The Federal Communications Commission told SpaceX and other companies on Monday that the billions in rural broadband subsidies it granted last year cannot be used in already connected areas, such as “parking lots and well-served urban areas,” citing complaints. The Commission sought to “clean up” its subsidy auction program, allowing companies to withdraw their funding requests from areas where the service already exists.
Beneficiary companies need to work to determine if they are meeting the money, wrote Michael Janson, director of the FCC’s Rural Broadband Task Force, in a letter to David Finlay, CFO of SpaceX. Similar letters for the first time Bloomberg, was sent to other recipients of the Commission’s Rural Digital Opportunity Fund, a $ 9.2 billion auction, to expand broadband to rural areas with no or no services.
SpaceX’s satellite internet network Starlink won $ 886 million last December as part of the RDOF program, and 196 other companies also received a share of $ 9.2 billion. Following the awards, reports from organizations such as the Competitive Carriers Association highlighted general shortcomings and waste with the FCC’s approach. “Common errors in broadband data will soon send hundreds of millions of dollars in federal broadband support to the country’s most deprived areas.” in May, a CCA report said.
Second report from Free Press, a media policy organization, found that more than $ 700 million of RDOF funds was used to roll out broadband to areas where it already exists, calling the rural Internet program “full of errors, waste and inadequate controls.” According to the report, $ 111 million of SpaceX’s $ 886 million stake went to well-served urban areas and occasional soils without infrastructure, thin highways and empty lawns to New York’s parking lots and large boxes.
RDOF support was announced under the leadership of former FCC chairman, Republican Ajit Pai, who resigned when President Biden became president. The Free Press had criticized the Pai-led RDOF program and praised Rosenworcel’s oversight after letters were distributed to RDOF companies on Monday.