Oct 13, 2020

The Pentagon floats plans to create nationalised 5G network

Harry Menear
2 min
The Pentagon and the Federal Communications Commission’s plans to lease 5G frequencies to a private contractor could give the recipient a huge advantage
The Pentagon and the Federal Communications Commission’s plans to lease 5G frequencies to a private contractor could give the recipient a huge advanta...

The Trump Administration is pushing forward a plan to effectively nationalise a portion of the United States’ 5G networks. The move, which is deeply uncharacteristic of a Republican government which has expounded free market economic doctrines louder than the Reagan administration, has been met with criticism from the telecoms sector and Republican legislators. However, industry experts and legislators suspect that the move is being motivated by a desire to more effectively compete with China in the 5G arena.  

The proposal is currently underway at two different branches of the government: the Federal Communications Commission and the US Department of Defence

In September, the Pentagon released a Request for Information (RFI) to the private sector for insight into “innovative solutions and technologies for dynamic sharing of the department’s current spectrum allocation to accelerate spectrum sharing and 5G deployment.” According to a report by the Wall Street Journal, the Pentagon’s plans are likely to involve creating a 5G military cell network, which the Pentagon would then lease to enterprises in the manufacturing, tech and telecom industries. The Pentagon currently uses a sizable portion of available 5G space for radar and aviation, but the government appears to believe that repurposing it for commercial and government 5G use is a more beneficial strategy. 

The Federal Communications Commission is apparently gearing up to hold an auction of some of the Pentagon-controlled bandwidth in December of 2021. According to Craig Moffett, an analyst for telecom and media research firm MoffettNathanson LLC, the entirety of the spectrum band controlled by the Pentagon could fetch as much as $100bn at auction.

Some people familiar with the matter have speculated that the resulting network could look a lot like FirstNet, a private communications network used by first responders and operated under government contract by AT&T. With FirstNew contracts costing as much - if not more - than a standard phone contract, the telecom company that ends up fulfilling a Pentagon-backed, “nationalised” 5G network could end up with a huge advantage over its competitors. 

Major US telecoms have raised the issue, protesting that the Pentagon selling spectrum directly to telecom operators would circumvent the current, auction-based system and subvert competition. 

However, the movement reportedly has popular bi-partisan support in congress, as it is increasingly seen as a way to “edge out” China from the US’ 5G networks, as well as bring 5G to underserved communities. In a virtual industry conference last month, ex-Google CEO Eric Schmidt said that a national 5G network using the Pentagon’s spectrum was the US’ best chance of “beating China” and averting the disaster of a world where China outstrips the US in 5G.  

Share article

Jun 21, 2021

Tech Corporations Fight for Alternative ESG Filings

Alphabet
Apple
Microsoft
ESG
Elise Leise
3 min
In a letter to the SEC, Alphabet, Amazon, and Intel pushed back against ESG disclosures in 10ks—asking for more flexible timelines and reporting standards

In 2021, almost a third of global equity inflow went into ESG funds, according to the Bank of America. In April alone, ESG assets hit US$1.4tn, growing at 3x the rate of non-ESG funds. And although it seems like solar panel and electric car firms should take the cake for sustainable investment, it’s actually the world’s largest tech firms that command the market. 

 

The Wall Street Journal reported that the most commonly held S&P 500 stocks in actively managed sustainable equity funds include Microsoft, Alphabet, and Apple. So it struck many as odd that in a June 11th letter to the Securities and Exchange Commission (SEC), Alphabet requested that ESG information not be disclosed in annual 10k filings.

 

Who Signed The Letter? 

Only some of the most influential tech giants in the world...

 

 

To be fair, these companies aren’t against ESG and sustainable business. ‘Collectively, we purchase more than 21 gigawatts of clean energy and many of us are members of the UN Race to Zero and America is All In campaigns’, the joint letter to the SEC stated. ‘Each company has an individual goal to procure 100% renewable energy’. 

 

Then Why Protest? 

According to the tech companies, filing ESG information might open them up to legal risks. After all, sustainability reporting relies on estimates and assumptions that involve uncertainty—and governance issues such as fair labour are much harder to track than annual financial data. ‘It is important not to subject companies to undue liability’, the companies wrote

 

Instead of reporting ESG data in their annual 10k filings, Alphabet et. al suggest that the SEC should allow for new climate-related reporting outside of the current annual or quarterly schedules. By adjusting the reporting frequency and timing, they argue, companies can provide a better and more accurate measure of how they’re doing with ESG. 

 

Who Opposes Alternative ESG Reporting? 

For the most part, asset managers aren’t thrilled. Pimco, Invesco, and other major asset funds want ESG information disclosed—the standard way. As of right now, the SEC still intends to make ESG 10k filings mandatory. ‘[Alphabet] positions itself as a sustainability leader’, said Josh Zinner, CEO of the Interfaith Centre on Corporate Responsibility. Added Molly Betounray, Director of Shareholder Advocacy at Clean Yield Asset Management: ‘While it’s great to see corporate ESG leaders advocating for climate disclosure standards, we disagree with their assertion that these disclosures should fall outside current standard SEC filings’. 

 

What’s the Verdict? 

Maybe Alphabet, Amazon, and Intel are honestly trying to frame ESG reporting in a new light. As Patrick Flynn, Vice President for Sustainability at Salesforce said: ‘[ESG disclosure] is a new process for companies to go through, and they’ll need to establish new procedures. Allowing for some sort of safe harbour from liability…[allows] companies to push in willingly and not just do the bare minimum’. 

 

In their letter to the SEC, these companies chose to recommend several concrete actions: 

 

 

In short: before we mandate ESG reporting, the SEC should at least think twice about how to design it.

 

 

Share article