Telecom companies in European Union urge the bloc to make Big Tech pay

The heads of European Union telecom giants including Orange and Vodafone on Monday (Oct 2) urged the EU to make tech and streaming giants pay for the huge amounts of bandwidth they use. Such a demand is not new but it has reignited the debate.

The telecom companies have said that they needed more funds to maintain and update the infrastructure for Europe's high data needs. The firms say that it would be fairer if tech and streaming giants like Netflix made contributions towards the cost.

But tech giants maintain that telecom companies already get money from customers.

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"Big tech companies pay today almost nothing for data transport in our networks, far from covering the costs needed to expand networks," a letter published by the European telecoms lobby group ETNO and signed by 20 CEOs said.

"A fair and proportionate contribution from the largest traffic generators towards the costs of network infrastructure should form the basis of a new approach," they said.

ETNO has previously named tech and streaming giants like Amazon, Netflix, Apple, Facebook, Microsoft and Google as being major culprits.

The telecom CEOs mentioned the EU estimate that at least 174 billion euros ($183 billion) of fresh investment would be needed by 2030 in order to meet connectivity targets.

"The telecoms sector is currently not strong enough to meet that demand," said the CEOs, including Orange's Christel Heydemann and Telefonica's Jose Maria Alvarez-Pallete.

A public consultation was launched by the European Commission in February. It invited citizens, NGOs and companies to submit what they had to say by May.

It is expected that the EU's executive arm would make the results public in 2023.

The idea of "fair contribution to telecommunication networks" is also divisive within the EU.

While earlier this year the European Parliament voiced support for the measure, not all of the EU's 27 member states are on board.

Many countries reportedly opposed such a levy on tech firms in June.

The Computer & Communications Industry Association (CCIA), one of the main tech lobbying groups, has repeatedly argued against the measure. It has warned that fees would have disastrous consequences for European consumers.

One of their main arguments is that customers would be forced to pay twice, first for the internet access, and second through higher costs for streaming and cloud services.

(With inputs from agencies)

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