EC Seeks to Ensure Net Neutrality, as Stakeholders Squabble Over How to Do It

There’s also pressure for national action on net neutrality to help complete the single digital market, Kroes said. “If we don’t address net neutrality, wider problems will arise and tomorrow’s innovative services might have to stop at the border,” she said. But at the following European Parliament discussion, the split between telecom companies who say regulation is unnecessary, and content providers and others who want legislation, remained evident.

Kroes said she will “soon” be putting forward proposals to ensure that new services don’t stop at the border. They will be built on competition, innovation, transparency and choice, she said. The EU should allow innovations, and if some want to pay extra for them, “no EU rules should stand in their way,” she said. But consumers must, before they sign an Internet contract, know what’s included, what’s not, and what speeds they will actually get, she said.

People also need “a real choice, not a theoretical one” in their Internet services, Kroes said. They should be able to switch providers without endless obstructions, she said. Finally, innovation needs competition, she said. Services such as VoIP or messaging services give consumers real innovation, but some ISPs are deliberately degrading or blocking them to avoid competition, she said.

Many Europeans expect protection against such commercial tactics, Kroes said. Her proposal will give them a safeguard on every device and every network, a guarantee of access to the full and open Internet, with no blocking or throttling of competing services, she said.

European citizens and businesses “need safeguards to curb the tendencies of access operators to act as gatekeepers of the internet,” 20 entrepreneurs said in a letter given to Kroes at the parliamentary event. They urged the EC to set three net neutrality principles: (1) The Internet should be open so everyone can send and receive the content, run the applications and use the services of their choice within the law, and access all other users. (2) Network management should be kept to a minimum and only used for technical security or legal reasons. (3) Transparency and facilitating switching are important but aren’t enough to protect the open Internet.

The panel discussions showed continued tension between those who seek net neutrality regulation and those who think it’s overkill. There “is no data explosion on the European Internet,” negating the need for net neutrality rules, said University of Sussex media law professor Chris Marsden. According to Cisco, the Internet is growing at the annual rate of 21 percent, well below earlier figures, he said. The EU shouldn’t be making policy “based on a fallacious assumption,” he said.

What’s really happening in Europe is “net neutrality light” that will eventually stop blocking and throttling, Marsden said. Net neutrality light is about letting Internet companies do what they like in fast lanes but preventing them from messing around with the slow lanes, he said.

But also on the table is “net neutrality heavy,” which is about what is allowed in the fast lanes, Marsden said. High-speed lane problems revolve around special or managed services, he said. Carriers have tried to define how to distinguish what to do about those services as opposed to regular services, he said. Telecom lawyers will try to define those distinctions as anything telcos can charge money for, he said. He urged the EC and European Parliament to work together to ensure a free and open Internet. Marsden stressed he favors net neutrality light, with the Internet treated under the same common carriage principles applied to other public networks.

There is a lot of common ground between the “slogans and headlines,” said Christoph Steck, Telefónica public policy and Internet director. The Internet is more complex than just the issue of access, he said. Services today use many different parts of the value chain, and policymakers should consider the interests of all players, he said.

Telefónica is not against having an open Internet, but it must be based on what customers want, Steck said. Customers must decide what they want based on transparent information, he said. Transparency and fair competition are key, he said. European market dynamics are shaping up to become even more competitive in the future, with consumers having ever more ability to access the Net via Wi-Fi, cable, 4G and other technologies, he said. In addition, the telecom industry is transitioning from charging for voice and SMS to data-based charging, he said. That will ease many of the issues surrounding discrimination in service offerings, he said.

Anticompetitive behavior by telcos doesn’t go unnoticed by regulators, Steck said. In considering net neutrality, EU lawmakers must ensure that traffic management can’t be used for anticompetitive behavior, he said. But telecom companies must be as free as other players to innovate and shouldn’t be restricted in finding new business models, he said. Moreover, because the sector is moving so fast, policymakers should be careful about regulating, he said.

Someone is trying to create a situation in which telecom operators are pitted against consumers, said European Telecommunications Network Operators’ Association Executive Board Chairman Luigi Gambardella. Both share the goal of creating a better Internet, he said. Europe has the highest level of competition in the world, with 3,000 Internet players and some of the lowest prices, he said. It doesn’t need net neutrality regulation, he said.

Europe needs a very clear statement from the EC on how to properly protect net neutrality under national law, said Jean Jacques Sahel, Microsoft policy director for Europe, the Middle East and Africa. Unrestricted access “should be the norm” but managed services should also be allowed to flourish, he said.

On the pro-regulation side were rights groups and content owners. European telcos want termination fees for Internet traffic, said European Digital Rights Executive Director Joe McNamee. But termination fees create barriers to the market, discourage innovation and disincentivize people from paying for better online services, he said. Networks benefit from being networks, but if the services aren’t there and the networks aren’t open, people will be less inclined to use them, he said.

European game makers are in the very center of the net neutrality debate, said Malte Behrmann, general secretary of the European Game Developers Federation. Many publish their games and reach consumers online, he said. Net neutrality is important to them because there are so many companies that start small, put their games online and grow very fast, he said. Innovation comes from the grassroots, and developers must be able to publish their games online without being blocked by Internet gatekeepers, he said. Telcos can’t be trusted not to use exceptions to net neutrality, such as those aimed at combating child abuse, to their own benefit, he said.

Telcos should be able to offer, and charge for, managed services under a flexible rule that ensures nondiscrimination and stands the test of time, said Computer and Communications Industry Association Vice President James Waterworth. A plurality of services equals a plurality of views, which is key to democracy, he said. One major aspect of what a neutral Internet brings is “universality of participation,” which is what the EU must protect, said La Quadrature du Net founder Jérémie Zimmermann. If it concerns free speech, it must be enforced by law, he said.

Transparency and fair use aren’t enough to guarantee net neutrality, said BBC Head of International Policy Daniel Wilson. Stopping anticompetitive blocking and throttling would be good, something that has already happened in the U.K. by virtue of a self-regulatory code, he said. Consumers expect there to be no point in the road they can’t reach online, said European Consumer Organisation Legal Officer Guillermo Beltrà. If the EU only asks telcos to ensure access to “champagne offers,” they will only offer restricted services, ending the Internet as it’s known, he said.

The Council of Europe is concerned that a competition approach alone won’t guarantee online rights, said Luca Belli of the CoE. Over 50 percent of ISPs restrict use of VoIP and peer-to-peer, limiting the rights to freely impart and receive information, he said. The CoE is mulling a model framework on net neutrality to propose to its members, he said.