February 21. 2024. 8:19

The Daily

Read the World Today

EU Commission launches Connectivity Package with ‘fair share’ consultation

The European Commission put forth a Connectivity Package on Thursday (23 February), including measures to boost the rollout of high-capacity networks in Europe and a public consultation that might pave the way for Big Tech companies to chip in infrastructure costs.

Internal Market Commissioner Thierry Breton introduced the long-awaited batch of initiatives, these most controversial part of which is a questionnaire to inform the so-called ‘fair share’ initiative that might make the largest traffic generators contribute to IT infrastructure.

“High-speed Internet requires high investments. That is why, in addition to facilitating network deployment in the short term, we are exploring the important question of who should pay for the next generation of connectivity infrastructure,” Breton said.

Also in the package are the Gigabit Infrastructure Act, a draft regulation intended to speed up the fibre and 5G deployment at the national level, and the Gigabit Recommendation, a non-binding document that might give influential indications for national telecom regulators.

Fair contribution

Breton, a former CEO of France Télécom, has been the main political driver behind the ‘fair share’. Based on the senders-pay principle, the initiative results from a long-standing grievance of telecom operators that they have to bear the cost for infrastructural investments whilst Big Tech companies reap most of the benefits.

The initiative was first raised last May, prompting heated reactions. EU lawmakers and governments have been taking sides in favour and against, the body of European regulators issued a relatively negative opinion, and civil society groups warned against violating net neutrality.

The consultation is not fundamentally different from a leaked version EURACTIV reported three weeks ago. It will run for 12 weeks and is meant to inform a long-term vision for the future of the telecom sector.

A politically sensitive part of the questionnaire is where to set the threshold that would qualify a tech company as a ‘large traffic generator’, a category likely to include the likes of Netflix and Google.

The other big question is the type of solution.

The questionnaire proposes two options: a digital fund that could be established at the EU or national level, and a direct contribution to the telecom operators that might come with some strings attached, such as green investments.

EU Commission starts showing hand in questionnaire on ‘fair share’ initiative

The European Commission is set to open a consultation on the future of the connectivity sector, including whether digital players should contribute to deploying high-capacity networks like 5G.

Gigabit Infrastructure Act

On the regulatory side, the EU executive put forth the Gigabit Infrastructure Act, a proposal to revise the Broadband Cost Reduction Direction and speed up the deployment of 5G and fibre networks.

The Commission considers that the previous directive fell short of expectations because it gave too much leeway to the EU countries, some of which never fully applied it. This mistake should not be repeated with a regulation, a legislative tool directly applicable to national jurisdictions.

However, the Broadband Directive had also been initially proposed as a regulation, but the European governments transformed it into a directive.

Asked by EURACTIV why things should be different this time, an EU official said the conditions have changed since the EU has set ambitious connectivity targets, and some member states have already gone even beyond what was initially required in the directive.

The overall structure of the proposal did not change compared to the leaked version of the proposal EURACTIV reported last month. The core idea is to reduce the administrative burden for network rollout, notably streamlining permit procedures and limiting administrative fees.

The procedure for obtaining permits is also digitalised via a single information point at the national level, which will also include information on infrastructure and planned civil work telecom operators might tap into under specific conditions.

Network providers could also access public infrastructure like the rooftops of public buildings, a measure intended to favour 5G deployment. New and renovated buildings will have to be pre-equipped with fibre.

LEAK: EU Commission to propose mandatory measures to accelerate network rollout

Access to public buildings, coordination of civil works, streamlining of permit procedures and single information points are at the centre of legislation to fast-track the deployment of high-capacity networks like 5G, according to an undated draft obtained by EURACTIV.

Gigabit Recommendation

The third element of the package is a recommendation intended to provide the appropriate incentives for telecom providers deploying fibre and new ducts.

Although non-binding, the recommendation might prove highly influential as it can shape national telecom regulators’ decisions, particularly about applying the European Electronic Communications Code, the EU regulatory framework for the telecom sector.

The Commission’s interpretation of the Code might be particularly influential as national regulators have to notify the EU executive about certain decisions, like pricing flexibility, or the practice of renegotiating prices between two telecom operators when market conditions change.

The Recommendation broadens the scope for national regulators to consider pricing flexibility. For alternative operators, with this measure, the Recommendation goes to the advantage of legacy operators, the former national monopolists that own most of the infrastructure.

Luc Hindryckx, the executive director of the European Competitive Telecommunications Association, criticised the recommendation, saying that “if approved, it will kill the 25 years of successful liberalisation, European model based on inclusiveness and will feed inflation in the most difficult moment that European economy is experimenting”.

Another contested measure is that telecom regulators might allow operators to raise access costs once they announce switching from copper networks to fibre.