The financing of Internet infrastructures will be the next subject on which the European Commission intends to look into. Barely out of the DSA / DMA file, the commission indicated last week its intention to return to the question of the financing of telecom infrastructures, in particular by asking players offering online services to support the efforts already made by operators.
A handful of players alone occupy more than 50% of the world’s bandwidth.
It is now time to reorganize the fair remuneration of the networks.
After DSA & DMA, it is now one of the main projects in our digital space.https://t.co/xzZforv9V7
— Thierry Breton (@ThierryBreton) May 4, 2022
With Les Échos, European Commissioner Thierry Breton explained that “the rules in place for twenty years are running out of steam and today operators no longer have a fair return on their investments. “, specifying in passing that a legislative project on the subject should see the light of day at the end of 2022. “A handful of players alone occupy more than 50% of the world’s bandwidth. It is now time to reorganize the fair remuneration of the networks,” indicated the European Commissioner for the Single Market in a tweet last week. Competition Commissioner Margrethe Vestager had previously mentioned this line of work during a briefing given on Monday 2 May.
This measure was insistently requested by Internet access providers: in November 2021, several operators had thus made it known that they were working on a “code of good conduct” for the major American streaming operators (Netflix, YouTube, Akamai and Facebook) to encourage them to limit their bandwidth consumption. According to Les Echos, the operators also planned to take advantage of the French presidency of the European Union to highlight the subject. Previously, European operators had already pleaded for an easing of the rules on net neutrality, this time by weighing the risk for 5G investments in the balance.
The weight of streaming
Following the positions taken by Thierry Breton and Margrethe Vestager, the European Telecommunications Network Operators’ Association, the European lobby of telecom operators has published a study highlighting the growing increase in infrastructure costs borne by operators. These are estimated at between 36 and 40 billion euros for the year 2021, an increase in costs justified according to the authors of the report by the increasing volumes of bandwidth necessary to route traffic from American players.
The report also highlights that 6 players (Google, Facebook, Netflix, Apple, Amazon and Microsoft) alone represent more than 56% of traffic on fixed and mobile Internet networks. One of the solutions mentioned by the report would be the establishment of a financial participation of the most important platforms, in order to reduce the investments of the operators without coming to weigh on the functioning and the capacity for innovation of the small players. An approach similar to that implemented within the framework of the DMA and the DSA, two texts which recommend a specific approach for the most important players.
But in addition to the difficulty of getting the American digital giants accepted, the European Commission’s project raises concerns about the principle of net neutrality. This principle voted by the European Parliament in 2015 aims to guarantee that “Internet service providers should treat all online content, sites and platforms in the same way. By involving US players in the financing of network infrastructure, net neutrality advocates fear that the players concerned will take advantage of this to demand privileged access, or exploit this position to crush competition. In Les Echos, the European Commission nevertheless defends itself from wanting to question the principle of net neutrality.