EU Telecom Regulators' Body Faces Questions on Its Net Neutrality Rules, Competence

Regulators readying guidelines for enforcing net neutrality provisions in the EU telecom single market regulation are facing not only criticism of their proposals but also hostility from some quarters over their competence and independence. A Body of European Regulators for Electronic Communications (BEREC) consultation on the draft document (see 1606060005) closed July 18, but responses haven't been made public. Various players, however, including telcos, digital rights groups and consultants, made their comments available to us, and many said the guidelines need more work.

BEREC said the final version of the document will be released on its website Aug. 30. "We are currently processing all the contributions received," its spokesman emailed. BEREC's board of regulators will review the report on the outcome of the consultation at an Aug. 25 plenary and, once approved, the report will be published on the website alongside the final guidelines and all the comments, he said. BEREC will unveil the guidelines at an event in Brussels, he said.

European telecom providers voiced their "deepest concern" with the draft, in a July 19 joint statement. The guidelines "appear to open a scenario of legal uncertainty as well as create a restraint on consumers choice, network innovation and investment," said the European Telecommunications Network Operators' Association (ETNO), GSM Association and Cable Europe.

The guidelines are overly prescriptive because they rely on prohibitions set in advance (ex ante) of any problems, paving the way for litigation, the organizations said. The guidelines also "appear to ignore the natural and on-going evolution" on e-communications networks by taking a static view that doesn't match technological reality, they said. They said 5G technologies centralize and virtualize network intelligence, which currently sits with terminal equipment. This clashes with the guidelines' "rigid distinction" between virtual private network apps and VPN networks, they said. The European Parliament decided not to define specialized services (services other than internet access services), but the draft takes an ex ante regulatory approach, they wrote. The document also appears to limit operators' ability to launch new business models that make the most of their network investment, they said.

ETNO and GSMA also attacked the guidelines in a July 7 "5G Manifesto for timely deployment of 5G in Europe." Together with the European Competitive Telecommunications Association, the European Association of Automotive Suppliers and the European Automobile Manufacturers Association, they said the "EU and Member States must reconcile the need for Open Internet with pragmatic rules that foster innovation. The telecom industry warns that the current Net Neutrality guidelines, as put forward by BEREC, create significant uncertainties around 5G return on investment." The organizations stressed the "danger" of tight net neutrality rules to 5G technologies, business applications and beyond.

The European Broadcasting Union rejected the proposal by telcos to water down implementation of net neutrality rules to accelerate 5G deployment. The EBU generally welcomed the guidelines but said provisions recommending national regulators probe interconnection policies to detect possible net neutrality breaches aren't strong enough. It urged BEREC to clarify the difference between a "predetermined group" and "services or networks being made publicly available" in connection with deciding whether a service is subject to net neutrality rules. "Commercial practices, such as zero-rating, require active monitoring" by national regulators to assess harms, said the EBU. It urged BEREC not to weaken its criteria for gauging which commercial and technical conditions limit the exercise of end-user rights.

Mobile network operators said zero-rate video streaming services in EU countries sell half as much gigabyte volume for 35 euros ($38) as those that don't, Finnish telecom consultancy Rewheel commented. Operators in 24 of the 28 EU markets zero rated their own or third-party video content or services in April, wrote Managing Partner Antonios Drossos. Operators that do that "have an economic incentive (non-coordinated effect) to set restrictive gigabyte volume caps in order to enhance the appeal of their zero-rated services," he said. The draft guidelines don't bar zero rating, instead setting out the types permitted.

BEREC's approach to zero rating won cheers from digital rights activists, many of whom banded together in an online initiative urging people to file comments. Over 500,000 did so, the website said Thursday. The FDN Federation (Fédération des fournisseurs d’accès à Internet associatifs), made up of nonprofit ISPs, said it backs BEREC's approach because "our organisations consider it implies the total ban of zero-rating from Europe. Any form of zero-rating." The guidelines expose "clearly that a data-cap, or speed-based pricing, when applied in an agnostic way, abides by the net neutrality principle," said the federation. Zero rating, however it's done, is a differentiation of traffic types so isn't agnostic, FDN said.

In a policy analysis submitted with its comments, European Digital Rights said the guidelines "contain three outstanding issues that still need to be resolved": zero rating, specialized services and traffic management. But it said "in general they are a big step towards delivering real net neutrality." EDRi called the lack of a ban on zero rating a "missed opportunity."

BEREC is also facing questions about its ability to function. "BEREC's independence and competence is being attacked on a nearly daily basis by the big telcoms providers," emailed a civil society source. The European Commission "added insult to injury" by discussing the telcos' 5G manifesto (with its anti-net neutrality stance) at its daily news briefing and publishing the document on its website, the person said.

There are "10 reasons not to trust BEREC on net neutrality," wrote Strand Consult telecom consultant John Strand in a research note. He said they include lack of evidence for the need for rules and guidelines and lack of transparency in the way BEREC developed the guidelines. This was echoed in criticism from FDN and others about the consultation and all documents being in English only. No one knows what specialized services are and the guidelines probably violate EU competition law, said Strand. The net effect of all this is that Europe has "become the region where it is least attractive to invest in telecom networks," he wrote.