TR Daily Pai Proposes $9B 5G Fund to Replace MF-II Fund
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Wednesday, December 4, 2019

Pai Proposes $9B 5G Fund to Replace MF-II Fund

FCC Chairman Ajit Pai today announced that he plans to ask his colleagues to establish a new Universal Service Fund program, the 5G Fund, which would replace the Mobility Fund Phase II program intended to support 4G LTE deployment to unserved rural areas, and which would dedicate funding for 5G deployments that facilitate precision agriculture.

The 5G Fund would double the $4.5 billion in planned MF-II funding over 10 years to $9 billion, with the extra $4.5 billion to come from increased USF support. A senior FCC official emphasized to reporters in a conference call on background that the overall size of the USF has been held steady during Chairman Pai’s tenure and that the agency believes that there is room to increase the fund by $4.5 billion.

Of the total $9 billion, the Chairman is proposing that $1 billion be set aside to support 5G deployments that benefit precision agriculture.

The funding would be distributed through a reverse auction, and because 5G is largely unavailable as yet, especially in rural areas, the data collection problems that arose with the MF-II program should not be an issue, another senior FCC official told reporters. In addition, the official said that the lesson of the MF-II program is that the FCC should not rely solely on coverage maps but on drive tests and audits, which will be needed to confirm that 5G Fund recipients meet their deployment commitments.

Chairman Pai plans to present a draft notice of proposed rulemaking to his colleagues for a vote early next year to kick off the 5G Fund proceeding, one of the officials said. Among the issues on which the NPRM will seek input are how to decide which areas should be eligible for funding, how to target the $1 billion set-aside for precision agriculture support, and what speed metric should be used in conjunction with the 3GPP technical standard for 5G.

Chairman Pai’s announcement coincided with the release of a staff report that concludes that the coverage maps submitted to the FCC by Verizon Wireless, U.S. Cellular Corp., and T-Mobile US, Inc., as part of the effort to determine which areas should be eligible for support in the MF-II auction were not accurate, and recommends that the Commission terminate the MF-II challenge process (see separate story).

In a statement, Chairman Pai said, “5G has the potential to bring many benefits to American consumers and businesses, including wireless networks that are more responsive, more secure, and up to 100 times faster than today’s 4G LTE networks. We want to make sure that rural Americans enjoy these benefits, just as residents of large urban areas will. In order to do that, the Universal Service Fund must be forward-looking and support the networks of tomorrow. Moreover, America’s farms and ranches have unique wireless connectivity needs, as I’ve seen across the country. That’s why I will move forward as quickly as possible to establish a 5G Fund that would bring next-generation 5G services to rural areas and would reserve some of that funding for 5G networks that promote precision agriculture. We must ensure that 5G narrows rather than widens the digital divide and that rural Americans receive the benefits that come from wireless innovation.”

CTIA Senior Vice President–regulatory affairs Scott Bergmann said, “Wireless providers are serving more consumers in more places than ever before, but reaching every American with increasingly essential wireless services, like 5G, will require a collective effort. Even as wireless providers continue to invest in 5G, Chairman Pai’s proposal for a 5G Fund demonstrates the type of leadership and collaborative effort that is needed to ensure all Americans can participate in our 5G future. We look forward to working with Congress and the FCC to make sure that support for 5G services is being targeted to rural areas that need it the most.”

NTCA Chief Executive Officer Shirley Bloomfield said, “NTCA looks forward to reviewing the FCC’s proposal to create a new 5G Fund for rural America and is in the process now of examining the staff report that concludes that mapping data remain too unreliable to conduct the Mobility Fund Phase II auction as previously planned.”

Ms. Bloomfield continued, “Obtaining accurate maps for mobile wireless services has proven particularly vexing, and in just the past several months, the FCC adopted new provisions to develop better maps for fixed and mobile services alike through a combination of more precise technical standards for reporting and public stakeholder input and challenges.”

She added, “NTCA members are eager to continue leading the charge in deployment and delivery of advanced services in rural areas, and we hope that the availability of better coverage data and this shift in program objectives will ultimately promote increased investment in, and help sustain, robust rural wireless networks.”

Competitive Carriers Association President and CEO Steve Berry said, “I welcome increasing the amount of funding available for mobile deployment in rural areas. It is critically important to get this program right, and I look forward to working with the Commission to structure an updated Universal Service Fund program that preserves and expands mobile service in the hardest to serve areas.”

In a statement, the Rural Wireless Association said that “[b]ecause of the delay associated with the Mobility Fund Phase II process, RWA members determined that the better course of action would be for the FCC to move on, jettison the disingenuous data, and target Mobility Fund Phase II funds for 5G deployment. The announcement from Chairman Pai today is along the lines of what RWA has been promoting. Utilizing the previously allocated MF II funds plus additional funding to bring 5G to rural America is in line with RWA’s thinking. On top of it, accurate coverage maps using clear engineering guidelines as recommended by the Staff Report will improve the accuracy of where these limited resources will be targeted for 5G.”—Lynn Stanton, [email protected]

MainStory: FederalNews FCC WirelessDeployment UniversalServiceLifeline

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