How The EU Might Keep Internet Access Open To The Public
Earlier this summer, the Body of European Regulators of ElectronicCommunications (BEREC) took in around a half million public comments on itsdraft guidelines for member states on implementing end user protections for fixedand mobile Internet connections. The largest telecoms in Europe are lobbyinghard for weakened interpretations of the so-called "net neutrality" Regulationpassed late last year, which also covers data roaming and the EU Digital SingleMarket.
A few weeks ago, the largest telecom ISPs issued a 5G Manifesto in which theythreatened not to invest in 5G wireless networks unless BEREC waters down itsguidelines for enforcement of open Internet access.
Fortunately for American consumers, startup entrepreneurs and smallbusinesses, the FCC was not swayed by similar ISP threats about how commoncarrier law would kill network investment here. And so even with U.S. openInternet law now firmly in place after a recent court decision, Verizon hasannounced significant continued investment in 5G networks and field testing inmultiple locations.
But carriers in Europe, that don't face competition from cable broadbandproviders like American phone company ISPs do, enjoy even stronger marketdominance that allows them to intimidate regulators attempting to defend enduser rights. The current generation of online startups needs to be able to counton the same open Internet connectivity that the most popular global platformsenjoyed in their infancy a decade or two ago. Only now it's a battle againstcorporate lobbyists to get it.
In recognition of this opposition, over one hundred founders of European techcompanies and startups along with their international investors and trade groupssigned an open letter to underscore the critical importance of BEREC's upcomingaction to innovation and job-creating growth in the digital economy. They made itclear that if telecom ISPs are able to manipulate and subsidize data plan costsfor users of established big name platforms, they will put up new barriers toonline market entry. Earlier up front capital will be required in a "pay to play"environment, and those entrepreneurs who can't pay up will find it much harderto be discovered online, scale up and compete for business. No such price ofadmission ever held back American tech startups, although many of theirinvestors had grown very uneasy prior to the FCC's decisive action in early 2015.
While BEREC has displayed a comprehensive understanding of real new threatsto open Internet access, several loopholes in the draft guidelines must be closedif Europeans expect effective safeguards to protect their Internet access servicefrom commercial interference. Specifically ISPs should not be allowed to use the"specialized services" exception to circumvent the ban on charging online contentand application providers for priority transmission on the public Internet.
Secondly, given provisions in the Regulation prohibiting discriminatorycommercial practices, BEREC should ban zero rating schemes that favor certainonline platforms by exempting them from data caps. Zero rating is as harmful tostartups and other competing platforms as technical network discrimination. Zerorating of an ISP's own content is particularly anticompetitive. Finally networktraffic management should be application-agnostic whenever possible. ISPsshould not favor some classes of traffic and delay others, such as encryptedcontent, except under unusual circumstances.
Open Internet access law supports a digital innovation economy in which allonline content is equally accessible regardless of the identity of one's ISP or itsbusiness deals with online platforms. In the US, all zero rating is not banned, butthe FCC is actively investigating sponsored data and zero rating plans forcompliance with its open Internet order. In response to the EU Regulation, theNetherlands already has banned zero rating.
All ISPs have a natural economic incentive to partner with or acquire popularcontent providers in order to maximize monetization of their network facilities. Asa practical matter, only the big ones like Comcast (NBC, Netflix) and Verizon(Aol, Yahoo!) can pull it off, but they can really change the game for others.
Sweden uniquely is less concerned about commercial interference with Internetaccess because the Swedish government itself built and owns the enviableuniversal fiber optic Internet access network there. Use of that infrastructure islicensed to dozens of competing IT providers, and Stockholm is beginning toresemble a Scandinavian Silicon Valley.
Elsewhere in Europe though, ISPs are in business to provide sufficient capacityto transmit the data traffic of all their customers without "fast lanes" for some andinterruptions and buffering for everybody else. Startups in Amsterdam, Berlin,Barcelona, Bratislava, Cyprus, Dublin, Lisbon, Ljubljana, Paris, Riga and Viennaare among their customers. So far the Dutch are in the lead in terms ofproactively implementing the Regulation's open Internet access provisions, whichtook effect this past spring.
While BEREC properly focuses on shielding consumers from the downsides ofISP commercial discrimination, it should also tailor its guidelines for the sake ofEurope's tech startups looking to attract investment funding and access globalmarkets online. Other policymakers around the world will be watching whateverthe EU decides at the end of August about enforcement of Internet access rights.
