NTIA blocks China Mobile's bid for U.S. presence

The U.S. government is moving to block China Mobile from providing international services in the United States because of national security worries.

David Redl, assistant secretary for communications and information at the Commerce Department and head of the National Telecommunications Information Agency, signed off on the recommendation against granting China Mobile's license request.

"After significant engagement with China Mobile, concerns about increased risks to U.S. law enforcement and national security interests were unable to be resolved," Redl wrote.

The Trump administration has moved against Chinese telecom companies on a number of fronts in recent months, including a decision (later reversed) to bar ZTE from sourcing components to U.S. suppliers – essentially a death sentence for the firm.

In May, the Pentagon banned the sale of Huawei and ZTE mobile devices at military bases and concessionaires based on cybersecurity concerns.

The Senate version of the 2019 National Defense Authorization Act includes a provision tightening federal procurement prohibitions on Huawei and ZTE devices. In early June, however, the president eased restrictions on ZTE after concerns that they harmed U.S. telecom gear makers that sold components to the company.

The Federal Communications Commission is considering a move to bar subsides under the $8.5 billion Universal Service Funds from going to companies the telecom agency deems a security risk.

China Mobile, which has almost a billion customers in its home country, applied for the license in 2011 at the FCC. The license allows telecommunications carriers to interconnect with domestic U.S. carriers' networks to transmit domestic long distance and international traffic.

NTIA told the FCC that China Mobile doesn't intend to offer domestic telecommunications services, or mobile services in the U.S., but wants to provide international voice services from the U.S. to foreign countries.

The NTIA told the FCC it is concerned about the amount of control the Chinese government has over the firm, U.S. law enforcement's ability to ask for information in the course of its duties and the potential of intentional disruption of other telecommunications networks the interconnection could bring.

If the deal went through, Redl wrote, "the Chinese government, through China Mobile, would have a greater ability to monitor, degrade and disrupt U.S. government communications." He warned that U.S. government agency international telecom traffic could be routed through China Mobile's network even if those agencies aren't its customers because of FCC interconnection rules.

NTIA warned China Mobile could also quietly increase its network's points of presence in the U.S. to satisfy those interconnection requirements, potentially giving the foreign firm its own network in the country.

Although China Mobile said in its filing that it could address those risks, the NTIA told the FCC that the company's proposed fixes wouldn't resolve the concerns. NTIA's redacted filing also noted that the administration was filing a classified appendix that contained information backing its concerns.