Meta Says Subsidies From Big Tech Should Be Last Option for EU Telcos

Meta Platforms said on Thursday subsidies from Big Tech should be the last option for European Union telecoms operators trying to get US companies to foot some of their network cost.

Deutsche Telekom, Orange, Telefonica and other operators have lobbied for two decades for US tech giants to contribute to 5G and broadband roll-out, saying they create a huge part of the region's internet traffic.

The European Commission launched a consultation early this year on whether tech giants should bear some of the costs of Europe's telecoms network.

Companies such as Meta have said such a move would not solve the telcos' financial problems and ignores hefty investments by tech companies.

Telcos that receive subsidies should also face strong regulatory oversight, including a process to ensure the funds are only used for network investment, Meta said in a response to the European Commission's exploratory consultation on network fee.

A majority of European Union countries have also rejected the push to levy a network fee on Big Tech, sources told Reuters earlier this month.

The European Commission did not immediately respond to a Reuters request for comment.

Meta said "the Commission should first require a demonstration by any telco seeking subsidies that it has first engaged with CAPs (content application providers) in good faith to reach technical, non-subsidy solutions".

It added any subsidies be awarded by a tender to ensure availability to all network operators, not just the large players.

"Incumbent operators receiving the functional equivalent of government bailouts should have additional restrictions imposed on them such as elimination of executive bonuses, caps on compensation, freezes on dividends," it said.

© Thomson Reuters 2023