$4.6 billion in Universal Service Fund subsidies has gone to Alaska telecoms since 2016, yet the state still ranks near the bottom for terrestrial high-speed internet and some communities remain unwired.
The consumer-funded program keeps paying carriers even when service is slow, outdated or barely used, because rules focus on building networks rather than whether customers actually use them.
Summit Telephone alone has collected $12 million over the past decade and now gets more than $1 million a year, though its owner Roger Shoffstall is a convicted tax felon and the company reports only about 120 internet customers.
Starlink has undercut many subsidized providers with roughly $90 to $130 monthly plans and speeds up to 280 Mbps, versus Summit's $135 plan capped at 25 Mbps in the same region.
The FCC is weighing whether to overhaul or sunset parts of the program, while critics say weak auditing and Alaska-specific political carveouts let subsidies keep flowing with little proof they improve access.
Why do federal subsidies for Alaskan internet fund convicted felons instead of providing high-speed service to residents?
As new federal funds aim to fix Alaska's internet, can they overcome the failures of the old subsidy system?
Should federal internet subsidies go directly to consumers instead of companies that fail to deliver on their promises?
Alaska’s $4.6 Billion Broadband Challenge: Funding, Failures, and the Search for Universal Connectivity
Overview
As Alaska approaches mid-2026, it stands at a critical crossroads for broadband development. The state is experiencing a major influx of federal investment through the BEAD program, which is funding a wide range of providers to expand internet access, including the successful launch of the AIRRAQ Network that now serves thousands in Western Alaska. At the same time, Alaska faces uncertainty as key funding sources like the Alaska Plan near expiration and the Universal Service Fund faces legal challenges. This convergence of new opportunities and looming risks will shape the future of connectivity for Alaska’s rural and underserved communities.