What Does the FCC’s $20 Billion, 5G Plan for Rural America Really Mean?

It’s been about three weeks since the Federal Communications Commission (FCC) announced its $20.4 billion plan to bring high-speed, mobile access to rural communities in the United States. Dubbed the Rural Digital Opportunity Fund, the plan will award $2 billion in subsidies per year, over ten years, to build a physical infrastructure for broadband throughout rural America. The goal is to connect up to 4 million rural homes and businesses.

This high-speed broadband network, better known as 5G, launches internet connectivity into a whole new sphere. At its peak speed, 5G is 20 times faster than 4G, with a minimum peak download speed of 20 Gb/s, as compared to 4G’s 1 Gb/s. That means 5G users can access infinitely more information, much faster--also helping advance other technologies, such as autonomous vehicles.

It is especially revolutionary because over 20 million Americans, many of whom live in rural areas, lack access to current broadband speeds. It’s an infrastructure issue; because of physical barriers, like mountains or rivers, and high implementation expenses, the wireline technology needed for broadband access isn’t always the best choice.

That’s where the FCC’s Rural Digital Opportunity Fund comes in. Ajit Pai, FCC chairman, envisions the resulting infrastructure as a combination of both wired and wireless technology. The $2 billion annual subsidy allows companies to install fiber optic cable throughout rural areas, and install devices on tall structures, such as towers, that will disseminate the signal.

The Fund will succeed the 2015 Connect America Fund, which provided $9 billion in subsidies for technologies like cable and DSL. The FCC’s newest plan more than doubles past federal funding.

According to New Food Economy, Rural and Agriculture Council of America Vice President Chris Skorupa said the current plan was the “best path forward to stimulating local economies and bridging the digital divide in rural communities across America.” He also described it as [creating the] “largest commercial spectrum auction in FCC history.”

The auction, run by the FCC, sells the rights to transmit signals over wireless spectrum bands, the radio frequencies over which wireless signals travel. Mobile phone companies, like Verizon or T-Mobile, compete for use, helping both to expand America’s 5G network and stimulate the economy.

The FCC’s third auction of the 5G spectrum is scheduled for early December, 2019. It will sell 3,400 megahertz in three spectrum bands which, according to Pai, “is a lot of spectrum.” It will be the largest auction yet, in terms of total spectrum to be auctioned.

By some accounts, the FCC’s $20 billion plan is just one more step forward into the Fourth Industrial Revolution (4IR). In his keynote at this year’s Consumer Electronics Show, Hans Verstberg, CEO and executive chairman of the board of Verizon Communications, outlined how 5G is paving the way for 4IR:

“Everything we're going to see in the future [will be] transformed by 5G. We're going to see a technology change that is going to transform people, businesses, and society.” he said. “It’s the next era of technology advancement.”

Which makes the Rural Digital Opportunity Fund a catalyst for change not just for rural America, but for the country as a whole.

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