Chapter 4: Trump wins 2024 US Election. Telecom and Tech Policy Takeaways for the Former and Future President
Strand Consult has covered tech and telecom policy items of the 2024 election season. See earlier coverage. This note reviews the information as of Wednesday, November 6, 2024 and reflects its ongoing study of the policy issues. This note covers the Big Picture, US-China policy, deregulation, FCC, spectrum, universal service fund (USF) reform, AI, and crypto.
The Big Picture
Donald J. Trump delivered a decisive victory in the 2024 Presidential Election, winning the electoral college and apparently the popular vote. Over the last decade, Trump has driven a realignment in American politics. The stereotypes of the country club WASP Republican, big business booster, and neoconservative no longer hold. Trump won a significant share of asserted Democrat voters: black men, Hispanics, youth, and union members. He strengthened his base among traditional conservatives and the working class. He grew his appeal with independents, rural residents, seniors, and people of diverse faith and ethnicity.
Patrick Ruffini predicted this a year ago in his Party of the People: Inside the Multiracial Populist Coalition Remaking the GOP. His newsletter is a must-subscribe. Ruffini breaks down the 70 million+ Trump voters into the following groups on the political spectrum from red to blue: MAGA conservatives (14%), Reagan Conservatives (10%), Right Leaning Populists (14%), Big Government Populists (12%), Apolitical Moderates (10%), Disillusioned and Diverse (12%), Liberal Patriots (14%), and Staunch Progressives (13%). At least half of Trump’s base are people who earlier voted Democrat.
Like in 2016, Trump broke the blue wall in Pennsylvania, Wisconsin, and Michigan. However, in 2024, he won these states plus Nevada for the first time. Trump also took the swing states of North Carolina, Georgia, and Arizona. Given net migration of disaffected voters from blue states since 2020, Florida is ruby red and Trump’s new home.
The GOP had a great night on the Senate side, flipping Democrat seats in West Virginia, Ohio, and Montana, and possibly winning other seats in Michigan, Pennsylvania, and Nevada. This returns the GOP to control of the upper chamber. The House appears to remain Republican with 5 seats already flipped red. The GOP holds the edge on US governorships with 27 states.
A second Trump Presidency is likely to see the White House and Congress aligned to deliver the America First agenda in a way it was not able to do so in 2016. Indeed, House Speaker Mike Johnson stood on the stage with the President Elect during his victorious speech. The Wall Street Journal reported South Dakota Senator John Thune receiving Trump’s support for the bid as Senate Majority Leader on November 13.
Given the GOP’s resounding win, it may seem that there is no need to work across the aisle, as such. However, Trump’s positions on key issues have become mainstream. His opponent Vice President Kamala Harris even adopted some of them in her campaign, e.g. no federal income tax on tips. A majority of voters want to secure the border, reverse a failed energy policy, and reduce (not raise) taxes. Hence there is likelihood that the parties will work together, lest Democrats risk losing more voters.
It remains to be seen what money is left to litigate every Trump action. We expect that stakeholders will want to get on the Trump Train and make business in the USA rather than prosecute everything they find objectionable about him.
This is not to say there will not be partisan fights about spending cuts and deregulation, even within the parties themselves. It just means that the biggest problems like the border, expiring tax law, and the federal deficit are too big to ignore anymore.
Trump and Republicans enjoyed a resounding win, but most polls and news outlets predicted that the race would be a “toss-up.” 2024 may be the last time these “experts” are taken seriously, as betting markets appear to be more precise at predicting outcomes than pollsters. In this domain, the online predictions market and financial exchange, Polymarket is the dark horse winner. It hosted more than $3B of bets on the US Presidential election. Polymarket provided the “October Surprise” with a spike in odds for Trump beginning on October 7. Simply put, when you must put your money where your mouth is, you are motivated to get it right.
China
Trump 1 made a shift on China policy; Biden continued it; and Trump 2 will take it even further. We expect further restrictions on malign Chinese technology, including possibly tariffs on offending tech. The TikTok ban is slated to begin the last day of the Biden Administration. We hope the Biden Administration keeps this policy.
Strand Consult has study telecom infrastructure policy for more than two decades and examining the major regions of the world, USA, EU, South Korea, Japan, Latin America, China and so on. Strand Consult has described the various countries which adopted restrictions on Chinese equipment from suppliers like Huawei and ZTE well before Trump was elected in 2016.
Shortly after the arrest of Huawei’s CFO Meng Wanzhou in Canada in December 2018, Strand Consult explained the note “The story behind the Huawei story – it’s not a politically-orchestrated car accident in slow motion” that she she was not a victim of a trade war, but was responsible for violations of the Wassenar Arrangement for international security, proscribing the export and sale of nine categories of conventional weapons and “dual use” technologies.
