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FCC says US needs $3 billion more to replace Huawei, ZTE gear

2022-07-18 17:36 by
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Removing Chinese equipment from American wireless networks will cost more than anticipated. On Friday, Federal Communications Commission Chairwoman Jessica Rosenworcel told Congress the agency needs an additional $3 billion to reimburse carriers that “rip and replace” their Huawei and ZTE infrastructure, reports Reuters.

"Because demand within the first prioritization group exceeds available funds for the Reimbursement Program, the Commission will prorate reimbursement funds equally to each eligible applicant in the first prioritization group. The pro-rata factor for those allocations will be approximately 39.5% of demand," wrote Rosenworcel.

Back in 2020, President Donald Trump signed the Secure and Trusted Communications Network Act, essentially mandating US telcos to replace networking provided by vendors that the government deemed untrustworthy with regards to national security, such as China’s Huawei and ZTE.

Of course, ripping and replacing networking equipment, especially on a large scale, does not come cheap. Many US telcos were quick to point out that they would struggle to comply with the new rules without significant subsidies from the government.

The FCC says it has received 181 applications to receive reimbursement by the start of 2022, with the telcos collectively requesting $5.6 billion. The vast majority of these applications have been deemed legitimate, with the FCC suggesting that around $4.98 billion would be required to reimburse eligible telcos fully.

For now, it remains unclear whether the almost $3 billion in extra funding can be secured to meet the initiative's needs, but it seems unlikely that such a large sum can be signed off quickly by government.

Read more -here-


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