BRUSSELS: The CEOs of Deutsche Telekom, Vodafone and 11 other major European telecommunications companies said on Monday that US tech giants will have to bear some of the costs of developing Europe’s telecommunications networks because they use them a lot.
The call by chief executives comes as the telecom industry faces massive investments for 5G, fiber and cable networks to tackle data and cloud services provided by Netflix and Google’s YouTube and Facebook.
Investments in Europe’s telecommunications sector rose to 52.5 billion euros ($59.4 billion) last year, a six-year high.
“A large and growing portion of network traffic is generated and monetized by large tech platforms, but this requires sustained, intensive network investment and planning by the telecom sector,” the CEO said in a joint statement seen by Reuters. . ,
“This model – which enables EU citizens to enjoy the fruits of digital transformation – can only be sustainable if such large tech platforms make a reasonable contribution to network costs.”
The CEO didn’t mention any tech firm by name, but Reuters understands that US-listed giants like Netflix and Facebook are on his mind.
The signatories to the letter include CEOs of Telefonica, Orange, KPN, BT Group, Telecom Austria, Vivacom, Proximus, Telenor, Altis Portugal, Telia Co and Swisscom.
The CEO also criticized high spectrum prices and auctions that EU governments use as cash cows, saying these artificially force volatile entrants into the market.
Efforts by EU lawmakers to end surcharges on intra-EU calls were also met with little from CEOs, who see the region as a source of revenue from business users.
“We estimate that they will forcibly remove more than EUR 2 billion in revenue from the sector over a 4-year period, which is equivalent to 2.5% of the sector’s annual investment potential for mobile infrastructure,” the companies said.
EU lawmakers will have to discuss their proposal with EU countries before adopting it and may struggle to find a deal.
($1 = 0.8839 Euro)
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