The Federal Communications Commission is allocating $424.2 million to expand broadband service in all 75 Arkansas counties.
The agency announced Monday that more than 388,000 rural residents of the state will gain access to high-speed internet service through the initiative, which FCC Chairman Ajit Pai said is “the commission’s single largest step ever taken toward delivering digital opportunity to every American and is another key success in our ongoing commitment to universal service.”
The allocation to Arkansas is part of $9.2 billion awarded nationally for rural broadband service expansion.
Under the agency’s Rural Digital Opportunity program, broadband service will be expanded to reach 200,612 unserved homes and businesses in Arkansas over the next 10 years. The program vows to deliver at least 100 megabits per second of upload speed and 20 megabits per second of download speed.ADVERTISING
The FCC said that nearly all locations in Arkansas that were eligible will be receiving broadband, with about 90% of the communities getting gigabit-speed service. The agency awarded contracts through a competitive auction process.
“Broadband is an essential infrastructure, similar to electricity, clean water and paved roads,” Arkansas Commerce Secretary Mike Preston said Monday. “These funds will provide long-term support for broadband deployment in high-cost areas that lack service currently.
“The majority of companies that won areas in Arkansas are committing to provide gigabit speeds, which will allow for telemedicine, distance education and telework,” Preston said.
There is no firm timetable for delivery of the new service — “the exact deployment schedule is determined by the carriers themselves, not the FCC,” according to the agency’s rules for the program. Providers are required to reach 40% of the locations by the end of the third year of the program, the rules say.
Likewise, there are few details on pricing. The FCC rules note that costs must be “reasonably comparable to the rates for similar service in urban areas.”
This year the state began extending broadband to rural areas as part of the Arkansas Rural Connect program, an initiative started by Gov. Asa Hutchinson and approved by state legislators.
The program has invested nearly $87 million to expand broadband in 60 rural areas, according to Commerce Department statistics. About $4.5 million in state funding has been combined with more than $82 million in federal coronavirus-relief funding.
Federal support focuses on providing rural broadband in high-cost areas, acting as a subsidy to extend service to areas too costly for providers to reach with their own investment. The state program focuses on expanding in rural communities.
The programs are complementary, Preston said.
“This allows us to utilize funds efficiently and close the digital divide more quickly by avoiding duplicating funds to areas,” he said. “Also, the ARC [Arkansas Rural Connect] program would allow Arkansas companies to bid more aggressively in the [FCC] auction by utilizing a combination of state and federal funds.”
Little Rock telecommunications provider Windstream Holdings Inc. was awarded the most contracts in the state through the auction, according to information the FCC released Monday. The company won the single largest contract — $13.4 million to provide service in Caroll County — and was awarded a total of 30 contracts.
Windstream said Monday it was prohibited from commenting on the contract awards under FCC rules. “We’re still digesting the auction results that were announced today by the FCC,” spokesman Scott Morris said. “In addition, FCC rules prohibit us from discussing project details until after Jan. 29, 2021.”
The auction and contract awards are the first phase of the decadelong program to expand broadband and connect rural customers to high-speed service.
“This historic auction is great news for the residents of so many rural Arkansas communities, who will get access to high-quality broadband service in areas that for too long have been on the wrong side of the digital divide,” Pai said in a news release.
“We structured this innovative and groundbreaking auction to prioritize bids for high-speed, low-latency services to deliver the best results for rural Americans, and the results show that this strategy worked.”
In January, the commission approved establishment of the $20.4 billion Rural Digital Opportunity Fund to deliver fixed broadband to rural homes and small businesses that lack it.
The initiative is financed through the universal service fund, which is supported by telecommunications carriers, including wireline and wireless companies, and cable companies that provide voice service.
Contributions are required by law and are based on the companies’ interstate and international end-user revenue.
Future phases of the federal initiative will target unserved areas not included in the current auction. Awards announced Monday are expected to reach about $16 billion nationwide and phase two will add another $4 billion investment, according to the FCC.
The biggest winners of the FCC’s awards nationally were LTD Broadband, Charter Communications and the Rural Electric Cooperative Consortium, each winning a little more than $1 billion worth of contracts, The Washington Post reported.