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Yet another FCC plan will hurt small cable companies

Published Mar 29th, 2018 10:02PM EDT
Huawei US blacklist FCC

Under the stewardship of new chairman Ajit Pai, the Federal Communications Commission has gone out of its way to enact policies that are favorable towards the biggest telecoms company. Nothing has done more to pump the stock prices of bigger ISPs at the expense of smaller companies than net neutrality repeal, and now it looks like Pai is pushing for more policies that would end up favoring the biggest firms.

Smaller cable companies have told the Wall Street Journal that the FCC’s proposed blacklist of Chinese firm Huawei would disproportionately affect smaller ISPs. Huawei sells cheaper networking equipment than American rivals like Cisco, and being forced to use more expensive equipment would destroy the thin margins that many smaller ISPs operate under.

“Our margins are pretty thin,” Eastern Oregon Telecom CEO Joe Franell told the WSJ. “If you start dictating what kind of equipment I can use, it tips the scales,” he said, noting that the measure is “driven (more) by nationalism and protectionism” than substantiated evidence.

The FCC, national security agencies and lawmakers have all demonized Huawei in recent months. Government intervention killed deals between Huawei, AT&T, and Verizon to distribute Huawei’s new flagship Android smartphone, a move that will help Samsung and Apple.

Allegations that Huawei uses its position as a telecoms vendor to infiltrate the networks of foreign countries have dogged the company for years, but investigations in the US and UK have shown no hard evidence that Huawei’s equipment is rigged to provide backdoors for hackers.