Is the proposal too radical?
Seven countries have sent a jointly written letter urging the European Commission (EC) to be ‘cautious’ as it considers how to make internet companies pay for the upgrades to telecom infrastructure that they profit from. The EC needs an “open and transparent debate” about the idea before presenting any formal proposal, Germany, Ireland, Sweden, Denmark, Estonia, Finland and the Netherlands said in a letter seen by Bloomberg.
The letter also suggested that the commission should wait for a final analysis from BEREC, the EU’s telecom regulating body, as well as open consultations with the bloc’s members and the public. Europe’s mobile network operators (MNOs) have argued that US tech giants should pay towards the European networks they use freely and exploit profitably. In November it was reported that chief executives of Deutsche Telekom and 12 other major European telecoms companies signed a joint statement, complaining that network traffic is enabled by european investment and exploited by US tech giants.
As mobile operators are forced to sell off their tower companies and take other drastic financing measures to raise the funds for massive 5G investment, it seemed unfair for entertainment companies to freely profit from their sacrifices, argued the CEOs of Vodafone, Orange and Telefonica. The other signatories to the letter include the CEOs of BT Group, Telekom Austria, Vivacom, Proximus, Telenor, Altice Portugal, Telia Company and Swisscom.
“A large and increasing part of network traffic is generated and monetised by big tech platforms,” said the joint CEO statement, “but it requires continuous, intensive network investment and planning by the telecommunications sector. This model, which enables EU citizens to enjoy the fruits of the digital transformation, can only be sustainable if such big tech platforms also contribute fairly to network costs,” they reasoned.
In response EC officials such as Executive Vice President Margrethe Vestager and Internal Market Commissioner Thierry Breton said they are interested in examining how streaming platforms such as Netflix and Google’s YouTube could help telecom providers shoulder the cost of the infrastructure they rely on. Though no formal proposal has yet been made and legislators haven’t said when one might take place, some countries appear to have retracted already. Members of the European Parliament also wrote a letter to the commission last week to express “deep concern” over any “radical proposal” such as a streaming fee.