The Federal Communications Commission is making it harder for Chinese tech companies like Huawei and ZTE to carve out a foothold in the U.S.
"Given the threats posed by Huawei and ZTE to American security and our 5G future, this FCC will not sit idly by and hope for the best," FCC Chairman Ajit Pai told the Commission.
The FCC's order blocks federal funding from going to any U.S. companies that do business with those Chinese telecoms. That's particularly important for the rural broadband companies that rely on FCC funding to operate; several of those companies also use Huawei equipment in their networks.
The commission also asked for public comments on a proposal which would require those providers to rip out and replace Chinese telecom equipment in order to keep receiving FCC funds.
Huawei and other Chinese tech companies have been widely blacklisted by the U.S. government over fears that they could provide a vector for espionage by the Chinese government.
But the FCC's push is going to be massively disruptive for the companies that rely on Huawei equipment.
FCC Commissioner Geoffrey Starks said during the hearing, "Replacing untrustworthy equipment in our networks could cost as much as $2 billion, and the actual figure could be more. We cannot afford to do this again."
A bill introduced in the Senate this year could free up $700 million to help companies switch out their Huawei gear. Otherwise, the FCC expects to dip into its rural broadband funds to ease the transition away from Chinese equipment.
