- Federal Communications Commission (FCC) gives Netgear a conditional approval to avoid router ban
- It seems Netgear is still using components made outside of the US
- Other router makers are still facing a ban
Last month, the US Federal Communications Commission (FCC) introduced a ban on routers made outside of the US, and while the official reasoning behind the ban was “an unacceptable risk to the national security of the United States and to the safety and security of U.S. persons,” as I wrote at the time, the ban made little sense, considering how many routers are made (or use parts that have been made) outside of the US.
And my confusion over the ban has turned to anger with the news (as reported by The Verge) that Netgear will be exempt from the ban, with the FCC granting the company a “conditional approval” to import and sell its routers.
Why anger? Well, I wasn’t really sold on the security argument — not because there are no security issues with routers — but because the heavy-handed approach would mean US consumers would end up with a lot less choice when shopping around for a new router.
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This looks like a case of special treatment
As I wrote last month, the initial ban meant that if Netgear (and other router makers) wanted to get around the ban, they’d need to move their manufacturing to the US — something that many companies would likely find prohibitively expensive.
With Netgear getting conditional approval to continue selling its routers (which explicitly states that companies need to “establish or expand manufacturing in the United States”), you might think that means Netgear is moving all parts of its manufacturing to the US, but there’s been no indication from the company that this is the case.
So, it feels like Netgear is getting special treatment. As this Reddit thread points out, Netgear was quick to praise the ban, stating “We commend the Administration and the FCC for their action toward a safer digital future for Americans,” while other router makers kept quiet.
Following the ban, Netgear’s stock rose by a not inconsiderable 16.7%, suggesting there was a lot confidence that Netgear would avoid the ban, whilst benefitting from the fact that future products from rivals, especially TP-Link, will be banned.
The reason I mention TP-Link is because not only does it make a lot of the routers found on our best router list; it has been steadily eating away at Netgear’s marketshare in the US, and also provides the free routers that over 300 ISP (Internet Service Providers) in the US offer. Crucially, TP-Link is a company that originally hails from China, which means it’s particularly vulnerable to the US ban.
With its biggest competitor facing a ban of future product sales (existing products will remain on sale), while somehow avoiding the ban itself, Netgear looks set to win big — and that’s where my frustration with this stems from.
Banning some companies while turning a blind eye to others is blatantly anti-consumer, as it could mean US consumers have little choice but to buy Netgear products.
It also undermines the FCC’s claim that this ban is about security. If that really was the case, Netgear wouldn’t be able to get an exemption without moving its entire hardware production line to the US.
It’ll be interesting to see if Netgear does indeed follow through and make all of its routers in the US. If not, will other US router makers who, like Netgear, still use components from outside the US, also get exemptions?
If the answer to both those questions is ‘no’, then this situation could get even messier — and I’ll likely get even angrier.
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matthew.hanson@futurenet.com (Matt Hanson)
