CCA Chief Still Optimistic Congress Will Fully Fund Rip and Replace

Donovan's optimism is based on several lawmakers saying publicly, and privately they plan on tackling the $3.8 billion needed to fully fund the Secure and Trusted Communications Networks Reimbursement Program (see 2404100067). The program pays for removing and replacing Huawei and ZTE gear in carrier networks. There are “real world consequences to it not being funded,” he said.

CCA has said for a while rip-and-replace “problems are coming” and “those problems are here.” Some larger providers are saying they will have to stop work “with much of the job still undone.” One problem, he said, has been the lack of “moving vehicles” in Congress to which something can be attached this year.

Timing is the biggest challenge, Donovan said. “That does also mean that there are vehicles that will be moving through Congress and that always creates opportunities,” he said. Donovan cited in particular an expected continuing resolution to keep the federal government from shutting down Oct. 1. Another possibility is an expected bill providing more money for the Federal Emergency Management Agency before it runs out of funding, he said. There is also likely to be an omnibus funding bill following the election, he said.

The rip-and-replace program was supposed to be finished in July “and we’re still here talking about it,” Donovan said. “There are absolutely companies” that face “existential” challenges if more funding isn’t approved, he said. If the Chinese gear fails or breaks, providers can’t get replacements or spare parts, he said.

5G Fund

“Some of the [FCC] commissioner statements read a little bit to me like there’s still more work to be done; this isn’t the final say,” Donovan said of the agency's 5G Fund rules. CCA and the Rural Wireless Association voiced disappointment when the order was released at the end of August (see 2408290041).

Donovan expects someone will seek reconsideration, though CCA hasn’t made its decision. “We’re looking at all options for next steps.” He added, “We are huge supporters of having the 5G Fund, and it’s super important to do it.” If the eligibility is focused on “extremely remote sites with incredibly expensive service to build,” while potentially losing service in areas supported now by the USF, it could mean “one step or half a step forward, but two steps back.”

Without support for ongoing expenses in areas that are expensive to serve, customers could lose service, Donovan predicted.

The 5G Fund “should be most beneficial for our carrier members, they should be the best positioned to take advantage of it,” Donovan said: “That’s why we really want to work to make it succeed, not to block it or stop it.”

CCA is “evaluating” the $42.5 billion broadband equity, access and deployment (BEAD) program, with an eye on what it will mean for wireless carriers. More will be known “as more states come forward with their plans, and we start seeing what some of the high-cost thresholds look like.” CCA members are evaluating the role fixed wireless could play in BEAD and the potential for fiber deployments, he said. BEAD “hasn’t moved forward as quickly as we may have thought.”

The cost of 5G build outs “drops dramatically” when carriers have fiber near the deployment in their networks. A $9 billion 5G Fund won’t pay for ubiquitous 5G service, he argued. If the FCC waits for BEAD to play out, carriers can make more informed bids in the 5G auction “and that’s going to spread support further.”

The FCC may be building time into the process to allow BEAD to develop further, Donovan said. The agency has made clear that the August order was “the next step in the 5G Fund -- there’s work to be done before we move to auction procedures and ultimately an auction.” He continued, “It was helpful to see in the order that the commission will continue to reevaluate BEAD and the progress there.”

Donovan said CCA is very concerned about the recent 5th U.S. Circuit Court of Appeals' decision that questions the USF's future (see 2408140055). That’s “a really, really big deal.” With a split in the federal circuits, Donovan expects the U.S. Supreme Court will take the case.

CCA members are focused on mid-band spectrum for 5G in the same bands the national carriers are targeting, including lower 3 GHz, Donovan said. Smaller carriers “can’t drive an equipment ecosystem.” Interest is also growing in an auction of the AWS-3 licenses that have been returned to the FCC. Those licenses are in larger and some smaller markets as well, he said.

CCA members are also tracking the FCC’s work on further changes to rules for the citizens broadband radio service band (see 2408160031). The smallest carriers are focused on mid-band. “For many small carriers it’s what you can get your hands on and can use,” he said: “The lower mid-band frequencies have been very helpful in terms of [being] workhorse bands.”

The approach CCA members are taking to 5G also varies widely, Donovan said. Some are “leapfrogging” 5G non-stand-alone, and going directly to stand-alone. “We’re not at a point where I can say that everyone is at 5G or all our members are even on a path to stand-alone 5G.”