Aug 25, 2021 - Technology

How the FCC got boxed out of the broadband push

Illustration of the FCC logo tangled in ethernet cable wires.
Illustration: Aïda Amer/Axios

As the federal government readies to spend tens of billions of dollars on broadband upgrades, the Federal Communications Commission — the agency that has traditionally doled out subsidies for internet connections — is on the sidelines.

Driving the news: The bipartisan infrastructure bill recently approved by the Senate commits $42.5 billion to broadband deployment and related projects, but the money would flow to the states, with oversight from the Commerce Department.

The intrigue: The broadband money got routed around the FCC for several reasons, according to insiders familiar with the process.

  • The White House will be able to exert greater control over how the money is awarded if the Commerce Department is in charge rather than an independent agency like the FCC.
  • Sources noted that Commerce Secretary Gina Raimondo was a key player in the infrastructure negotiations.
  • The FCC has also come under fire recently for how it handled awarding $9 billion for broadband in rural areas in 2020.

What happened: Critics say the program, known as the Rural Digital Opportunity Fund (RDOF), was rushed in order to begin before the end of the Trump administration.

  • Problems with the accuracy of the FCC's broadband maps led to complaints about funds being awarded to provide broadband in parking lots.
  • There are also concerns that the agency did not thoroughly vet companies before allowing them into the auction, leading to questions about whether providers who won subsidies will be able to deliver service.
  • "If the RDOF had been more successful, I think the FCC would’ve had a very significant role [in the new funding]," Blair Levin, a non-resident fellow with Brookings Institution, told Axios. "On the other hand, I think if we’re talking about this magnitude of money, the senators, many of whom are former governors, wanted governors to have more power."

What's next: The FCC said in July it's taking steps to "clean up" the program.

  • The agency sent letters to 97 companies that won funding in questionable locations to allow them to withdraw without penalties.
  • "For those applicants who are dragging their feet or can’t meet their obligations, follow the rules or we will disqualify you and move on," acting chairwoman Jessica Rosenworcel said in a statement last month.
  • The agency budgeted up to $16 billion for the program, but only awarded $9 billion. The extra money can be spent on a second phase of the program.

What they're saying: "The FCC stands ready to help get 100% of Americans connected in any way that Congress sees fit," an FCC spokesperson told Axios Tuesday.

What's next: House Democrats are expected to approve the bill as is rather than blow up the Senate's hard-won compromise — but not until after they also pass a much bigger, Democrats-only "soft infrastructure" bill.

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