EU official defends talks with Big Tech on digital infrastructure upgrade

Europe’s existing telecom networks aren’t up to the job of handling surging amounts of internet data traffic, a top European Union official said Monday, as he defended a consultation on whether Big Tech companies should help pay for upgrades.

The telecom industry needs to reconsider its business models as it undergoes a “radical shift” fueled by a new wave of innovation such as immersive, data-hungry technologies like the metaverse, Thierry Breton, the European Commission’s official in charge of digital policy, said at a major industry expo in Barcelona called MWC, or Mobile World Congress.

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Breton’s remarks came days after he announced a consultation on whether digital giants should help contribute to the billions needed to build the 27-nation bloc’s future communications infrastructure, including next-generation 5G wireless and fiber-optic cable connections, to keep up with surging demand for digital data.

“Yes, of course, we will need to find a financing model for the huge investments needed,” Breton said in a copy of a keynote speech at the MWC conference.

Telecommunications companies complain they have had to foot the substantial costs of building and operating network infrastructure only for big digital streaming platforms like Netflix and Facebook to benefit from the surging consumer demand for online services.

“The consultation has been described by many as the battle over fair share between Big Telco and Big Tech,” Breton said. “A binary choice between those who provide networks today and those who feed them with the traffic. That is not how I see things.”

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Big tech companies say consumers could suffer because they’d end up paying twice, with extra fees for their online subscriptions.

Breton denied that the consultation was an attack on Big Tech or that he was siding with telecom companies.

“I’m proposing a new approach,” he later told reporters. Topics up for discussion include how much investment is needed and whether regulations need to be changed, he said.

“We will have zero taboo. Do we need to adapt it? Do we need to discuss who should pay for what? This is exactly what is the consultation today,” Breton said.