DETROIT — AT&T Inc. will receive nearly $30 million from the federal government to provide reasonably priced high-speed internet access to areas in Michigan where the company and the government say it’s costly and uneconomic to provide it.
The $29.7 million in funding will provide access to more than 86,000 rural homes and businesses across the state. The Michigan funding is among $428 million the company got from the FCC nationwide to provide service to more than 1.1 million rural homes and businesses.
The service provided will be at least 10 megabits per second download and 1 megabit per second upload. The FCC’s latest broadband progress report showed that nearly one in three rural Americans lack access to this broadband speed, compared to only one in 100 Americans living in urban or suburban areas. The FCC’s Connect America Fund is designed to close the rural-urban digital divide.
The FCC for decades has been providing funding for rural telephone service through a universal access fee program. In 2011, the FCC expanded the program to include broadband access, ruling that broadband access has become as essential to life in the 21st Century as telephone service was in the 20th.
“Today we told the Federal Communications Commission that we will participate in the second phase of the FCC’s Connect America Fund program in Michigan,” AT&T Michigan president Jim Murray said. “AT&T is committed to rural and small town America, and using all available technologies, including AT&T’s innovative fixed wireless program that delivers broadband through the air using base stations and fixed antennae on customers’ homes or buildings.”
“AT&T’s acceptance of close to one-half billion dollars annually from the Connect America Fund represents a huge investment in broadband for its rural customers,” FCC Chairman Tom Wheeler said. “This is one of the largest amounts accepted by any company. The financial support provided by American ratepayers will bring significant benefits to AT&T’s rural communities, and we urge state and local leaders to help communities realize these benefits by facilitating the broadband buildout.”
Over the next six years, Phase II of Connect America will provide more than $9 billion to expand broadband-capable networks throughout rural America nationwide, all without increasing the cost of the program to ratepayers. Overall, the FCC’s Universal Service Fund allocates $4.5 billion annually through various universal service programs for high-cost areas to support voice- and broadband-capable networks in rural America.
Carriers receiving Connect America Fund support must build out broadband to 40 percent of funded locations by the end 2017, 60 percent by the end of 2018, 80 percent by the end of 2019, and 100 percent by the end of 2020.