THE FEDERAL COMMUNICATIONS COMMISSION APPROVED AN ORDER THAT ESTABLISHES A RURAL DIGITAL OPPORTUNITY FUND THAT WILL PROVIDE A SUPPORT MECHANISM THAT WILL BUILD UPON THE SUCCESS OF THE CAF PHASE II AUCTION 

On January 30, 2020, the Federal Communications Commission (“FCC”) approved an Order that establishes the Rural Digital Opportunity Fund (“RDOF”) which will provide a new two-stage support mechanism using competitive bidding similar to the CAF Phase II auction to target up to $20.4 billion over ten years to support up to gigabit speed broadband networks in areas that lack access to 25/3 Mbps broadband service. 

The FCC’s RDOF Order contains information on the requirements for participating in the auction and for reporting after the auction that are too numerous to discuss in detail in this notice. Therefore, the following is a summary of the RDOF Order. 

The FCC’s order addresses the Phase I auction since it will precede the Phase II auction. For a more detailed review of the order, carriers are encouraged to review the order. The RDOF Order has not yet been released but GVNW will send it out once it is available. 

Phase I And Phase II Auctions 

The RDOF will target support in two stages: 

Phase I will target census blocks that are wholly unserved with broadband at speeds of 25/3 Mbps. 

Phase II will target census blocks that are later determined through the Digital Opportunity Data Collection to be only partially served, along with census blocks unawarded in the Phase I auction. 

Eligible Census Blocks 

The Wireline Competition Bureau (“WCB”) will announce the availability of preliminary eligible census blocks and census block groups and mapping of the area at some point this year. The preliminary list will consist of the following: 

(1) the census blocks for which price cap carriers currently receive CAF Phase II model-based support. 

(2) any census blocks that were eligible for, but did not receive, winning bids in the CAF Phase II auction. 

(3) any census blocks where a CAF Phase II auction winning bidder has defaulted. 

(4) the census blocks excluded from the offers of model-based support and the CAF Phase II auction because they were served with voice and broadband of at least 10/1 Mbps. 

(5) census blocks served by both price cap carriers and rate-of-return carriers to the extent that the census block is in the price cap carrier’s territory. 

(6) any unserved census blocks that are outside of price cap carriers’ service areas where there is no certified high-cost ETC providing service. 

(7) any census blocks identified by rate-of-return carriers in their service areas as ones where they do not expect to extend broadband. 

Carriers should note that areas receiving ReConnect program funds or similar federal or state programs are not eligible for RDOF funding

Phase I Auction Framework 

The Phase I auction will consist of a single nationwide, multi-round reverse auction that will be similar to the CAF Phase II auction with competition within and across eligible geographic areas to identify areas that will receive support and determine support amounts. 

Deployment Obligations 

The RDOF will have technology-neutral standards for voice and broadband services with four performance tiers that carriers can bid upon. Each performance tier will differentiate between bids that would offer either low or high latency service. The performance tiers for the auction are: 

Performance TierSpeedMonthly Usage AllowanceWeight
Minimum≥25/3 Mbps≥ 250 GB or U.S Average, whichever is higher50
Baseline≥50/5 Mbps≥ 250 GB or U.S Average, whichever is higher 35
Above-Baseline≥100/20 Mbps≥2 TB20
Gigabit≥1 Gbps/500 Mbps≥2 TB0

The following are the latency requirements and weighting: 

LatencyRequirementWeight
LowLow ≤100 ms0
HighHigh ≤750 ms & MOS ≥440

Term of Support 

The RDOF will provide a 10-year term of support similar to the CAF Phase II auction. 

Auction Application Process 

Like the CAF Phase II auction, the Phase I auction will have a two-stage application process (short-form application and long-form application) with pre-auction and post-auction requirements. The format and deadlines for the submission of documentation for the short-form and long-form applications will be announced at some point this year. 

GVNW anticipates that more information will become available once the WCB announces the potential eligible census blocks and the timing for the submitting the short-form application and the long-form application, and the auction date. 

Please contact your GVNW Consultant or Steve Gatto (830.895.7226), sgatto@gvnw.com with any additional questions you may have about the Rural Digital Opportunity Fund Phase I and Phase II Auctions.