The nub of the debate lies in the popularity of social networks and streaming, which has ratcheted up the data demands on internet service providers.

Those providers point to the increasing costs of running and maintaining the mobile and broadband networks that businesses and households rely on every day.

While the debate has been bubbling for years, the European Commission recently opened an exploratory consultation for industry to voice their views amid efforts by the EU to stimulate more investments in connectivity across the continent.

On one side, ISPs say that traffic from the likes of Netflix, YouTube and TikTok puts a great deal of pressure on their infrastructure that ISPs must build, maintain and upgrade.

According to research by tech firm Sandvine, six major online platforms – Google, Netflix, Facebook, Microsoft, Apple and Amazon – accounted for nearly 48pc of all internet traffic in the first six months of 2022.

On the other side, tech companies see the levy idea as a money grab from the success of their own businesses.

Opponents also add that creating a system where certain companies are expected to pay the telecoms that carry their content would fall foul of the principles of net neutrality.

The key tenet of net neutrality is that all traffic on a network is treated equally. One content provider being required to pay while another isn’t would fly in the face of that principle.

​The telecoms and ISP industry in recent years has invested heavily in building and deploying fibre broadband and 5G mobile networks.

Eir, in its annual earnings announcement, said that its 5G network was now reaching 530 cities and towns across the country. This, coupled with a fibre-to-the-home broadband roll-out, is part of a €1bn capital investment programme for the operator.

In early 2022, Eir inked a significant investment deal with private equity firm InfraVia Capital Partners to finance its fibre roll-out.

Mobile operators like Three and Vodafone meanwhile have been racing to cover the country with 5G availability on their networks.

Siro, the Vodafone-ESB joint venture, is expanding its fibre broadband across the country and signed a deal with Virgin Media Ireland last year that will see it offer services through the Siro network.

Ireland’s telecommunications and broadband industry players are now considering their positions on the matter of network fees but are keeping their cards close to the vest.

“Three Ireland welcomes that the European Commission is consulting on this important issue and we will contribute to a submission in due course through our parent company,” a Three spokeswoman said.

Eir declined to comment and Virgin Media did not respond to a request for comment.

Vodafone has already been making its case.

Vodafone has lobbied the Irish Government on the proposal arguing for a levy to be implemented on the likes of Meta and Netflix that would be reinvested into the networks that carry their content.

“The majority of data traffic growth over the last decade had been driven by a small number of large over-the-top (OTT) providers, with little or no economic contribution to the development of national telecom networks, who now account for over 55pc of all network traffic,” Vodafone wrote in a letter to the Department of Enterprise, Trade and Employment.

More broadly in Europe, this is the position held by much of the telecoms industry.

Chief among them is the European Telecommunications Network Operators’ Association (ETNO), which has voiced support for network fees as a means to address “major imbalances in the internet ecosystem”.

According to the organisation, Europe is still behind on network infrastructure investments. It said that 5G coverage in Europe is reaching about 73pc of the population compared to 96pc in the US and 95pc in South Korea.

To accelerate the roll-out of faster broadband and the next generation of mobile networks, the telecoms industry argues that tech companies – the biggest consumers of their networks’ capacity – need to contribute to the overheads.

As the thinking goes, Big Tech cash flowing into the coffers could get masts erected and cables laid much quicker.​

That argument has met serious pushback from the tech sector.

Christian Borggreen is head of the Computer & Communications Industry Association (CCIA) in Europe, which has been a loud voice of opposition.

CCIA is an industry lobby group funded by big tech firms including Amazon, Google, Apple and Stripe.

Borggreen told the Sunday Independent that the debate bubbles up every now and again but in this latest incarnation, the core issue remains the same.

“Every 10 years or so, the most profitable telecom operators are pushing for the idea that they should be paid twice at both ends of the same cable that they control,” he said.

“They have already been paid by the end users who are requesting data. Now they want to be paid twice to deliver that data. At the end of the day, somebody has to pick up the bill and that is always the user. In this case, through more pricey streaming and cloud services.”

He argues that such a mechanism will increase the costs of doing business in Europe and that these costs will be foisted on the consumer. For example, a streaming service that finds itself paying a levy to ISPs could boot up its subscription fees for users to make up the cost.

Jessica Dine, a broadband policy researcher at the Information Technology and Innovation Foundation (ITIF), a US think tank, is another opponent of the idea.

Dine said content providers like Netflix and YouTube “aren’t free riding” on telecom networks as they are the ones generating the content that people want to access and thus generating the demand for broadband networks.

“Without that content, there would probably be much less interest in subscribing to the internet to begin with,” she said.

The opponents also argue that the logistics of how exactly a network levy would be collected and administered remains unclear.

​The Department of the Environment, Climate and Communications said that it too is considering its position on the issue.

“Last year, Ireland and a number of other European Union Member States called for an open and considered debate, to take all relevant views into account. The Department welcomes the Commission’s public consultation in that context,” a department spokesman said.

In the debate, Big Tech could have an unlikely ally in the form of regulators.

While large tech companies have repeatedly found themselves in the crosshairs of watchdogs in Europe, whether it’s data protection violations or competition probes, communications regulators appear unconvinced that the ‘fair share’ model or network fees will work.

The Body of European Regulators for Electronic Communications (BEREC) published its preliminary assessment of the proposal in October.

Its report pointed out that content continues to drive the demand for broadband access.

“BEREC has found no evidence that such mechanism [of network fees] is justified given the current state of the market,” the report said.

It added that investor capital continues to flow into network infrastructure projects.

“The attractiveness of access network investment is reflected in the annually increasing capital investors’ investments in fibre access networks,” it said.

ComReg, the Irish regulator, is a member of BEREC but has stayed mum on its own position.

“ComReg is considering whether it will make its own submission to the consultation and no decision has been taken to date,” a spokesman said.

CCIA’s Borggreen said the system of network fees would clash with net neutrality rules that these regulators are expected to enforce and could ultimately end up being the subject of legal challenges.


“Today, EU legislation guarantees that consumers can access the online content and services of their choice in a non-discriminatory way, and that all data is treated equally. The very idea of charging some online services and not others is, by definition, discriminatory,” he said.

“What happens if an online service cannot pay the network fee that a telecom operator demands? Will the telco slow down the service or remove it from the internet? Hopefully, Europeans will not be forced to give up popular streaming and online messaging services for the telcos’ own services.”

On the matter of alternatives to network fees, ITIF’s Dine said it is best to leave well enough alone.

“Big ISPs are essentially asking for an extra fee for doing a necessary part of their own business that they don’t overpay for, and as a policy this doesn’t make sense.”

The debate, in its latest form, remains at an early stage but is gearing up to be the most contentious form yet.

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