Without us ‘there is no Google’: EU telcos ramp up pressure on Big Tech to pay for the internet

Published

3 years ago

March 10, 2023

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European telcos want U.S. big tech to pay for the internet — but tech giants are hitting back

Tensions between European telecommunications firms and U.S. Big Tech companies have crested, as telecom bosses mount pressure on regulators to make digital giants fork up some of the cost of building the backbone of the internet.

European telcos argue that large internet firms, mainly American, have built their businesses on the back of the multi-billion dollar investments that carriers have made in internet infrastructure.

Google, Netflix, Meta, Apple, Amazon and Microsoft generate nearly half of all internet traffic today. Telcos think these firms should pay “fair share” fees to account for their disproportionate infrastructure needs and help fund the rollout of next-generation 5G and fiber networks.

The European Commission, the EU’s executive arm, opened a consultation last month examining how to address the imbalance. Officials are seeking views on whether to require a direct contribution from internet giants to the telco operators.

Big Tech firms say this would amount to an “internet tax” that could undermine net neutrality.

What are telco giants saying?

Top telecom bosses came out swinging at the tech companies during the Mobile World Congress in Barcelona.

They bemoaned spending billions on laying cables and installing antennas to cope with rising internet demand without corresponding investments from Big Tech.

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“Without the telcos, without the network, there is no Netflix, there is no Google,” Michael Trabbia, chief technology and innovation officer for France’s Orange, told CNBC. “So we are absolutely vital, we are the entry point to the digital world.”

In a Feb. 27 presentation, the CEO of German telecom group Deutsche Telekom, Tim Hoettges, showed audience members a rectangular illustration, representing the scale of market capitalization among different industry participants. U.S. giants dominated this map.

Tim Hoettges, CEO of Deutsche Telekom, delivers a keynote at Mobile World Congress.

Angel Garcia | Bloomberg | Getty Images

Hoettges asked attendees why these companies couldn’t “at least a little bit, contribute to the efforts and the infrastructure which we are building here in Europe.”

Howard Watson, chief technology officer of BT, said he sees merit in a fee for the large tech players.

“Can we get a two-sided model to work, where the customer pays the operator, but also the content provider pays the operator?” Watson told CNBC last week. “I do think we should be looking at that.”

Watson drew an analogy to Google and Apple’s app stores, which charge developers a cut of in-app sales in return to use their services.

What have U.S. tech firms said?

Efforts to implement network fees have been strongly criticized — not least by tech companies.

Speaking on Feb. 28 at MWC, Netflix co-CEO Greg Peters labeled proposals to make tech firms pay internet service providers for network costs an internet traffic “tax,” which would have an “adverse effect” on consumers.

Greg Peters, Co-CEO of Netflix, speaks at a keynote on the future of entertainment at Mobile World Congress 2023.

Joan Cros | Nurphoto | Getty Images

Requiring the likes of Netflix — which already spends heavily on content delivery — to pay for network upgrades would make it harder to develop popular shows, Peters said.

Tech firms say that carriers already receive money to invest in infrastructure from their customers — who pay them via call, text and data fees — and that, by asking internet companies to pay for carriage, they effectively want to get paid twice.

Consumers may end up absorbing costs asked of digital content platforms, and this could ultimately “have a negative impact on consumers, especially at a time of price increases,” Matt Brittin, Google’s head of EMEA, said in September.

Tech firms also argue that they are already making large investments in European telco infrastructure, including subsea cables and server farms.

Rethinking ‘net neutrality’

The “fair share” debate has sparked some concern that the principles of net neutrality — which say the internet should be free, open, and not give priority to any one service — could be undermined. Telcos insist they’re not trying to erode net neutrality.

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Technology firms worry that those who pay more for infrastructure may get better network access.

Google’s Brittin said that fair share payments “could potentially translate into measures that effectively discriminate between different types of traffic and infringe the rights of end users.”

One suggestion is to require individual bargaining deals with the Big Tech firms, similar to Australian licensing models between news publishers and internet platforms.

“This has nothing to do with net neutrality. This has nothing to do with access to the network,” said Sigve Brekke, CEO of Telenor, told CNBC on Feb. 27. “This has to do with the burden of cost.”

Short-term solution?

Carriers gripe that their networks are congested by a huge output from tech giants. One solution is to stagger content delivery at different times to ease the burden on network traffic.

Digital content providers could time a new blockbuster movie or game releases more efficiently, or compress the data delivered to ease the pressure off networks.

“We could just start with having a clear schedule of what’s coming when, and being able to have a dialogue as to whether companies are using the most efficient way of carrying the traffic, and could certain non-time critical content be delivered at different times?” Marc Allera, CEO of BT’s consumer division, told CNBC.

“I think that’s a pretty, relatively easy debate to be had, actually, although a lot of the content is global, and what might be busy in one country and one time may or may not be busy in another. But I think at a local level is certainly a really easy discussion to have.”

He suggested the net neutrality concept needs a bit of a refresh.

Not a ‘binary choice’

The “fair share” debate is as old as time. For over a decade, telecom operators have complained about over-the-top messaging and media services like WhatsApp and Skype “free riding” on their networks.

At this year’s MWC, there was one notable difference — a high-ranking EU official in the room.

Thierry Breton, internal market commissioner for the European Union, delivers a keynote at Mobile World Congress in Barcelona.

Angel Garcia | Bloomberg | Getty Images

Thierry Breton, head of internal markets for the European Commission, said the bloc must “find a financing model for the huge investments needed” in the development of next-generation mobile networks and emerging technologies, like the metaverse.

