While those of us who live in or near the country’s medium and large cities see slow but eventual improvements in broadband service and sometimes even some competition, the same is not true for millions of Americans who live in the more rural parts of the country. Running wires outside of the ‘burbs costs more money than it brings in, so carriers aren’t keen to do it without a boost. And that’s where the FCC’s Connect America fund comes in.
The Fund is a big pile of money that broadband carriers can tap into for funds to kickstart their own investments in bringing broadband to underserved rural markets. This week was the deadline for businesses to say if they’re going to take the money and participate or not, and the result is good news for consumers, 7.3 million of whom should be getting some service sometime soon.
The funds will be used in 45 states as well as the Northern Mariana Islands, a U.S. territory. (States without participating carriers include Alaska, Delaware, Maryland, Rhode Island, and Wyoming.)
The funding recurs annually, and so the total amount invested from the fund will be approximately $9 billion over the next six years.
“Today we are taking a significant step forward in narrowing the rural-urban digital divide,” FCC Chairman Tom Wheeler said in a statement. “Access to modern broadband is critical to life in today’s society. The financial support provided by American ratepayers through the Connect America program is an investment in the future of our rural communities that will pay dividends for all Americans for years to come.”
In the most recent Broadband Progress Report, the FCC found that when it comes to rural areas and tribal lands, broadband is, well, not progressing. Nearly a third of Americans in rural areas lack access even to 10 Mbps broadband, let alone the new 25 Mbps standard the FCC adopted with that report.
The businesses tapping the Connect America Fund have certain benchmarks to meet over the next five years, with a goal of having broadband built out to 100% of the funded locations by the end of 2020.