Meta steps up attack on network fees

Facebook parent Meta has fired another salvo in its campaign against the introduction of network fees.

Nick Wood

May 17, 2023

3 Min Read
facebook meta logo sign

Facebook parent Meta has fired another salvo in its campaign against the introduction of network fees.

Markus Reinisch, Meta’s vice president of public policy for Europe and global economic policy, said in a blog post on Wednesday that his company has submitted its response to the European Commission’s consultation on the future of electronic communications and infrastructure. Launched in February, it includes a section on whether telcos should be allowed to charge content application providers (CAPs) for access to their networks.

The deadline for responses is on Friday, so this is no time for holding back – Reinisch clearly isn’t.

“Allowing selected telecom operators to charge twice for the same infrastructure – already charging consumers for Internet access while also mandating discriminatory network fees from CAPs – will harm net neutrality, the structure of the open Internet, as well as consumers without any guarantee of more investment in networks,” he said.

Meta’s submission encourages the Commission “to deeply examine the negative impacts of the telco-led proposals,” he continued. “We explain why the creation of what is effectively a required private sector handout for selected telecom operators would lead to bad outcomes for European businesses and consumers, dis-incentivise innovation and investment, and distort competition.”

Over the last 12 months or so, the telecoms industry has renewed its effort to pressure regulators into forcing big tech to compensate them for the amount of web traffic they generate. Back in February, the GSMA welcomed the Commission’s consultation, repeating its assertion that “it is only fair that the companies generating the largest amounts of traffic on Europe’s networks should contribute to the required infrastructure investment.”

Meta disagrees with that assertion, obviously, and it isn’t the only one.

The Computer and Communications Industry Association (CCIA) – also clearly aware of the Commission’s looming deadline – on Tuesday published a response of its own, in which it reiterated its opposition to any attempt to force CAPs to cough up.

It pointed out that operators’ own customers are the ones driving demand for traffic, and they have already paid ISPs to receive it.

“Telecom operators simply want to charge the same Internet traffic twice. European consumers already pay for Internet access, they shouldn’t have to pay telcos a second time through pricier streaming subscriptions and cloud services,” said Alexandre Roure, CCIA Europe’s public policy director.

There is also no getting away from the fact that the biggest CAPs invest not just in traffic-generating applications and services, but the infrastructure that carries them too.

As Analysys Mason pointed out in October, cumulative CAP spending on infrastructure weighed in at €183 billion between 2011 and 2021. The number of cloud regions operated by the world’s top five cloud providers increased by 66% between 2018 and 2022. The number of ready-for-service submarine cable systems in which one or more CAPs has directly invested has increased from one to eight over the same period. Another two will be ready for service by 2024.

All this benefits telcos by making it more efficient to get traffic from where it originates to the end user. In fact, Analysys Mason says investments made by CAPs in infrastructure saved telcos €950 million in 2022.

“Proposals by a handful of telecom operators to be cross-subsidised by CAPs are fundamentally flawed. They misrepresent the digital ecosystem, including the symbiotic relationship between telcos and CAPs,” said Reinisch on Wednesday. “We urge the Commission to recognise the value that CAPs provide to the digital ecosystem, in addition to the multi-billion euro investments that Meta has made – and continues to make – into Europe’s digital infrastructure.”

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About the Author(s)

Nick Wood

Nick is a freelancer who has covered the global telecoms industry for more than 15 years. Areas of expertise include operator strategies; M&As; and emerging technologies, among others. As a freelancer, Nick has contributed news and features for many well-known industry publications. Before that, he wrote daily news and regular features as deputy editor of Total Telecom. He has a first-class honours degree in journalism from the University of Westminster.

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