SpaceX pockets $900mln to bring net to rural US

Photo: EPA

US government is set to launch a massive spending plan to bring internet to rural areas. The envisaged amount is just shy of a billion dollars, CNN reported. Washington plans to give SpaceX a total of $856 million, one of the largest subsidies handed out by the Federal Communications Commission under a new program designed to encourage companies to extend broadband access into the US most underserved areas over the next 10 years.

SpaceX won the competition for the state subsidy in a race with major traditional fiber optic providers like Charter Communications and CenturyLink. SpaceX's Starlink internet service, which is currently in beta testing and is not yet fully operational, relies on an experimental swarm of nearly 1,000 satellites whizzing around Earth.

The FCC did award the bulk of the $9bn worth of subsidies to more traditional providers. Charter, for example, received more than $1.2 billion to bring high-speed internet into more than 1 million neighborhoods. And the Rural Electric Cooperative Consortium, a joint bid from smaller regional companies, was awarded $1.1 billion to more than 618,000 neighborhoods.

The Federal Communications Commission estimates that 21 million Americans — about 1 in 15 people — still lack access to high-speed internet. The actual number could be far higher, perhaps even double the FCC's estimate, according to a BroadbandNow study. And a 2018 Pew Research study found that high-speed internet access is a problem for nearly 60% of rural Americans.

SpaceX is promising that its network will be just as fast as the best fiber-optic based services. Its satellites are flying much closer to the ground than most other telecommunications satellites, which the company says will eliminate the frustrating lag times.

For now, it's not clear exactly how well the network will function. Beta testers have reported top-of-the-line speeds, but they're also reportedly experiencing intermittent outages because SpaceX hasn't launched enough satellites to guarantee continuous coverage. It's also to be seen how affordable SpaceX's service will be.

Similar articles