internet lab. – fair share / network fees | 23 Jan 2023
[EU RUMOURS – CONSULTATION] After EURACTIV’s recent news on delays, a European Commission consultation on the future of telecoms networks is now expected on 10 February, according to a tweet from Internet expert Konstantinos Komaitis, PhD. POLITICO confirmed this possible date, pointing to College approval being set for 8 February.
According to Komaitis, the consultation would cover:
- Technological & market developments
- Fairness for consumers
- Barriers to the Single Market
- Fair contribution by all digital players
POLITICO also highlighted that the forthcoming Gigabit Infrastructure Act (GIA) remains silent on the fair share / network fees topic pending this public consultation. The GIA notably “aims to address the shortcomings of the [Broadband Cost Reduction Directive (BCRD)] and contribute to the cost-efficient and timely deployment of Very High Capacity Network, necessary to meet the increased connectivity needs”, POLITICO explains.
Earlier this month, Reuters indicated that the EU wants to hear details from Big Tech and telcos on their investment plans.
[EU RUMOURS – METAVERSE] Virtual worlds, like the ‘metaverse’, call for network investments according to European Commission President von der Leyen’s answer, dated 22 December, to French Renew MEP Valérie Hayer. This answer comes in response of a September 2022 letter by a group of MEPs that wrote to the EC in favour of network fees, albeit upon them meeting certain conditions, including consistency with all the core principles of the Open Internet Regulation.
“The amount of data exchanged – and harvested – is larger than ever and will increase. The metaverse and virtual worlds, the rapid move towards cloud, the use of innovative technologies online are marking this even more evident. Increasing volumes of data on the infrastructures need to be met through adequate returns and appetite to invest, especially for mobile networks.”
The European Commission is set to present a non-legislative initiative on virtual worlds on 3 May. In parallel, the European Parliament is also set to draft an own-initiative report on “Virtual worlds: opportunities, risks and policy implications for the Single Market.”
EURACTIV does note that (for now) “the extent to which the two initiatives[, network fees and virtual worlds,] will be connected remains unclear,” but this remains something to watch as both seem to be increasingly linked by policymakers. The infrastructure aspect might thus get a prominent role.
[EU PERSPECTIVE – PART 1] Over the Winter break, the European Commission answered German S&D MEP Tiemo Wölken’s parliamentary question on network fees (see our ‘Hot Item’ on Twitter & LinkedIn, as well as netzpolitik.org’s coverage). In his response, Commissioner Breton:
- rejected the idea that the EC has so far suggested network fees;
- noted that any mechanism would have to abide by the net neutrality rules and principles;
- claimed to that the EC is engaging in an open dialogue with all stakeholders; and,
- confirmed that the Commission is planning to launch by early 2023 a consultation on the vision for the future of the connectivity infrastructure.
[EU PERSPECTIVE – PART 2] On 10 January, the European Commission responded to the letter from 29 Internet experts and academics from October 2022, driven by Internet expert Konstantinos Komaitis, PhD (see our ‘Hot Item’ on Twitter & LinkedIn). In their response, EU Executive VP Vestager and Commissioner Breton notably highlighted that:
- the fair share idea could be implemented in other ways than through the Sending-Party-Network-Pays principle; and,
- there will be a consultation in early 2023 and that they want to “have a more comprehensive conversation with all interested parties”.
[UK WORRIES] UK Open Rights Group’s Dr Monica Horten warns how the UK’s Retained EU Law (Revocation and Reform) Bill risks to “wipe out net neutrality from UK law on 31 December this year.” A bright spot she identifies is that: “the EU-UK Trade and Co-operation Agreement, Article 178, entitled ‘Open Internet Access’ enshrines a fundamental principle of the Open Internet and net neutrality into an international agreement signed by the UK government.” Horton points out that “a breach of the Trade and Co-operation Agreement can have serious consequences,” so the Government should take action to ensure that the net neutrality principle remains enshrined in the UK.
[INTERNET LAB – PODCASTS] In our most recent internet lab podcast episodes we spoke with:
- Brian Williamson (Communications Chambers) – see our podcast page, Twitter thread and LinkedIn update;
- Konstantinos Komaitis, PhD (Internet Policy & Strategy expert and author) – see our podcast page, Twitter thread and LinkedIn update; and,
- Rudolf van der Berg (Stratix) – see our podcast page, Twitter thread and LinkedIn update.
[STAKEHOLDERS – MEPs] Check this interview (in German) wherein MEP Tiemo Wölken (S&D, Germany) explains why network fees are dangerous for net neutrality.
[STAKEHOLDERS – MEMBER STATES] Before the winter break, Spain’s Deputy Prime Minister Nadia Calviño emphasised that getting Big Tech to contribute to the telco network is “indispensable”, at a meeting with the Secretary General of the OECD, Mathias Corman. “If we want to continue making the necessary investments in technological infrastructure, we need everyone who uses and benefits from them to contribute to financing that investment,” Calviño argued.
