The FCC is canceling Starlink’s $886 million in funding to expand access in rural areas, citing the cost of the satellite Internet system and doubts about whether it can provide high enough speeds. PC Magazine reports: The agency announced today that it rejected “lengthy applications” from both SpaceX and Internet provider LTD Broadband to receive funding from the FCC’s Rural Digital Opportunity Fund. “The Commission determined that these applications failed to demonstrate that the providers could provide the promised services,” the FCC said in a statement. FCC Chair Jessica Rosenwortzel added, “We cannot afford to subsidize businesses that do not deliver the promised speeds or do not meet the program’s requirements.”
In December 2020, the FCC awarded SpaceX $886 million to help its Starlink service bring high-speed broadband to 642,925 locations in 35 states. However, it came with a requirement that SpaceX submit a detailed proposal for how Starlink would meet its obligations before federal funding could be fully secured. The FCC’s goal with the Rural Digital Opportunity Fund is to provide gigabit Internet speeds to more than 85% of selected rural communities and download speeds of at least 100 Mbps to all 99.7% of locations in the coming years. “Starlink technology is really promising,” said Rosenwortzel. “But the question before us was whether to publicly subsidize its still-evolving consumer broadband technology — which requires users to buy a $600 dish — with nearly $900 million in universal service funds through 2032.”
