At its August 2017 Open Meeting, the Federal Communications Commission (“FCC”) unanimously adopted an Order on Reconsideration and Second Report and Order (“Order”) outlining a process to challenge the FCC’s determinations of which areas will receive financial support in the upcoming second phase of the Mobility Fund. The Mobility Fund provides financial support to wireless service providers to maintain and extend mobile broadband and voice services in rural and other underserved areas. As we previously reported, the FCC plans to give out over $4.5 billion in Mobility Fund Phase II financial support over the next ten years to expand 4G LTE coverage across the country. The Order generally mirrors the discussion draft released last month, except that parties now have more time to submit challenges. While the FCC plans to provide additional details about the challenge process over the next year, carriers interested in participating in the Mobility Fund Phase II should review the Order carefully and consider their challenge strategies.

How the Challenge Process Works

The Mobility Fund Phase II challenge process will take place over four stages:

First, wireless carriers will participate in a one-time collection of detailed information regarding their current 4G LTE coverage. Specifically, carriers will submit propagation maps certified by a qualified engineer showing where they provide outdoor 4G LTE coverage with download speeds of 5 Mbps at least 80 percent of the time. Any census block not fully covered by unsubsidized 4G LTE service meeting these speed and probability benchmarks will be eligible for Mobility Fund Phase II support. The FCC found the benchmarks best reflected the current minimum 4G LTE service standard among major nationwide carriers. The FCC therefore dismissed calls to increase the download speed and probability benchmarks, as well as requests to include an upload speed benchmark, in order to direct support to areas lacking even basic 4G LTE service. The FCC similarly dismissed requests to condition Mobility Fund Phase II support on making 4G LTE networks backwards compatible with GSM and CDMA, stating such “legacy” technologies are being phased out by the marketplace. To reduce the burden on smaller carriers, the FCC will only require wireless providers offering 4G LTE service meeting the benchmarks to participate in the data collection. The FCC will use the data collected to generate a coverage map showing the areas presumptively eligible and ineligible for Mobility Fund Phase II support.

Second, parties will have 150 days to challenge the determination that an area is ineligible for Mobility Fund Phase II support. This period is longer than the 60-day challenge window the FCC initially proposed. Challengers must submit actual outdoor speed test data certified by a qualified engineer indicating that 4G LTE service with a minimum download speed of 5 Mbps is unavailable in an area deemed ineligible for funding. Challengers will submit their data through a portal that will be established on USAC’s website. The portal will conduct an “automatic validation” of the data and inform challengers if their submissions fail to meet the FCC’s standards. Importantly, the FCC imposed significant limitations on the challenge process. For example, only service providers and government entities can file a challenge. The FCC stated that consumers likely lack the equipment or engineering expertise necessary to submit a challenge and recommended that consumers work with their local and state representatives to raise any concerns regarding 4G LTE coverage. In addition, parties may only challenge the determination that an area is ineligible for Mobility Fund Phase II support. The FCC found that prohibiting parties from challenging whether an area is eligible for Mobility Fund Phase II support will streamline the overall challenge process and encourage carriers to submit accurate coverage information during the initial data collection.

Third, if a challenge passes USAC validation, the carrier whose coverage data was challenged will have a 30-day window to respond with additional information demonstrating that the challenger’s speed test data are invalid or do not accurately reflect network performance. The FCC did not impose any technical requirements on a carrier’s response and the response will not be subject to USAC validation.

Fourth, the FCC will review the evidence provided by the challenger and the response from the carrier (if any) and determine whether an area initially deemed ineligible for Mobility Fund Phase II support should become eligible for funding. The FCC will resolve challenges on a “preponderance of the evidence” standard, meaning the challenger must show that it is more likely than not that the challenged area does not have sufficient 4G LTE coverage and performance, and therefore requires Mobility Fund Phase II support.

Next Steps

While the Order sets forth the general process for challenging Mobility Fund Phase II eligibility determinations, much work remains. The FCC still needs to issue a public notice providing the instructions, deadlines, and requirements for filing a challenge, including the technical specifications for the required speed tests. In addition, the USAC challenge portal still needs to be developed along with the capability to automatically validate submissions. The FCC also must collect the 4G LTE coverage data from wireless carriers and produce its eligibility map before it can begin accepting challenges. As a result, the Order reflects just the first step in determining where the FCC will direct its Mobility Fund Phase II support, a process likely to extend into next year.

August 2017 FCC Meeting Recap: FCC Adopts Challenge Process for Billions in Mobility Fund Phase II Support