[STAKEHOLDERS – EXPERTS] Internet expert Konstantinos Komaitis, PhD warns on the Verfassungsblog that “this regulatory shift could risk an Internet collapse in Europe.” He cautions that:
“If Europe gets this wrong, there is an open question about whether it can be reversed. There is no reason to try to find out. Europe is reopening an issue unjustifiably and without clear support from its wider stakeholder community. This policy only guarantees the future of telecommunication providers; it does not guarantee Europe’s nor the Internet’s.”
[STAKEHOLDERS – INFRASTRUCTURE] In early January, the European Internet Exchange Association (Euro-IX) shared their grieves about network fees in a letter to the Commission (see our ‘Hot Item’ on Twitter & LinkedIn).
[STAKEHODLERS – TECH] Christian Borggreen, from the Computer & Communications Industry Association (CCIA), published a blog post wherein he tries to separate fact from fiction in the fair share / network fees debate. His observation:
“A year down the road, the facts speak for themselves. Telecom operators have been very vocal, but they’ve failed to substantiate their claims. The evidence presented in recent months only highlights the negative consequences of taxing internet traffic.”
[STAKEHODLERS – TECH] Association Allied For Startups (AfS) wrote a blog post reminding policymakers that “an open and free internet offers equal opportunities for every company, no matter how large or small they may be or how many resources they have, which allows them to compete on a [levelled] playing field.” AfS stresses that:
“Regulatory initiatives that could impact net neutrality rules and result in lower internet speed for actors such as startups can affect their innovation potential and would impact the future growth of the European tech industry as a whole by discouraging new market entrants and investment.”
[STAKEHOLDERS – CONSULTANCIES] Roslyn Layton from Strand Consult, which targets telcos to help them develop a strategy for ‘broadband fair cost recovery’, joined the Telecoms.com podcast. Listen to Iain Morris (Light Reading) providing some pushback.
[STAKEHOLDERS – TELCOS] Telecom Italia (TIM) published a ‘fair share’ paper, wherein they notably claim that they cannot refuse to interconnect with large service and content providers because of the net neutrality rules. TIM further argues that net neutrality would be strengthened, and not weakened by the introduction of a fair share, as it “goes to ‘mitigate’ the ‘distortion’ of the negotiating positions that net neutrality has shifted further in favour of international platforms, rebalancing them and bringing them closer to those that the respective parties originally held, i.e. in the absence of net neutrality obligations.”
Rudolf van der Berg took the time to debunk some of TIM’s claims.
[MUSICAL CHAIRS]
- BEREC – BEREC’s 2023 Chair is Prof. Kostas Masselos, president of the Greek NRA.
- Deutsche Telekom – Anja Ingenrieth, who was DT’s Head of the EU Office and Vice President for European Affairs, joined the Brunswick Group as partner.
[EVENTS – DIGITAL POLAND] On 25 January (10h CET), Związek Cyfrowa Polska / Digital Poland Association organises a virtual roundtable: “CEE perspective on network fees – fair contribution or a risk to regional growth?”, with amongst the panellists internet lab podcast guest Žiga Turk.
[EVENTS – ETNO] On 2 February (11-12h CET), ENTO hosts a webinar on the “State of Digital Communications Report 2023”, commissioned from Analysys Mason.
[FURTHER READING]
- Mobile World Live – German players claim network rollout successes
“Germany’s mobile operators told the country’s regulator they had largely met coverage obligations required in the terms of a 5G spectrum auction in 2019, with authorities set to scrutinise claims by the four players.”
- LinkedIn – Dean Bubley | ‘Will Internet companies be forced to pay fees for generating data traffic?’
“Maybe techcos should just acquire some towercos & FTTX assets to offset any requirements to ‘support network investment’? Then they could get revenue from old-school telcos, as well as support government targets for infrastructure….”
- LinkedIn – Arjan van der Oest 🏳️ 🌈🇪🇺 | ‘Dear EU commissioner Thierry Breton: please stop the SPNP lobby now’
“Asking content parties to contribute to the revenue model of the terminating party is unfair (see above, double dipping), it does not make sense (see above, the hamburger example) and it will only raise pricing of end-users. SPNP only serves ONE interest: the interest of the telecom lobby.”
“EU competition enforcers will decide by Feb. 10 whether to allow Deutsche Telekom, Orange, Telefonica and Vodafone to set up an advertising joint venture to compete with Big Tech, a European Commission filing showed.”
- Telecoms.com – DT named most valuable brand in Europe
“According to the Brand Finance Global 500, DT is the 11th most valuable brand in the world, up from 17th a year ago. That improvement enabled it to leapfrog compatriot brand Mercedes Benz to become the most valuable brand in Europe. Among the global telcos it is second only to perennial top 10 Verizon, but well ahead of 26th-placed AT&T. No other European operators even make it into the top 100.”
“In its “2022 Year in Data” report, eir said that 4,400 Petabytes of data were used this year compared to 4,500 Petabytes in 2021.”
“Each household on average used just under 6,000 Gigabytes across the 12-month period, which is equivalent to eight hours of video a day.”
- Eurostat – What did we use the internet for in 2022?
“In 2022, the internet was used mainly to communicate with others, sending/receiving e-mails (77%), instant messaging (72%), to find information about goods and services (70%), telephoning or video calls (66%) and watching internet streamed TV or videos (65%).”
Written by Caroline De Cock, LL.M. , Head of Research.
January 23, 2023
