Elon Musk's SpaceX has urged the Federal Communications Commission (FCC) to consider eliminating the $4.5 billion fund that subsidizes voice and broadband services in rural areas. In a letter to the FCC, the satellite internet company argues that it has effectively bridged the connectivity gap by offering high-speed internet at competitive rates.
SpaceX's Argument
SpaceX contends that the Commission's universal service programs must adapt to a new reality where the longstanding problem of high-speed broadband network access has been largely resolved, rendering most legacy High-Cost support mechanisms unnecessary. The company noted that over the years, the FCC and the U.S. government have spent billions on these programs.
The High-Cost Program was designed to ensure that all Americans have access to communications services comparable in capabilities and rates to those in urban areas. However, SpaceX points out that the FCC established numerous support programs—such as CAF BLS, HCLS, A-CAM I, A-CAM II, E-ACAM, and RDOF—distributing billions of dollars annually over decades without fully achieving universal access.
Technological and Competitive Landscape
The letter highlights an evolving technological and competitive landscape that is successfully delivering universal access to Americans, making High-Cost programs unnecessary. It notes that unsubsidized terrestrial competitors already provide broadband service to 58% of locations in areas receiving High-Cost support. Additionally, low-Earth orbit satellite systems like Starlink offer ubiquitous low-latency coverage at high speeds across the country, serving effectively all locations that remain unserved by terrestrial broadband despite decades of subsidies.
SpaceX also references the $42.5 billion Broadband Equity Access and Deployment Program (BEAD), which supports deployment to fill remaining gaps and is intended to be the last major broadband funding initiative.
Starlink's Performance and Future Plans
SpaceX's Starlink service has steadily increased user speeds and reduced latency while supporting exponential subscriber growth. In 2025 alone, SpaceX launched over 3,000 satellites and added more than 270 Tbps in capacity to its constellation, with launches continuing at a similar pace in 2026. The company expects to begin launching its third-generation satellites later this year, providing a tenfold increase in downlink capacity and a 24-fold increase in uplink capacity compared to current second-generation satellites.
Furthermore, a recent FCC order modernizing satellite spectrum sharing will dramatically increase Starlink's capacity by enabling overlapping beams from multiple satellites in the same location. These developments are expected to further improve subscriber speeds and increase the volume and density of customers the system can support. Meanwhile, competing next-generation satellite operators, such as Amazon's Project Kuiper, are expected to launch commercial services in 2026.
Call for Program Sunset
SpaceX argues that satellite broadband already delivers comparable performance to terrestrial broadband at competitive rates, aligning with the High-Cost Program's objectives. The company urges the FCC to establish a plan to wind down these programs, allowing universal service funds to be returned to consumers through reduced contributions or redirected to other programs that deliver meaningful public benefits. The letter includes several proposed revisions to the draft notice to support this objective.