In November 2020, Strand Consult observed in “Would a new President change the US view of the security of Huawei and ZTE in 5G networks?” that the new US president would not change such restrictions on China. Strand Consult’s assessment was and is correct.
Both Trump and Biden called for ripping and replacing Chinese equipment, and preferably, not buying in the first place, of course. The difference emerged in what to replace it with. Trump had a “Clean Network” effort led by Keith Krach which called on using equipment from democratically aligned countries. The Biden solution was OpenRAN, using hardware, interfaces and software from small and large American vendors. While few could fault the Americans for wanting to push their own vendors, the problem with OpenRAN is that it did not offer a secure solution.
Strand Consult exposed that 44 Chinese companies joined the OpenRAN effort and participated in specifications, an apparent attempt of subterfuge of Huawei’s presence. On the technical side, OpenRAN products and services were never a 1:1 replacement for standards-based equipment which is needed to create 5G. Small players will struggle to the scale of companies like Nokia, Ericsson, Samsung, Huawei and ZTE.
What will happen under Trump 2?
Pressure on China and Chinese suppliers like Huawei will likely increase significantly. Chinese manufacturers’ access to American technology will likely be significantly limited in the coming years. It will become increasingly difficult for Huawei and others to access solutions with American technology. This is vision of derisking (not decoupling) that will become policy for the US and its allies.
The next Trump administration will likely examine the separate EU policy in this domain. Notably these are measures, including certain sanctions on China, which EU developed itself; they did not come from the USA. The EU has performed its own risk analyses in connection with the its 5G Toolbox and other security questions.
China has changed significantly since 2012 and the rise of General Secretary Xi. China considers Russia, North Korea and Iran as friends. China distrusts democracy and open society. China is helping Putin get modern mobile networks into occupied parts of Ukraine to help his war effort, including Crimea, which Russia occupied since in 2014. China has most likely approved the use of North Korean troops in Russia’s war against Ukraine.
What does another Trump Presidency mean for the telecom industry?
Many countries like United States, Canada, the UK, Australia and New Zealand and others will continue their current network security policy, including the EU which uses the 5G toolbox. The question now turns to regions like Latin America. Costa Rica will restrict the use of Chinese equipment, for example. Countries choosing Huawei in the medium and long term will find it increasingly hard to implement and upgrade as Huawei can’t get the right inputs from US suppliers. Hence the need to manage supply chain risk must be considered from the start of any network investment cycle. Both telecom operators and national regulatory authorities are starting to understand that they need to consider who is faster, Huawei to circumvent the US restrictions or the American government to implement new sanctions that limit Huawei’s access to new technology.
The focus on security will extend beyond mobile networks and 5G to other parts of the telecommunications value chain. For example in Danmark, a new law allows authorities proactively to assess telecom providers equipment for the presence of non-trusted vendors and to demand its removal. The law is based on Denmark’s National Cyber and Information Strategy and is implemented by Centre for Cyber Security (CFCS). Already in April 2023, TDC was forced to replace their WDM network from Huawei with a network from a non-Chinese supplier.
There will likely be a focus on the safety of Chinese clouds, for example which are being used in Latin America. See Strand Consult’s research note: “5G Telecom Infrastructure Investment Challenge: LATAM can learn from the building and running of networks in EU”and the guest blog: “Huawei data centres and clouds already cover Latin America. Chinese tech influence is a gift to countries and politicians that don’t respect human rights.”
Simply put, security will become increasingly important in telecom networks because of an increasing aggressive China. There is increased security risk from Chinese equipment. Restrictions will be adopted by every allied nation and the USA, regardless of the President’s party. Trump will just do more of what we already know and there will be more focus in the coming years.
The Deregulatory Agenda
Trump’s deregulatory agenda is a signature accomplishment of his first term. While his administration succeeded to remove specific regulations, the regulatory edifice remains. The Biden Administration simply reinstated, rebooted, or re-introduced the regulations that had been removed. Trump must work with Congress to create lasting change which fundamentally reforms and rationalizes federal bureaucracy so that there are fewer departments, agencies, offices, and employees. Ultimately the federal budget and headcout must reduced. Ostensibly this is the idea of the Department of Government Efficiency (DOGE), which Musk would lead.
The one specific campaign promise has been to close the Department of Education. This is predicated on the idea that education should be governed at the state, not federal, level.
Depending on the bureau or agency and the relevant statute, Trump appointees can close offices which were opened by Biden appointees, for example offices created to fulfill Biden diversity or climate goals. Agency heads have some leeway to structure the organization more efficiently.
