The EU has started consultations to allow tech companies to pay for networks

The European Commission has started the announced consultation period for a proposal to allow large tech companies to contribute to the costs of telecom and internet networks in EU member states. There is some resistance from the tech companies to the plans.

The Commission is currently considering such a proposal and has prepared a draft document for this purpose Bloomberg has recognized. This document is part of the consultation that was announced last year to start in the first quarter of 2023. The document proposes that companies can contribute to a fund for the costs of 5G and fiber networks, in addition to a mandatory system of direct payments from the tech giants to telecom operators.

As part of this consultation period, the Commission has asked companies whether there should be a certain threshold on the basis of which a company can or cannot be qualified as a ‘high traffic generating’ company. The idea is that companies that exceed the threshold value, if any, will have to contribute, while companies that remain below the threshold value will not have to deal with this obligation. This threshold, if any, will presumably be based on global or EU sales of large companies.

Last year, European Commissioner Thierry Breton indicated that the current consultation period will last five to six months. This period is designed to gather feedback from stakeholders, Member States and the public and is the first prelude to an actual plan. According to Bloomberg, the consultation will remain open for another two to three months.

This move is intended to arrive at a proposal to have tech giants pay a ‘fair share’ of the financing of the European telecom and internet infrastructure. The European telecom sector previously stated that half of all European internet traffic can be attributed to six major tech companies, namely Google, Facebook, Netflix, Apple, Amazon and Microsoft.

These big tech companies are not happy with the EU’s plans. They argue that the proposal could undermine net neutrality rules. It is also stated that large content platforms such as Facebook and Netflix will offer their services via ISPs outside the EU in order to avoid mandatory payments, which would not benefit quality and security. It is also suggested that the large companies may pay the amounts, but then pass them on to European consumers.