The US Federal Communications Commission (FCC) changed plans to award SpaceX millions of dollars in subsidies to deliver rural broadband coverage. The doubts over the company’s ability to meet minimum quality requirements re-emerged.

SpaceX was awarded $885.5 million of the $9.2 billion Rural Digital Opportunity Fund (RDOF) pot in late 2020 despite FCC reticence to include the company in an auction process due to concerns over its ability to deliver low-latency broadband services from its Starlink satellites. The program aims to close a digital divide in the US by funding deployments of high-speed broadband in unserved areas. SpaceX’s award involved 642,925 locations in 35 states.

FCC chair Jessica Rosenworcel questioned SpaceX’s consumer business model. The FCC also ruled LTD Broadband was now ineligible to participate in the program. The operator was set to be the biggest beneficiary of the funding program. Rosenworcel added the regulator could not afford to subsidize ventures which were not delivering the promised speeds or are not likely to meet program requirements. Ookla data showed Starlink’s average US downlink data rate stood at 90.55Mb/s in Q2, with upload at 9.33Mb/s.