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CenturyLink gets $35 million FCC grant to connect 45,000 rural homes to the internet (updated)

Daniel Cooper
Senior Editor
Updated ·5 min read

CenturyLink has announced that it's getting $35 million from the FCC's Connect America Fund to hook 45,000 homes in rural areas up to the internet. The company isn't hiding its disappointment at the donation, since it was originally angling for closer to $90 million. However, the conditions attached to the extra cash made further deployment "uneconomic," so the company will have to settle at this first target to begin with. There is some hope for countryside folk: CenturyLink mavens have filed a waiver application which, if granted, would let the company connect a further 60,000 homes where service is currently too expensive to install.

Update: The FCC has made its own announcement, pledging that it'll connect up to 400,000 unconnected citizens in the next three years and up to seven million in six. The full text is after the jump.

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WASHINGTON, July 24, 2012 /PRNewswire/ -- CenturyLink, Inc. (NYSE: CTL) announced today that it will accept $35 million from the Federal Communications Commission's Connect America Fund (CAF) to deploy broadband service to 45,000 homes in unserved rural areas.

CenturyLink was eligible for nearly $90 million in CAF Phase I funding. However, restrictions on the use of the CAF 1 funds made further deployment uneconomic.

"CenturyLink is excited to be able to work with the FCC to bring broadband services to thousands of homes for the first time. In addition to the incremental CAF funding, we are investing millions of dollars of our own money to bring robust broadband services to more customers because we believe these services will bring essential educational and economic opportunities to high-cost, rural areas of the country," said Steve Davis, CenturyLink executive vice president for public policy and government relations.

"We are disappointed that restrictions on the use of these funds will not allow us to deploy rural broadband services to the extent we had originally anticipated," Davis said. "However, we share the FCC's overall goal of deploying needed facilities in high-cost areas where reliable and affordable broadband service is not available. Therefore, we will continue working with the FCC to find ways to efficiently and effectively use additional CAF 1 funds to provide broadband services to our rural customers."

CenturyLink has filed a waiver application which, if granted, would allow it to deploy broadband services to approximately 60,000 more homes in high-cost areas where reliable and affordable service is currently not available. This waiver has been supported by the Washington Public Service Commission, the Minnesota Department of Commerce and other state agencies.

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FCC KICKS-OFF 'CONNECT AMERICA FUND' WITH MAJOR ANNOUNCEMENT: NEARLY 400,000 UNSERVED AMERICANS FROM RURAL COMMUNITIES IN 37 STATES WILL GAIN ACCESS TO HIGH-SPEED INTERNET WITHIN THREE YEARS

Marks beginning of most significant public-private effort in history to connect 19 million unserved rural homes and businesses by 2020

Washington, D.C. – The Federal Communications Commission today announced that nearly 400,000 residents and small businesses owners in 37 states will gain access to high-speed Internet within three years, as a result of the first phase of the 'Connect America Fund.' About $115 million of public funding will be coupled with tens of millions more in private investment to quickly expand broadband infrastructure to rural communities in every region of the nation. Many projects will begin immediately, and all projects must be completed within three years.

Nationally, nearly 19 million rural residents currently lack access to broadband. Without broadband, consumers and small business are cut off from the $8 trillion global Internet economy, severely limiting opportunities for jobs and economic prosperity. This announcement marks the beginning of the most significant public-private effort in history to ensure that every American has access to broadband by the end of the decade.

FCC Chairman Julius Genachowski said, "I'm pleased to announce today that nearly 400,000 residents and businesses in rural communities who currently lack access to high-speed Internet will gain access within the next three years. Today's action is just the beginning of our efforts to unleash the benefits of broadband for millions of homes and small businesses in unserved rural communities across the U.S. In today's economy, broadband is a vital platform for innovation and opportunity, including jobs, education, and healthcare."

ABOUT THE 'CONNECT AMERICA FUND'

The 'Connect America Fund' aims to connect 7 million unserved rural Americans to broadband in six years, and puts the nation on a path to connect all 19 million unserved rural residents by 2020. The FCC launched this unprecedented broadband expansion last year when it reformed and modernized the Universal Service Fund, which connected rural America to the telephone network in the 20th century. The Commission created the 'Connect America Fund' to unleash the benefits of broadband for all Americans in the 21st century.

Key reforms allowed Connect America to expand support to both broadband and voice without increasing universal service fees on consumers and businesses. Reforms improve fiscal responsibility and accountability, and target funding more accurately and effectively. Without these reforms, millions of Americans had no path forward to gaining access to the job, education, healthcare, and public safety benefits of high-speed Internet. The FCC's reforms provide a clear path to rural America's broadband future, benefitting Americans no matter where they live.

For more information about the Connect America initiatives to provide broadband access to rural communities across the U.S., visit http://www.fcc.gov/encyclopedia/connecting-america.