Earlier we mentioned that the US Department of Commerce may extend Huawei’s half-year exemption period because US rural telecommunications companies cannot leave Huawei for a short time. However, the final news is that the extended exemption period is 90 days, which is the third extension of the exemption period by the US Department of Commerce.
Huawei officials have already said that the US will continue to extend the exemption period or lift the restrictions. The potential impact on Huawei is very limited. The root cause of the extended exemption is that US rural telecommunications companies will not be able to cover the remote areas of the United States without the low-cost and high-quality equipment provided by Huawei.
In the rural areas of the United States, many basic telecom operators need to purchase Huawei equipment to provide a network. The rural population of the United States itself has a low population density and a relatively high network cost. Huawei can provide these companies with more low-cost and high-quality network equipment, which allows users in remote rural areas in the United States to enjoy lower network prices.
If the US Department of Commerce does not provide exemptions, these telecom companies will either choose to leave the countryside or double the price of the network to maintain network operating costs. US Secretary of Commerce Wilbur Ross said in the exemption states that the extension of the license will allow telecom operators to provide services in remote rural areas of the United States. These rural telecom operators can also continue to purchase Huawei’s network equipment instead of providing Huawei with basic firmware upgrades or technical services.