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Tuesday, May 18, 2021

Government support for the Elon Musk Internet Space Project is bothering competitors

The US Federal Communications Commission (FCC) is facing pressure from rural Internet service providers to refuse to provide a planned $ 886 million support for SpaceX, a subsidiary of billionaire Tesla boss Elon Musk, to carry broadband. ) From outer space to deprived areas.

Even before it was approved to receive the funds, SpaceX began its service and began launching satellites. To date, there are more than 1,000 Starlink small satellites in space, providing the service with the aim of testing subscribers. The company asserts that its system is “uniquely positioned to provide high-quality broadband service to hard-to-reach rural Americans.”

But that hasn’t stopped complaints about her winning a contest to get benefits from the Federal Communications Commission’s Rural Digital Opportunities Fund, in part because Starlink was originally built without this aid, and its services are not limited to rural areas.

It is reported that the grants planned to be given to this company, which is officially known as “Space Exploration Technologies Corp”, and to other companies, raise questions about the whole program, which is valued at $ 9.2 billion.

Competitors objections
“SpaceX’s broadband from orbit is an unproven technology,” said Jim Matheson, chief executive of the National Rural Electric Cooperative Association, which includes members vying for funding. “Why should this money be used in a scientific experiment?”

SpaceX did not respond to emails requesting comment.


Feasibility of the program
The Rural Digital Opportunities Fund is the cornerstone of federal efforts to connect millions of people who do not own home broadband, many of them in low-density and expensive areas of population, for this service, a need that has been emphasized during the Corona pandemic. This fund prepares to distribute public funds to expand broadband in 49 states over 10 years.

In December, the fund announced the winners of the auction that included 180 companies and bids, most of which provide broadband through more established technologies, such as cable or wireless service.

At that point, SpaceX’s plan to provide the service to 642,925 locations in 35 states was approved. But consumer advocates say these sites include parts of New York City and airports in Newark and Miami – places that do not fit the program’s goal of serving rural people outside of broadband networks.

It should be noted that these decisions were made when the officials appointed by the “Trump” administration still controlled the FCC, but now the head of the agency appointed by “Biden”, and they can exclude the applicants who are considered suspicious in the eyes of the agency.

Concerns about government support spending
Last month, 160 members of the House and Senate urged the Federal Communications Commission to scrutinize beneficiaries, in part because building the network takes time. Legislators said, “We are afraid that we will not know for several years whether the money has been spent inappropriately.”

In this context, Representative “Jim Clairn” from South Carolina, who is a Democratic member of the House of Representatives, said in an e-mail, that “there is a need for a prior and appropriate evaluation.”

He added that many applicants claim to be able to provide faster service to new customers than they are now providing to existing subscribers.

Some bidders have promised a super-fast gigabit-speed service they have never offered before. Others have missed previous deadlines to build subsidized networks or promised to build one at discounted rates.

It is reported that the review is the responsibility of the acting FCC chairperson, Jessica Rosenworsel, who said last year that the program is being pushed forward very quickly in what looks like a “pre-election rush”.

While others defended the program, saying that the Americans who are deprived of the service “can not wait” to receive it.

It is noteworthy that the Federal Communications Commission declined to comment.

Selecting the winning companies
In early October, the Federal Communications Commission held an auction to determine how to split the rural money earmarked for the matter, which is being funded through fees on consumer phone bills.

The agency also identified unconnected areas that do not have this service and announced bids for them. The companies offering to build broadband won the lowest price in the subsidies.

The winners were announced in December, which included subsidies in excess of $ 1 billion to cable provider Charter Communications, the Rural Electric Cooperative of 95 cooperative companies, and a company called LTD Broadband, which was the first winner in the support. It requested $ 1.3 billion to provide the service in 15 states.

“Charter” announced that it will use its support of 1.2 billion dollars in a project worth 5 billion dollars, to provide fast internet service to more than one million homes and non-serviced companies in 24 states.

LTD Broadband, founded in 2011, provides broadband service that is distributed wirelessly from 2,100 tower sites in Iowa, Minnesota, Nebraska, and South Dakota, and according to its website, it said it will fulfill its fiber communications obligations, which It generally provides faster speeds than wireless ones.

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