RUS Solicits Satellite Broadband Stimulus Funding Applications

The Rural Utilities Service opened the window Friday for applications for broadband stimulus funds for projects using satellites to increase the reach of broadband. The request for proposals (RFP) was printed in Friday’s Federal Register and outlines the application process for rural library broadband and technical assistance projects as well. The satellite broadband funds are part of the second round of broadband stimulus fund distribution through RUS’s Broadband Initiatives Program (BIP). The agency will accept applications for funds through June 7, it said.

The RFP includes some significant changes from the initial release of details described in the opening of BIP’s second round. The most important change, according to executives from WildBlue and Hughes, is RUS’s decision to allow awards to multiple providers who apply to serve a single region. The change would also allow multiple grant winners for national applicants, it said. RUS “determined that reaching hard to serve unserved rural premises may best be served” by multiple awards, “depending on the satellite proposals it receives,” the RFP said.

WildBlue, Hughes, and EchoStar previously explored applying for the funds as a consortium and then competing within a maximum price limit for customers. While RUS declined to let consortia apply, the multiple grant winner per region rule allows similar competition. Allowing multiple winners per region “introduces the concept of competition,” into the process, said WildBlue General Counsel Lisa Scalpone. The updated rules are also “great for the industry” since more satellite broadband providers will be able to participate, she said. Hughes General Counsel Dean Manson said the company was also pleased with the adjustment because government agencies “typically veer away” from giving awards to multiple applicants since extension of service is preferred over doubling up of providers in a region. “For satellite broadband, since the coverage is there, there is no necessity to limit the potential competitors,” he said. “We appreciate RUS recognizing the benefits of enabling competition for the end-user customer by providing for multiple winners per region and think that approach will benefit the public by delivering competition and rapid deployment of subsidized broadband service."

RUS also removed a stipulation that would have required winners of stimulus funds to offer satellite broadband subscriptions at a 25 percent discount from what the companies offered in December last year. Instead, basic service packages may not exceed $50 per month. The change was made to allow new entrants that hadn’t offered service previously to apply. The RFP reiterated that $100 million is set aside for satellite broadband projects and the amount could increase if there are leftover funds that weren’t given toward terrestrial broadband projects. RUS is still in the process of distributing money for the terrestrial projects, leaving unclear the total amount that satellite companies could get.

Hughes and WildBlue said they were reviewing the RFP and haven’t made a decision on how they will apply, the executives said. EchoStar, which has been linked as a possible applicant for the broadband funds, said the company was still reviewing the RFP.