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The Federal Communications Commission (FCC) said it would reach out to Congress to allocate funding to assist rural carriers

In recent months, aggressive campaigning by the Trump administration against Chinese telecoms companies, in particular Huawei, have begun to bear fruit on a major scale. The latest round of sanctions against Huawei has decimated the vendor’s semiconductor supply chain, severing their access to US chip technology.
 
For some countries around the world, this was the straw that broke the camel’s back when it came to Huawei. The UK, for example, after resisting US pressure back at the start of the year and simply limiting Huawei’s market presence and access to the core, has now begun a programme to gradually  remove the Chinese equipment from their networks altogether.
 
But while this impact against China will certainly be scored as a win for the Trump administration, it should be remembered that the US has some reliance on this equipment too. Now, the FCC is saying that it will cost the country’s operators around $1.8 billion to rip and replace Huawei and ZTE gear from their networks. 
 
On Friday, an FCC report noted that a number of telecoms companies had already applied for federal reimbursement reaching around $1.6 billion under the Secure and Trusted Communications Network Act of 2019, with yet more eligible to apply. Congress has yet to approve these reimbursements, which could leave some of the country’s smaller operators high and dry when it comes to network equipment. 
 
"I once again strongly urge Congress to appropriate funding to reimburse carriers for replacing any equipment or services determined to be a national security threat so that we can protect our networks and the myriad parts of our economy and society that rely upon them," urges FCC chairman Ajit Pai in the report.  
 
Finding alternatives for the Chinese technology has been a hot topic throughout the year. When the UK noted this before making their initial judgement on Huawei back in January, Attorney General William Barr proposed that the US purchase a controlling stake in one of Huawei’s main rivals, either Nokia or Ericsson. While this idea seems to have swept under the rug, there has been a great surge in the development of OpenRAN technologies, which it is hoped will create a much broader vendor ecosystem and leave operators less reliant on single companies.
 
The traditional vendor space is changing too. The removal of Huawei leaves a considerable void, which one would expect to be filled by the aforementioned rivals, Nokia and Ericsson. However, it is Samsung who has made headlines this week, scoring an enormous $6.6 billion deal with Verizon. 
 
The vendor space is changing rapidly as a result of technological advances, the coronavirus pandemic, and, of course, tensions between the US and China. While its unclear who will be the long term beneficiaries of this major policy shift, what is clear is that this will be an expensive process in the interim. 
 
 
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