All You Need to Know: Connect America Fund Phase II Auction

Last week, the FCC released the draft of a proposed order for the Connect America Fund Phase II auction design, bidder qualifications, and timing. The FCC will vote on the draft at its January 30 meeting, and it is almost certain to be approved largely in its current form. 

Therefore, if you are interested in participating in the auction, now is the time to review the eligible census blocks and reserve prices the FCC released in December, along with the draft order and prior FCC orders establishing rules and requirements for the auction, to determine whether and where you have a viable business case for a particular area.

Then, if you believe you have a viable business case and may want to participate in the auction, you should carefully review the auction design, bidding procedures, and technical/financial requirements and deployment and reporting obligations. Only once you complete all of this due diligence and if you then determine the auction presents a real opportunity, you should turn promptly to working on the short-form application and begin considering how to meet the requirements in the long-form application.

The following are some of the highlights of the draft order:

Short form applications are due by March 30, 2018; bidding is scheduled to begin on July 24, 2018. The FCC will hold educational tutorials on the submission of applications on March 8.

The minimum geographic area for bids is a census block group in which eligible census blocks can be grouped for bidding. An applicant must identify the state in which it is bidding, and applicants that are commonly controlled can only submit one application for a state.

Reserve prices are set by the FCC’s Connect America Cost Model.

The auction will be conducted as a multi-round, descending clock auction. Bidders will indicate bids according to a broadband performance tier based on speed and latency, and bids will be weighted by the performance tier.

We will be back to you once the FCC adopts the order to discuss the process further.