Many federal agencies received budget increases during the Biden Administration. Those are likely to be scaled back in future as the next Congress contemplates budget deficits, tax cuts, and other fiscal policies.
A true test of GOP mettle will be to imagine a better future for spectrum management. Presently management of this critical resource is bifurcated between two competing agencies—the FCC and NTIA, and the resulting conflict has not served the American people. Spectrum should be managed in one place by one agency. Full stop.
FCC
The Biden FCC adopted a series of misguided regulations. In most cases these are not the result of Congressional requests for rulemaking, but FCC overinterpretation of statute, if not an outright power grab. Many FCC rules are on track to be rejected as unlawful in court, and a new FCC will likely reverse or vacate them. At the very least, the FCC chair can slow or stop proceedings. Where there are lawsuits in play, FCC lawyers will likely pivot positions. There will likely be negotiations between the FCC and petitioners about how to resolve cases when the new administration takes office. Understandably petitioners want certainty that a future FCC will not take up misguided rules again. Hence Congressional action may be needed.
These challenged rules include but are not limited to net neutrality, digital discrimination, data breach notification, “all-in” pricing for cable and direct broadcast satellite television service, prohibition of bulk billing in multiple tenant/dwelling unit environments, various tinkering with broadband speed requirements, regulation of data caps and so on. This list of regulations to be overturned seems longer than in any from an FCC in recent memory.
If Trump’s ultimate goal is to shrink the administrative state, it makes little sense to beef it up with thousands of appointees. There will likely be some strategic nominations and then working with existing situations to make it more efficient. For example, the FCC with just 4 commissioners still made meaningful policy, and an FCC with just 3 commissioners can also work.
Spectrum Reauthorization
As Strand Consult has said many times, spectrum is the single most important telecom policy issue, and the action on this front will be in the US Senate in the next Congress. The key Senate leaders of spectrum policy, John Thune and Ted Cruz, have won their elections handily and have already delivered the plan to getting America’s spectrum back on track in the 119th Congress. They can reintroduce Spectrum Pipeline Act introduced in March 2024. As Ranking Member of the Senate Commerce Committee today, Ted Cruz is poised to the helm of the key committee in the next Congress. The House Energy & Commerce Committee under the leadership of Cathy McMorris Rogers had their spectrum reauthorization bill ready in March 2023.
Specifically, the Spectrum Pipeline Act requires National Telecommunications and Information Administration (NTIA) to identify at least 2,500 MHz of mid-band spectrum that can be reallocated from Federal use to non-Federal or shared use in the next 5 years (including at least 1,250 MHz in the next 2 years). It also renews the Federal Communication Commission’s (FCC) auction authority which expired in March 2023 and requires the FCC to auction at least 1250 MHz of spectrum for full-power commercial wireless services, including 5G, within 6 years (including at least 600 MHz within 3 years). Importantly the bill would remove any limitation to allow federal agencies to purchase new state-of-the-art equipment using spectrum auction proceeds.
Importantly the Senators recognize that spectrum is critical for national and economic security and that the US has lost ground to its adversaries by not moving more quickly on auction authority and pipeline. The release of the bill observed, “Companies require radio spectrum to provide high-quality wireless service to consumers. Mid-band spectrum is particularly valuable, given its unique properties. The Spectrum Pipeline Act of 2024 creates a true pipeline that significantly increases commercial access to mid-band spectrum….will protect American taxpayers and prioritize national security.”
A new FCC Chair should take the Spectrum Pipeline Act, once passed and signed by the President, and run with it. Earlier FCC Ajit Pai Chair battled against incumbent federal interests to ensure that the US led on the spectrum front. Pai’s tenure is associated with a period of record-breaking broadband investment and deployment, following a downturn during the Obama Administration. Key to this development was the reversal of Title II internet regulation and the restoration of internet freedom (meaning that oversight of broadband was returned to the Federal Trade Commission, FTC, where it was since inception). There was also the record-breaking 5G C-band auction spectrum which raised $81 billion. FCC auction design was recognized in 2020 Nobel prize for economics. The FCC’s 5G FAST plan included getting more spectrum into the marketplace; modernizing regulation, and speeding rollout such that there were some 420,000 mobile sites by the end of the Trump administration.
The next FCC Chair will have to make up for the loss of the current administration. However, there will be a new Cabinet who presumably will be hired for their America First bona fides. This means that Trump appointees may well work together to fulfil the goals requested by the electorate.
