FCC to Block Chinese-Made Wireless Equipment

by: The Knowledge Group

April 02, 2018


On March 27, the FCC released a new proposal designed to restrict the use of certain wireless equipment made by foreign manufacturers from being used in the next generation of data networks.

As justification for the restrictions, the FCC cited the potential for foreign agents to write “back doors” into the equipments’ coding, allowing them to spy on United States businesses and agencies.

Specifically, the new proposal will largely target Chinese firms such as Huawei and ZTE – both of which were directly mentioned in the proposal. While the proposal would not directly prevent US companies from working with these foreign firms, it would provide them with monetary reasons to avoid doing so. Under the FCC’s new proposal, US companies that do business with these firms will no longer have access to Universal Service Fund – an $8.5 billion pool of federal money that is overseen by the FCC and used to help fund private infrastructure projects. For companies seeking to build a 5G network in the United States, no longer having access to the Universal Service Fund is a major deterrent.

Right now, the proposal is still in the works as the FCC looks at ways to identify companies that pose a security threat as well as the devices that would be covered under the proposal. However, many executives are displeased by this protectionist approach to international trade. Without having the ability to work with foreign companies, the construction of a national 5G network could become a much more costly and lengthy process.

According to Ajit Pai – the Chairman of the FCC – though, “Any federal effort to construct a nationalized 5G network would be a costly and counterproductive distraction from the policies we need.”

The five FCC commissioners plan to vote on the proposal sometime in April. You can stay updated on this story as well as other industry trends and developments, all whilst earning continuing education credits with The Knowledge Group.  Have a look through our extensive library of live and recorded events by clicking here.