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Carriers Set To Be Paid To Remove Huawei & Other Chinese Telco Gear

As the local Chairman of Huawei was spruiking a closer relationship between China and Australia a US Federal Communication Commissioner was sticking the knife into Huawei and other Chinese communication Companies such as Oppo and ZTE at an industry conference, suggesting US telcos will be given financial assistance to cleanse their networks of any Huawei and other Chinese made gear.

As the same time attendees at the conference were told of the dangers of installing Chinese telecommunication gear, Huawei Australia chairman John Lord was warning that a loss of trust between Australia and China could affect business productivity and hurt the local technology industry, as the telecommunications kit maker continues to grapple with a ban on its equipment.

Mr Lord criticised the Morrison government for “mischievously” overplaying security concerns involving Huawei, which has been accused in the United States of spying on behalf of the Chinese government.
In stark contrast, FCC Commissioner Geoffrey Starks told a telecommunication conference that the powerful FCC was targeting the Chinese telecommunications industry across the board as well as Huawei who they have accused of spying.

He said that the FCC was currently exploring ideas on how to ban the purchase of Huawei equipment entirely and that could involve paying out Federal dollars to carriers to remove legacy Huawei gear similar to what is being used by Telstra and Optus in their 4G networks in Australia.

Currently Huawei is still contracted by Australian carriers to service and further enhance existing 4G networks despite being banned from delivering 5G technology to Australian carriers.

Currently the FCC is carrying out an audit to identify how much legacy Huawei equipment which might be in US networks.

“Huawei is one of the biggest telecom equipment manufacturers in the world, and although its share of the U.S. telecom market is relatively small, some wireless carriers have purchased Huawei equipment for their networks,” Starks said.

“These carriers bought this equipment, often a decade or more ago, because it was far less expensive than other options, and because Huawei was willing to work with them to create customized networks.

“The Commission is currently examining whether to ban the use of federal support dollars for the purchase of such equipment, but we can’t ignore the problem of the equipment that’s already here.”

Starks is the FCC front man for a new programme which has been known as ‘Find it, Fix it, Fund it’. The initiative will provide funding to telcos to self-assess networks and identify what would be deemed as ‘suspect equipment’. Currently it is voluntarily, though it does appear there are regulatory changes on the horizon to make the initiative a compliance issue.

In the short-term, the equipment might be allowed to stay in the network, though it would be quarantined. Long-term, Starks is suggesting every piece of equipment would have to be ripped and replaced.

He added “Nokia and Ericsson have said that they are willing to create products and financing options geared toward smaller carriers that need to replace Chinese equipment,” Starks said. “They also claim that they have had handled similar replacement efforts with minimal customer disruption.”

This is the reason Huawei has been successful in engaging rural and regional connectivity providers in the US. Not only does it offer a broader range of products, some of which are much more financially attractive, but it has been much more open to customisable deployments than rivals. The US is an incredibly varied geography, there is not a one-size-fits-all opportunity here.

According to Telecoms.com a lack of competition and the removal of the cheapest network infrastructure provider is a massive concern for US rural and regional telcos. However, with the help of federal funding and new business offerings from Ericsson and Nokia, the financial burden of rip and replace regulations might be lessened. This does not mean networks will be better or cheaper in the long-term, but it is a nod from the FCC to the immediate concerns.

Currently the US Department of Justice was revealed as moving to put the brakes on a subsea cable which is being funded by Facebook and Google, as well as a Chinese partner.

The likes of Oppo, ZTE, Alibaba, OnePlus and Xiaomi should perhaps be wondering when they will be dragged into the conflict claims Telecoms.com.

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