Large US tech companies should fund European ISP upgrades! That is according to the CEOs of 13 European telecom companies who voiced their argument in a joint letter on November 30.
The CEOs of major European telecom networks including Vodafone, Deutsche Telekom, and 11 others have voiced that US tech giants should share some financial liabilities to improve Europe’s internet service-related infrastructures.
The European telcos that argued their opinion in a joint letter were from Telefónica, Orange, KPN, BT Group, Telekom Austria, Vivacom, Proximus, Telenor, Altice Portugal, Telia Company, and Swisscom who called on the US tech companies for their share of investments in European communications services.
The argument comes European telcos face massive investments demands for 5G, fiber, and cable networks in Europe as their current infrastructures are untenable to deliver today’s bandwidth-hogging contents smoothly. Much of this is due to extremely high bandwidth standards set by Netflix, and Youtube, and Facebook among others. The CEOs reason that their networks required upgrades because of the US companies’ bandwidth clogging contents.
Europe’s telecoms sectors investments rose to a six-year high of €52.5 billion last year and will continue to rise.
“A 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,” a joint statement of the chief executives argued.
“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 said.
The European telecom companies’ CEOs were not explicit about the US companies they were referring to. However, the fingers did imply at Facebook, and Netflix, the major global bandwidth juggernauts.
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CEOs unhappy Over High Spectrum Charges
The Chiefs touched on many other topics of their concern. They regretted high spectrum prices and auctions and dimmed the European governments for their ‘cash grab’ strategies. They believe the overcharged spectrum charges lead to unstable telecom businesses in the region.
Regarding the EU’s latest attempts to remove surcharges on intra-EU calls, they had the following “We estimate that they would forcibly remove over €2 billion revenues from the sector in a four-year period, which is equivalent to 2.5 percent of the sector’s yearly investment capacity for mobile infrastructure,” the chiefs said.
Not to mention, the CEOs’ joint statement also voiced displeasure over issues related to fiber and mobile broadband. The letter read, “regulation must fully reflect market realities… Namely, those telecom operators compete for face-to-face with services by big tech.”
Netflix The Culprit Of Bandwidth Surge!
This is not the first time internet provider has called on tech companies to pay for their system upgrades. Netflix recently incurred a flack from South Korean service provider SK Broadband over bandwidth surge which was partly inspired by its popular show Squid Game.
Reuters reported on October 1, “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.”
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US Tech Companies’ “Free Ride on Contents”
FCC has not officially made any claims that payments must trickle from US tech companies for their content delivered through ISPs. However, Federal Communications Commission member Brendan Carr who was part of the US congress majority that eliminated net neutrality rules has made a similar case to that of the European telcos’ chiefs.
Barr has penned an opinion piece in Newsweek in May titled “Ending Big Tech’s Free Ride.”
He argued, “Big Tech has been enjoying a free ride on our Internet infrastructure while skipping out on the billions of dollars in costs needed to maintain and build that network.”
Carr even urged Congress to “enact legislation that ensures Big Tech contributes an equitable amount” toward federal broadband-deployment grants that will pay ISPs to expand networks in unserved and underserved areas. Carr also urged the FCC to raise money for the Universal Service Fund by “shifting a fair amount over to Big Tech.”
Guardian has once written that in the UK 80 percent of internet traffic originated from YouTube, Facebook, Netflix, etc.
A Case For US Tech Companies
While the scrutiny has grown on US tech companies for their content delivery from broadband providers those US companies have done their part to ease out their content transmission too.
To air their contents over the air smoothly without clogging the internet network, the US companies have undertaken significant steps. One example includes Google’s data centers and direct connections to ISP networks around the world.
It also goes without saying that these large tech giants also regularly pay for their internet bandwidth costs. Netflix, just like Google have built their own infrastructure to alleviate the network traffic caused for their content delivery.
Carr even urged Congress to “enact legislation that ensures Big Tech contributes an equitable amount” toward federal broadband-deployment grants that will pay ISPs to expand networks in unserved and underserved areas. Carr also urged the FCC to raise money for the Universal Service Fund by “shifting a fair amount over to Big Tech.”
Guardian has once written that in the UK 80 percent of internet traffic originated from YouTube, Facebook, Netflix, etc.
A Case for US Tech Companies
While the scrutiny has grown on US tech companies for their content delivery from broadband providers those US companies have done their part to ease out their content transmission too.
To air their contents over the air smoothly without clogging the internet network, the US companies have undertaken significant steps. One example includes Google’s data centers and direct connections to ISP networks around the world.
It also goes without saying that these large tech giants also regularly pay for their internet bandwidth costs. Netflix, just like Google have built their own infrastructure to alleviate the network traffic caused for their content delivery.
What is your opinion on the tech companies funding ISP’s upgrades for their content delivery? Should it be mandatory, or not or there should be a middle ground? Do leave your insights in our comments section.
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