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Previous forecasts had put the price of replacing the Chinese companies’ equipment in US networks at $1.9 billion
Just how expensive is it to replace mobile network equipment? This is a question that has been a cause of great concern for various operators and governments in recent years, especially with regards to Huawei, ZTE and others that some authorities have designated as threats to national security.
In the UK, for example, when discussions around potentially banning Huawei from UK mobile networks were in full flow in 2020, BT suggested that reducing their reliance on Huawei equipment to just 35% would cost them up to £500,000.
Since then, the government has gone further, order a total phase out of the Chinese vendor’s technology in UK mobile networks. However, since the government agreed to lengthen the deadline to remove and replace this equipment to 2027, costs will reportedly not run as high as feared; over seven years, much of the equipment would be due an upgrade anyway, hence swapping out Huawei kit for an alternative would not accrue much in the way of additional costs.
In the US, meanwhile, the operators have been facing a similar battle.
In 2019, the Federal Communications Commission (FCC) approved rules that would withhold government funding to operators that made use of Huawei and ZTE equipment, two companies that would shortly afterwards be deemed to represent threats to national security. Almost immediately following this approval, the FCC began drawing up a draft of the Secure and Trusted Communications Networks Reimbursement Program, a project which aimed to provide the smaller US operators with $1.9 billion in public funding to help pay for the removal and replacement of Huawei and ZTE network equipment.
After the Program was finalised, telcos with 10 million or fewer customers were able to submit applications for funding between October 2021 and January 2022. Now, the FCC have revealed exactly how many applications for reimbursement they have received, with the funds requested reportedly exceeding $5.6 billion.
"We’ve received over 181 applications from carriers who have developed plans to remove and replace equipment in their networks that pose a national security threat," said FCC chairperson Jessica Rosenworcel. "While we have more work to do to review these applications, I look forward to working with Congress to ensure that there is enough funding available for this program to advance Congress’s security goals and ensure that the U.S. will continue to lead the way on 5G security."
Naturally, it is highly unlikely that all of these applications will be approved, but if just half of these applications get the green light, then the total funding will run to $2.8 billion, almost a billion dollars over budget.
In related news, the FCC last month voted unanimously to revoke China Unicom America’s licence to do business in the US, saying that the “national security landscape” had changed in recent years and that “mounting evidence” suggested that the company represented a threat to national security.
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