broadband technology to meet the FCC’s buildout and performance standards for fixed service. The auction design included a weighted preference for service with higher speeds, higher usage allowances, and lower latency.

As a result, 53 percent of all homes and businesses served with support from the auction will have broadband available with download speeds of at least 100 Mbps. Nineteen percent will have gigabit service available. And 711,389 locations — all but 0.25 percent — will have at least 25 Mbps service available, more than twice the 10 Mbps minimum standard for the Connect America Fund program.

Robust Price Competition
The auction also unleashed robust price competition that means more locations will be served at less cost to Americans who pay into the Fund. Although the 713,176 locations assigned had an initial reserve price of $5 billion over the next decade, the final price tag to cover these locations is now only $1.488 billion.

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.

Closing the Digital Divide
The Connect America Fund Phase II auction is part of a broader effort by the FCC to close the digital divide in rural America. In addition to the funding that will provided by this auction, the Commission is working toward the launch of a $4.53 billion Mobility Fund Phase II auction to expand 4G LTE wireless coverage throughout rural America. And the Connect America Fund is in the midst of providing over $9 billion over a six-year period for rural broadband in areas served by large carriers.

In addition to modernizing its support programs, the FCC is also working to reduce the cost of broadband deployment by eliminating needless regulatory barriers and by freeing up more spectrum for wireless broadband.

Following are the results of the Connect America Fund Phase II auction by state. A separate chart below lists winning bidders. More information is available at https://www.fcc.gov/auction/903. A map of winning bids is available at https://www.fcc.gov/reports-research/maps/caf2-auction903-results/

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