European Digital Agenda Commissioner Neelie Kroes opposes a sending-party-pays provision

had asked what Kroes meant by “managed services,” and whether Internet search engines, video sites and social networks fall under the heading. Sargentini asked whether Internet content companies could sign contracts with ISPs for faster and better transmission of their data in exchange for payment of termination rates, and whether the European Commission perceived any danger that, in purchasing priority online, large and rich Web content companies could reduce the opportunities for smaller and new entrants. Sargentini also sought comment on the Dutch government’s objections to the European Telecommunications Network Operators Association’s contention that termination tariffs could hamper suppliers of services and applications from continuing to offer those services, and ETNO’s contention that an automatic deduction system in which costs are passed on through termination tariffs is likely to cause economically less efficient results than if tariffs are charged directly to end-users. The lawmaker also asked Kroes why the EC, in its proposal for the EU position at the upcoming World Conference on International Telecommunications, said nothing about net neutrality. Kroes replied that managed services provide access to applications and content with a certain quality of service level. ISPs may enter commercial agreements with content providers to ensure that technical properties of specific content or applications are controlled from end to end, she said. Some applications need a specific QoS level, such as Internet Protocol TV, VOD and business services such as virtual private networks, she said. Not all services referred to in the question need quality control, she said. E-communications operators should be able to market managed services, but to protect the Internet’s capacity to innovate, the provision of those services should not lower the quality of the “best effort” Internet, Kroes said. The EC is committed to maintaining the Internet as an open platform for innovation or all providers, she said. The EC backs the Dutch government’s position on ETNO’s proposal, she said. “Generally, the Commission believes that the ITRs are not the appropriate forum for setting compensation and tariff systems.” The EC proposal seeks to ensure that the scope of existing ITRs isn’t extended, especially with regard to Internet-related matters, Kroes said. The absence of any specific ITR provisions doesn’t prevent the EU from taking regulatory or legislative actions in that area, she said. The U.S., European countries and the EU have now explicitly nixed ETNO’s proposal, which appears to be supported only by repressive Arab and African regimes, European Internet Services Providers’ Association board member Innocenzo Genna wrote on his blog (http://xrl.us/bnvtwr). Remarkably, despite the opposition, the incumbents are moving ahead, he said. But the final shape of ETNO’s proposal remains unclear and the organization is reportedly considering its withdrawal (CD Oct 24 p5).