Nextlink, the fixed wireless Internet provider from AMG Technology Investment Group, said it does not plan to build Internet connections across 265 locations in New Mexico. The company won funding from the FCC's Rural Digital Opportunity Fund (RDOF) auction last year to cover those locations over the next six years.
"Nextlink Internet has determined that the small amount of assigned support for the small number of locations in these census blocks [in New Mexico] will be insufficient in relation to the costs of buildout and compliance," the company told the FCC. "It is therefore not economically prudent for Nextlink Internet to move forward" in the state.
But in response to questions from Light Reading, Nextlink CEO Bill Baker said the company's withdrawal from New Mexico affects just a tiny fraction of its overall RDOF plans.
"In the recent RDOF reverse auction proceeding, Nextlink Internet won RDOF support representing 206,136 covered locations across 12 states," Baker said in a statement. "Nextlink has filed with both the FCC and the New Mexico Public Utility Commission that it does not intend to follow through with receiving the funding for 265 locations in New Mexico, which represent a single census block group and just 0.1% of the total RDOF covered locations awarded to Nextlink. We eagerly await the opportunity to initiate long awaited broadband service to the other 99.9% of the RDOF covered locations which we have been awarded."
Nonetheless, the issue is important. In its own filing with the FCC, the Ensuring RDOF Integrity Coalition (ERIC) argued that Nextlink's decision underscores the difficulty some companies may face in meeting their RDOF network buildout requirements. "Each of these 265 locations represents households, families, businesses, workers and visitors who no longer can expect to have high-speed broadband service that had been promised by Nextlink through its bids in the RDOF," the coalition wrote.
As a result, the coalition urged the FCC to create a public RDOF review process "to ensure that the largest [RDOF] Auction 904 provisional winners have the technical, financial, managerial, and operational skills, and necessary resources to provide their promised RDOF-supported services."
In its filing, ERIC described itself as a coalition "consisting of rural broadband providers, rural Americans, and local government officials who have joined together to work to ensure that the Federal Communications Commission's Rural Digital Opportunity Fund proceeding will result in timely broadband service to rural America." However, according to Telecompetitor, the group has not provided specifics about its membership.
Nextlink's announcement about New Mexico comes at a critical time in the RDOF process. The FCC is currently reviewing RDOF winners' network construction plans, and will have to decide whether the companies will be able to actually do the work they have said they can do with the money they won in the auction. The agency could pull RDOF winners' funding if it finds their plans insufficient.
ERIC is among a large and growing number of critics that argue some of the biggest winners in the RDOF auction – including Nextlink, LTD Broadband and others – simply do not have the financial and logistical wherewithal to meet their RDOF network buildout obligations.
But Nextlink and others disagree. Indeed, Nextlink itself has been announcing a series of agreements the company said positions it to dramatically expand its network operations. For example, the company recently announced an extensive deal with American Tower, millions of dollars in potential funding, and several corporate acquisitions.
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This article first appeared on Broadband World News.