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EU network providers push Big Tech to help pay for infrastructure

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Telecom and EU representatives at MWC 2023 put pressure on America’s big tech companies to back future-proof spending.

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Who pays for the telecommunications network? In a continuing attempt to answer this question, European Union telecommunications companies attending Mobile World Congress 2023 Regulator pressed To make US tech giants, including Google, part of the cost of maintaining the world’s busiest network.

Reference: Organizational Data Governance Checklist (TechRepublic Premium)

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What do these EU telecom providers want?

Orange, Deutsche Telekom and BT were among the EU organizations to speak at MWC 2023 calling for changes from the American companies that account for the majority of their traffic. CNBC reported.

In particular, carriers want Google, Netflix, Meta, Apple, Amazon, and Microsoft, which generate nearly half of Internet traffic today, to participate in maintaining the networks that deliver their content. These “fair share” fees are used to properly operate our infrastructure and deploy next-generation networks. Some rates support physical infrastructure such as new cables and antennas, and increased network speeds.

Some carriers are proposing network charges as a solution. This is essentially a “tax” to help maintain the network. But US tech companies who oppose it say it will trickle down and harm consumers. BT also proposed to CNBC a “two-sided model” in which content providers pay network operators in much the same way consumers do.

For telecom providers, such deals could help meet the growing demand for faster services carrying more data. They may now have more opportunities to have their voices heard on: Seeking a “fair share” from hyperscalers.

European Commission intervenes

The European Commission started consultations on the issue in February, with much discussion at MWC 2023.

The big change this year is the addition of Thierry Breton, the European Commission’s head of the Internal Market, to the telecommunications side. According to CNBC, to fund proposed technologies such as Metaverse and next-generation mobile his networks, EU telecom companies will need to “find a financing model for the huge investments required”. he said.

Bretton also cautioned against framing this as a discussion only between the telecoms industry and the content giants. Net neutrality is also a concern. The more financial relationships and information shared between the two, the more likely it is that it will lead to obstacles to a free and open internet, including throttling and preferential treatment for certain types of content.

See also: Dell partners with Red Hat as part of MWC 2023 announcement slate (TechRepublic)

What do these changes mean for Big Tech companies?

Streaming content provider leaders such as Netflix co-CEO Greg Peters have argued that the telecom “tax” will strain already-bending budgets and make it more difficult to produce quality programming. increase. Netflix subscribers increased in Q4 2022, Sluggish revenue growthSome tech companies have already paid for the undersea cables and server farms, claiming they don’t need to pay for shipping either.

Another consideration, as Breton mentioned, is net neutrality. Dealings with telcos and big tech companies is the Internet’s net neutrality philosophy, which gives companies who have paid more to support infrastructure get better network access and give equal priority to all services. does it mean to lose

A possible compromise is to coordinate the staggered release of content by network providers and content makers. Streaming services, for example, can inform EU carriers about their schedule of blockbuster content. This can reduce the overall network traffic load, but requires an extra level of coordination between content creators and network operators across time zones.

Paolo Pescatore, Technology, Media and Telecom Analyst at PP Foresight, told CNBC: “This imbalance is not the fault of Big Tech, nor the streamers, nor the telcos.

READ NEXT: 5G Open RAN Gains Momentum: Next Steps and Challenges (TechRepublic)

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