According to European network operators, the exponential growth in internet data traffic has led to a situation in which they are no longer able to generate a sufficient return on their network investments. For this reason, they are calling for an ‘infrastructure levy’ to be imposed on major OTT providers. However, such a levy carries the risk of significantly impairing competition across various markets within the internet ecosystem.
At a glance
The European Commission has launched a consultation process concerning the question of whether data-intensive over-the-top (OTT) providers should contribute to the network roll-out costs incurred by telecoms network operators. The Monopolies Commission currently considers regulatory intervention to compel these OTT providers to make payments to network operators to be unjustified:
- According to the Monopolies Commission’s current assessment, new conditions in peering and transit markets do not justify a contribution towards network roll-out costs, as there is no evidence that OTT providers are abusing their increased bargaining power in a harmful manner in these markets.
- There is no evidence to suggest that a redistribution mechanism between OTT providers and network operators could improve the market situation. At the same time, such intervention could cause distortions of competition.
- Sufficient financial resources are available for the expansion of fixed-line and mobile networks.
