In January, we wrote about the Connect America program, a Federal Communications Commission (FCC) initiative designed to help spread broadband access across rural America. At the time, the commission had pledged $100 million to support broadband experiments, and received nearly nine times that much in bids from interested companies. So far, Connect America has brought broadband to 1.7 million residents in 45 states, and Puerto Rico.

On April 29, the FCC announced a $1.675 billion increase in Connect America Phase II funding. The whole of the FCC’s annual investment in rural broadband and voice networks is $4.5 billion, making the increase a huge one in terms of percentage. Even better is that the FCC says this increase comes without any increase in the Universal Service Fund fees, the source of Connect America funding, on our phone bills.

Funding Requirements

Based on bidders’ response to earlier Connect America proposals, Internet Service providers (ISPs) will likely offer to accept funding than the FCC can possibly accommodate, and the FCC has specific targets in mind. Most importantly, participating providers will have to deliver 10 Mbps download and 1 Mbps upload speeds, an increase in speed of more than 70 percent compared to current speeds in eligible areas. According to the commission, only one in 100 rural Americans currently has that level of speed, compared to one in three Americans nationwide.

Companies receiving funding would also have to work within a specific timeframe. To get the money, participating companies will have to provide target speeds to 40 percent of their eligible area by 2017, increasing to 60 percent in 2018 and 100 percent by 2020.

The Core of the Problem

The FCC realizes that the challenge to bringing broadband to rural areas is that it’s expensive. Laying fiber in rural areas is no more expensive than laying it in a city, but the city has fare more potential customers to reduce the per-consumer cost. Companies building high-speed networks know that consumers won’t be willing to pay enough to create a profit, and so rural areas’ connectivity gets ignored.

The new FCC funding will subsidize the per-customer cost of spreading access to high-speed networks. The FCC estimates 10 Mbps service should cost $52.50 per month, and the program funds areas where consumer costs would likely exceed that figure. Population in these areas is 8.5 million, which means that the math is easy: the FCC is willing to pay $200 per customer to expand existing networks into rural areas. That’s actually a fairly significant commitment, representing the equivalent of almost four months of free Internet based on the FCC’s service cost estimate.

Where and When

An FCC map displays areas eligible for Phase II funding. If you live in an eligible area, know that participating ISPs have until August 27, 2015 to accept funding. Naturally, it will still take time after that to actually expand service areas, so while the FCC is pushing hard to narrow the broadband gap, it’s not something that will happen overnight.

If you can’t wait that long, maybe you don’t have to. See which plans are currently available in your area, and maybe you can get a faster connection overnight.

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