FCC plans spectrum auction to fund “rip and replace” of Chinese telecoms equipment  

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The FCC says the replacement process is more urgent than ever in the wake of the ‘Salt Typhoon’ cyberattacks late last year 

The US Federal Communications Commission (FCC) is pushing ahead with plans for a new spectrum auction to help pay for the removal and replacement of Chinese telecoms equipment from US networks.  

The Rip and Replace program, established in 2019, is an initiative by the FCC designed to help secure the US telco infrastructure by removing and replacing high-risk network equipment made by Chinese companies, particularly Huawei and ZTE.  The project was initially allocated $1.9 billion in public funding to support smaller operators to replace their equipment; however, demand for the funds far outstripped the budget, leaving the FCC with an almost $3.1 billion shortfall to complete the project as planned.  

Following years of pressure from the FCC, late last month the US Senate approved a bill allocating the required funding to the rip and replace initiative. The bill allows the FCC to borrow the required funding from the Treasury on the proviso that the funds are repaid with profits from upcoming spectrum auctions. 

As a result, the FCC is looking to push ahead with an auction of AWS-3 (1,695–1,710 MHz, 1,755–1,780 MHz, and 2,155–2,180 MHz) spectrum left over from previous allocations. 

FCC Chairwoman Jessica Rosenworcel this week urged the commission to “quickly adopt rules” that would allow the spectrum auction to proceed and therefore fund the rip and replace programme “without further delay.” 

The urgency of replacing Chinese equipment from US networks has been highlighted by the high profile ‘Salt Typhoon’ cyberattacks on telecoms operators last year. 

“With ‘Salt Typhoon’ and other recent incidents, we are all acutely aware of the risk posed by Chinese hackers and intelligence services to our privacy, economy, and security,” said Rosenworcel. “Today’s proposal is a critical step toward finally filling the shortfall in the Rip and Replace program. I am confident that the FCC’s world-leading and award-winning auction team will meet this important moment.” 

“The cybersecurity of our nation’s communications critical infrastructure is essential to promoting national security, public safety, and economic security,” she added. “As adversaries grow more sophisticated, we need to modernise our defenses.” 

The Salt Typhoon cyberattacks, first reported in October, exposed the vulnerability of the US telecommunications infrastructure. The hackers exploited weaknesses in systems used for surveillance, giving hackers linked to Chinese state actors access to sensitive data and communications. 

Senate Intelligence Committee Chair Mark Warner called the attack “the worst telecom hack in our nation’s history—by far.” Major companies like AT&T, Verizon, and Lumen were reportedly affected, raising questions about whether current cybersecurity protections are enough to prevent future breaches. 

In response, Rosenworcel recently proposed mandatory rules requiring telecom providers to have robust cybersecurity measures in place. Companies would also need to submit annual certifications proving they are up to date on cybersecurity risk management. 

Join the conversation around US telecoms at this year’s Connected America, 11-12 March in Dallas. Get discounted tickets here! 

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