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Trump White House mulls nationalizing 5G... an idea going down like 'a balloon made out of a Ford Pinto'

Make America Socialist Again?

By Kieren McCarthy in San Francisco


A proposal by the Trump administration to effectively nationalize next-generation 5G networks in America triggered an angry reaction from the mobile industry, former government officials, and federal regulator the FCC.

According to a leaked 30-page document [PDF], the White House is considering getting the federal government to pay for and build a single nationwide high-speed 5G cellular network which it will lease to mobile operators.

While that approach may have some advantages, it would also represent a huge reversal from today's capitalist system where mobile operators ostensibly build their own networks and compete with one another. As such, the idea of a federal network has not gone down well with the industry.

"The wireless industry agrees that winning the race to 5G is a national priority," a statement from the CEO of mobile industry association CTIA, Meredith Attwell Baker said, adding: "The government should pursue the free market policies that enabled the US wireless industry to win the race to 4G."

Meanwhile, Jonathan Spalter, CEO and president of comms industry body US Telecom, said:

There is nothing that would slam the breaks [sic] more quickly on our hard-won momentum to be the leader in the global race for 5G network deployment more quickly than the federal government stepping-in to build those networks. The best way to future-proof the nation’s communications networks is to continue to encourage and incentivize America’s broadband companies – working hand-in-glove with the rest of the internet ecosystem, and in partnership with government, to continue do what we do best: invest, innovate, and lead.

A former head of the National Telecommunications and Information Administration (NTIA) – the US government wing that oversees such policies – was less diplomatic. "This sounds like an intern project," said Larry Strickling at an internet policy conference in Washington DC on Monday morning.


His successor David Redl gave a keynote speech today at the same conference. He did not directly mention the nationalization plan, but did note: "Last year, the President made it clear that 5G network security is a critical element of our national security."

He added that, especially with the internet of things, "security both in the device and in the network itself will be important to ensuring not only our national leadership in wireless, but also to ensuring access to a vital part of our national economy."

When it came to the idea of the federal government building its own network, he was oblique: "NTIA will continue to work with our colleagues across the Federal government to coordinate a national strategy on spectrum access and will work the private sector to ensure that the standards process for 5G wireless services continue to promote our national interest in security."

The leadership of the FCC, America's broadband watchdog, was less obtuse. All five FCC commissioners rushed out statements criticizing the proposal.

"I oppose any proposal for the federal government to build and operate a nationwide 5G network," said chairman Ajit Pai. "The main lesson to draw from the wireless sector’s development over the past three decades - including American leadership in 4G - is that the market, not government, is best positioned to drive innovation and investment… Any federal effort to construct a nationalized 5G network would be a costly and counterproductive distraction from the policies we need to help the United States win the 5G future."

Commissioner Michael O'Reilly was more blunt: "I've seen lead balloons tried in DC before but this is like a balloon made out of a Ford Pinto." He called the proposal "nonsensical." Likewise, Commissioner Brendan Carr said "any suggestion that the federal government should build and operate a nationwide 5G network is a non-starter."


Commissioner Mignon Clyburn said in a statement: "A network built by the federal government, I fear, does not leverage the best approach needed for our nation to win the 5G race." And Commissioner Jessica Rosenworcel tweeted: "This correctly diagnoses a real problem. There is a worldwide race to lead in 5G and other nations are poised to win. But the remedy proposed here really misses the mark."

So far the mobile operators themselves have refused to directly comment on the proposal.

Aside from the remarkably swift condemnation – the plan was only revealed one day earlier when it was leaked to online news site Axios – it is the statement by Rosenworcel that sheds most light on what happened.

The proposal was developed by a senior official on the National Security Council, and has as it main focus fears over security and in particular concerns that China may be able to hack a future 5G network because Chinese companies are the leading makers of 5G infrastructure hardware and software.

Essentially, it is feared Beijing will backdoor all the kit going into America's next-gen wireless broadband networks. And if anything's going to be backdoored around here then, by God, it's going to have American backdoors.

"China has achieved a dominant position in the manufacture and operation of network infrastructure," reads a bullet point on a presentation deck. The next reads: "China is the dominant malicious actor in the information domain."

But the US can catch up, the presentation argues, and pushes the idea of a federally built 5G network as the modern day equivalent of President Eisenhower's national highway system or President Kennedy's space race.

It even falls back on the US government's long-held desire to export American ideals to the rest of the globe. "Eventually, this effort could help inoculate developing countries against Chinese neo-colonial behavior," the memo reads.

The pros and cons

Those arguments, combined with a desire by the Trump administration to come up with forward-thinking mass infrastructure projects, is likely what has led to the proposal getting this far. It is notable, however, that the proposal leaked soon after it was presented to senior officials at other government agencies.

The logic behind the proposal is solid: the United States is a vast country and the cost of introducing a nationwide 5G network is enormous. Each mobile operator is effectively creating its own parallel network, which is highly inefficient, and it is far from certain that those networks will be able to interoperate.

As such, a federally created nationwide fast 5G network would likely end up much cheaper, with less redundancy, and, theoretically, much higher security as it can be administered centrally. It could also be built faster than relying on competing companies to introduce their own networks. And it would be able to cover remote and rural areas in a way that profit-seeking companies are unlikely to do. It could also bypass the multitude of different local and state laws that cover the installation of mobile equipment.

In addition, it would probably work out cheaper for businesses and citizens to use since the federal government would be in a position to charge only what it costs to maintain the network.

Those are the plus sides. The downsides are not insignificant.

A federally built and owned network would almost certainly end up being a tool of mass surveillance. The creation of such a network would almost certainly kill off the industry's plans to build their own 5G networks since they would not be able to compete, and that would give the government effective control of its citizens' communications: something that doesn't sit at all well with government-fearing Americans.

There is also a big difference between building a highway system and a modern telecommunications network. Concrete and asphalt are relatively easy to maintain and pretty predictable. There is very unlikely to be some undiscovered property in these materials that would enable a third party to cause the highways to fall apart.


And while much of a 5G network will be physical in nature – the installation of hundreds of thousands of access points – the nature of this next-generation network is that it requires constant, careful management and that is done remotely and electronically.

Who would you trust to run a secure network that remains focused on its users' needs: public mobile companies or the federal government?

It's also worth noting that this is not exactly the first time that the issues surrounding 5G rollout have been discussed and considered: it has been the focus of significant attention and effort for nearly a decade.

As just one example, former NTIA head Strickling gave a speech about 5G rollout more than two years ago in which he talked in some depth about the balance between competition, interoperability and getting networks built.

"Continued growth and innovation in the wireless sector will hinge in large part on the successful introduction of 5G networks and our ability to deliver the spectrum needed to power this and other next-generation technologies," he identified, before going into the complexity of moving to a shared-spectrum approach.

It's also worth noting that for something as significant as a full nationwide network, there are a lot of people that need to be brought on board, without whom a project is doomed to fail.

Strickling noted in his speech: "Working collaboratively with the White House, FCC, federal agencies and industry… We have been assisted greatly in this effort by our interagency Policy and Plans Steering Group (the PPSG), the Commerce Spectrum Management Advisory Committee (CSMAC), and the President's Council of Advisors on Science and Technology, or PCAST."

Meanwhile, today's inhabitants of the White House continue to insist to themselves that everything is much simpler than it appears, and that difficult national problems can be solved by one hard-working guy in an office with his laptop.

Nationalizing 5G networks is not a terrible idea. In fact, it would have some real advantages. But it's not going to happen because magic wands don't exist. ®

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