The USF/ICC Transformation Order set the course for the comprehensive modernization of universal service for the 21st century.  In so doing, the Commission set an ambitious goal of universal broadband and advanced mobile coverage.  As part of the Connect America Fund, the Commission created the Mobility Fund, a universal service support mechanism dedicated exclusively to mobile services.  Phase I of the Mobility Fund provided one-time support to accelerate our nation's ongoing efforts to close gaps in mobile wireless service.

In order for the Mobility Fund to improve coverage in these areas for current-generation or better mobile voice and broadband services, the FCC needs detailed coverage data both to identify areas that lack mobile voice and broadband service and to avoid spending limited resources on support in areas where an unsubsidized provider is already offering service. 

Today, we are excited to announce improved analysis of coverage data, giving the FCC the ability to take the next steps toward closing the coverage gap in rural America through Mobility Fund Phase II.  This is due, in large part, to our access to more reliable data from provider-filed Forms 477.  Twice a year, mobile broadband and voice providers must submit shapefiles showing their network coverage areas and certify the accuracy of their submissions.  These shapefiles depict the areas where providers have reported that consumers should expect the minimum speeds associated with 4G LTE or other network technologies.  There is no better mobile coverage data available today.

This new and improved data is a major step forward over the data analyzed in the Mobility Fund Phase I auction, called the “centroid method.”  Let’s get technical. The “centroid method” uses the geometric center (expressed in latitude/longitude) of a census block.  If that point has service coverage, the entire census block is considered to be covered.  Thus, the centroid method has drawbacks.  As parties have pointed out, the centroid method may over-estimate coverage, particularly in rural areas with very large census blocks – or under-estimate it in census blocks with partial coverage that does not include the centroid location.  Because the U.S. has approximately 11 million census blocks, there is the potential that by using the centroid method, we may have missed a number of areas in the country that lacked 3G or better service in Mobility Fund Phase I.

Now, with the best available data we have today, FCC staff has finely honed our analytics to go beyond the centroid method and identify where unsubsidized mobile broadband service is available within each census block.  In other words, we can now utilize Form 477 data to produce “actual area coverage.”  Using the actual geographic area coverage based on the Form 477 data provides a significantly more detailed basis than the prior centroid method for reforming universal service support for mobile services to provide more targeted support where it is needed.

A quick look at some of the data reveals why this matters.  Our analysis shows that just under one and a half million people, approximately 470,000 square miles, and 550,000 miles of road in the U.S. do not have 4G LTE coverage.  In addition, we can overlay the actual area coverage data with publicly available data on universal service subsidies to determine at a sub-census block level where 4G LTE service is available only from a provider receiving support – an indication that continuing support for service in those areas is needed. 

Our analysis of this data demonstrates that altogether there are approximately 3 million people, 575,000 square miles of area, and 750,000 road miles in the U.S. that either have no 4G LTE coverage or only have 4G LTE available from a provider that is receiving universal service support.  These are the areas where our analysis shows there is a clear need for an ongoing subsidy to either expand 4G LTE coverage or continue coverage on a subsidized basis.

We believe that this significant need for ongoing support shows that the current aggregate funding levels for mobile broadband service are justified.

However, we can also see from the data that the bulk of current support under today’s legacy system is going to wireless providers in areas where unsubsidized 4G LTE service already exists – a result inconsistent with the principles underlying the Commission’s universal service reforms and a strong basis for taking a new approach in the Mobility Fund Phase II.  We estimate that approximately 75% of this legacy support is going to areas where at least one unsubsidized provider has 4G LTE coverage. 

Finally, we are well aware that widespread access to these data is critical to getting this right.  As a result, we’re releasing the Form 477 data that shows mobile coverage as of December 31, 2015 together with a description of our methodology to allow for robust public examination of the coverage data.  We are also releasing a report, Working Toward Mobility Fund II, that provides detailed analysis of the Form 477 data.  We are ready and willing to work with all interested parties on any anomalies or errors in the coverage data submitted by providers.  And we will establish a targeted challenge process to allow providers and other stakeholders to contest determinations of coverage.  We will provide details of this process in the coming months.  Stay tuned.