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01/18/2013
FCC Takes Heat For New Broadband Subsidy Plans As Agency Tries to Give Away $185 Million

by Karl Bod, DSLReports.com

The FCC still has around $185 million out of the $300 broadband funds available from phase one of their Connect America Fund. As we've been noting, Frontier signed up quickly for the funds, agreeing to take $71.9 million to wire some 92,000 homes. However, some companies (like Windstream) have balked at taking full funding, saying that getting $775 per install wasn't enough for their liking.

AT&T and Verizon have refused funding entirely, as both companies have made every indication they have no interest in retaining millions of their DSL users, or expanding fixed line broadband in any meaningful fashion. Phase two plans to dole out the $185 million are still being crafted by the FCC, but the agency is already taking heat for giving incumbents first dibs and for lowering their definition of broadband:
 

Under the new guidelines, providers could be able to apply for funding if the areas they propose to serve are not already getting at least 4/1Mbps service. But in a surprising footnote, the FCC announced they will "use 3Mbps downstream and 768kbps upstream as a proxy for 4/1Mbps service." In other words, the FCC is ignoring its own standard definition of broadband and settling for something less. That will leave customers waiting for something better than 3Mbps service up the creek, excluded from Connect America funding.



There also continues to be significant debate over the FCC's data used to determine whether regions are served or not. After spending hundreds of millions to determine broadband connectivity, the agency's broadband maps continue to be horribly inaccurate, raising more than a few questions of whether any of this money will actually get where it needs to go. As we've seen in West Virginia, good intentions when it comes to broadband stimulus often aren't enough when dealing with major league incompetence and corruption.

It's not that broadband subsidies are bad per se, but it remains unclear if we have a competent enough government to actually get the money where it needs to go. The telecom sector has a long and painful history of subsidies being doled out to companies with nobody bothering to even see where the money went, which is why it's 2013 and we're still clumsily trying to fill in the broadband gaps in the first place.

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