FCC to hold major 5G spectrum auction, launch $20 billion fund for rural broadband

The Trump administration is announcing two major initiatives aimed at speeding the deployment of next-generation wireless networks — a major new 5G spectrum auction and a $20.4 billion fund for building out broadband in rural areas.

Ajit Pai, the Republican chairman of the Federal Communications Commission (FCC), announced the proposals at a White House event alongside President TrumpDonald John Trump2020 Democrats spar over socialism ahead of first debate Senate passes .5 billion border bill, setting up fight with House 'Teflon Don' avoids the scorn of the 'family values' GOP — again MORE, top economic adviser Larry Kudlow and Trump's daughter, Ivanka.

"Secure 5G networks will absolutely be a vital link to America's prosperity and national security in the 21st century," Trump said.

The president also tamped down on speculation that his administration would seek to nationalize or otherwise inject itself into the 5G deployment efforts, saying the rollout would be "private-sector driven and private-sector led."

The conjecture had been driven by Trump allies like former Speaker Newt Gingrich (R-Ga.) and Brad Parscale, the president's campaign manager, who had called for the government to be more involved in the telecom industry's efforts.

The FCC will begin auctioning off three different airwaves in December, with the 3,400 megahertz of airwaves for sale representing the largest-ever spectrum auction.

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The $20 billion fund will aim to connect 4 million rural homes and businesses to fiber high-speed internet. Laying down the network for wired broadband will help facilitate deployment of 5G technologies in those rural areas.

The Rural Digital Opportunity Fund will allocate the $20 billion over the next 10 years.

Pai said in a call with reporters on Friday that the money will only be used in areas where broadband internet isn’t currently available.

The proposal is still light on details, but the FCC chair said the funds would come from the agency's Universal Service Fund (USF), which provides subsidies for expanding access to communications services in poor and rural areas.

The Republican-led FCC recently proposed capping the amount of money that can be spent by the USF, prompting an outcry from public interest advocates. Pai said that the cap is unrelated to his proposal to repurpose the funds into his new subsidy program. 

The administration has emphasized 5G deployment as a top economic and national security concern. In February, Trump urged wireless companies to step up their efforts to roll out the new networks in an effort to beat China to full deployment of the new technology.

Jessica Rosenworcel, one of the two Democrats on the FCC, criticized the administration's approach to promoting the new technology.

“So far, this Administration’s interventions on 5G have done more harm than good," Rosenworcel said in a statement. "From imposing tariffs on 5G equipment to alienating allies on 5G security to falling behind the rest of the world on critical mid-band spectrum, the White House has yet to offer a workable plan for US leadership."

"I hope today’s announcement offers better because our global leadership is at stake," she added.

Harold Feld, a senior vice president at the consumer group Public Knowledge, called on Congress to look into the FCC's new efforts.
 
“Today’s announcement raises many questions," Feld said in a statement. “Chairman Pai and the Trump Administration have an unfortunate history of promising big things for rural broadband with great fanfare, but have either failed to deliver, or simply taken credit for programs developed by the Obama Administration. Hopefully, this will not be the case again.”

AT&T, Verizon, Sprint and T-Mobile have all begun introducing 5G in certain areas, but the new networks are not expected to be fully available for years.

Updated at 3:33 p.m.