The Rural Digital Opportunity Fund (RDOF) Phase 1 auction appears to be winding down. In recent days, the duration of auction rounds dropped from six to four hours and then again to two and a half hours, suggesting that bidding activity is slowing.
The reverse auction will award up to $16 billion in rural broadband funding, with funding going to bidders that commit to deploying broadband to unserved areas for the lowest level of support. A weighting system favors bids for higher-speed, lower-latency service, and bidding is by census block group.
According to the FCC, about 5.3 million unserved homes and businesses are located in areas eligible for bidding in the Phase I auction.
Round 19 of the auction was completed earlier today.
RDOF Auction Winding Down
Nearly 400 entities (386) qualified to bid in Phase 1 of the RDOF auction, which commenced on October 29th. The actual number of companies participating in the auction is somewhat higher because some companies are bidding as consortia.
Bidders include cable companies such as Cox Communications and Midco; telecom companies such as Frontier, Verizon and Windstream; satellite broadband providers Viasat and newcomer SpaceX; small rural telecom companies; rural electric cooperatives; and fixed wireless providers known as WISPs (for wireless internet service provider).
WISPs are likely not the only companies pursuing RDOF funding for fixed wireless, however. If successful in the auction, some of the telecom and cable companies also are likely to use fixed wireless for at least some deployments, while many bidders will pursue fiber-based deployments.
The minimum speed that auction winners can deploy is 25 Mbps downstream and 3 Mbps upstream, but it is likely that a considerable portion of the winners will deploy faster speeds. The RDOF auction was based, in large part, on the Connect America Fund (CAF) II auction of 2018. Like the RDOF auction, the CAF II auction used a weighting system to favor higher-speed bids, resulting in some winners deploying service at speeds up to 1 Gbps downstream.
Almost half of the entities that bid in the CAF II auction won funding. But there were considerably fewer participants in that auction – only 220 in total, or less than half the number participating in the RDOF auction.
Accordingly, it would seem unlikely that we will see such a high percentage of winners in the RDOF auction.
Phase 2 of the RDOF auction will award an additional $4 billion or possibly more but will not occur until the FCC has updated broadband availability data.
