Commissioners OK Rip and Replace Changes

Commissioners OK’d modifying FCC rules for the $1.9 billion program for removing Huawei and ZTE gear from carrier networks 4-0 Tuesday, as expected (see 2107070052). Acting Chairwoman Jessica Rosenworcel announced an Oct. 29 “target date” for opening this window. “Carriers can start planning for their applications and their new networks." she said: "There’s a lot of work to do."

The order imposes a June 30 deadline by when providers had to buy equipment and services to be eligible for reimbursement and creates a prioritization system if demand surpasses the money. The order aligns rules with the Secure and Trusted Communications Networks Act (see 2012220061)

Among the changes from the draft is one sought by Commissioner Geoffrey Starks, who asked the FCC to consider delays in the federal permitting process as a factor in looking at whether to grant extensions of the deadline, Wireline Bureau Chief Kris Monteith told reporters. The order addresses other ex parte filings, she said.

“Our work is far from complete” but the FCC has made significant progress over the last two years, Starks said. He said that when he held a workshop on Chinese gear in U.S. networks in 2019, “funding posed a daunting challenge.” At the time, an executive from Union Wireless said replacing the equipment was “an extraordinary expense” that companies like Union “could not bear,” Starks said.

Starks met again with Union officials at his request last week (see 2107120045). He's grateful for funding from Congress but “that does not altogether mean that the road ahead will be easy,” Starks said. In the meeting last week, the carrier “outlined challenges they faced in replacing insecure equipment even with the financial support provided today,” he said: “Some of those difficulties include short construction seasons limited by severe weather” and “delays in permitting for federal lands.” Companies also face increasing costs for steel and concrete and worker shortages, he said.

The FCC is starting “what is perhaps the most significant federally funded effort to rebuild and secure commercial communications networks nationwide,” Rosenworcel said. “We will evaluate network after network, base station after base station and router after router until we have rooted out equipment that could undermine national security,” she said: “It’s a daunting task.”

Rosenworcel told reporters the replacement program poses difficult problems. "Moving insecure equipment from existing networks after installation is not easy and that’s because these systems have been deeply integrated,” she said. Open radio access networks could help, she said, noting the FCC’s showcase starts Wednesday.

Open networks have a role to play, Commissioner Brendan Carr told reporters. “Hopefully, the timing lines up … where carriers feel confident that the development of ORAN is at a place” it can be used for rip and replace, he said: “This is where technology is moving.” It's a "timely action that will contribute not only to national security, but also to carrying out the program that was specified for us by Congress,” said Commissioner Nathan Simington.

Relative to the more than $50 billion spent by AT&T, Verizon and T-Mobile annually, “this represents a modest tailwind” for vendors, Raymond James told investors: “We believe most of this will go to smaller rural operators that installed the gear to save costs. As the administration is looking to subsidize broadband builds going to rural areas, this is a prudent way to clean up any remaining gear beforehand or as it is being deployed.”

Commissioners separately unanimously denied Mobile Relay Associates’ application for review of a 2020 Enforcement Bureau denial of the company’s petition for reconsideration of a 2015 order imposing a $25,000 forfeiture for violating the commission's Part 90 rules in its operation of private land mobile radio station WPPF234 in Malibu, California (see 1507070042). The decision was based on the Mobile Relay’s “heavy use of a shared channel, plus inadequate monitoring to avoid causing interference, plus actual harmful interference to another licensee,” said Matthew Gibson, Enforcement Bureau senior field counsel. Rosenworcel said she's having the agency “develop new timeliness goals for case resolution” because airwaves are “increasingly important to our economic and national security.”