U.S. Allows Google Internet Project to Advance Only if Hong Kong Is Cut Out
09 April 2020 - 6:57AM
Dow Jones News
By Drew FitzGerald and Kate O'Keeffe
U.S. officials granted Google permission to turn on a high-speed
internet link to Taiwan but not to the Chinese territory of Hong
Kong, citing national-security concerns in a ruling that
underscores fraying ties between Washington and Beijing.
"There is a significant risk that the grant of a direct cable
connection between the United States and Hong Kong would seriously
jeopardize the national-security and law-enforcement interests of
the United States," the U.S. Department of Justice said in its
Wednesday decision, which was backed by the departments of Homeland
Security and Defense.
The agencies instead urged the Federal Communications Commission
to grant Google owner Alphabet Inc. permission to start using the
portion of its 8,000-mile underwater Pacific Light cable that
connects California to Taiwan.
Crews have already built the multimillion-dollar cable with
branches to Taiwan and Hong Kong, but it remains dormant. The FCC
has final authority over licenses to operate submarine cables,
though it usually defers to other agencies on projects'
national-security reviews.
The decision threatens to end Hong Kong's dominance as a top
destination for U.S. internet cables and puts at risk several
ongoing projects, including a Facebook Inc.-backed fiber-optic line
linking Los Angeles to Hong Kong and a Google-backed project
linking Hong Kong to the U.S. territory of Guam.
Chinese authorities have blocked U.S. companies like Facebook
and Google from operating on the mainland, but the semiautonomous
territory of Hong Kong has unfiltered access to the web and has
served as a stopping-off point for global companies seeking
connections to the region.
But U.S. officials are souring on the territory as Beijing uses
a heavier hand there. Hong Kongers have spent months resisting
Beijing's efforts to integrate the territory more closely with
mainland China.
Washington is turning to the self-ruling island of Taiwan, which
the U.S. supports with arms sales and unofficial political ties
despite Beijing's claims that it is part of China.
U.S. officials are also considering alternatives. In their
Wednesday decision, the agencies said their approval was
conditioned on Google pursuing "diversification of interconnection
points in Asia, including but not limited to Indonesia,
Philippines, Thailand, and Vietnam."
A Google spokeswoman said the company welcomed the decision,
adding that it recognizes "the importance of Google services at a
time like this" and is "committed to adding capacity to stay ahead
of demand."
A Facebook spokeswoman said the company is still navigating the
licensing and permitting process.
Google and Facebook originally teamed up to build Pacific Light
to Hong Kong in 2016, continuing the Silicon Valley giants'
long-term strategy to take more control of the network pipes that
connect their data centers. The web companies and their Chinese
investment partners kept building the cable even as U.S.
authorities withheld the regulatory approvals they needed to start
using it.
In January, Google retooled its approach and asked for
authorities' initial permission to turn on the portions of the
cable that don't touch Hong Kong. The cable's operators had mostly
finished building the undersea lines and its anchor stations on
land but lacked permission to power up the system. The companies
again tweaked their proposal last week to fast-track Google's
Taiwan link while construction continued on Facebook's branch to
the Philippines.
Major international data projects are subject to review by Team
Telecom, a coalition of federal agencies with national-security
oversight. The panel has taken a hard line against China in recent
years. Team Telecom in 2018 recommended for the first time the
denial of a Chinese application -- that of China Mobile Ltd. -- to
provide telecom services through U.S. networks, citing
national-security and law-enforcement concerns.
President Trump this month signed an executive order that puts
the attorney general in charge of overseeing Team Telecom and gives
the panel direct authority to review existing licenses to provide
such services, including those issued earlier to Chinese
state-owned operators China Telecom Corp. and China Unicom.
Write to Drew FitzGerald at andrew.fitzgerald@wsj.com and Kate
O'Keeffe at kathryn.okeeffe@wsj.com
(END) Dow Jones Newswires
April 08, 2020 16:42 ET (20:42 GMT)
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