The US Federal Communications Commission (US FCC), back in June this year, declared ZTE as well as HUAWEI as threats to national security. The order meant that funds from the US FCC’s $8.3 billion a year Universal Service Fund can’t be used to buy equipment or procure services from the two companies. Today, the US FCC has re-affirmed its stance of classifying ZTE as a threat to national security following a petition to reconsider the order.
In a press release, the US FCC revealed that it has denied a reconsideration petition filed by ZTE over the agency’s order that designated it as a national security risk. “After reviewing the record, the Bureau found no basis for reconsideration. As a result, the FCC’s $8.3 billion a year Universal Service Fund cannot be used to purchase, obtain, maintain, improve, modify, or otherwise support any equipment or services produced or provided by ZTE as well as its parents, affiliates, and subsidiaries,” the FCC noted.
You don’t say! https://t.co/c1QTIyzcFz
— Ajit Pai (@AjitPaiFCC) November 25, 2020
The US FCC is going to conduct a meeting on December 10 where the commission will take votes for drafting and implementing rules of the Secure and Trusted Communications Networks Reimbursement program. The latter is aimed at helping carrier partners ‘remove and replace untrusted equipment from their networks, months before the statutory deadline.’
The denial by FCC’s Public Safety and Homeland Security Bureau means US companies can’t buy telecom equipment from ZTE, and depending on the voting results of the December 10 meeting, existing ZTE telecom gear might be removed from the US soil as well. The US FCC has previously claimed, based on evidence it has gathered, that equipment made by ZTE and HUAWEI can be used for espionage – a claim both the companies have denied on multiple occasions in the past.
A host of rural carriers in the US have been using ZTE or HUAWEI gear, and as per UC FCC’s own estimates, replacing the telecom equipment might cost anywhere between $40 million and $45 million for each company. As for the overall cost, it would cost a total of almost $1.8 billion to fully get rid of Chinese telecom equipment.