President Trump and the Federal Communications Commission unveiled a new 5G effort Friday afternoon.
“5G networks will also create astonishing and really thrilling opportunities for our people,” Trump said at the press conference. “Opportunities that we never even thought we had a possibility of looking at. We cannot allow any other country to outcompete the United States in this powerful industry of the future.”
FCC Chairman Ajit Pai announced the third 5G spectrum auction set to begin on Dec. 10. Pai said it will be the largest spectrum auction in U.S. history, “which will be critical to providing the airwaves necessary for carriers to deploy 5G wireless networks,” said Pai.
Pai also announced his plans for a Rural Digital Opportunity fund, which would dedicate $20.4 billion over 10 years to expand high-speed broadband access to underserved or unserved areas.
The FCC says the fund will connect up to four million rural homes and small businesses to high-speed broadband networks
“This is a critical tool toward closing the digital divide and it will provide some of the critical infrastructure to connecting rural Americans with 5G technologies,” said Pai.
To pay for it, Pai said the agency plans to repurpose money from the Universal Service Fund. Each year for the next decade, $2 billion dollars would go toward rural carriers to build out the broadband network.
Pai said the FCC still needs to go through the notice and comment process on the proposal, but he wants the funding to be given to companies through a reverse auction. The chairman hopes to start that process sometime this year.
There have been concerns that the United States may be lagging behind China in 5G, but Pai is confident the U.S. is leading the way.
“We have the greatest number of 5G deployments currently than any country in the world. The FCC is making more spectrum available than any other country in the world and we’re taking steps going tin the future to make sure we maintain that leadership position,” said Pai in an interview with Yahoo Finance.
President Trump shot down the idea of a nationalized 5G network at the White House event on Friday.
“In the United States our approach is private-sector driven and private-sector led,” said Trump. "We don't want to do that [nationalize 5G]. It won't be nearly as good, nearly as fast.”
Pai told Yahoo Finance he agreed with the president.
“It simply won’t work. The amount of money that would be required, the amount of legwork that would have to be done would be on a scale that the federal government would be incapable of doing,” said Pai.
Pai told Yahoo Finance 5G has the potential to create an internet economy that would “dwarf what we saw with 4G,” though it’s difficult to estimate 5G’s economic impact at this point.
“We don’t know precisely how some of these industries are going to be transformed — only that they will be. Whether it is agriculture, health care, transportation or manufacturing — all of these have a very compelling 5G use case,” said Pai.
In a tweet ahead of the White House event, Democratic FCC Commissioner Jessica Rosenworcel said, “So far this administration’s interventions on 5G have done more harm than good.”
So far this Administration’s interventions on 5G have done more harm than good. From imposing tariffs on 5G equipment to alienating allies on 5G security to falling behind the rest of the world on critical mid-band spectrum, it has yet to offer a workable plan for US leadership.
— Jessica Rosenworcel (@JRosenworcel) April 12, 2019
Pai responded to the criticism telling Yahoo Finance he believes the U.S. is leading the 5G race and he hopes “to move forward in a bipartisan way to maintain that American leadership.”
Jessica Smith is a reporter for Yahoo Finance based in Washington, D.C. Follow her on Twitter at @JessicaASmith8.
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