The Federal Communications Commission has awarded SpaceX $885 million in funding to provide high-speed broadband internet to over 660,000 locations in 35 states.
The funding was awarded as part of the FCC’s Rural Digital Opportunity Funding (RDOF) phase 1 auction. The RDOF program was created to bring broadband capability to approximately 5.2 million unserved homes and businesses throughout the United States.
A total of 180 bidders were awarded RDOF funding with SpaceX receiving one of the largest slices of the $9.2 billion pie. According to the FCC, 99.7% of locations identified in the RDOF phase 1 will receive broadband speeds of at least 100/20 Mbps with 85% set to receive gigabit speeds.
The $9.2 billion in funding will be paid over a period of 10 years. Providers will be required to reach all assigned locations by the end of year six.
SpaceX launched the first 60 operational Starlink satellites aboard a Falcon 9 rocket in November 2019. Since then, the company has launched close to 900 satellites and has just recently begun offering a public beta of the service.
According to an email shared by CNBC on October 27, the Starlink broadband service will initially cost $99 per month. Additionally, users will be required to pay a $499 upfront fee for a Starlink ground terminal and wifi router.
RDOF phase 2
A total of $16 billion had originally been allocated for phase 1 of the auction. However, the FCC’s decision to utilise an auction-based bidding process resulted in $6.8 billion in savings.
According to the FCC, the savings from phase 1 will be rolled over to phase 2, which seeks to provide high-speed broadband to partially served areas and unserved areas not addressed in phase 1. The second phase of the auction will, as a result, now be worth up to $11.2 billion.