Monday, 24 September, 2018

Trump moves to block China Mobile from U.S. market

Headquarter of China Mobile in Beijing financial street Trump moves to block China Mobile from US market
Elsie Buchanan | 05 July, 2018, 15:03

Regardless of how it planned on offering its services, the NTIA (National Telecommunications and Information Administration) states China Mobile's entry to the market "would pose unacceptable national security and law enforcement risks", and the FCC is allegedly set to deny its application.

The NTIA told the FCC it is concerned about the amount of control the Chinese government has over the firm, USA 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.

China Mobile's plans to offer telecom services from within the United States may face FCC hurdle.

China Mobile wanted to provide cell phone and other communication services between the United States and other countries.

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.

The NTIA decision comes amid escalated tensions between Washington and Beijing.

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It is worth noting that China Mobile is technically the largest telecom carrier in the world with 899 million subscribers.

The move marked the latest blast from the USA under President Donald Trump in its growing trade dispute with China.

The Chinese government could use links established by China Mobile for economic espionage and intelligence collection, according to the filing. The company wasn't seeking to offer mobile services directly to U.S. customers, according to the USA filing. The worldwide calling business accounts for only a tiny portion of China Mobile's revenue, according to Ramakrishna Maruvada, an analyst with Daiwa Capital Markets.

As a recall, the matter in hand is the latest extension of the ongoing trade conflicts between China and the United States. The U.S.in June reached a deal to allow ZTE to get back in business after the Chinese telecommunications company pays a record fine and agrees to management changes. At the time the DOC said that the company had supplying Iran and North Korea with equipment that illegally included U.S. components.

However, following some pressure from Beijing, the USA struck a deal with ZTE that would involve the firm paying a $1bn penalty, hiring a compliance team chosen by the United States, and replacing much of its management board, among other measures.

It had planned something similar for the U.S. but this week (though not a direct to consumer offering apparently, but aimed at the enterprise sector) but its application was blocked following a recommendation from the National Telecommunications and Information Administration. With a unit of the Commerce Department recommending an FCC veto based on security concerns, a campaign to cramp Beijing's ability to monitor overseas traffic from Chinese companies and individuals could be getting underway.

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