Telcos urge EU to make Big Tech pay for network costs – Technology

Telcos are urging the EU to make Big Tech pay for network costs


A letter will be sent to EU industry boss Thierry Breton in the next five to six weeks

PARIS (Reuters) – Telecom operators are urging the European Union to introduce new legislation that would make Big Tech pay for network costs, following Australia’s example, according to four sources close to the matter.

Europe’s telecom operators have lobbied for a financial contribution from US tech companies like Alphabet’s Google (GOOGL.O), Meta’s Facebook (META.O) and Netflix (NFLX.O), saying they consume a large chunk of the region’s internet traffic.

The latest proposal, which has not yet been reported, is currently being discussed in the telecoms lobby group GSMA, an association representing more than 750 mobile operators.

“The GSMA is coordinating a proposal that addresses Big Tech’s contribution to European infrastructure investment,” said John Giusti, the GSMA’s Chief Regulatory Officer, without specifying the substance of the proposal.

A letter will be sent to EU industry chief Thierry Breton in the next five to six weeks, Giusti said.

Google, Facebook, Netflix and Amazon did not immediately respond to requests for comment.

The proposal precedes the 27-country bloc’s consultation on a so-called “fair share” contribution from companies like Google, Netflix, Meta and Amazon (AMZN.O), which account for more than half of internet traffic.

These platforms reject the idea, considering it an internet traffic tax.

Australia’s recently passed legislation in its own dispute with Google and Facebook has emerged as the favorite weapon for telecom operators in their row with big tech companies, the sources said.

The rules, initially intended to force tech giants to pay for online news content, allow an Australian government-appointed arbitrator to assess fees when big tech companies and news publishers fail to find common ground on copyright.

Rupert Murdoch’s News Corp struck a compliant content supply deal with Meta’s Facebook in Australia last year, which helped end a dispute that saw the social media giant briefly shut down thousands of pages in the country.

Under Australia’s binding Final-Offer Arbitration, the parties must negotiate in good faith. But if no agreement can be reached between them, they must present their offers and leave themselves to an arbitrator to choose one.

The aim is to encourage tech giants and news publishers to reach an agreement before they are forced to opt for this last resort procedure.

Telecom operators that are part of the GSMA, including some of Europe’s largest such as Orange (ORAN.PA), Deutsche Telekom (DTEGn.DE) and Telefonica (TEF.MC), agree that the Australian way is the best approach, the sources said.

According to the sources, no formal document has been sent to Breton yet. Officials are debating whether the proposal will be made directly by the GSMA or by a group of chief executives, one of the sources said.

Breton has said he will seek feedback from both sides before drafting legislation.

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