FCC, Telcos Scoff at ‘Far-Fetched’ Nationalized 5G Idea

A leaked National Security Council memo advises the federal government to create a “centralized” 5G network in order to stay competitive with China.

Axios obtained and published documents that security officials presented to members of the Trump administration. The memo and slide-show presentation warn that China has a “dominant position” in network infrastructure and uses its position to spy on the U.S.  According to the recommendations, the U.S. needs to establish a secure 5G network within the next three years in order to prevent China from winning “politically, economically and militarily.”

Telecommunications companies, analysts and regulators quickly dismissed the idea, which takes a public approach to an initiative that businesses like AT&T, Verizon and T-Mobile already are working furiously to complete. AT&T and Verizon both updated the public earlier this month about how they are inching closer to commercial 5G launches.

“This is so far-fetched that it doesn’t deserve to even be discussed,” Craig Moffett, a MoffettNathanson analyst told CNET.

Recode reports that the memo was outdated, a mere suggestion by a staffer and not a reflection of the Trump administration’s plans.

Even so, it has brought to light questions about the efficiency of multiple service providers building separate 5G networks.

Ian Morris of Light Reading suggests that the plan is “not as bonkers as they say” in his Tuesday article. He compares the networks to railroads, which are considered a basic utility and expensive to make.

“Countries outside the U.S. have already shown that networks can support more than one service provider,” Morris writes. “No one in their right mind would ever consider building three or four railroads or freeways in parallel. So why build three or four 5G networks covering the same land mass?”

The memo offers two options for a centralized network. The first and preferred option is that the U.S. government takes responsibility for funding and building it. The second option states that wireless companies could create their own 5G networks. But the presenters believe the second plan would take too long.

“A source familiar with the documents’ drafting says Option 2 is really no option at all: A single centralized network is what’s required to protect America against China and other bad actors,” Axios writes.

All five members of the Federal Communications Commission shot down the idea of a nationalized 5G network. While some of them acknowledged the concern over China’s ability to infiltrate unsecured networks, Chairman Ajit Pai called a centralized network “costly and counterproductive.”

Commissioner Michael O’ Reilly says the government and regulators can do their job by “allocating additional spectrum and preempting barriers to deployment.”

“I’ve seen lead balloons tried in D.C. before, but this is like a balloon made out of a Ford Pinto. If accurate, the Axios story suggests options that may be under consideration by the Administration that are nonsensical and do not recognize the current marketplace. Instead, U.S. commercial wireless companies are the envy of the world and are already rushing ahead to lead in 5G,” O’Reilly said in a statement.

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