Cathy Sloan is a telecom and Internet industry lawyer and consultant
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A few weeks ago, the largest telecom ISPs issued a 5G Manifesto in which theythreatened not to invest in 5G wireless networks unless BEREC waters down itsguidelines for enforcement of open Internet access.
Fortunately for American consumers, startup entrepreneurs and smallbusinesses, the FCC was not swayed by similar ISP threats about how commoncarrier law would kill network investment here. And so even with U.S. openInternet law now firmly in place after a recent court decision, Verizon hasannounced significant continued investment in 5G networks and field testing inmultiple locations.
But carriers in Europe, that don't face competition from cable broadbandproviders like American phone company ISPs do, enjoy even stronger marketdominance that allows them to intimidate regulators attempting to defend enduser rights. The current generation of online startups needs to be able to counton the same open Internet connectivity that the most popular global platformsenjoyed in their infancy a decade or two ago. Only now it's a battle againstcorporate lobbyists to get it.
In recognition of this opposition, over one hundred founders of European techcompanies and startups along with their international investors and trade groupssigned an open letter to underscore the critical importance of BEREC's upcomingaction to innovation and job-creating growth in the digital economy. They made itclear that if telecom ISPs are able to manipulate and subsidize data plan costsfor users of established big name platforms, they will put up new barriers toonline market entry. Earlier up front capital will be required in a "pay to play"environment, and those entrepreneurs who can't pay up will find it much harderto be discovered online, scale up and compete for business. No such price ofadmission ever held back American tech startups, although many of theirinvestors had grown very uneasy prior to the FCC's decisive action in early 2015.
While BEREC has displayed a comprehensive understanding of real new threatsto open Internet access, several loopholes in the draft guidelines must be closedif Europeans expect effective safeguards to protect their Internet access servicefrom commercial interference. Specifically ISPs should not be allowed to use the"specialized services" exception to circumvent the ban on charging online contentand application providers for priority transmission on the public Internet.
Secondly, given provisions in the Regulation prohibiting discriminatorycommercial practices, BEREC should ban zero rating schemes that favor certainonline platforms by exempting them from data caps. Zero rating is as harmful tostartups and other competing platforms as technical network discrimination. Zerorating of an ISP's own content is particularly anticompetitive. Finally networktraffic management should be application-agnostic whenever possible. ISPsshould not favor some classes of traffic and delay others, such as encryptedcontent, except under unusual circumstances.
Open Internet access law supports a digital innovation economy in which allonline content is equally accessible regardless of the identity of one's ISP or itsbusiness deals with online platforms. In the US, all zero rating is not banned, butthe FCC is actively investigating sponsored data and zero rating plans forcompliance with its open Internet order. In response to the EU Regulation, theNetherlands already has banned zero rating.
All ISPs have a natural economic incentive to partner with or acquire popularcontent providers in order to maximize monetization of their network facilities. Asa practical matter, only the big ones like Comcast (NBC, Netflix) and Verizon(Aol, Yahoo!) can pull it off, but they can really change the game for others.
Sweden uniquely is less concerned about commercial interference with Internetaccess because the Swedish government itself built and owns the enviableuniversal fiber optic Internet access network there. Use of that infrastructure islicensed to dozens of competing IT providers, and Stockholm is beginning toresemble a Scandinavian Silicon Valley.
Elsewhere in Europe though, ISPs are in business to provide sufficient capacityto transmit the data traffic of all their customers without "fast lanes" for some andinterruptions and buffering for everybody else. Startups in Amsterdam, Berlin,Barcelona, Bratislava, Cyprus, Dublin, Lisbon, Ljubljana, Paris, Riga and Viennaare among their customers. So far the Dutch are in the lead in terms ofproactively implementing the Regulation's open Internet access provisions, whichtook effect this past spring.
While BEREC properly focuses on shielding consumers from the downsides ofISP commercial discrimination, it should also tailor its guidelines for the sake ofEurope's tech startups looking to attract investment funding and access globalmarkets online. Other policymakers around the world will be watching whateverthe EU decides at the end of August about enforcement of Internet access rights.
Cathy Sloan is a telecom and Internet industry lawyer and consultant
Permalink | Comments | Email This Story