Over the weekend, a rumor surfaced that the Trump Administration might nationalize the United States’ burgeoning 5G network. A plan laying out such options was reportedly presented at the White House. Allowing wireless providers to create their own wireless 5G network was argued to cost more and take longer than a nationalized option, with the argument that a single nationalized network would allow American infrastructure to be protected from China and other bad actors.
One option would be for the US government to require carriers to “bind together” in a consortium, according to Axios, to put aside their business models to serve the common good of the nation. There are basically two arguments here: an economic one about the value of free markets compared with a government-run institution, and a conceptual one about national security. It’s not crazy to see a certain tension between them. (The memo can be viewed in its entirety here.)
The US government has expressed concern that companies like Huawei might sell phones to US consumers. The past few years have offered ample evidence foreign states are moving to secure power for themselves in ways that challenge the America-dominated narrative of the post-Cold War era. China and Russia both have major ambitions on the world stage, the Russians have moved to modernize multiple weapon systems, and China is flexing its own economic power.
The Trump administration, meanwhile, has rhetorically implied America needed to renegotiate various military and security arrangements, and moved to increase overall military spending. A national 5G network, secured from Chinese influence, could be viewed as a component of such a policy. Nor is such consideration historically invalid — the creation of ARPANET led, after all, directly to the modern internet. A nationalized or consortium-created 5G network with a hybrid public-private partnership model isn’t something we’ve built before in the US, but there’s a justifiable national security angle in considering one. Under the proposed model, the US government would build the infrastructure, then rent it to the various carriers like ATT and Verizon. The memo also suggests the US work to develop a secure 5G network concept, which could then be shared with allies.
The FCC has already reacted in horror to the concept. “I oppose any proposal for the federal government to build and operate a nationwide 5G network,” said chairman Ajit Pai. “The main lesson to draw from the wireless sector’s development over the past three decades — including American leadership in 4G — is that the market, not government, is best positioned to drive innovation and investment.”
The swift response to the leaked memo implies there could be truth to it, though the Trump administration has now told the press the exploration was a hypothetical one. It’s the job of various staffers within the White House to present position papers and arguments on various topics as part of evaluating White House policy. The idea that the Trump White House might consider nationalizing the 5G network to protect against foreign incursions or attack might seem a shocking departure from US norms. But national cybersecurity isn’t a trivial concern and the concerns raised in the memo are, as far as we can tell, consistent with general fears about the degree to which foreign powers may have penetrated US infrastructure.
As of this writing, there’s no evidence the US government intends to take any concrete steps to nationalize 5G or to create a hybrid public/private model for 5G financing or development.