The Federal Communications Commission on Monday said it reaffirmed its previous decision to reject Starlink’s application for $900 million in subsidies from the Rural Digital Opportunity Fund due to the company failing to meet the program’s requirements.
Starlink had applied for $885 million in federal subsidies from the Rural Digital Opportunity Fund, which uses scarce universal service funds collected through consumer phone bill fees to expand access to broadband networks in rural areas. Although Starlink was approved during the short-form round of the application process in 2022, the application does not require applicants to specify areas of service. This is part of the long-form application process during which Starlink was eliminated, deeming its costly equipment as one of the deciding factors.
The rejection comes after Starlink hiked the price of its starter kit and internet services earlier this year to $599 for the satellite dish and a $110 monthly internet bill. This is up from $499 for the kit and $99 per month, according to Variety, which reported that $111 million of Starlink’s funding was slated for areas that didn’t need additional connectivity.
“The FCC is tasked with ensuring consumers everywhere have access to high-speed broadband that is reliable and affordable,” said FCC Chairwoman Jessica Rosenworcel. “The agency also has a responsibility to be a good steward of limited public funds meant to expand access to rural broadband, not fund applicants that fail to meet basic program requirements. The FCC followed a careful legal, technical, and policy review to determine that this applicant had failed to meet its burden to be entitled to nearly $900 million in universal service funds for almost a decade.”
Starlink blasted the decision and said it would hurt U.S. consumers.
“This decision directly undermines the very goal of RDOF: to connect unserved and underserved Americans,” the company said in a statement sent to Cord Cutters News. “Starlink is demonstrably one of the best options—likely the best option—to accomplish the goals of RDOF. Indeed, Starlink is arguably the only viable option to immediately connect many of the Americans who live and work in the rural and remote areas of the country where high-speed, low-latency internet has been unreliable, unaffordable, or completely unavailable, the very people RDOF was supposed to connect.”
Applicants who pass the high-level, short-form application must also pass a more in-depth look into how the company plans to utilize the funds to verify they meet program requirements. Starlink’s application didn’t demonstrate the company can provide internet services as promised and denied funding, saying it would not be the best use of limited Universal Service Fund resources.