Huawei equipment may be stuck in some US networks indefinitely

The FCC is giving some of the US companies in its “rip and replace” program more time to tear Huawei and ZTE equipment out of their networks.

Importantly, the agency agreed to delay some deadlines due to the roughly $3 billion funding gap that Congress appears unwilling to fill.

“As a small, rural operation, we lack the financial resources to complete the project, as Congress has provided only 40% of the funds needed,” Viaero Wireless wrote to the agency last month. “Congress maintains that replacing the covered communications equipment is essential to national security; it therefore must fully fund the Reimbursement Program. Without additional government funding, Viaero Wireless simply cannot complete the removal, replacement and disposal project; Congress’ inaction and the lack of funding is completely outside of our control.”

Continued the company: “With no assurances of additional funding from Congress, we respectfully request the Commission to find that our ability to complete the permanent removal, replacement and disposal by the end of the term is due to no fault of Viaero Wireless. Accordingly, we request a six-month extension of the one-year completion deadline.”

The request from Viaero is important because the company is asking for almost $2 billion from the FCC to tear equipment from China’s Huawei out of its network and replace it with equipment from Sweden’s Ericsson. Of the almost 200 companies participating in the program, Viaero’s “rip and replace” price tag is the highest.

In a new filing, the FCC said it would grant Viaero’s request for a deadline extension. “The lack of full funding has rendered it unable to take necessary actions towards the completion of its respective removal, replacement and disposal processes,” the agency wrote.

Thus, the situation sets up the possibility that “rip and replace” companies can continue to ask for delays until Congress decides to pump more money into the program. It’s unclear whether that will happen given the leadership debacle in the House and a looming presidential election.

Counting beans

The FCC’s “rip and replace” program stems from the Secure and Trusted Communications Networks Act of 2019, which built on years of fears among US policymakers that telecom equipment from Chinese companies could be used by Chinese spies to peek into US communications. The act required some US companies – including a number of smaller wireless network operators like Viaero – to tear out suspect equipment from their networks.

The legislation charged the FCC with administering the effort. Initial estimates pegged the total cost of the program at $700 million, but that quickly ballooned to around $1.9 billion. That was the amount Congress set aside for the effort. But last year, the FCC said it recalculated the cost of the program and arrived at a new grand total: $4.6 billion.

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