Tune in on Thursday 14 November at 4pm ET when Strand Consult Vice President Roslyn Layton moderates a discussion on Spectrum and National Security in the USA online at Center for Strategic & International Studies (CSIS) featuring James A. Lewis, CSIS Vice President of the Strategic Technologies Program of the who details the current spectrum gamble; Umair Javed, Vice President of CTIA who will reflect on 30 years of US leadership in spectrum auction and wireless; and Adam Candeub, Michigan State University Professor of Law & Director of the Intellectual Property, Information & Communications Law Program, formerly of NTIA, will offer his views on spectrum from administrative law and policy.
Universal Service Fund Reform
About two months remain in this Congress, and both parties have worked hard on universal service fund (USF) reform. Indeed the effort has been underway for more than two years and includes the FCC’s important report on the Future of Universal Service as well as the introduction of bipartisan bills to permanently reform this program. Significantly, the bipartisan and bicameral USF Working Group led by Senators John Thune and Ben Ray Luján has been examining how to ensure access to advanced telecommunications and information services in all regions of the Nation at just, reasonable, and affordable rates.
The urgency to reform this program is due to the expected depletion of the fund within a few years and a very serious legal challenge questioning the outsourcing of contribution methodology. As such, the job to fix USF necessarily falls to Congress, and this would be the first congressional update to the program since 1996. Importantly the USF Working group has contemplated merging the Lifeline and the expired Affordable Connectivity Programs (ACP) into a single voucher for connectivity for people of low-income. Incoming Vice President J.D. Vance, who led a bipartisan bill to extend ACP, declared, “[t]his is exactly the type of program my family would have benefited from if I was growing up in Ohio today.”
A key issue is how to reform the contribution system for USF. Presently, the USF cost is born largely by elderly voice subscribers, but it should be updated so that enterprises which profit from the internet in USF areas pay something for the network and the revenue garnered by new subscribers. Notably, a set of eight internet platforms enjoy more than $90 billion annually in revenue from services to rural and low-income consumers, but they contribute almost nothing to the program. Strand Consult describes how to modernize this essential program so that neither taxpayers nor low income families bear the burden of broadband subsidies which ultimately enrich Big Tech. Stand by for Strand Consult’s forthcoming report “How edge providers profit from every American connected: USF reform, infrastructure, and affordability.”
Tech Policy
Strand Consult observed in its election coverage that Trump focused on voters’ key concerns: the economy, the border, and regulatory perversions which inhibit flourishing and growth. One Little Tech manifesto declares, “bad government policies are now the #1 threat to Little Tech.” These camps have found a home in the Trump campaign whose campaign highlighted crypto, AI, and space. These elements of the “Trump Trade” already appear to be paying off.
Bitcoin had an intraday high. AI stocks like Palatir, Nvidia, Telsa were up. Big Tech stocks are also up as is DJT (Trump Media & Technology Group Corp), parent of Truth Social. Trump will likely overturn Biden’s flawed AI orders soon after taking office. Similarly, a new set of Cabinet and agency appointees will likely end, reverse, or forbear on all Biden regulations which are not statutory. For example, a second Trump Presidency’s signals a coming end to the Security & Exchange Commission’s war on cryptocurrencies and related securities and instruments. On the legal front, the Biden Administration in engaged in dozens of lawsuits to defend its regulation. A Trump Administration will likely change, shift, or end those cases.
The Big Tech antitrust cases are different, as some actually began during the first Trump Administration. There will be a lot to unpack when we get there. Meantime, check out a helpful Strand Consult guest blog on the topic.
Elon Musk played a pivotal role in the Trump election. The world’s richest man, he sponsored a daily lottery of $1 million for new voter registrants in battleground states who agree to support the Bill of Rights and stumped at rallies in Pennsylvania. Trump paid tribute to Musk in his victory speech, retelling again (as he described on Joe Rogan Podcast) the story of the successful SpaceX Starship landing and docking, a fiery tumult from the Super Booster which landed safely and successfully in the launcher as the flames extinguished. Perhaps it serves as the metaphor of chaos brought to order, not unlike the campaign itself. Trump detailed how Starlink satellite broadband “saved lives” following Hurricane Helene in North Carolina.
Conclusion
We will probably never again see such a political comeback and vindication as we did today. Few people ever get a second chance like Trump. By the same token, few are as tough or resilient to survive impeachment, litigation, and assassination. It shows as well why so few even contemplate running for President.
The election offered much entertainment. However, we suspect that most Americans are relieved the election is finally over. They want things to proceed peacefully and with as little drama as possible. When the new President takes office and creates his administration, they should get on with it and deliver on the promises.
President Trump will have a milestone on July 4, 2026. The people can access whether and how well the American democracy has prevailed after 250 years.
