© Reuters. Workers walk past a GSMA 2023 billboard ahead of the Mobile World Congress (MWC) in Barcelona, Spain, February 25, 2023. REUTERS/Nacho Doce
By Supantha Mukherjee, Martin Coulter and Joan Faus
BARCELONA (Reuters) – A showdown between big technology companies and European Union telecoms companies over who will finance network infrastructure will dominate discussion at the world’s biggest telecoms conference this week.
More than 80,000 people, including technology executives, innovators and regulators, will attend this year’s Mobile World Congress (MWC) in Barcelona.
EU industry chief Thierry Breton on Thursday launched a 12-week consultation on his “fair share” proposals, under which Big Tech platforms would bear a greater share of the costs of the systems that give them access to consumers.
Representatives from companies including Alphabet (NASDAQ:), Meta and Netflix (NASDAQ:) are expected to use the conference as a platform to reject the EU proposals.
Content providers like Netflix, which has arranged for CEO Greg Peters to meet Breton at the conference, argue that their companies already invest heavily in infrastructure.
They say paying additional fees will detract from investment in products that benefit consumers.
By contrast, Deutsche Telekom (OTC:), Orange, Telefónica (NYSE:) and Telecommunications Italy (BIT:) have been actively lobbying for Big Tech to pay the fees.
The GSMA, an association representing more than 750 mobile operators and the organizing body behind the MWC, has been at the forefront of the debate.
“This ‘fair share’ discussion, or what we sometimes call the ‘investment gap,’ is going to be a threshold issue,” said John Giusti, GSMA director of regulation.
Critics of the fair share model or “SPNP” (Sending Party Network Pays) have warned that the so-called “traffic tax” could lead content-based platforms to route their services through ISPs (Internet Service Providers). outside the EU.
Orange told Reuters the telecoms industry was not asking for special privileges in its lawsuits. A spokesman said the EU consultation was a “first positive sign” of the start of a debate.
“We stand for a framework that will facilitate a fair and equitable business relationship that recognizes a direct contribution from tech giants to network costs,” they said.
However, the regulations will be difficult to implement and enforce, said Shahid Ahmed, executive vice president of NTT and adviser to the US Federal Communications Commission.
“We saw something very similar, the whole net neutrality debate, that was tried in the United States,” he said.
MWC, which kicks off on Monday, will also see new product launches from companies like Huawei, Xiaomi (OTC:), HMD Global, Honor, and RealMe.
Other hot topics include the adoption rate of 5G, which has disappointed some executives, and the potential uses of generative AI systems like OpenAI’s ChatGPT.
“Everything on the MWC floor is about looking to the future,” Guisti said.