By Maria Armental
Removing equipment bought from Chinese companies Huawei Technologies Co. and ZTE Corp. would cost U.S. companies that receive federal subsidies nearly $2 billion, according to a Federal Communications Commission survey.
The FCC designated the Chinese companies as "posing a national security threat to the integrity of communications networks or the communications supply chain" and barred the use of money from the Universal Service Fund to buy equipment or services from those companies.
The FCC's USF subsidizes phone services for low-income and rural customers.
Based on the information that the FCC collected from carriers, including Verizon Communications Inc. and America Movil SAB, it would cost an estimated $1.84 billion to remove and replace Huawei and ZTE equipment in their networks. Of that total, the FCC said, carriers that appear to initially qualify for reimbursement under the "rip and replace" program reported it could cost them about $1.62 billion to remove and replace the equipment.
"By identifying the presence of insecure equipment and services in our networks, we can now work to ensure that these networks--especially those of small and rural carriers--rely on infrastructure from trusted vendors," FCC Chairman Ajit Pai said in a statement, asking Congress to appropriate money to reimburse carriers for replacing the relevant equipment and services.
Write to Maria Armental at firstname.lastname@example.org