FCC Blocks Huawei, ZTE From Billions In US Federal Subsidy Dollars

FCC Blocks Huawei, ZTE From Billions In US Federal Subsidy Dollars

FCC Blocks Huawei, ZTE From Billions In US Federal Subsidy Dollars

On Friday, the FCC approved a measure to cut funding to United States projects using equipment from Huawei and ZTE or any other "bad actor".

The group said Friday that it was "cautiously optimistic" that the FCC's approach would let its companies keep providing services to customers and give them funding to replace any banned equipment.

FCC Chairman Ajit Pai first proposed in March 2018 to bar companies that posed a national security risk from receiving funds from the FCC's Universal Service Fund, but did not name Huawei or ZTE. If the two companies raise objections, the ban may take effect after 120 days.

Huawei has responded to the issue. It also claims that the FCC misinterprets Chinese law.

"These concerns are by no means hypothetical", Pai added, citing recent evidence of potential hidden backdoors built into Huawei equipment. Now, it cannot do so with federal subsidy funds.

USA regulators unanimously recognized Chinese language telecom firms ZTE and Huawei as threats to nationwide safety on Friday and blocked them from accessing $ eight.5 billion in federal funds for providers and tools. The decision of the FCC is based on one-sided information and misinterpretation of Chinese law.

Huawei said that the order was based on "irrational speculation" and urged the Federal Communications Commission to "rethink on the order".

As for replacing existing equipment, the FCC is asking for comment on how to help rural telecoms financially.

The new rules also would require telecommunications carriers that use the fund to certify their equipment is made by vendors other than ZTE and Huawei.

The Universal Service Fund is an $8.5 billion-a-year government program that subsidizes companies offering wireless service in mostly rural areas. And, due to reduced competition in the market for telecommunications equipment, particularly in cutting-edge 5G networks, all Americans will pay higher prices for these critical services.

The FCC is very clear about prohibiting operators from purchasing Huawei equipment and not really improving the network security situation in the United States. The agency said China's Huawei and ZTE pose such a threat. In this region, there has never been a major cybersecurity incident... This sentiment was echoed by the U.S. Department of Justice Attorney General Bill Barr in a November 13th letter to the FCC chairman. We are also willing to open communication with the USA government and policy makers. "We believe this is a necessary step to safeguard the USA national telecommunications network and establish a system of diverse, competitive and trusted suppliers".

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