Federal 5G Network Is Panned by FCC and Industry

WASHINGTON — Federal regulators and major telecommunications companies pushed back Monday against a proposal circulating in the White House that would put the government in control of a next-generation mobile broadband network to address economic and security concerns related to China.

The chairman of the Federal Communications Commission, Ajit Pai, said he opposed the idea. He argued that the federal government taking control of developing 5G networks, as the mobile technology is called, could hurt the private sector and the economy.

“The market, not the government, is best positioned to drive innovation and investment,” Pai, a Republican, said in a statement. “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.”

USTelecom, the trade group that represents telecommunications and cable broadband providers, said any government-run plan would set back the industry.

“There is nothing that would slam the brakes more quickly on our hard-won momentum to be the leader in the global race for 5G network deployment,” Jonathan Spalter, chief executive of USTelecom, said in a statement.

The strong reaction was in response to reports that the Trump administration, on a recommendation from the National Security Council, was contemplating using federal money for a 5G network. The proposal was first reported by Axios, the online news organization, on Sunday.

White House officials said the idea was very preliminary. The administration has thrown its support behind the development of more secure wireless networks using 5G technology, according to two administration officials who would speak only on the condition of anonymity because the discussions were at an early stage.

Some White House officials have pushed for greater federal involvement in the private sector’s efforts, but the administration does not prefer the idea of the government building a network on its own with public funding, the people said.

Discussions on the government’s involvement in 5G networks are likely to take at least six months before reaching the president for consideration. In a news conference Monday, Sarah Huckabee Sanders, the White House press secretary, said any discussion is at its “earliest stages.”

The Trump administration is becoming increasingly concerned about economic and security threats posed by China’s development of mobile technology and 5G networks. Among the concerns is the ability of the Chinese government to spy on Americans and businesses.

The U.S. government has long been suspicious of Huawei, a giant Chinese technology company that is behind much of the 5G network development in that country. This month, AT&T dropped its plan to carry a new phone model from Huawei. The company has declined to comment on its reasons for dropping the deal, although government officials have expressed concerns over security on those phones.

The introduction of 5G, or fifth-generation wireless technology, is expected to make browsing and streaming over mobile phones much faster. It is also expected to promote the adoption of what is known as the internet of things, where all sorts of machines and appliances — such as refrigerators, cars and health monitors — connect to the internet with nearly zero lag time.

Wireless companies said that they had already started building their 5G networks and that any government-run network would be disruptive.

“Industry standards have been set, trials have been underway since 2016, and later this year AT&T is set to be the first to launch mobile 5G service in 12 U.S. locations,” AT&T said in a statement.

Any nationalization project could be a difficult sell politically, since the Trump administration and other Republicans have strongly criticized big government projects.

Among those officials aggressively pushing the 5G network are two China hard-liners: Gen. Robert S. Spalding II, senior director for strategic planning at the National Security Council, and Peter Navarro, director of the White House national trade council.

On trade issues, Navarro has faced off against officials who favor a more free-market approach, like Gary Cohn, the president’s chief trade adviser. The national security adviser, Gen. H.R. McMaster, has also opposed aggressive trade moves against China, in part because the administration needs China’s support to rein in North Korea.