According to Reuters, during a news conference on 2 May 2022, the Executive Vice President of the European Commissioner for A Europe Fit for the Digital Age, Margrethe Vestager, said that tech giants such as Google, Meta and Netflix may have to bear some of the cost of Europe’s telecoms network. These comments follow renewed complaints from EU telecoms operators that they are bearing all the costs of building new infrastructure that Silicon Valley internet firms use to make extraordinary profits.

“I think there is an issue that we need to consider with a lot of focus, and that is the issue of fair contribution to telecommunication networks”, Commissioner Vestager said. “Because we see that there are players who generate a lot of traffic that then enables their business but who have not been contributing actually to enable that traffic. They have not been contributing to enabling the investments in the rollout of connectivity. And we are in the process of getting a thorough understanding of how that could be enabled”, she continued, adding that she was looking into how data traffic evolves over time and that related to the COVID-19 pandemic.

Reuters reports that, according to a study released by ETNO, a telecoms alliance, Meta, Alphabet, Apple, Amazon, Microsoft and Netflix accounted for over 55% of all global telecom network traffic in 2021. The study found that an annual contribution of €20 billion (£17 billion) to network costs by the tech giants could give a €72 billion (£61.5 billion) boost to GDP in the EU. ETNO’s members include BT, altice, Deutsche Telekom and Orange.

These comments come at a time of unprecedented investment by network owners into network infrastructure upgrades and roll-out efforts for costly new technologies such as 5G and FTTH, increasingly involving infrastructure-focused partners and specialist investors alongside traditional telecoms operators.

While network upgrade and roll-out cost allocation principles are often determined in commercial arrangements between network owners and capacity takers, further efforts to regulate network infrastructure cost responsibilities would have a profound effect on who is incentivised to ensure infrastructure, capacity and OTT services can meet the needs of tomorrow.

To read Reuters’ report in full, click here. To read an article on telecoms.com’s website, click here.