FCC Moves to Establish Rural 5G Fund

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FCC Chairman Ajit Pai circulated a draft Notice of Proposed Rulemaking Wednesday aiming to establish a 5G fund for Rural America. The up to $9 billion fund would target rural areas that would not see timely deployment of 5G service without support and are not likely to be covered by the T-Mobile transaction commitments. Pai would like the agency to vote on the item in April. 

“The 5G Fund for Rural America focuses on building out 5G networks in areas that likely would otherwise go unserved,” said Pai. “It’s critical that Americans living in rural communities have the same opportunities as everybody else.” 

As part of its recently closed acquisition of Sprint, T-Mobile committed to deploying 5G service to 99 percent of Americans within six years, including covering 90 percent of those living in rural areas. However not all rural areas will see 5G if there are insufficient financial incentives for mobile wireless carriers to invest in 5G-capable networks, according to the Commission.

That’s why the FCC is proposing to use Universal Service Fund support to make sure that rural areas are not left behind. Building on the success of the Connect America Fund Phase II auction and the upcoming Rural Digital Opportunity Fund Phase I auction, the FCC is proposing to award funding for 5G services through a reverse auction.  

The FCC is seeking comment on two options for identifying areas that would be eligible for 5G Fund support:

  • Under one approach for Phase I, the Commission would hold an auction in 2021 by defining eligible areas based on current data sources that identify areas as particularly rural and thus in the greatest need of universal service support. The proposal would prioritize areas that have historically lacked 4G LTE or 3G service.  
  • The second approach would delay the 5G Fund Phase I auction until at least 2023, after collecting and processing improved mobile broadband coverage data through the Commission’s new Digital Opportunity Data Collection.  

Phase II of the 5G Fund would target support to bring wireless connectivity to harder to serve and higher cost areas, such as farms and ranches. It would make at least $1 billion available for deployments that would facilitate precision agriculture.

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