EC Digital Infrastructure Approach Concerns US Companies, EU Regulators

European Commission proposals for addressing the continent's digital infrastructure needs include some worrying aspects and have kept alive the long-running "fair share" dispute, some commenters said. While no plan forces content providers to pay telcos for use of their networks, most U.S. entities that responded to an EU white paper focused on that issue, telecom consultant Innocenzo Genna said in an email. The white paper, which prompted more than 350 responses (available at the link), also unnerved EU telecom and spectrum regulators.

Mastering Europe's digital infrastructure requires more work in three areas, the white paper said: (1) Creating "connected collaborative computing"; (2) building secure and resilient infrastructures; and (3) completing the digital single market.

Possible scenarios for improving the digital single market might include widening current rules, which would ensure a level playing field all users and providers of digital networks. To address technological and market developments and the resulting need for regulatory change, the EC could consider dropping "ex ante" (preventive) rules and focusing on lighter-touch regulation and a more harmonized approach at the EU level to spectrum authorization.

The paper noted that while regulators have seldom intervened in the contractual relationship between networks and content providers, "there has nonetheless been a vivid debate on this topic." If wrangles increase, it said, then the EC could set dispute resolution policies.

"There is no concrete proposal" on fair share, Genna said. "The Commission just wants to keep this subject alive, although the fair share initiative has little chance to re-emerge in the future, due to the lack of interest by most governments." Genna believes this issue isn't "the central and most worrying part" of the paper, but many US responses addressed it.

While it supports the goal of improving connectivity and reaching a competitive single market, Meta said it's concerned about the concept of a dispute resolution mechanism between operators and content providers, which "we (and others) see [as] an imminent risk of harm to the open internet." Microsoft urged the EC to "avoid introducing mandatory 'network fees' mechanisms." Don't regulate the IP interconnection market, said the Computer & Communications Industry Association.

"The Commission should not favor either side of the broadband infrastructure," the Information Technology & Innovation Foundation said. Google branded as "worrisome" proposals that modify how internet traffic is exchanged via an "unnecessary" dispute resolution process for Internet interconnection that telecom regulators oversee.

If large telcos extract fees from content providers, it would result in a de facto network fee through arbitration, the MPA said. The Internet Society noted that the EC "forcefully" rejected the fair share idea in an exploratory consultation. Raising the issue again gives the impression that the discussion paper is biased toward large telcos, it added.

EU regulators had concerns about some of the proposals. For example, the Body of European Regulators for Electronic Communications (BEREC) dismissed EC fears that the current regulatory framework is broken. "Europe seems to be on the right track," with the EU's ex ante regulatory model "widely regarded as a success story," BEREC said.

"As regards Europe's performance in the telecoms sector compared to other jurisdictions, BEREC cannot find any compelling evidence of Europe's claimed underperformance," it said. Nor, it added, is Europe lagging in 5G uptake. Regulators also opposed the idea of pan-European spectrum awards, saying they might take into account national or regional circumstances and result in inefficient use of spectrum, and that there are other ways of incentivizing operators to invest in mobile networks, such as by reducing deployment costs.

To ensure more EU spectrum harmonization, the EC said, EU governments should be able to take positions on spectrum management that are independent of non-EU actors. "This means reconsidering the role of the European Conference of Postal and Telecommunications Administrations (CEPT) in EU decision-making, given the fact that its members include non-EU countries." CEPT, however, countered that its decisions are highly regarded globally and often serve as a model for other regions and countries, and that no evidence exists that its role in European spectrum decisions should change.