A rural wireless network operator in Kansas said that the bulk of its current wireless network uses equipment from China’s Huawei. And the carrier, United TelCom, said that the FCC’s proposed action against Huawei could force the operator to shut off its wireless service.
“Huawei equipment accounts for nearly all of the equipment used in United TelCom’s wireless network,” the operator wrote in a filing to the FCC. “Prohibiting the use of Huawei equipment, or the use of USF and CETC legacy support to purchase or maintain that equipment, would have a severe and detrimental impact on residents living in remote, underserved locations in United TelCom’s wireless service area.”
United TelCom’s filing intersects with several key elements in the FCC’s efforts to prevent U.S. telecom companies from using equipment from Chinese companies like Huawei. Perhaps most importantly, it runs immediately counter to the FCC’s stated goals of bringing telecommunications services to rural areas.
“United TelCom estimates that the cost of replacing all of the Huawei equipment in its network would be approximately $20 to 25 million dollars. This is an extremely large expenditure for a company serving predominately rural customers, and United TelCom would not be able to undertake such a massive project, which is tantamount to replacing its entire wireless network, in order to continue to receive USF and legacy support if the FCC adopts rules to deny such support as proposed,” the company wrote. “Moreover, even if United TelCom could replace its current Huawei-based infrastructure, United TelCom would have to rely on higher-priced vendors for ongoing product support and network maintenance, at what could well be twice United TelCom’s current annual cost based on current estimates, in order to continue provide high quality service to its customers.”
Indeed, United TelCom said that it has halted plans to deploy a wireless network using its newly obtained 600 MHz spectrum due to the FCC’s ongoing proceeding on the topic.
Huawei can trace its troubles in the U.S. market back to a 2012 government report warning that equipment from Chinese companies could be used by the Chinese government for espionage. Those concerns appear to have grown alongside President Trump’s isolationist actions and brewing trade war with China: Earlier this year, the FCC voted to move forward with a proceeding that would block any U.S. network operator—big and small—from using Universal Service Funds to purchase equipment from companies that pose a security threat.
United TelCom said it receives USF support for its incumbent local exchange carrier operations that provide wireline service to 10 rural communities in Kansas, as well as money from other government programs. The company said that a tacit ban on Huawei “could be devastating to certain rural communities in southwest Kansas as wireless services made available through the use of Huawei equipment by United Wireless is the only means of quality communications for many residents living in those areas.”
Concluded United TelCom: “There is no evidence that Huawei equipment is a threat to national security, and southwestern Kansas residents rely on such equipment used by United TelCom to provide them with reliable wireless services not only for public safety purposes, but also for daily business and personal communications. Accordingly, United TelCom supports Huawei’s comments, and urges the FCC not to adopt rules that would disconnect many rural Kansans not only from the public switched telephone network, but also from accessing high-speed data and Internet services provided by United TelCom’s 4G/LTE Huawei-based network.”
Nonetheless, the FCC’s vote to move forward on the topic appears to have cooled Huawei’s already minor activity in the U.S. market. The company in April reportedly laid off a chunk of its top U.S. officials including William Plummer, who had served for years as Huawei’s top representative in the U.S. market in Washington and at various industry and media events.