The EU telecoms regulators’ group, BEREC, has advised the European Commission against forcing Big Tech to pay for the rollout of 5G. This follows campaigns by industry associations, such as the GSMA and ETNO, to force tech giants to help pay for the rollout of 5G.
Speaking on behalf of telecom providers, the GSMA proposed “a fair contribution mechanism that allows balanced negotiations between Telco’s and large traffic generators”. John Giusti, the association’s chief regulatory officer, said that the industry wants to ensure that “huge international companies benefitting the most from access to European consumers pay their fair contribution to the network investment they rely on.”
Deutsche Telekom, Orange and Telefonica, amongst others, have been lobbying for tech behemoths such as Google, Apple, Meta, Netflix, Amazon and Microsoft, who account for the majority of global data internet traffic, to share the financial burden of building 5G networks.
However, in evidence submitted to the European Commission’s exploratory consultation on 19th May, BEREC says that mandatory financial contributions from large CAPs (content and application providers) to ISPs (internet service providers) would disadvantage smaller ISPs on account of their smaller number of end-users and lower bargaining power.
BEREC also suggests that a financial contribution may reduce the incentives for CAPs to develop new content and applications and reduce the quality of existing services. A financial contribution made by CAPs may also cause higher costs to be passed on to CAPs’ customers, including SMEs.
The EU telecoms regulators’ group also says that it has not found any evidence that operators’ costs were not fully covered, or any evidence of “free-riding”.
5G is fast becoming a reality across the globe, with carriers investing in networks to expand and support the ecosystem.
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According to GlobalData’s forecasts, 5G subscriptions will top 5.5 billion by 2027, with Asia-Pacific as the largest 5G market. In addition, the analyst says major drivers of subscriber growth include increased spectrum availability and operator investment in network rollouts. However, the data analytics and business intelligence company also says that 5G penetration will partly depend on the availability of affordable handsets, especially if rising inflation continues to squeeze consumers’ disposable income.
Major operators in the 5G theme include Vodafone, BT/EE and T-Mobile.