Industry Calls on Government to Invest Billions for Developing Secure 5G Networks 

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Comments to the NTIA also say the administration shouldn’t choose winners and losers to compete with Chinese telecoms giant Huawei.

Responding to a request for comment from the National Telecommunications and Information Administration, information and communications technology companies outlined ways for the U.S. government to massively invest in the development of fifth-generation networks.

One suggestion is for the U.S. to change rules governing the Export-Import Bank to allow its support for products that are manufactured and deployed overseas. 

U.S. efforts to secure the country’s telecommunications networks have largely focused on removing the Chinese company Huawei—the globe’s leading provider of 5G equipment—from the ecosystem. Huawei refutes claims it would use its connection to spy on behalf of the Chinese government or compromise critical infrastructure, as U.S. officials fear.   

Apart from the security implications, there’s a lot at stake. A Qualcomm estimate puts the economic output 5G will enable by 2035 at $13.2 trillion. 

In February, Attorney General William Barr said: “through ownership of a controlling stake, either directly or through a consortium of American and allied companies” the U.S. needs to back a “horse” and actively support Finnish company Nokia or Swedish company Ericsson, two of Huawei’s few competitors.  

The Information Technology Industry Council, a trade association representing the largest tech companies in the world, including Ericsson, advises against this.

Comments from the group praised the administration for developing a comprehensive strategy on 5G but noted concern “with some of the ways in which Administration officials have proposed ensuring that leadership, including having the government buy controlling stakes in certain companies.”

“The [U.S. government] should ensure in every instance that its actions do not result in picking winners and losers in the 5G marketplace,” wrote ITI’s John Miller. “The private sector should lead, and the market should determine the ‘winners.’”

ITI instead supports investment in the development of technology and standards for virtualizing network functions performed by physical equipment. This gives operators the ability to mix and match components of a network by using open-source software instead of relying on a single supplier. A fund dedicated to making the idea a reality is outlined in the annual Intelligence Authorization Act, which recently passed committee

“Create the Multilateral Telecommunications Security Fund as proposed in Sec. 501 of the Intelligence Authorization Act for FY 2021,” ITI wrote. “In addition to setting up other helpful funding mechanisms noted elsewhere in our response, the language set forth in the Act would create a Multilateral Telecommunications Security Fund. We are supportive of this fund, as it would provide additional direct support to the United States in its engagements with foreign partners.”

The Intelligence Authorization Act refers to funds that may be appropriated, or “or otherwise made available to the director of the Defense Advanced Research Projects Agency and the director of the Intelligence Advanced Research Projects Activity” to be deposited. But a previous bill introduced by Committee Ranking Member Mark Warner, D-Va., called for $1.2 billion to fund the same effort.

The chief proponents of the interoperable software-based networks are members of the Open Radio Access Network Alliance. The group is led by telecom operators such as AT&T which would benefit from increased competition the technology would foster. 

The Open RAN Policy Coalition also wrote to the NTIA, extolling the security benefits of open network interfaces for collaboration.

“In short, open RAN provides the framework for these communications network stakeholders to align on shared understanding of security requirements and to tailor security requirements at a more granular level than has been possible before,” the coalition wrote.

In addition to provisions of the Warner legislation, the Open RAN Policy Coalition is calling for a portion of $1 billion to $2 billion that the government makes available for rural providers to replace equipment from Huawei and ZTE be “reserved for recipients who elect to use the funding to deploy open RAN network equipment.”

“This funding should also recognize that operators applying for this funding will need flexibility to enable interoperability with legacy systems,” the group adds.

Another suggestion is to leverage the buying power of the federal government. 

“Agencies should establish procurement preferences for open, interoperable and standards-based equipment,” the group says. “Potential partners to expand open RAN include: DARPA, Spectrum Forward Consortium, AFWERX, NavalX, and Army Futures Command.”

The coalition also wants the Department of Energy to use its procurement authority for spectrum development projects through the Idaho National Laboratory, the Pacific Northwest Laboratory, and others to promote open and interoperable networks.

And the Department of Defense should do the same with its National Spectrum Consortium 5G testbeds, the group says.

Both the Open RAN Policy Coalition and ITI drew attention to international investment organizations like the Export-Import Bank. 

“Leverage U.S. international funding agencies (e.g., EXIM Bank, U.S. International Development Finance Corporation, USAID), and the State Department, to develop incentives or include preferences for open and interoperable equipment in wireless projects that will result in the deployment of such network equipment from trusted vendors and service providers,” the policy coalition wrote.

ITI noted this may require revisiting rules that limit such investments to products made in the U.S.

“Reconsider the content rules that currently govern Export-Import Bank (Ex-Im) transactions as they are not necessarily applicable to the tech sector,” Miller wrote. “Current U.S. content requirements hinder the ability of Ex-Im to support the deployment of trusted network equipment overseas. Especially in the tech sector, [intellectual property] and [research and development] may be U.S.-based, even if the product is manufactured elsewhere. This important aspect is not considered in the current iteration of U.S. content requirements that dictate whether Ex-Im can support an overseas deal, therefore making it significantly more difficult for Ex-Im to support deals related to 5G technology.”

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