For the first time, the FCC has recognized mobile service as a universal service priority. According to FCC Chairman Julius Genachowski, dead zones in mobile coverage are too common in the U.S. Hence, the FCC will ensure that the gaps in mobile coverage will be closed. To do that, the FCC has initiated a competitive bid for new mobile broadband subsidies with the goal of deploying 3G and 4G network services to areas in the U.S. that have no existing mobile services. FCC’s Mobility Fund will award up to $300 million to mobile carriers that will take on the mission of bringing the much-needed service to the marked areas.
The winning mobile provider will be given two years to deploy a 3G network and three years for a 4G service to be implemented. The Federal Communications Commission will be awarding the funds in a reverse auction, which means that the lowest-priced bidder will win. In a reverse auction, providers will compete to obtain the award from the FCC, and prices will typically decrease as the bidders undercut each other. The FCC said that this is just the first phase of the Mobility Fund. On Wednesday, the FCC announced the procedures of the bidding as well as a map of the eligible areas for the subsidy.