Why Rural Americans Keep Waiting for Fast Internet, Despite Billions Spent

Most U.S. households today have access to internet download speeds of at least 100 megabits per second and upload speeds of 10 Mbps, according to government data. Although the FCC’s programs have made progress, some rural Americans still can’t get 4 Mbps download and 1 Mbps upload speeds—the level of service that was the federal standard in 2011.

The broadband saga around Heavener, Okla., illustrates some of the problems. Heavener, with a population of around 3,000, is surrounded by cattle pastures and forested hills. Today some buildings on the main streets have good broadband service, but the internet deteriorates outside town, residents say.

Much of the area, in Le Flore County, was slated for upgrades under the Rural Digital Opportunity Fund in 2020—and some of those areas had already been part of prior programs.

In 2012, the FCC launched a program called the Connect America Fund, which, in the words of the commission’s then-chairman, “puts us on the path to get broadband to every American by the end of the decade.”

The new fund repurposed “universal service” fees on Americans’ phone bills to also subsidize broadband. The local phone company, Little Rock, Ark.-based Windstream Holdings Inc., received $716,782 to make broadband upgrades in and near Le Flore County between 2012 and 2014.

Homes on Timber Ridge Road already had DSL running over their existing phone line. DSL’s speed diminishes with distance, and Windstream said that moving the fiber line closer to residents improved speeds available in the area. The company was complying with the FCC’s rules at the time, which required it to offer service with 4/1 Mbps download/upload speeds.

John Powell, 28, who grew up on Timber Ridge Road and lived there with his parents until earlier this year, said he remembers hardly any improvement to the family’s home internet during this time. He said the DSL service wouldn’t allow him to stream movies or get on a Zoom call. “It’s brutally, brutally bad,” he said.

Windstream later added wireless broadband service near Heavener, delivered via radio tower. The company said the service provides speeds of 25 Mbps—often faster than DSL, but still far slower than fiber.

The tower’s signal reaches some of the homes on Timber Ridge Road, but not the Powell home.

Funds for this new wireless service came from Windstream and not from public funds, the company said. At the same time, it was also taking public subsidies. Between 2015 and 2021, Windstream received an additional $7.8 million annually under the Connect America Fund’s second phase to bring 10/1 Mbps service to Oklahoma locations, including around Heavener.

FCC rules for those funds didn’t oblige Windstream to serve every customer equally, as long as it served a minimum number of locations statewide.

The company said the money covered roughly half of its operating and capital expenses in very high cost areas of the state where it might not be profitable to offer service without subsidies. It said it exceeded the terms of the FCC program by providing 10/1 Mbps service to more than the minimum required locations.

Current and former FCC officials said the agency’s broadband programs aim to provide ongoing support for rural service. The Journal’s findings that many areas were targeted multiple times, they said, might have occurred because one program ended and was replaced by a new one.

Officials said the Journal’s findings also reflect difficult trade-offs that the agency didn’t always get right.

“It’s clear we need to fix what came before and make changes,” said FCC Chairwoman

Jessica Rosenworcel.

In an effort to upgrade as many people as possible with limited funds, the FCC chose to subsidize incremental improvements. Many of those upgrades quickly became outdated as technology advanced and consumers wanted faster speeds.

In other cases, internet providers were allowed to pick which customers to upgrade. This helped ensure companies would participate. It also meant they could take public money while leaving pockets of homes and businesses without access.

“In retrospect it’s not surprising that companies made a business decision to do the bare minimum,” said Carol Mattey, an industry consultant and former senior FCC official.

Eddie Nelson, a former assistant principal at Heavener High School who now runs a local pizza parlor, saw how lackluster internet service affected residents when the pandemic closed schools in 2020. Many students couldn’t get online from home. Mr. Nelson said the school didn’t have enough Wi-Fi hot spot devices, and the ones it had worked erratically due to spotty cell service. The school beamed Wi-Fi into the parking lot for students to work in cars.

The FCC was rolling out its Rural Digital Opportunity Fund around the same time. Officials sought to apply lessons from previous experience to the program. It favored companies willing to build high-speed fiber networks. Service would have to be universal. To keep costs down and encourage competition, the FCC auctioned subsidies to the lowest bidder. In many parts of the country, the auction worked as intended and providers are breaking ground.

The funding around Heavener had an unexpected wrinkle.

Windstream participated in the auction. In its bid, the company offered to run fiber-optic cable to homes in the area. It mostly lost out to another company, LTD Broadband LLC, which offered the same deal at a lower price.

