Last Wednesday, May 16, the House Energy & Commerce Committee’s Communications and Technology Subcommittee (the “Subcommittee”) held a hearing entitled, “Telecommunications, Global Competitiveness, and National Security,” examining telecommunications infrastructure and supply chain threats, and how government and industry stakeholders are responding to these threats.
From the outset, the Subcommittee appeared particularly focused on examining these threats in the context of the security concerns raised regarding telecommunications equipment from Chinese manufacturers. In her opening statement, Chairwoman Blackburn (R-TN) highlighted the importance of securing U.S. telecommunications networks in the face of growing threats to the global equipment supply chain, stating: “In time, it will be difficult for our domestic communications providers to obtain their network infrastructure from trusted sources when vulnerable foreign vendors acquire more and more global market share.” In turn, while recognizing the national security threat posed by certain foreign manufacturers, Committee Ranking Member Pallone (D-NJ) highlighted the equipment supply chain challenges faced by U.S. providers, noting as follows: “U.S. networks depend on equipment from foreign companies as they race to build next-generation networks, like 5G wireless technology. For many broadband providers, less expensive Chinese equipment may be the only option.”
To help inform its examination, the Subcommittee heard testimony from three subject matter experts. Although the witness panel did not include federal government representatives, the three witnesses engaged in a robust discussion with Subcommittee Members regarding the U.S. government’s response to these telecommunications infrastructure and supply chain threats. Vice Chairman Lance (R-NJ) commended the FCC for its vote to “move a proposal forward to ban federal funds from being used to purchase telecommunications equipment from companies deemed a security threat, such as Chinese manufacturers Huawei and ZTE.” Former Department of Commerce official, Clete Johnson, testified that the FCC proposal “can be a lever to move the whole government, and the market, in the right direction.” When asked to comment on how the U.S. government should be responding to these threats, Dr. Charles Clancy of Virginia Tech emphasized the importance of adopting a risk-based approach to securing the telecommunications equipment supply chain.
Although the hearing did not focus on specific legislation, both Members and witnesses touched on a provision included in the pending National Defense Authorization Act for Fiscal Year 2019, which would prohibit federal government agencies from procuring telecommunications equipment or services produced or provided by Huawei or ZTE Corporation. Ms. Samm Sacks of the Center for Strategic and International Studies highlighted the significant competitive challenges for U.S. information and communication technology companies doing business with China, and suggested that the United States, “not take a sweeping approach to banning companies based on national origin but instead look at the specific threats posed by equipment.”
We will continue to monitor the Subcommittee’s activities on these issues and provide updates on any significant developments.
