At least two-thirds of applications to reimburse US carriers for removing China telecommunications equipment deemed national security threats are deficient, the Federal Communications Commission (FCC) told Congress.
Of the 181 applications filed by mostly rural carriers under a $1.9 billion program, 122 were found to be “initially materially deficient”, FCC chair Jessica Rosenworcel said.
The FCC told applicants they have 15 days to fix their applications to remove China telecom equipment, and it “expects to complete this process by July 15.”
The FCC currently estimates the cost estimate to remove the telecom equipment from Chinese companies like Huawei and ZTE Corp from the “rip and replace” programme is $5.3 billion, much higher than what Congress set aside.
In July 2021, the FCC voted to finalise the programme that had been funded by Congress in December 2020.
China Telcos ‘Security Threats’
The FCC designated China telecom firms Huawei and ZTE as national security threats to communications networks in July 2020 – a declaration that barred US firms from tapping an $8.3 billion government fund to purchase equipment from the companies.
The FCC in December 2020 adopted rules requiring carriers with ZTE or Huawei equipment to “rip and replace” that equipment.
The issue is a big one for rural carriers that face high costs and difficulty finding workers to remove and replace China telecom equipment.
Huawei said last year the “FCC initiative only creates extraordinary challenges for carriers in the most rural/remote areas of the US to maintain the same high level and quality of service they provide to their customers without disruption.”
Rosenworcel’s letter noted the FCC “will allocate funding first to approved applications that have 2 million or fewer customers.”
She said to date “all but one of the eligible applicants falls within the first prioritization group, and the collective demand of these applicants exceeds available funds for the program.”
- Reuters with additional editing by Jim Pollard