Senate Bill Offers Loans for Swapping Chinese Telecom Gear

Phil Harvey
5/23/2019

Now that the US government has banned Huawei over security concerns, carriers are left at a crossroads: What if they did buy Huawei gear and want to swap it out?

Several members of the Senate are backing a bill that addresses that exact issue. A new bill -- cited as the "United States 5G 5 Leadership Act of 2019" -- will help carriers who have purchased the Chinese telecom giant's gear get funding so they can replace it with something from a different foreign country.

The bill said that up to $700 million would be earmarked for that task and the funds would be in a trust fund grant program.

The grant program would get its money from interest-free loans provided by the US Treasury, the part of the government that socks away our tax dollars. Those free Treasury loans would be paid back, but the bill doesn't specify how.

The bill also establishes US policy that American 5G networks should not include equipment or services provided by Huawei, ZTE or their affiliates. The bill does actually namecheck Huawei and ZTE and it includes, for good measure, "any communications provider domiciled in the People's Republic of China (or a subsidiary or affiliate of such a company)."

If you couldn't find it earlier, the United States 5G 5 Leadership Act of 2019 is listed in the Congressional Register as "S.1625 - A bill to promote the deployment of commercial fifth-generation mobile networks and the sharing of information with communications providers in the United States regarding security risks to the networks of those providers, and for other purposes."

Why this matters
Service providers, especially smaller carriers with "not more than 6,000,000 customers" as specified by the new bill, need a path to ripping and replacing gear, if the government is going to continue to label telecom companies based in China as a national security threat.

"I thank Senators Wicker, Cotton, Warner, Sullivan, and Markey for introducing the United States 5G Leadership Act of 2019," said Steven K. Berry, the president and CEO of the CCA, in a statement sent to the media. "This bipartisan bill will help ensure that all carriers have the information and resources necessary to address security risks while advancing US leadership in 5G."

Related posts:

Phil Harvey, US Bureau Chief, Light Reading

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Phil Harvey
Phil Harvey
6/3/2019 | 10:09:43 AM
Huawei reax
Here was the comment from Huawei (generically attributed to a "spokesperson") on this story. My apologies -- they sent it post-deadline and I meant to post earlier:

"Huawei values its relationships with all partners and associations around the world and understands the difficult situation they are in. Our top priority remains to continue delivering world-class products to our customers. We are hopeful this situation will be resolved and are working to find the best solution."

smartedge
smartedge
5/23/2019 | 8:53:10 PM
Re.: Senate bill offers loans for swapping chinese gear
Wow. This is unprecedented - the US Govt offering loans for swapping out telco equipment. I guess the govt is very serious about putting the squeeze on Huawei.