After the auction, Las-Vegas based LTD failed to file paperwork for certification in Oklahoma in time to meet an FCC deadline. The FCC found the company in default. That means that in areas where LTD won, neither LTD nor any other company will soon be getting the funds that were auctioned to upgrade service.

LTD’s chief executive, Corey Hauer, said his company delayed filing the paperwork because it didn’t want to give potential competitors time to lobby against its certification. He said the company still plans to offer fiber-to-the-home service in Oklahoma.

Last year, Congress enacted a $42.5 billion rural broadband program as part of a bipartisan infrastructure law. Companies taking those funds will have to provide service at faster speeds than previous federal programs, and the money will come through states instead of the FCC. Officials said they hope that will help identify which areas are most in need and which providers can best serve them.

Mr. Powell, who recently moved to Arkansas for a new job, said his parents began subscribing to a new home internet service from

T-Mobile US Inc.,

which the company says uses extra network capacity from a cell tower about 3 miles away. A recent speed test registered a download speed of about 21 Mbps, he said. T-Mobile said download speeds for the service average 140 Mbps.

The Powells’ speed is a big improvement, but still slower than what most Americans can get.

“It’s like getting left behind,” Mr. Powell said.

Methodology: To analyze FCC broadband funding efforts, The Wall Street Journal compiled public data on federal programs that sought to improve internet access and speeds in largely rural areas. The Journal focused on programs where FCC data included geographic details at the census block level. These included the Rural Digital Opportunity Fund (RDOF), Connect America Fund Phase II Auction, Alternative Connect America Cost Model II, Connect America Phase II Model-Based Support, Connect America Phase I, and Rural Broadband Experiments. Additional programs where census block-level data weren’t available, such as the Alaska Plan, weren’t included.

For the analysis of RDOF, the Journal excluded about 20,000 census blocks that were partially eligible. It then counted census blocks that appeared in both RDOF and the various Connect America Fund programs. In rare cases, census blocks may have appeared in multiple programs due to changes in the boundaries served by a telecom provider, or because of imperfections in the FCC’s program data, according to the FCC.

—Graphics by Jemal R. Brinson, Emma Brown, Kara Dapena and Jason French

Write to Ryan Tracy at ryan.tracy@wsj.com and Anthony DeBarros at Anthony.Debarros@wsj.com

Most U.S. households today have access to internet download speeds of at least 100 megabits per second and upload speeds of 10 Mbps, according to government data. Although the FCC’s programs have made progress, some rural Americans still can’t get 4 Mbps download and 1 Mbps upload speeds—the level of service that was the federal standard in 2011.

The broadband saga around Heavener, Okla., illustrates some of the problems. Heavener, with a population of around 3,000, is surrounded by cattle pastures and forested hills. Today some buildings on the main streets have good broadband service, but the internet deteriorates outside town, residents say.

Much of the area, in Le Flore County, was slated for upgrades under the Rural Digital Opportunity Fund in 2020—and some of those areas had already been part of prior programs.

In 2012, the FCC launched a program called the Connect America Fund, which, in the words of the commission’s then-chairman, “puts us on the path to get broadband to every American by the end of the decade.”

The new fund repurposed “universal service” fees on Americans’ phone bills to also subsidize broadband. The local phone company, Little Rock, Ark.-based Windstream Holdings Inc., received $716,782 to make broadband upgrades in and near Le Flore County between 2012 and 2014.

Homes on Timber Ridge Road already had DSL running over their existing phone line. DSL’s speed diminishes with distance, and Windstream said that moving the fiber line closer to residents improved speeds available in the area. The company was complying with the FCC’s rules at the time, which required it to offer service with 4/1 Mbps download/upload speeds.

John Powell, 28, who grew up on Timber Ridge Road and lived there with his parents until earlier this year, said he remembers hardly any improvement to the family’s home internet during this time. He said the DSL service wouldn’t allow him to stream movies or get on a Zoom call. “It’s brutally, brutally bad,” he said.

Windstream later added wireless broadband service near Heavener, delivered via radio tower. The company said the service provides speeds of 25 Mbps—often faster than DSL, but still far slower than fiber.

The tower’s signal reaches some of the homes on Timber Ridge Road, but not the Powell home.

Funds for this new wireless service came from Windstream and not from public funds, the company said. At the same time, it was also taking public subsidies. Between 2015 and 2021, Windstream received an additional $7.8 million annually under the Connect America Fund’s second phase to bring 10/1 Mbps service to Oklahoma locations, including around Heavener.

