Lobby groups for small ISPs are urging the Federal Communications Commission to investigate whether SpaceX can deliver on its broadband promises and to consider blocking the satellite provider’s rural-broadband funding. Meanwhile, SpaceX says the Starlink beta is now serving high-speed broadband to 10,000 users.
SpaceX was one of the biggest winners in the FCC’s Rural Digital Opportunity Fund (RDOF), winning $885.51 million over 10 years to bring Starlink broadband to 642,925 homes and businesses in 35 states. Overall, the reverse auction awarded $9.2 billion ($920 million per year) in funding for 180 entities nationwide to expand networks to 5.2 million homes and businesses that currently don’t have access to modern broadband speeds.
But funding winners still had to submit “long-form applications” by January 29 to provide “additional information about qualifications, funding, and the network that they intend to use to meet their obligations.” The FCC will review those applications to determine whether any funding should be revoked.
Electric co-ops that provide broadband raised concerns about both SpaceX’s low Earth orbit (LEO) satellite technology and fixed-wireless services that deliver Internet access from towers on the ground to antennas on customers’ homes. The National Rural Electric Cooperative Association (NRECA) and National Rural Telecommunications Cooperative (NRTC) submitted a white paper to the FCC claiming that the RDOF awards put “rural America’s broadband hopes at risk.”
Starlink dismissed as “science experiment”
The CEO of NRECA was blunt in his opposition to SpaceX’s funding, as stated in a Bloomberg article today:
SpaceX’s broadband-from-orbit “is a completely unproven technology,” said Jim Matheson, chief executive officer of the National Rural Electric Cooperative Association, which has members that vied for the funding. “Why use that money for a science experiment?”
Electric co-ops that offer broadband won a combined $1.6 billion from the FCC auction to serve 900,000 locations in 31 states, according to the NRECA. That included 180 co-ops that “competed as part of five consortiums that garnered a total of about $1.5 billion” and “five individual electric co-ops [that] won a total of $59.4 million.”
All of those electric co-ops bid in the FCC’s gigabit tier, a search of the FCC system shows. NRECA said that “many” of the electric co-ops are using fiber technology to deliver those speeds and that they pushed for high standards in the FCC auction “to ensure co-ops with superior service could compete against other types of Internet providers with slower or spotty service in rural areas.”
Matheson told the FCC in a filing that many of the LEO satellite and fixed-wireless awards went to census blocks that “are in electric cooperative service territory.”
SpaceX has good early results and 10,000 users
SpaceX committed to provide service in the FCC’s “Above Baseline” tier, which requires 100Mbps download speeds, 20Mbps upload speeds, and a data cap of at least 2TB a month. Based on early reports from SpaceX Starlink beta testers, it appears that the service can provide broadband with high speeds and latency better than the FCC’s 100ms standard. SpaceX is continuing to launch satellites and has told beta testers to expect steady improvements in speed, latency, and uptime in the coming months. Before bidding for the funding, SpaceX first had to overcome the FCC’s “serious doubts” about whether it can deliver the required latencies.
“Starlink’s performance is not theoretical or experimental,” SpaceX said in an unrelated FCC filing yesterday. “Over 10,000 users in the United States and abroad are using the service today. While its performance is rapidly accelerating in real time as part of its public beta program, the Starlink network has already successfully demonstrated it can surpass the Commission’s ‘Above Baseline’ and ‘Low Latency’ performance tiers.”
Starlink already provides 100Mbps download and 20Mbps upload speeds and is delivering latencies at or below 31ms on 95 percent “of network round-trip latency measurements,” the company said.
Starlink’s beta status raises questions
But groups that oppose SpaceX’s FCC funding said the technology hasn’t been proven because it isn’t widely available. “Any applications that appear unlikely to deliver promised speeds to all locations should be disqualified per FCC rules,” the NRECA/NRTC white paper said.
LEO-satellite service “is currently in beta testing and commercially available on a limited basis in extremely limited areas, and questions remain. At the current time, LEO-based broadband lacks the ‘demonstrated capabilities to perform at certain speed and latency combinations’ the Commission reasonably requires,” the groups wrote. “Awarding bids to experimental and unproven LEO satellite service is a direct contradiction” of FCC requirements, they also said. (SpaceX was the only LEO-satellite company to win funding.)
The white paper questioned whether LEO satellites can “consistently provide a high level of speed as thousands of subscribers sign up for the service.” Suggesting that the funding isn’t even needed by SpaceX, they also said that “satellite providers eventually plan to deliver service to areas regardless of whether they get subsidized to do it.”
We contacted SpaceX today about the groups’ filing and will update this article if we get a response.
As for fixed wireless, the groups argued that providing gigabit speeds is possible but only under the right conditions. NRTC said its experience working with rural utilities “shows that the conditions for this speed are largely unable to be met in rural America for a number of reasons.”
Fixed-wireless challenges “include the need for substantial spectral bandwidth at lower frequencies for propagation, availability of vertical assets for higher frequency spectrum, near or absolute line of sight from transmitter to antenna, and a substantial deployment of fiber optic cabling for backhaul purposes,” they said. “Many of the areas where support was assigned to fixed wireless bidders to provide Gigabit service would either fail to meet these conditions or be prohibitively expensive to achieve.”
The FCC rural-broadband funding is paid for by Americans through fees imposed on phone bills.
New FCC chair had doubts about auction
The ISP lobby groups aren’t the only ones raising concerns about SpaceX funding. Consumer-advocacy group Free Press researched the auction results and found that SpaceX won funding in surprising places such as “the Jersey City Target store”; census blocks “with luxury hotels” in Chicago; “empty parking lots, grassy fields and highway medians” near Washington, DC; a “parking garage in downtown Miami Beach, two blocks from the beach, surrounded on all sides by multiple companies offering gigabit service”; and a street in San Francisco “that borders the southern edge of Golden Gate Park.” SpaceX “appears to have played by the rules. But the FCC’s rules created a broken system,” the group said.
It’s not clear whether the FCC is likely to reverse any or all of the funding awarded to SpaceX or other companies. But FCC Acting Chairwoman Jessica Rosenworcel criticized then-Chairman Ajit Pai for completing the auction without waiting for the FCC to collect more accurate broadband data.
“We need maps before money and data before deployment,” Rosenworcel said in January 2020, when the decision was made. “With today’s decision we commit the vast majority of universal service funds—$16 billion!—for the next ten years without first doing anything to improve our maps, survey service accurately, or fix the data disaster we have about the state of service today. That means if your home is marked as served by the FCC’s maps today and it is not, then for the next decade you are on your own.” (The FCC ended up awarding $9.2 billion in the fund’s first phase instead of the maximum $16 billion. There may be $11.2 billion available in the as-yet-unplanned second phase.)
Given Rosenworcel’s view, it wouldn’t be surprising if the RDOF’s first phase undergoes some changes, whether that’s to SpaceX’s funding or someone else’s. The FCC recently heard from Sen. Shelley Moore Capito (R-WV), who objected to funding awarded to Frontier Communications given that company’s past failures to meet broadband-deployment requirements. And just before Pai left office in January, a bipartisan group of 157 members of Congress sent a letter urging the FCC to make sure that every funded ISP “has the technical, financial, managerial, operational skills, capabilities, and resources to deliver the services that they have pledged for every American they plan to serve regardless of the technology they use.”