ENDitorial:Leaked telecoms Regulation with or without net neutrality?

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Last week, an internal draft of a regulation for a “telecoms single
market” was leaked in Brussels. We published an initial reaction to this
document. But what are the details of the text and what do they mean?
The draft is a strange mix of re-packaged measures that are already in
place and an odd list of disparate issues ranging from spectrum
management to roaming charges.

One important point of the draft regulation, as previously announced by
Neelie Kroes, Vice-President and Commissioner for the Digital Agenda, is
a half-hearted legal “guarantee” of network neutrality – which
simultaneously seeks to “guarantee net neutrality” and at the same time
to allow the kinds of “new premium services” that would undermine net
neutrality.

The positive points first:

– Harmonisation: The Commission chose to propose a Regulation as a
legislative instrument which means that it would allow for greater
harmonisation of the digital single market.

– No discrimination: It would guarantee net neutrality (while killing it
by promoting discriminatory services). Article 20.2 aims at a
prohibition of anti-competitive discrimination: “Providers should not
block or throttle specific services or service classes within
contractually agreed limits on data volumes and speeds”.

– Transparency: The Commission’s spokesperson also explained that “our
net neutrality plans include much stronger rights for consumers to
transparent information and switching”. Of course, if the Commission
believed that it was really guaranteeing net neutrality, consumers would
not need transparent information about non-neutral behaviour and their
possibilities to sign up to another access provider. Article 21 would
now introduce new provisions on transparency. However, as we have
highlighted previously, transparency and switching are insufficient to
guarantee and open, free and neutral internet.

– Sanctions: National Regulatory Authorities (NRAs) have an essential
role in securing the users’ capability to exercise their freedom of
communication and freedom of expression. According to recital 68, NRAs
should be able to impose financial or administrative sanctions for
violations of net neutrality provisions of the Regulation.
Unfortunately, these sanctions are not detailed in the leaked draft and
merely make reference to the already existing provisions of Article 21a
of the Framework Directive (2002/21/EC). We know from the weak
implementation of existing legislation in some EU Member States that
strong sanctions are necessary to act as a deterrent against
discriminatory practices.

Negative points:

– Discrimination: If adopted, the leaked Regulation would kill net
neutrality (while ostensibly “guaranteeing” it, as described above).
Article 20.1, sub-paragraph 2, foresees that “providers of content,
applications and services and providers of electronic communications to
the public shall be free to agree with each other on the treatment of
the related data volumes or on the transmission of traffic with a
defined quality of service”. The Commission would therefore allow
operators to enter into agreements with content and service providers in
order to deliver certain services faster than others – it would allow a
non-neutral Internet, in other words.

The Commissioner’s spokesperson explained on Twitter that “telcos want a
free hand”. If adopted, this Regulation would be disastrous not only for
innovation and competition in Europe, but would cement the economic
advantage of big players who have the financial capacity to strike
exclusive deals with operators – the “death sentence” for innovation
described by Commissioner Kroes.

– Data caps: The leak states that “volume-based tariffs are compatible
with an open internet”. While this is true, up to a point, it appears
that the draft would allow discriminatory behaviour, similar to what the
Deutsche Telekom proposed in Germany. A volume-restricted tariff which
has no restrictions on the volume of traffic from certain sites and
services can be effectively used to transparently and openly stifle
competition.

– Premium services: The draft text also explains that some users should
be able to keep on using high bandwidth services, such as video
conferencing, internet telephony and so on – with an “enhanced quality”.
This might be what Commissioner Kroes meant with “enjoy something extra”
in her speech on 9 July. This approach, however, is not based on
evidence but rather the assumption that current temporary and
exceptional traffic management measures are insufficient to deal with
congestion. The Commission draft attempts to explain that the
possibility and flexibility to provide enhanced quality of service
especially applies to new services such as machine-to-machine
communications (recital 44, p. 12). However, the way in which the
current text is drafted would permit discrimination on the public internet.

– Bundles: In recital 41, the growing importance of bundles (offers that
include internet, fixed/mobile telephone and television as a single
package) is highlighted, but the Commission unfortunately fails to
acknowledge the particular difficulties for consumers subscribed to
bundled offers to change providers.

– National laws: Where does this leave the Netherlands and Slovenia?
According to the leaked internal draft, Article 20.1, sub-paragraph 3,
it is likely that the Dutch provisions and the Slovenian law will have
to be amended, since they restrict the “freedom” of the providers to
enter into discriminatory agreements: “The exercise of these freedoms
shall not be restricted by national competent authorities, or, as
regards the freedom laid down for end-users, by providers of electronic
communications to the public, save in accordance with the provisions of
this Regulation, the Directives and other provisions of Union law.”

– Timetable: The draft Regulation will probably be published in
September/October, it then has to be approved by the Council and go
through the legislative process in the European Parliament. Due to the
upcoming elections, there is a chance that this Regulation might not be
adopted before the new Parliament is in place.

Leaked consolidated version of the draft Regulation laying down measures
to complete the European single market for electronic communications and
to achieve a Connected Continent
https://edri.org/files/consolidateddraft-ISC070713.pdf

Leaked Regulation: Schrödinger’s net neutrality on its way in Europe
(11.07.2013)
http://www.edri.org/schroedinger-NN

Tweets by Ryan Heath, spokesperson of the Commissioner for the Digital
Agenda, on the leaked internal draft
https://twitter.com/RyanHeathEU/status/355723803755675650
https://twitter.com/RyanHeathEU/status/356904743592931328
https://twitter.com/RyanHeathEU/status/356913626004721666
https://twitter.com/RyanHeathEU/status/356903483242323968

Joint letter EDRi-BEUC to Commissioner Kroes: Over 80 European
organisations demand protection for Net neutrality (17.04.2013)
http://www.edri.org/node/3281

European Parliament resolution on Completing the digital single market
(11.12.2012)
http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P7-TA-2012-468

(Contribution by Kirsten Fiedler – EDRi)