The FCC has completed its first ‘Mobility Fund’ auction, which used a market-based competition to distribute funding where carriers competed to provide wireless coverage to roads in un-served areas, and winners were chosen based on the lowest cost-per-mile bids.
The Mobility Fund consists of $300 million in savings gleaned from the reform of the Universal Service Program.
As a result of the auction, mobile infrastructure deployment will begin in 31 states with areas that currently lack access to 3G or 4G mobile service, covering up to 83,500 road miles. Winning companies must complete projects within three years and make their networks available to other providers for roaming.
A total of 38 companies participated in the auction, submitting nearly 900 bids. Winners ranged from larger national carriers like T-Mobile USA to smaller carriers like Pine Belt Cellular in Alabama and VTel Wireless in Vermont. The Commission expects millions more in private investment to complement the auction funding.
Allied Wireless Communications (Alltel) was the biggest winner with 93 bids garnering $45.8 million in support to cover 4,417 road miles, followed by NE Colorado Cellular with 50 bids winning $40.2 million (12,000 road miles) and US Cellular with 21 bids winning $30.9 million (1,723 road miles).
Alltel’s winning bids averaged just shy of $6,000 per road mile with a few that were more than $10,000 per road mile. NE Colorado’s bids ranged from $576 to $10,775 per road mile. US Cellular’s winning bids ranged from $9,938 to $32,773.
To accelerate mobile deployment under-served areas, the FCC will also provide an additional $50 million in one-time support to tribal lands and $500 million annually for ongoing support to mobile services in Phase II of Mobility Fund.