- The US government revises broadband funding criteria, allowing satellite providers to compete more directly for rural internet grants.
- SpaceX’s Starlink may now qualify for previously restricted infrastructure subsidies under the updated guidelines.
What happened: Commerce revises Starlink’s funding prospects
The US Commerce Department has updated the rules governing its \$42.5 billion Internet for All initiative, allowing satellite broadband providers like SpaceX’s Starlink to access federal funding under certain conditions. As reported by The Wall Street Journal, the new guidance from the National Telecommunications and Information Administration (NTIA) softens prior restrictions that largely excluded low Earth orbit (LEO) satellite providers from bidding for infrastructure funds.
States distributing federal broadband grants will now be permitted to fund satellite technologies if traditional fibre or cable solutions are not “reasonably feasible.” This change could benefit Starlink, which had previously been disqualified from the FCC’s Rural Digital Opportunity Fund over concerns about performance and reliability. The NTIA’s update signals a more flexible interpretation of what qualifies as “reliable broadband,” particularly in hard-to-reach areas where ground infrastructure is prohibitively expensive.
Also read: Starlink partners with Space Norway for LEO services
Also read: Starlink receives warning from Australian watchdog
Why it‘s important: rural connectivity and competitive access
The Commerce Department’s revised guidance may reshape the competitive landscape for rural broadband access in the US. By easing restrictions on satellite internet funding, the federal government acknowledges that fibre-to-the-home, while ideal, may not be universally practical—especially in remote or mountainous regions. For companies like Starlink, this marks a significant policy shift that could unlock state-level contracts previously unavailable to them.
While critics remain sceptical of satellite broadband’s ability to deliver consistent speeds and low latency, advocates argue that excluding satellite options outright limits choice and innovation. According to the NTIA, the update is intended to “offer flexibility without compromising on service standards.” The decision also reflects growing political pressure to close the digital divide quickly, even if it means accepting interim technologies.
This move mirrors global discussions on broadband equity, where countries such as Canada and Australia have also embraced hybrid connectivity models involving satellites. It sets a precedent for multi-technology approaches to public internet access—especially as emerging providers seek infrastructure funding.
