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Proposals to pay for broadband networks by charging new fees to big tech companies are “built on a false premise,” Meta executives wrote in a blog post today.
“Network pricing proposals fail to recognize that our investment in content drives the operators’ business models,” Meta executives Kevin Salvadori and Bruno Cendon Martin wrote. Meta’s comments come just weeks after Netflix co-CEO Greg Peters spoke out against a proposal being reviewed by European regulators.
Meta executives said that carriers and content application providers (CAPs) are “a symbiotic business, playing different but complementary roles in the digital ecosystem. Billions of people access this content online every day, creating a demand for enabling carriers to charge for Internet access. It drives the revenue and business model of our customers.”
Internet service providers in the EU say big tech companies should pay their “fair share” of the cost of building their networks. In the U.S., Federal Communications Commission Republican Brendan Carr said, “Big Tech skips the billions of dollars required to maintain and build networks, while using the Internet his infrastructure for free.” I have done it,” he claims.
But that doesn’t mean that Big Tech companies actually have free access to the internet. Anyone who distributes content over the Internet either pays their own provider, builds their own network his infrastructure, or does a combination of the two.
For very large companies such as Netflix and Meta, investments include building their own content delivery networks. “Over the past decade, CAP has invested a total of over $880 billion in global digital infrastructure, including nearly $120 billion annually from 2018 to 2021,” Meta’s blog post said today. I’m here. “Technology companies’ contributions to these infrastructures will save carriers about $6 billion annually.”
Telefónica wants a ‘two-sided market’
Last month, the European Commission began to take public comment on a proposal to make online platforms pay for upgrades and expansions of telecommunications companies’ broadband networks. Preliminary talks are expected to end on May 19.
In a blog post last week, Telefónica argued that it should be a “two-sided market” where carriers charge internet users and content providers.
“Telcos just want to open up new revenue streams. Why do they have policies for that when other companies and markets do not need such intervention to evolve into a two-sided or multi-sided market? Do we need a planner?” Fernando Herrera González, Corporate Regulations Manager at Telefónica, writes:
A Telefónica blog post lamented the existence of telecom industry-specific regulations that required new rules for ISPs to withdraw payments from over-the-top (OTT) companies that send content to internet users. It means that there is
“Like any other industry, the number of facets of the telco market should depend on the specific business model that the operator deems sustainable,” the post said. “On the contrary, what is exceptional is the existence of a company (in this case he is an OTT) who can refuse to negotiate the terms of the service he enjoys until he refuses to pay.”
Meta: no evidence of an investment gap
According to Meta’s blog post, the carriers seem to have enough money to build out their networks. “Neither we nor others see credible evidence that there is an investment gap in either fixed network capacity or mobile coverage,” the post said.
More than 60% of Europeans have fiber internet access in their homes, “putting us on track towards the EU Commission’s goal of full home coverage with gigabit networks by 2030,” says Meta. is writing
“For European consumers, a priority is to ensure that the fixed networks that carry the most data have the technical capabilities to take advantage of tomorrow’s Internet. Our existing investment roadmap is already on track, with home connection speeds dozens of times higher than today,” Meta wrote. “Coupled with the expected improvement in latency from the continued growth of edge data centers, Europe’s network has ample potential to serve the demand for the Metaverse and other Internet services over the next few decades. I’m here.”
Meta also said that 5G wireless coverage in Europe has “expanded dramatically, with almost three-quarters of the EU27 population now having access to 5G.” Meta said he hopes the AR glasses plan will work, but that 5G should be able to handle the traffic generated by the device.
“We expect AR application speeds to be in the low double-digit megabits per second or lower,” said Mehta, who said no “significant changes to the physical architecture” of mobile networks would be required.
