>SpaceX asked the FCC to expedite approval now that it has settled on the Starship-launched configuration.
Regardless, to reach those obligatory speeds by 2025 they would need to launch an insane amount of satellites with no failures. If the FCC doesn't think they can do that, they don't get funding.
1. https://spacenews.com/spacex-goes-all-in-on-starship-configu...
The second round was designed to eliminate providers who didn't seem able to deliver on their promises even with the subsidies. It was made to prevent a situation where either party (but mostly the US Gov and tax payers by extension) was on the hook for unsuccessful delivery.
I'm not sure what happens with the funds that would have gone to Starlink.
There are two rounds of funding so it's possible unspent funds from the first round may roll over to fund the second round.
There are processes in place to gauge progress and viability along the way before handing over the bags with money.
SpaceX is hardly the only one who didn’t end up getting their share of the subsidies, it’s just the biggest with a very vocal person at the helm.