The House and Senate Armed Services committees released a compromise version of the FY 2025 National Defense Authorization Act (HR-5009) Saturday night with language allocating $3.08 billion to fully fund the FCC’s Secure and Trusted Communications Networks Reimbursement Program, as expected. The measure also provides up to $500 million through 2033 to the Commerce Department for regional tech hubs. The language in HR-5009, originating from the Spectrum and Secure Technology and Innovation Act (S-4207), would give the FCC $3.08 billion in Treasury Department borrowing authority for rip and replace reimbursements.
Some congressional backers of the FCC’s Secure and Trusted Communications Networks Reimbursement Program are beginning to see momentum turn toward including an additional $3.08 billion that will fully fund the initiative in an end-of-year legislative package (see 2411190064), but they aren’t guaranteeing success yet. Lawmakers and other rip-and-replace boosters hope congressional scrutiny of the Salt Typhoon Chinese government-affiliated effort at hacking U.S. telecom networks (see 2411190073) could be a tipping point for securing the funding after multiple spectrum legislative proposals, meant to pay for the program, stalled in recent years.
Congressional GOP leaders are doubtful about lawmakers' chances of reaching a year-end deal on an additional $3.08 billion for the FCC's Secure and Trusted Communications Networks Reimbursement Program even as some Democrats are softening their insistence that the funding move in tandem with stopgap money for the FCC's lapsed affordable connectivity program. Sen. Steve Daines of Montana, Rep. August Pfluger of Texas and nine other Republicans wrote congressional leaders Monday to press for rip-and-replace funding in a bid to highlight the issue amid the lame-duck frenzy.
The extended deadlines granted EchoStar's Dish Network for building out its 5G terrestrial network were "clearly justified," New America's Open Technology Institute and Public Knowledge said in an FCC docket 22-212 filing posted Friday. Vermont National Telephone (VTel) Wireless has a pending reconsideration petition (see 2410230004). "Building a nationwide mobile network from scratch is a high hill to climb, and EchoStar deserves every benefit of the doubt as it tries to overcome numerous obstacles," OTI and PK said. They said the extension includes "positive and unprecedented" public interest conditions. VTel Wireless said last week that the FCC Wireless Bureau lacked legal authority to grant the extension. The extension clearly harmed VTel, the company said, as it forestalls reauction of EchoStar's H-block and AWS-3 spectrum licenses. Acquiring those licenses would have more than doubled VTel's AWS spectrum holdings, it added.
Vermont National Telephone (VTel) Wireless' reconsideration petition concerning the FCC Wireless Bureau extending EchoStar's 5G network buildout deadlines (see 2410230004) never mentions commitments that come with those new deadlines, EchoStar said in an opposition posted Friday (docket 22-212). It added the extension is fully within bureau precedent of giving licensees additional time so they can "complete the arduous process of building wireless networks." In addition, EchoStar said, the bureau's order comports with the FCC's objective of promoting a fourth national wireless provider. No one else has opposed the new deadlines, and VTel's "meritless" petition seems likely to have sprung from its unrelated litigation against EchoStar that alleges fraud against Dish Network in the FCC's 2015 AWS-3 auction.
The sale of Dish Network and Sling to DirecTV, as well as the spectrum-backed debt deals that accompany that transaction (see 2409300009), will give EchoStar several years to scale its wireless business, but that scaling up won't be easy, Lightshed Management's Walter Piecyk noted Wednesday. Along with the $10 billion EchoStar is raising against its AWS-3 and AWS-4 spectrum, its 3.5 GHz holdings could unlock another $2.75 billion in borrowing, he said. The DirecTV and spectrum deals provide EchoStar money for existing leases while the FCC approval of longer milestones for its 5G network buildout (see 2409200049) focuses on areas where EchoStar would use co-locations instead of new tower builds, he said. It also provides funding for the AT&T and T-Mobile mobile virtual network operator agreements, he said. A stronger balance sheet puts EchoStar in a better position to invest in customer acquisition for its Boost wireless business, "though this remains an uphill battle due to the industry’s low churn rates."
Citing "unanticipated intervening global events beyond [its] control," EchoStar is seeking additional time to meet construction milestones attached to some of its wireless licenses. An advantage EchoStar has is that the FCC wants to see increased national wireless network competition, analysts told us.
A group of companies and associations, including Federated Wireless and Charter Communications, urged the FCC in comments this week to adopt a nonexclusive, nonauctioned shared licensed framework in the lower 37 GHz band. The band is one of five targeted for further study in the administration’s national spectrum strategy (see 2311130048). Comments were due Monday in docket 24-243 and most were posted on Tuesday.
With Congress back for a three-week sprint before Election Day, Competitive Carriers Association CEO Tim Donovan remains convinced lawmakers will fully fund a program that removes unsecure gear from U.S. networks. In an interview, Donovan also said he expects at least some groups will seek reconsideration of the FCC’s recent order creating a 5G Fund.
Telecom lobbyists are closely watching whether Senate backers of the Spectrum and National Security Act (S-4207) can secure a hoped-for September markup of the measure given recent efforts to move the Proper Leadership to Align Networks for Broadband Act (S-2238) as an alternative vehicle for funding the FCC’s lapsed affordable connectivity program (see 2408150039). The Senate Commerce Committee in July adopted amendments to S-2238 that attached funding for ACP and the FCC’s Secure and Trusted Communications Networks Reimbursement Program (see 2407310048). Several observers pointed to a proxy fight about spectrum issues during Senate Commerce’s consideration of S-2238 as evidence negotiations on S-4207 are likely to remain fraught.