US politicians planning $1bn deal to replace Huawei and ZTE

US politicians planning $1bn deal to replace Huawei and ZTE kit

26 September 2019 | Alan Burkitt-Gray

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Members of the US House of Representatives will take the first steps tomorrow to subsidising rural operators to replace Huawei and ZTE equipment in their networks.

The challenge for small and rural networks is that Ericsson and Nokia systems for mobile networks are more expensive.

And any network that provides service to a government organisation – even a village post office – is banned from using Huawei or ZTE kit, thanks to an executive order by President Donald Trump in May. The US Department of Commerce has also added Huawei to its entity list, expressly forbidding companies from buying from the company.

The House Energy and Commerce Committee noted in a report: “Some smaller carriers with more limited resources and less sophisticated security operations have purchased and installed Huawei, and other suspect foreign equipment, in their networks either because the equipment was less expensive or they were unaware of the security risk, or both.”

The committee’s hearing – on “Legislating to Secure America’s Wireless Future” – is due to start at 9:30 Washington time on Friday, with reports suggesting that it will result in bipartisan legislation to make up to $1 billion available to network operators.  

The committee, originally the Committee on Commerce and Manufactures, is one of the oldest in the House of Representatives, having been set up in 1795.

It said, in a memorandum this week in advance of tomorrow’s hearing, that “American networks are appealing targets for foreign adversaries. The United States, therefore, has a clear interest in mitigating threats posed by vulnerable communications equipment and services.”

It said Huawei and its affiliates pose “significant threats to US commercial and security interests”, including “espionage and cyberattacks” – charges Huawei has always denied.