Technology FCC cancels Starlink’s $886 million grant from Ajit Pai’s mismanaged auction

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The Federal Communications Commission (FCC) has rejected Starlink's application to receive $885.51 million in broadband funding, essentially canceling a grant awarded by the FCC during then-Chairman Ajit Pai's tenure.

Starlink was tentatively awarded the Rural Digital Opportunity Fund (RDOF) grant in December 2020. But the satellite provider still needed FCC approval of a long-form application to receive the money, which is intended for areas with little or no high-speed broadband access.

We wrote about potential problems with the SpaceX grant a week after the FCC's reverse auction, in which ISPs bid on grants organized by census blocks. Consumer advocacy group Free Press accused Pai of "subsidiz[ing] broadband for the rich," pointing out that Starlink was awarded money in urban areas including locations at or adjacent to major airports.

Today, Chairwoman Jessica Rosenworcel's FCC announced that it rejected the long-form applications from both Starlink and LTD Broadband. The FCC said that both Starlink and LTD "failed to meet program requirements," submitted "risky proposals," and that their "applications failed to demonstrate that the providers could deliver the promised service."

The Starlink grants were supposed to fund broadband to 642,925 homes and businesses in 35 states. Losing the grants may not impact the actual availability of Starlink much because the satellite service isn't geographically restricted in the same way as wireline networks.

"After careful legal, technical, and policy review, we are rejecting these applications. Consumers deserve reliable and affordable high-speed broadband," Rosenworcel said. "We must put scarce universal service dollars to their best possible use as we move into a digital future that demands ever more powerful and faster networks. We cannot afford to subsidize ventures that are not delivering the promised speeds or are not likely to meet program requirements."

 
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