Breton said it was important not to undermine net neutrality and that the debate should not be characterized as a “binary choice” between internet service providers and Big Tech firms.

Breton’s presence at MWC appeared to reflect the bloc’s sympathies toward Big Telecom, according to Paolo Pescatore, tech, media and telecom analyst at PP Foresight.

“The challenge in Europe is it’s not that clear cut because you have an imbalance,” Pescatore said. “The imbalance is not down to Big Tech, it’s not down to streamers, and it’s not down to telcos. It’s down largely to the old, out-of-date regulatory environment.”

A lack of cross-border consolidation and stagnating revenues in the telecoms sector created a “perfect concoction that’s unfavorable to telcos,” he said.

“A potential landing zone for resolution is a framework for telcos to negotiate individually with the tech firms that generate the heaviest traffic,” Ahmad Latif Ali, European telecommunications insights lead at IDC, told CNBC. “However, this is a highly contested situation.”

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Technology

Tesla’s stock erases loss for the year, soaring 85% from April low

Published

13 hours ago

September 15, 2025

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Tesla's stock erases loss for the year, soaring 85% from April low

Tesla CEO Elon Musk attends the Saudi-U.S. Investment Forum, in Riyadh, Saudi Arabia, May 13, 2025.

Hamad I Mohammed | Reuters

Tesla’s shares have finally turned positive for the year.

After a dismal first quarter, which was the worst for the stock in any period since 2022, and a brutal start to April, following President Donald Trump’s announcement of sweeping new tariffs, Wall Street has again rallied around the electric vehicle maker.

The stock rose 3.6% on Monday to $410.26, topping its closing price of 2024 by over $6. It’s up 85% since bottoming for the year at $221.86 on April 4. A new filing revealed that CEO Elon Musk purchased about $1 billion worth of shares in the company through his family foundation.

It’s the second straight year Tesla has bounced back after a down first quarter. Last year, the shares fell 29% in the first three months before ending up 63% for 2024.

In recent weeks, analysts have praised the EV maker’s proposed pay plan for Musk, which could amount to a $1 trillion windfall for the world’s richest person over the next decade. The company has also gotten a boost from its new MegaBlocks battery energy storage systems that Tesla ships preassembled to businesses looking to lower their power costs or make greater use of electricity from renewable resources.

Even with the rebound, Tesla is the second-worst performer this year among tech’s megacaps, ahead of only Apple, which is down about 5% in 2025. Tesla is still in the midst of a multi-quarter sales slump due to an aging lineup of EVs and increased competition from lower-cost competitors in China, namely BYD.

Tesla has seen a consumer backlash, in part because of Musk’s political activities, including spending nearly $300 million to propel President Trump back to the White House and his work with the Trump administration to slash the federal workforce.

Tesla leadership has been working to shift investors’ attention to other topics such as robotaxis and humanoid robots.

However, the company has yet to deliver vehicles that are safe to use without a human onboard and ready to take control if needed. And while Musk is touting Tesla’s Optimus robots, which he says will be able to do everything from factory work to babysitting, a product is still a long way from hitting the market.

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Technology

Alphabet becomes fourth company to reach $3 trillion market cap

Published

19 hours ago

September 15, 2025

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Alphabet becomes fourth company to reach trillion market cap

Google CEO Sundar Pichai gestures to the crowd during Google’s annual I/O developers conference in Mountain View, California on May 20, 2025.

Camille Cohen | Afp | Getty Images

Alphabet has joined the $3 trillion club.

Shares of the search giant jumped more than 4% on Monday, pushing the company into territory occupied only by Nvidia, Microsoft and Apple.

The stock got a big lift in early September from an antitrust ruling by a judge, whose penalties came in lighter than shareholders feared. The U.S. Department of Justice wanted Google to be forced to divest its Chrome browser, and last year a district court ruled that the company held an illegal monopoly in search and related advertising.

But Judge Amit Mehta decided against the most severe consequences proposed by the DOJ, which sent shares soaring to a record. After the big rally, President Donald Trump congratulated the company and called it “a very good day.”

Bessent: TikTok deal ‘framework’ reached with China, Trump and Xi will finalize it Friday

Published

21 hours ago

September 15, 2025

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Bessent: TikTok deal 'framework' reached with China, Trump and Xi will finalize it Friday

Samuel Boivin | Nurphoto | Getty Images

The U.S. and China have reached a ‘framework’ deal for social media platform TikTok, Treasury Secretary Scott Bessent said Monday.

“It’s between two private parties, but the commercial terms have been agreed upon,” he said from U.S.-China talks in Madrid.

Both President Donald Trump and Chinese President Xi Jinping will meet Friday to discuss the terms. Trump also said in a Truth Social post Monday that a deal was reached “on a ‘certain’ company that young people in our Country very much wanted to save.”

Bessent indicated that the framework could pivot the platform to U.S.-controlled ownership.

TikTok did not immediately respond to a request for comment.

The comments came during the latest round of trade discussions between the U.S. and China. Relations have soured between the two countries in recent months from Trump’s tariffs and other trade restrictions.

At the same time, TikTok parent company ByteDance faces a Sept. 17 deadline to divest the platform’s U.S. business or face being shut down in the country.

U.S. Trade Representative Jamieson Greer said Monday that the deadline may need to be pushed back to get the deal signed, but there won’t be ongoing extensions.