FCC bolsters fund for Internet in rural areas

The Federal Communications Commission on Wednesday announced a $300 million effort to extend high-speed Internet to up to 400,000 previously unserved homes, businesses and anchor institutions in rural America.

The Connect America Fund was created last October when the commission voted unanimously for what Chairman Julius Genachowski called a "once-in-a-generation reform" of the Universal Service Fund to help connect all Americans with high speed Internet by the close of the decade. The USF was established to guarantee telephone service to all regardless of means.


Genachowski said the new program will "continue our work to unleash the benefits of broadband for all Americans, regardless of where they live, and consistent with fiscal responsibility."

The fund's $300 million comes from savings from conditions imposed on the USF, which imposed fiscal responsibility standards and cut waste. Genachowski stressed the importance of those standards, saying "by cutting waste, we are saving hundreds of millions of dollars – and those savings will now provide an immediate boost to broadband deployment in unserved areas."

Telecommunications carriers have 90 days to decide whether to participate in the program, which comes with aggressive build-out requirements as a condition of accepting CAF dollars. In a press release issued today, the FCC said it expects that carriers will likely supplement CAF funding with private investment.

While carriers are not required to participate, the commission said the result will still be that hundreds of thousands of Americans will gain access to broadband even if carriers only accept a portion of the money.

"All Americans will benefit while our nation’s global competitiveness is strengthened," Genachowski said.