FCC rules for those funds didn’t oblige Windstream to serve every customer equally, as long as it served a minimum number of locations statewide.

The company said the money covered roughly half of its operating and capital expenses in very high cost areas of the state where it might not be profitable to offer service without subsidies. It said it exceeded the terms of the FCC program by providing 10/1 Mbps service to more than the minimum required locations.

Current and former FCC officials said the agency’s broadband programs aim to provide ongoing support for rural service. The Journal’s findings that many areas were targeted multiple times, they said, might have occurred because one program ended and was replaced by a new one.

Officials said the Journal’s findings also reflect difficult trade-offs that the agency didn’t always get right.

“It’s clear we need to fix what came before and make changes,” said FCC Chairwoman

Jessica Rosenworcel.

In an effort to upgrade as many people as possible with limited funds, the FCC chose to subsidize incremental improvements. Many of those upgrades quickly became outdated as technology advanced and consumers wanted faster speeds.

In other cases, internet providers were allowed to pick which customers to upgrade. This helped ensure companies would participate. It also meant they could take public money while leaving pockets of homes and businesses without access.

“In retrospect it’s not surprising that companies made a business decision to do the bare minimum,” said Carol Mattey, an industry consultant and former senior FCC official.

Eddie Nelson, a former assistant principal at Heavener High School who now runs a local pizza parlor, saw how lackluster internet service affected residents when the pandemic closed schools in 2020. Many students couldn’t get online from home. Mr. Nelson said the school didn’t have enough Wi-Fi hot spot devices, and the ones it had worked erratically due to spotty cell service. The school beamed Wi-Fi into the parking lot for students to work in cars.

The FCC was rolling out its Rural Digital Opportunity Fund around the same time. Officials sought to apply lessons from previous experience to the program. It favored companies willing to build high-speed fiber networks. Service would have to be universal. To keep costs down and encourage competition, the FCC auctioned subsidies to the lowest bidder. In many parts of the country, the auction worked as intended and providers are breaking ground.

The funding around Heavener had an unexpected wrinkle.

Windstream participated in the auction. In its bid, the company offered to run fiber-optic cable to homes in the area. It mostly lost out to another company, LTD Broadband LLC, which offered the same deal at a lower price.

After the auction, Las-Vegas based LTD failed to file paperwork for certification in Oklahoma in time to meet an FCC deadline. The FCC found the company in default. That means that in areas where LTD won, neither LTD nor any other company will soon be getting the funds that were auctioned to upgrade service.

LTD’s chief executive, Corey Hauer, said his company delayed filing the paperwork because it didn’t want to give potential competitors time to lobby against its certification. He said the company still plans to offer fiber-to-the-home service in Oklahoma.

Last year, Congress enacted a $42.5 billion rural broadband program as part of a bipartisan infrastructure law. Companies taking those funds will have to provide service at faster speeds than previous federal programs, and the money will come through states instead of the FCC. Officials said they hope that will help identify which areas are most in need and which providers can best serve them.

Mr. Powell, who recently moved to Arkansas for a new job, said his parents began subscribing to a new home internet service from

T-Mobile US Inc.,

which the company says uses extra network capacity from a cell tower about 3 miles away. A recent speed test registered a download speed of about 21 Mbps, he said. T-Mobile said download speeds for the service average 140 Mbps.

The Powells’ speed is a big improvement, but still slower than what most Americans can get.

“It’s like getting left behind,” Mr. Powell said.

Methodology: To analyze FCC broadband funding efforts, The Wall Street Journal compiled public data on federal programs that sought to improve internet access and speeds in largely rural areas. The Journal focused on programs where FCC data included geographic details at the census block level. These included the Rural Digital Opportunity Fund (RDOF), Connect America Fund Phase II Auction, Alternative Connect America Cost Model II, Connect America Phase II Model-Based Support, Connect America Phase I, and Rural Broadband Experiments. Additional programs where census block-level data weren’t available, such as the Alaska Plan, weren’t included.

For the analysis of RDOF, the Journal excluded about 20,000 census blocks that were partially eligible. It then counted census blocks that appeared in both RDOF and the various Connect America Fund programs. In rare cases, census blocks may have appeared in multiple programs due to changes in the boundaries served by a telecom provider, or because of imperfections in the FCC’s program data, according to the FCC.

—Graphics by Jemal R. Brinson, Emma Brown, Kara Dapena and Jason French

Write to Ryan Tracy at ryan.tracy@wsj.com and Anthony DeBarros at Anthony.Debarros@wsj.com