Two years after former US President Donald Trump signed the Secure and Trusted Communication Network Act, mandating US telecoms to replace any suspect foreign network equipment from their networks, resulting in the ouster of Chinese telecom giants, Huawei and ZTE, the telecom regulator is battling to contain the cost.
The Federal Communications Commission (FCC) told Congress on Friday that it needs additional $3 billion to fund the removal of Huawei and ZTE telecom equipment from the US, Reuters reported.
In 2020 when the Secure and Trusted Communication Network Act came into effect, the FCC had estimated that it will cost $1.9 billion to remove the equipment. The demand for additional $3 billion brings the total cost to $4.9 billion, which, given the circumstance, is not clear would be enough.
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“To fund all reasonable and supported cost estimates…, the Reimbursement Program will require $4.98 billion, reflecting a current shortfall of $3.08 billion,” Jessica Rosenworcel, the chairwoman of the Federal Communications Commission, said Friday in a letter to Senator Maria Cantwell, who heads the Committee on Commerce, Science, and Transportation.
Since Congress only appropriated $1.9 billion to fund the removal process, companies would be reimbursed for only about 40% of the costs, she added.
The Congress had in 2019, when it passed the bill, promised to reimburse telecoms the cost of removing Huawei and ZTE infrastructure.
“Absent an additional appropriation, the Commission will apply the prioritization scheme Congress specified,” Rosenworcel said in the letter, adding that the Commission would begin processing reimbursement claims “as allocations are issued in the coming days.”
The Commission said it received 181 applications at the start of 2022.
Companies are not required to complete the work until after they receive reimbursement and the FCC only has enough to reimburse companies about 40 percent of their costs without additional funding from Congress.
Washington had designated Huawei and ZTE national security risks and sought to unbundle their telecom equipment from US’ 5G infrastructure deployment. The decision eliminates any chance of the Chinese Communist Party using the companies as spy tools in the United States.
But it has come at a cost that has more than doubled in just two years, and may likely see further increase before the job is fully done.