DIPLOMATIC ECONOMY

EU Plans Consultation On Tech Giants’ Contribution To Telco Costs

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By Matthew Broersma

The European Commission is to launch a consultation on whether the biggest tech multinationals should contribute to the cost of Europe’s telecommunications networks by the end of the first quarter of next year, EU internal market commissioner Thierry Breton has announced.

Breton said on Friday the so-called “fair share” remuneration issue would be part of a broader consultation.

European telecommunications companies argue tech companies such as Facebook, Google and Netflix should help pay for the region’s telecoms infrastructure as they drive a significant portion of internet traffic.

Earlier this month it was reported that the Commission was preparing a questionnaire for telecoms companies and tech firms as it prepared the ground for the consultation.

A draft version of the questionnaire asked telecoms firms how much their traffic had increased in the past three years, where it was coming from and what the higher demand was costing them, Bloomberg reported.

Tech companies were asked how much their own costs have increased and to describe their relationships with telecoms operators and whether there are any signs of “market failure” in how content is delivered over networks.

Any remuneration would be re-invested by telecoms companies to upgrade their networks.

Open internet

Remuneration plans have spurred a backlash from tech giants as well as open internet campaigners, who fear the development of a two-tier internet with preferential treatment for certain types of traffic.

EU member states including Germany and the Netherlands over the summer reportedly urged the Commission to wait for a final analysis from the EU’s telecoms regulator and to hold consultations with member states and the public before pushing ahead with a proposal.

Other countries including France and Italy have increased pressure on the Commission to move ahead with a remuneration proposal, Reuters reported in August.

The EU’s biggest telecoms firms include Telefonica, Vodafone Group, Deutsche Telekom and Orange.

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