Huawei urged the US Federal Communications Commission (FCC) to rethink its decision to bar operators from using government subsidies to buy its equipment, arguing such a step is not necessary to ensure national security.
The plea came after the FCC unanimously approved an order blocking operators from using an $8.5 billion pot of federal funds to purchase kit from companies deemed national security threats. Huawei and ZTE, whose equipment is primarily used by rural operators in the country, were the first two vendors named to the ban list. The measure also proposed a process for removing and replacing suspect kit already in use.
In a statement to Mobile World Live, Huawei argued the commission’s decision was “unlawful” and based on “selective information, innuendo and mistaken assumptions” that the company is subject to Chinese government control. It added the move would have “profound negative effects” on rural connectivity in the country.
Huawei insisted there are other paths the regulator could take: “The FCC is aware of best practices that could actually improve US network security without unlawfully and irrationally targeting Huawei.”
However, in a report issued just before the vote, Commissioner Geoffrey Starks argued “no amount of mitigation will fully address the problem” if a vendor is subject to Chinese government influence. He added during the FCC vote the cost to rip out and replace suspect equipment in US networks could surpass $2 billion.
The gravity of the FCC’s decision wasn’t lost on Commissioner Michael O’Rielly, who highlighted a series of reservations he had about the move. Specifically, he said he pressed for an appeals process for vendors on the ban list because blacklisted entities “stand to lose significant business opportunities” and “sometimes innocent companies can be implicated by mistake”.
He also warned the move could come with costs beyond those to rip-and-replace suspect kit, noting the removal of suppliers from the market could force US operators to pay more for equipment.