Rural Parties Seek CAF II Auction Changes to Help Small Providers Bid; Microsoft Interested
Rural interests urged the FCC to ease small provider participation in a reverse auction of Connect America Fund Phase II subsidies for fixed broadband services, while Microsoft said its "vision aligns closely" with the agency's goals. Comments were posted Monday and Tuesday in docket 10-90 responding to a public notice on proposed procedures for auctioning up to $1.98 billion in cumulative support over 10 years (see 1708070032) in rural areas where large telcos declined support. A rural electric and telco coalition said the commission should simplify the auction, modify anti-collusion rules to ease small-provider use of outside experts, and strengthen safeguards against waste, fraud and abuse. The Rural Wireless Association sought "flexible" anti-collusion rules and backed using census block groups as the minimum geographic bidding area. Saying the PN "would take several steps backward," the Wireless ISP Association agreed smaller providers need "flexibility to engage" expert assistance, proposing a "safe harbor" to "enable a consultant to represent one bidder in each census block group without being considered a potential conduit for prohibited communications." Proposed financial qualification reviews and certain other procedures need adjustments, said USTelecom.
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"A simpler, more straightforward" auction could avoid "complex gaming strategies," including by eliminating "package bidding" and "performance/latency tier" shifts once established, said the American Cable Association. US Cellular also opposed "package bidding," which "would favor larger bidders." ITTA said the FCC shouldn't subject experienced providers to a "proposed five-point scale for evaluating financial qualifications before the auction, but should limit applicants to bidding on performance tier and latency combinations that they or similar providers" currently offer. It urged procedures for reallocating funding forfeited by winning bidders that default so rural consumers aren't left without service. Adtran opposed the proposal to limit applicants to bidding on existing performance tiers and latency combinations.
Microsoft is "committed to connecting rural America" and believes TV white spaces should be added to the "list of suitable spectrum bands," it said. Touting its satellite broadband capability, EchoStar's Hughes Network Systems generally backed a "technology neutral approach" and proposed application requirements, and said applicants should be able to cite certain "spectrum in the pipeline" (the V and Q bands) and engage in "sufficient geographic switching from round to round" to stimulate competitive bidding. Pennsylvania's Public Utility Commission and its Department of Community and Economic Development asked for application measures to facilitate the use of the state's "proposed negative weights" in scoring of bids in areas where Verizon declined support. Other commenters included Vantage Point Solutions, Sacred Wind Communications, SpaceX, GeoLinks, the Institute for Local Self-Reliance, the Illinois Electric Cooperative, BEK Communications and the Technology Policy Institute.