Cable lobby warns of chaos if FCC doesn't relax ban on foreign routers

While the FCC is trying to force companies to move manufacturing to the US, the NCTA said the whole industry is constrained by shortages: Like AT&T, NCTA members are encouraging their suppliers to quickly pursue required onshoring, and, in the meantime, seek Conditional Approvals for Covered Routers as necessary. However, unavoidable supply chain shortages in critical substrate material and memory modules (including both volatile and nonvolatile memory) significantly constrain the industry. AT&T’s suppliers are not unique; the same impediments they are experiencing impose inevitable limitations on NCTA’s suppliers. Accordingly, NCTA seeks the same relief on behalf of its suppliers. Given the immediacy of these issues and the concrete harms that would result from disruptions to the availability of broadband to large swaths of US consumers and businesses, the grant of this Petition is warranted. The memory shortage is a well-known problem, and the NCTA said cable firms’ vendors are “facing significant lead-times to find alternatives for memory to use in routers.” The NCTA said its members’ suppliers also “face the repercussions of a global shortage for semiconductor substrates, a critical component for electronic devices.” AT&T pointed out in its successful petition that software and firmware changes “are not the only updates necessary to ensure continued functionality of previously approved devices.” But as of now, “Class I and Class II permissive hardware changes remain prohibited for other providers,” the NCTA said. Before the FCC added all foreign-made routers to the Covered List, cable companies could make the necessary changes without special permission, the NCTA said: With respect to permissive changes for routers, alternative sources as well as higher density sources such as 64GB eMMC are generally a pin-to-pin and footprint-compatible replacement for a lower-density part, so it can be placed directly onto the existing routers without other changes to device hardware. Prior to foreign-made routers being added to the Covered List, this change would generally have been classified as a Class I permissive change, as it involves no degradation to device performance and requires no changes to the device or other hardware components. However, NCTA members’ suppliers now cannot pursue these memory changes given the prohibitions of permissive changes for router hardware. Router makers may seek “conditional approvals” to let them import and sell new models, and must submit a justification for the use of foreign manufacturing and a “detailed, time-bound plan to establish or expand manufacturing in the United States.” The process includes more than just the FCC, as hardware makers must obtain a determination from the Department of Defense or Department of Homeland Security that the router does not pose national security risks. Netgear and others, such as Amazon’s Eero subsidiary, were quick to apply for and obtain conditional approvals. Chinese companies are expected to have the most trouble obtaining exemptions. The process also applies to foreign-made drones and adds a layer of bureaucracy for hardware makers that want to update existing products or import new models. The NCTA said the waiver it seeks will prevent problems while cable ISPs and their vendors navigate the process of obtaining company-specific exemptions. “The targeted waiver requested by NCTA on behalf of its suppliers would allow continued production of existing devices in the near term while members work with their suppliers on Conditional Approval requests, and is intended to prevent sudden and abrupt disruptions that would harm vast swaths of American consumers who are NCTA members’ customers,” the NCTA said.