Updated May 3rd, 2024 at 15:25 IST

FCC needs more funds to replace Chinese telecom instruments

Despite Washington's request for an additional $3.1 billion to support the removal of equipment from Chinese telecom giants, Congress has yet to take action.

Reported by: Business Desk
Telecom | Image:Unsplash
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Replacing Chinese tech: The US Federal Communications Commission revealed on Thursday that nearly 40 per cent of US telecom companies receiving federal assistance require additional government funding to eliminate equipment supplied by Chinese telecom firms Huawei and ZTE, which pose security risks to American wireless networks.

According to the FCC, the cost of removing this equipment is estimated at $4.98 billion, but Congress has only allocated $1.9 billion for the "rip and replace" initiative.

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FCC Chair Jessica Rosenworcel urgently appealed to Congress for additional funding, highlighting the concerns raised by some carriers participating in the reimbursement program. These carriers have warned the FCC about potential significant consequences resulting from insufficient funding, including the possibility of network shutdowns.

Despite the White House's request for an additional $3.1 billion in October to support the removal of equipment from Chinese telecom giants, Congress has yet to take action.

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In 2019, Congress mandated the FCC to compel US telecom carriers receiving federal subsidies to eliminate Chinese telecom equipment from their networks.

As per the law, the FCC is prioritising funding allocation to applicants serving two million or fewer customers, covering only 39.5 per cent of the replacement costs.

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Telecom companies, having received partial funding, are facing deadlines ranging from May 29 to February 4, 2025, to remove, replace, and dispose of all Huawei and ZTE communications equipment and services.

Highlighting the potential impact, the FCC underlined that many providers in the program serve rural and remote areas where they may be the sole mobile broadband service provider. A network shutdown in these regions could leave residents without any connectivity options.

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Rosenworcel underscored the importance of carriers fully complying with the removal, replacement, and disposal requirements, stressing that failure to do so would raise national security concerns by leaving insecure equipment and services within the networks.

(With Reuters inputs)

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Published May 3rd, 2024 at 15:25 IST