FCC approves Starlink by SpaceX for a high-speed broadband provider

The Federal Communications Commission’s (FCC) Rural Digital Opportunity Fund (RDOF) aims to “close the digital divide” and provide high-speed internet access to unserved rural areas. As part of its Phase I reverse auction, the FCC program awarded $9.2 billion to rural internet providers.

Consisting of cable operators, electric cooperatives, telephone companies, satellite companies, and fixed wireless providers, a broad range of providers competed in the auction. And, this Monday the FCC announced its list of 180 bidding winners.

Among those winners is Elon Musk’s SpaceX. The company scored $885 million in federal subsidies to provide internet access through its Starlink satellite network. It was assigned 642,925 locations across 35 states. SpaceX also appears to be the only satellite broadband provider to have won a bid.

But, SpaceX won’t just be handed all the money upfront. The $885 million will be distributed over the next 10 years. And, the company will need to prove they are making good on their promise. They will need to “meet periodic buildout requirements that will require them to reach all assigned locations by the end of the sixth year.”

Starlink, which is made up of low Earth orbit internet satellites, isn’t available globally yet. However, it will need to show its services are performing at a minimum speed of 25/3 Mbps to its assigned locations. And, they will need to submit a long-form application by June 7.

“I’m thrilled with the incredible success of this auction, which brings welcome news to millions of unconnected rural Americans who for too long have been on the wrong side of the digital divide. They now stand to gain access to high-speed, high-quality broadband service,” said FCC Chairman Ajit Pai.

As a result of Phase I, the funding will allow bidders to deploy high-speed broadband to over 5.2 million unserved homes and businesses. $16 billion was initially set aside for the Phase I auction. Since all the funds weren’t used, they will roll over into the Phase II auction. This will allow for an $11.2 billion budget to target partially-served areas and unserved areas that were left out from Phase I.

“This auction was the single largest step ever taken to bridge the digital divide and is another key success for the Commission in its ongoing commitment to universal service,” said FCC Chairman Ajit Pai.