Google Tries To Fend Off Telecom Backed ‘Big Tech Tax’ In EU
We just got done noting how the European Union, prompted by regional telecom monopolies, has been seriously pushing for a new tax on big tech to fund broadband. For decades, telecom giants have lustfully eyed big tech ad revenues. They've then convinced politicians that the best way to fix the digital divide" (lack of broadband) is by taxing tech giants, which telecom giants (falsely) claim get a free ride."
AT&T efforts to charge Google extra just because" started the U.S. net neutrality wars nearly two-decades ago. Now, as the EU contemplates its digital policy trajectory for the next decade, the idea that big tech" should pay big telecom" for no coherent reason has popped up again in a big way.
The rhetoric is always the same. Some politician, being prodded by a telecom company eager for new subsidies, prattles on at length about how companies like Netflix and Google somehow get a free ride" on the Internet, despite these companies paying billions of dollars in cloud, transit, bandwidth costs, and other telecom infrastructure (Google even runs its own residential ISP, Google Fiber).
As Europe contemplates taxing tech giants to fund telecom networks in the EU, Google's Matt Brittin is once again having to remind politicians that Google already pays plenty for bandwidth:
He said Google, owner of YouTube, has done its part to make it more efficient for telecoms providers by carrying traffic 99% of the way and investing millions of euros to do so. In 2021, we invested over 23 billion euros in capital expenditure - much of which is infrastructure," Brittin said. These include six large data centres in Europe, 20 subsea cables globally, with five in Europe, and caches to store digital content within local networks in 20 locations in Europe.
These efforts to tax big tech are uniformly being pushed by telecom giants with a long history of abusing taxpayer subsidies by only half-delivering the fiber networks they spent the last 30 years promising. You'll notice that the politicians pushing for a big tech tax (like FCC Commissioner Brendan Carr here in the US) very rarely support cracking down hard on telecom monopoly subsidy abuse (Carr is routinely, notoriously absent when it comes to AT&T's multi-decade record of taxpayer fraud, for example).
The whole thing is a big con pushed by captured politicians and driven by telecom lobbyists on the hunt for even more subsidization. Google of course can't come out and say that, so they're forced to adopt the various dumb rhetoric politicians have adopted from telecom over the years, such as sender pays":
Introducing a sender pays' principle is not a new idea, and would upend many of the principles of the open internet," he said according to the text of a speech to be delivered at a conference organised by telecoms lobbying group ETNO. These arguments are similar to those we heard 10 or more years ago and we have not seen new data that changes the situation."
Big tech should pay big telecom billions of additional dollars for no coherent reason" is literally a 20 year old telecom industry talking point, but who's counting. And, it should go without saying, that when it comes to giant telecom monopolies, nobody gets a free ride. You pay, and you pay, and you pay, and maybe that money winds up in the form of an actual fiber upgrade. Maybe.
Without reforming telecom monopoly subsidy abuse, any big tech tax" simply gets thrown in the laps of telecom giants with a generation-long history (both here in the US and in the EU) of subsidy fraud. But politicians like the concept because it not only pleases their campaign contributors in the telecom sector, it earns them easy brownie points as a way to claim they're fixing the digital divide."