from the please-pay-me-billions-of-dollars-for-no-coherent-reason dept.
Big Telecom's Quest To Tax Big Tech For No Reason Will Cause Massive Internet Instability, Group Warns
For much of the last year, European telecom giants have been pushing for a tax on Big Tech company profits. They've tried desperately to dress it up as a reasonable adult policy proposal, but it's effectively just the same thing we saw during the U.S. net neutrality wars: telecom monopolies demanding other people pay them an additional troll toll — for no coherent reason.
To sell captured lawmakers on the idea, telecom giants have falsely claimed that Big Tech companies get a "free ride" on the Internet (just as they did during the U.S. net neutrality wars). To fix this problem they completely made up, Big Telecom argues Big Tech should be forced to help pay for the kind of broadband infrastructure upgrades the telecoms have routinely neglected for years.
It's a big, dumb, con. But yet again, telecom lobbyists have somehow convinced regulators that this blind cash grab is somehow sensible, adult policy, dubbing it their "sender pays" initiative. Dutifully, European Commission's industry chief Thierry Breton said last September he would launch a consultation on this "fair share" payment scheme in early 2023, ahead of any proposed legislation.
Tech giants like Netflix have tried to explain that this whole thing is just part of a longstanding attempt to force them to pay telecom additional money for no reason. Both Konstantinos Komaitis and K.S. Park also penned a good piece here at Techdirt explaining how these policies could have a profoundly negative impact on user and enterprise costs, broadband quality, and how the Internet functions.
The European Internet Exchange Association (Euro-IX), a coalition of core transit and interconnection telecom providers, have also now come out in criticism of the plan, saying it risks creating "systemic weaknesses" across the Internet in Europe.
[...] Yes, both the EU and U.S. need to find additional ways to creatively subsidize broadband expansion, especially to the marginalized communities long neglected by these very same telecom companies.
But taking money from tech giants (again, for no actual reason) then throwing it in the lap of an industry with a forty year history of anti-competitive behavior, subsidy fraud, and routine under-investment isn't the answer. Hopefully the EU figures this out before it's broader rules for the Internet are finalized later this year, but I wouldn't count on it.
And I suspect if telecom companies succeed in the EU, you'll see a similar renewed push in the U.S.
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They suggest any move to legislative for a mechanism that funnels direct payments to telecom incumbents would have "immediate and wide-ranging" negative consequences for European businesses and consumer interest — arguing it would hit consumer costs and choice by damaging the diversity and quality of products and services available online, as well as harming competition.
"The risks of introducing network fees are many but ultimately the biggest threats would be to consumer rights, costs, and freedom of choice," they warn. "Users of the internet and mobile networks are the key players in the debate, not content providers. Consumers access content (and thus drive internet traffic and take-up), so the fee would effectively be a fee on consumer behaviour and choice."
[...] Major European telcos, meanwhile, want regional lawmakers to let them extract a network fee from Big Tech platforms whose popular services they claim are responsible for generating the most traffic across their fixed and mobile networks — spinning the ask to double dip (given consumers already paid them for connectivity) as getting tech giants like Meta and Netflix to contribute what they dub a "fair share" towards funding network infrastructure costs.
While the likes of Meta have pushed back that such a fee would actually be arbitrary and unfair.
Thing is, the European Commission, which is responsible for drafting EU legislative proposals, has been sounding suspiciously sympathetic to Big Telco's lobbying.
(Score: 5, Insightful) by bzipitidoo on Monday January 09, @02:50AM (5 children)
Once again, privatization shows its ugliness. Remember the proposal to take the entire .org domain private? The dirtbags behind that one were deafeningly silent about what their real plans were. They didn't have even a plausible rationale for why they'd be any better at running .org. They didn't have to say anything, anyone with any sense knew what their game was: rent seeking.
If telecoms don't like mere regulation, how'd they like it if they were nationalized?
(Score: 1, Informative) by Anonymous Coward on Monday January 09, @04:38AM (3 children)
Many big european telecom companies are already nationalized or at at least owned by the state to a large degree.
(Score: 4, Interesting) by MIRV888 on Monday January 09, @07:20AM (2 children)
I am not an expert on European utilities. Why would state owned telecoms go for a grift like this? They're already funded. Nationalized phone companies have no need to turn a profit.
Privately held telecoms are going full lobby in the EU just like they did in the US. I feel comfortable saying these telecoms will probably get the kickback eventually.
Money talks and .....
(Score: 0) by Anonymous Coward on Monday January 09, @10:53AM (1 child)
You have no concept of the level of corruption and cleptocratic nepotism here.
(Score: 1, Interesting) by Anonymous Coward on Monday January 09, @11:04AM
To add to that, if you can extract more money from more, especially foreign, entities you can pocket more of if yourself (= funnelled back to their affiliated political parties/mafias) with fewer people noticing and/or caring. They've done similar stuff with electricity companies where I live. They used to be state run, then the two leading political parties through some smoke and mirror campaign obtained partial ownership over the utilities, which are nominally run by the state but factually run directly by those political parties. Investment in infrastructure is still funded by the tax payer of course, but the profits go right into party pockets.
(Score: 1) by khallow on Monday January 09, @07:17AM
It's too easy to rig the game so a small number of parties get the property or to create obligations that generate a lot of rent-seeking. The privatization of Russia is a great example of the former since a good portion of the property went cheaply to a small number of well-connected oligarchs. The privatization of California's electricity system is a great example of the later where a minor feature of the market obligated the big three electricity distributors to buy a considerable amount of their demand at market "spot" prices. Then manipulators, organized by Enron, ensured that demand was restricted so that spot prices would go up a lot.
But for what this is worth, the above scheme is a move away from privatization. There was already a mostly private marketplace and it would create rent-seeking where none existed before.
(Score: 5, Insightful) by Fnord666 on Monday January 09, @03:19AM