The CEOs of 13 large European telecom companies today called on tech giants to pay for a portion of the internet service providers' network upgrade costs. The European telcos said in a statement that their proposal was to "rebalance the relationship between global technology giants and the European digital ecosystem."
The letter makes an argument similar to one that AT&T and other US-based ISPs have made at times over the past 15 years, that tech companies delivering content over the Internet get a "free" ride and should subsidize the cost of building last-mile networks that connect homes to broadband Tech giants already pay for their own internet bandwidth costs, and other companies have built their own networks to deliver traffic to home-Internet customers.
The CEOs of A1 Telekom Austria Group, Vivacom, Proximus Group, Telenor Group, KPN, Altice Portugal,Deutsche Telekom,BT Group, Telia Company, Telefnica, Vodafone Group, Orange Group, and Swiss signed the letter. They wrote.
Large and increasing part of network traffic is generated and monetized by big tech platforms, but it requires continuous, intensive network investment and planning by the telecommunications sector. The model that enables EU citizens to enjoy the fruits of the digital transformation can only be sustainable if big tech platforms contribute fairly to network costs.
Payments from Big Tech are growing.
The European telecommunications companies didn't mention any specific tech giants, but they did mention that US-listed giants such as Facebook are companies they have in mind. The letter says that regulation must reflect market realities. Telecom operators compete with services by big tech.
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The European ISPs wrote a letter saying that tech giants should help them pay for network upgrades. "South Korean internet service provider SK Broadband has sued Netflix to pay for costs from increased network traffic and maintenance work because of a surge of viewers to the US firm's content."
The show Squid Game was a factor in the traffic surge. The court found that it was reasonable for the company to give something in return for the service provided by the company.
Net neutrality annoyedBT.
According to The Guardian, the CEO of the consumer division of the British Telecom Group argued that net neutrality rules should be changed to allow for payments.
Net neutrality rules that require all internet traffic to be treated equally are outdated for the streaming era, according to Allera.
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He says that the principles of net neutrality are valuable, but that there needs to be more effective coordination of demand. The rules were created 25 years ago and I don't think anyone would have thought that a few companies would drive 80% of the traffic on the internet. It doesn't feel right that they aren't making a contribution to the services they are being carried on.
The Guardian article said that 80% of the traffic was driven by companies like YouTube, Facebook, and Netflix, but it isn't clear where that data came from or whether it's accurate. According to a May 2020 report by Sandvine, YouTube accounted for 15.9% of home-Internet traffic globally during the first months of the epidemic, compared to just over 12% for Facebook and over 9% for Netflix.
All video streaming accounted for more than 50 percent of traffic. General Web browsing was 8.1 percent and social networking accounted for 10%. The gaming category accounted for 4.2 percent, which is less than the other categories. It doesn't seem likely that four companies account for 80 percent of all internet traffic.
