China Mobile somehow surprised at FCC snub

There was no squabbling over party-politics here; both the Republicans and the Democrats agree China Mobile should not be allowed a licence to operate telco services in the US.

Making an entry for the least surprising decision ever made, the FCC has announced it will deny China Mobile, the Chinese state-owned telco, a licence to operate in the US. Despite the outcome being glaringly obvious, China Mobile is irritated at the decision, suggesting there is no reason to deny the application.

“CMI (China Mobile International) complies with and adheres to the local laws and regulations in every country it operates. In the spirit of openness and free trade, CMI applied to obtain International 214 License from the Federal Communications Commission (FCC), aiming to support telecommunication needs to customers in both countries, enhancing connections between the two markets,” the company said in a statement.

“After 7 years and 8 months of application, FCC now denies CMI’s bid to operate in the U.S. without apparent reasons and basis. It is out of market economy principles and contradicts the trend of economic globalization.”

Made back in 2011, China Mobile filed an application under Section 214 of the Communications Act and section 63.18 of the Commission’s rules to provide international facilities-based and resale services between the US and abroad. It might have taken almost eight years to make a decision, but it is exactly what you would have expected.

“Simply put, granting China Mobile’s application would not be in the public interest,” said FCC Chairman Ajit Pai. “China Mobile ultimately is owned and controlled by the Chinese government. That makes it vulnerable to exploitation, influence, and control by that government.”

“As a fierce supporter of promoting competition, permitting foreign ownership, and facilitating open markets, I nonetheless find the situation confronting us to be extremely serious, and the action we take today to block China Mobile from accessing the US telecommunications market to be a necessary step, drastic though it may be,” Commissioner Michael O’Reilly said.

This is a decision which has the full support of the FCC as well, with all Commissioners voting the same direction. Unsurprisingly, all of the Commissioners spoke of national security, the importance of communications networks in today’s society and the lack of trust in China Mobile. Simply put, the FCC doesn’t want a puppet of the Chinese state poking around its telco infrastructure.

The Huawei case is slightly nuanced as the ties back to the Chinese government are largely based on a piece of legislation and founder Ren Zhengfei’s time in the People’s Liberation Army. Here, there is no murkiness or grey areas; China Mobile is owned by the state, directly.