FCC Rejects LTD Broadband’s Long-Form Application For Rural Digital Opportunity Fund Support

August 10, 2022 – The Federal Communications Commission (FCC) has announced it is rejecting LTD Broadband LLC’s long-form application to receive Rural Digital Opportunity Fund (RDOF) auction support.[1] The decision was announced in an FCC News Release and a Public Notice.

LTD Broadband initially won $1,320,920,718.20 in 10-year RDOF support to serve 528,088 locations in 15 states.

LTD was later declared to be in default of winning bids in seven states after failing to timely receive eligible telecommunications carrier status, but was waiting to have its RDOF long-form application approved for the remaining states. However, the FCC has ultimately concluded that LTD is “not reasonably capable of deploying a network of the scope, scale, and size required by LTD’s extensive winning bids.”

The News Release, which announces the FCC is rejecting the long-form applications of both LTD Broadband and Starlink contains the following statement from FCC Chairwoman Jessica Rosenworcel on the decision:

“After careful legal, technical, and policy review, we are rejecting these applications. Consumers deserve reliable and affordable high-speed broadband,” said Chairwoman Rosenworcel. “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.”

The FCC’s Rural Broadband Auctions Task Force, Wireline Competition Bureau, and Office of Economics and Analytics released a Public Notice officially denying LTD Broadband’s long-form application and Starlink’s long-form application. The following paragraph from the Public Notice sums up the decision:

The Bureau has concluded its review of LTD Broadband’s (LTD) and Starlink’s long form applications. LTD proposes to deploy gigabit fiber to 475,616 estimated locations in 11 states. Starlink, relying upon a nascent LEO satellite technology and the ability to timely deploy future satellites to manage recognized capacity constraints while maintaining broadband speeds to both RDOF and non-RDOF customers, seeks funding to provide 100/20 Mbps low latency service to 642,925 estimated locations in 35 states. The Bureau has determined that, based on the totality of the long-form applications, the expansive service areas reflected in their winning bids, and their inadequate responses to the Bureau’s follow-up questions, LTD and Starlink are not reasonably capable of complying with the Commission’s requirements. The Commission has an obligation to protect our limited Universal Service Funds and to avoid extensive delays in providing needed service to rural areas, including by avoiding subsidizing risky proposals that promise faster speeds than they can deliver, and/or propose deployment plans that are not realistic or that are predicated on aggressive assumptions and predictions. We observe that Ookla data reported as of July 31, 2022 indicate that Starlink’s speeds have been declining from the last quarter of 2021 to the second quarter of 2022, including upload speeds that are falling well below 20 Mbps. Accordingly, we deny LTD’s and Starlink’s long-form applications, and both are in default on all winning bids not already announced as defaulted. Because LTD has defaulted on its remaining winning bids, we also dismiss as moot LTD’s petition for reconsideration of the Bureau’s denial of its request for additional time to obtain an ETC designation in Nebraska and North Dakota.

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[1] FCC Rejects Applications Of Ltd Broadband And Starlink For Rural Digital Opportunity Fund Subsidies, Applicants Failed To Meet Program Requirements And Convince FCC To Fund Risky Proposals, FCC News Release (Aug. 10, 2022), https://docs.fcc.gov/public/attachments/DOC-386140A1.pdf; Rural Digital Opportunity Fund Support For 80 Winning Bids Ready To Be Authorized; Bid Defaults Announced; Listed Auction 904 Long-Form Applicants Must Submit Letters Of Credit And Bankruptcy Code Opinion Letters By August 24, 2022, AU Docket No. 20-34, WC Docket No. 19-126, WC Docket No. 10-90, Public Notice, DA 22-848 (Aug. 10, 2022), https://docs.fcc.gov/public/attachments/DA-22-848A1.pdf. Attachment B to the Public Notice is a list of RDOF Bids in Default, https://docs.fcc.gov/public/attachments/DA-22-848A3.pdf.