Chinese firms might be compelled to sell, transfer, or close their data centers and network nodes located in the United States, according to analysts.
Recent U.S. restrictions targeting Chinese telecommunications companies may eventually push them out of the American market, according to analysts, signaling a further intensification of Washington’s long-term effort to curb Chinese technological influence.
The U.S. Federal Communications Commission (FCC) announced on Thursday that it is evaluating more extensive actions to prevent Chinese telecommunications companies from establishing data centers within its borders, thereby limiting the access of Chinese telecom providers to U.S. networks and infrastructure.
China Mobile, China Telecom, and China Unicom – all listed on the restricted list of entities considered a threat to national security – might be impacted, according to analysts, even though the financial effect would be minimal.
Are you curious about the major issues and global trends? Find the solutions withSCMP Knowledge, our latest platform featuring curated content including explainers, FAQs, analyses, and infographics, presented by our acclaimed team.
On Thursday, the US telecommunications regulator announced it is evaluating more extensive actions to prevent Chinese telecom companies from managing data centres within its borders and to impose additional limitations on their access to US networks and infrastructure. China Mobile, China Telecom, and China Unicom—each listed on the Covered List of entities considered a threat to national security—might be impacted.
According to the proposal, US carriers would also be prohibited from connecting with those firms, as the FCC mentioned in the draft, citing “substantial national security issues” regarding these connections.
“The proposal signifies an increase in the FCC’s regulations, shifting from prohibiting Chinese companies from directly offering services to the public and restricting their equipment, to more extensive oversight of fundamental internet infrastructure and connection protocols,” stated Harry Wang Yuxiang, a partner at Tahota Law Firm, who is licensed in China, the UK, and California.
The three Chinese companies did not promptly reply to inquiries for statement on Friday.
The organization has increased its control over Chinese companies in recent years, intensifying the technological separation between the world’s two biggest economies.
Chinese company affiliates and subsidiaries would also be banned from operating data centers or linking with other US carriers, as the new proposal would expand restrictions to these entities, which were not previously included.
If carried out, the proposal might compel a complete withdrawal, Wang stated, with Chinese firms probably needing to sell, transfer, or close their data centers and network nodes in the United States, thereby losing the capacity to route or handle data within the nation. It could also expose US companies linked to these networks to regulatory review and necessitate changes.
This action highlighted a change in the FCC’s regulatory strategy, “from general acceptance with focused enforcement to comprehensive exclusion, with few license-based exceptions, based on the legal basis of national security classification,” stated Arthur Chiu, a U.S. attorney and associate professor at the Law School of the University of International Business and Economics.
The FCC had traditionally followed a deregulatory approach to telecommunications, where “blanket domestic Section 214 authority” enabled carriers — along with their selected partners — to offer interstate communication services by default without needing previous approval, according to Chiu, as part of an effort to encourage competition.
Senior equity analyst Dan Baker from Morningstar downplayed the possible financial effects of the proposed ban, pointing out that the three companies earned the majority of their income within the country.
China Mobile announced revenue of 1.05 trillion yuan (US$154 billion) for 2025, reflecting a 0.9 per cent rise compared to the previous year, with international operations contributing just 2.7 per cent. China Telecom saw a marginal 0.1 per cent growth in revenue, reaching 529.6 billion yuan, with 3.7 per cent coming from foreign markets. China Unicom recorded revenue of 392.2 billion yuan, an increase of 0.7 per cent, and international business accounted for 3.4 per cent. The firms do not provide specific details about their overseas markets.
The expansion has decelerated in all three areas as conventional telecommunications services decline, prompting them to increase their investments in computing infrastructure and associated ventures.
The FCC stated it would conduct an initial vote on the proposal during a meeting on April 30. Should it be approved, the measure would then undergo a period for public feedback before a final vote takes place.
It delivered a setback in December to the three Chinese carriers as part of an initiative to curb robocalls, urging them to fix the violations or risk being disconnected from US networks.
This action followed the withdrawal of operational approval for China Unicom’s U.S. branch in 2021 and China Telecom Americas in 2022. It also rejected a proposal from China Mobile, the world’s biggest mobile operator in terms of subscribers, to offer services in the United States.
The agency during the Trump administration has also aimed to broaden its restrictions on Chinese technology beyond conventional telecommunications equipment manufacturers and service providers, initiating a campaign to focus on Chinese drones and consumer internet routers.
Chiu noted that, from a legal and policy perspective, the FCC’s proposal followed a wider strategy previously implemented by other government bodies in fields like export controls and investment review.
Further reporting by Ben Jiang
More Articles from SCMP
Alibaba’s HappyHorse leads Seedance, providing a look at China’s competition for AI expertise
Number of workplace sexual harassment reports increases by 38% in Hong Kong
New Kai Tak Hospital will commence operations in two stages beginning in October.
This piece was first published in the South China Morning Post (www.scmp.com), a top news outlet covering China and Asia.
Copyright (c) 2026. South China Morning Post Publishers Ltd. All rights reserved.
jasdooit 
Leave a comment