EU telecom chiefs call on tech firms to share internet network costs

The bosses of Europe’s biggest telecoms operators, including BT, Vodafone and Deutsche Telekom, have called on tech companies such as Netflix and Amazon to pay for some of the rising data costs fueled by the global streaming and internet boom.

The call from the 16 chief executives comes as the European Commission prepares to launch a consultation on whether tech companies such as Google, Facebook, Netflix and Microsoft should be forced to pay some of the rising costs of the huge amount of global Internet traffic they carry. on their telecommunications networks.

More than half of global internet traffic passes through six Silicon Valley companies – Google, Facebook, Netflix, Apple, Amazon and Microsoft – according to ETNO, a lobby group for European telecoms operators. The proportion rises to 80% when gaming giants such as Call of Duty maker Activision Blizzard are included.

Much of the growth in data usage is due to the streaming of shows such as Netflix’s hit Bridgerton and Amazon’s Lord of the Rings: The Rings of Power, which is based on the works of JRR Tolkien.

“We believe the largest traffic generators should make a fair contribution to the significant costs they currently impose on European networks,” the telecoms chiefs said in a joint statement. “A fair contribution would send a clear financial signal to streamers regarding the data growth associated with their use of scarce network resources.”

The statement says European telecoms companies spend €50bn (£44.5bn) a year building and maintaining full fiber broadband and 5G networks.

The energy crisis and soaring material prices – fiber optic cable has doubled in price this year – are adding to the financial burden.

“In this context, the issue of ensuring a sustainable ecosystem for internet and connectivity is more urgent than ever,” the companies said. “Timely action is imperative. Europe has missed many opportunities offered by the consumer internet. It must now strengthen rapidly for the era of metaverses.

Streaming and internet companies say they pay for their content through huge investments in systems that dramatically reduce costs for telecommunications companies.

These include large networks of data servers that allow content to be delivered close to telco networks, reducing the distance data travels and the cost to consumers, with Silicon Valley companies paying the charges “transit fees”.

On Monday, Matt Brittin, president of EMEA business and operations at Google, said that last year the company spent more than 23 billion euros on capital expenditure, much of it on infrastructure.

“Introducing a ‘sender-pays’ principle is not a new idea and would upset many principles of the open internet,” he said. “These arguments are similar to those we heard 10 or more years ago and we haven’t seen new data that changes the situation.”

Google’s investment includes six large data centers in Europe, 20 undersea cables around the world, including five in Europe, and caches to store digital content locally in 20 locations in Europe.

The telecom companies say the rules that prevent them from passing on some of the costs to the main drivers of internet traffic – net neutrality rules that say all internet traffic is treated equally – would continue to be enforced.

“We fully respect and support the need to uphold the EU Open Internet Principles,” they said. “Consumers should continue to enjoy all legal content and applications available on the Internet.”

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