President Trump is expected to sign a bill that would allocate $1bn to US carriers to replace existing Huawei-built infrastructure after it was unanimously passed by the Senate yesterday.
H.R. 4998, which revels in the snappy name "Secure and Trusted Communications Network Act of 2019", was passed by the House of Representatives last December. It formally prohibits federal subsidies from being used to buy equipment from vendors deemed to pose a national security risk – which, in this case, encompasses current bêtes noires Huawei and ZTE.
The FCC has, since November of last year, prohibited the use of subsidies provided by the department to buy Huawei and ZTE's gear. The biggest development here is that it has been formally signed into law – rather than merely being a departmental policy that can easily change between administrations.
The bill also provides the aforementioned chunk of cash to smaller rural telcos to "rip and replace" existing high-risk kit, which was previously proposed by the FCC.
This funding would be administered by the FCC, which already has experience in supporting smaller providers, thanks to its $8.5bn annual Universal Service Fund.
It's not clear how much Huawei equipment is used by rural providers, or indeed, whether the $1bn will be enough to cover the cost of switching cheaper Huawei infrastructure with products from Nokia and Ericsson – which tend to be more pricey.
If anyone is likely to know, it's the FCC, which has recently begun insisting that carriers provide information on how much Huawei and ZTE equipment they use in order to continue receiving federal subsidies.
Huawei is likely to be irritated by this move. In December of last year, it filed suit against the FCC over its Universal Service Fund ban, which it argued was "unconstitutional". It wouldn't be a surprise to see similar protestations or actions form the Chinese firm in the coming days.
This latest bill is the most recent in a series of woes for Huawei which have seen the firm placed on a US entity list, thereby preventing its access to US suppliers. As a result, its handset business, which was one of the most vibrant in Europe and Asia, has began to slowly wither outside of its Mainland China heartland.
And with no reconciliation in sight, there's no telling what the future holds for Huawei outside of its domestic market. ®