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Fair share or net neutrality? Cakeist EC thinks it can have both

The European Union seems to be approaching the subject the way Boris Johnson approached Brexit.

Iain Morris

March 27, 2023

5 Min Read
Fair share or net neutrality? Cakeist EC thinks it can have both

The cakeism idea is floating around European corridors of power that telcos can charge five or six big Internet companies for network use, leaving it freely available for numbers six or seven down, without infringing net neutrality rules, designed to "safeguard equal and non-discriminatory treatment of traffic in the provision of Internet access services." Any fool can see that billing Netflix but not Paramount for video traffic would flout a strict interpretation of those rules.

Cakeism is most associated with the bumbling disgrace of a British prime minister that was Boris Johnson before he quit the job last summer. It's a shortening of the terrible idiom about "having your cake and eating it," which makes a lot of people wonder why anyone would want to have a cake and not eat it (to chuck at politicians, perhaps?) but is supposed to be about the desire for two good but irreconcilable outcomes. For Johnson, that was all the benefits of access to the European Union (EU) single market without the compromises of membership.

Figure 1: Boris Johnson's cakeist approach seems to have inspired the EC. (Source: Kuhlmann/MSC via Creative Commons) Boris Johnson's cakeist approach seems to have inspired the EC.
(Source: Kuhlmann/MSC via Creative Commons)

For the EU, cakeism could turn out to be net neutrality with fair share mixed in. Roberto Viola, the director-general of CNECT (that's communications networks, content and technology – we're not sure about the E, either) for the European Commission (EC), and an apparent architect of net neutrality (according to him), doesn't see the potential for conflict. Whatever the EC decides to do, net neutrality is sacrosanct, he told a Politico debate last week, and that's why there isn't so much as a question about it in the ongoing consultation that covers fair share.

"Why is there nothing in the consultation? Because there is nothing to ask. We will not change it," he said on a panel that featured executives from Orange and Meta along with a representative of BEREC, a club of European regulators. Challenged by the Politico moderator to explain why charging only select companies would not count as discrimination, Viola launched into a rambling analogy about airlines and hotels that is unlikely to have made a shred of sense to anyone.

Subject to interpretation

Nor is this staunch defender of net neutrality even sure what he's fighting for. "If we want to enter into an interpretation of the net neutrality rules, we can spend the next three hours," he said on the Politico panel, seemingly without embarrassment. It's no wonder that Andrea Dona, the chief network officer of Vodafone UK, recently (and charitably) described those rules as "hazy" if their author thinks they're about as easy to figure out as James Joyce's Ulysses.

Telcos have clearly been punished for more than just outright blocking and throttling of Internet services. Some have landed in court (and trouble) over the practice of zero rating, whereby use of a popular service or application, like Spotify, is not counted against a customer's monthly data allowance. The rationale is that such consumer-friendly tie-ups between operators and developers discriminate against rival developers whose services die when those gigabyte thresholds are breached.

This is the unspoken threat if an Amazon refuses to pay up – because what recourse other than blocking or throttling would a big telco have? If ordinary consumers refuse to pay for a service or product, the provider's first response is usually to withhold it. Yet Viola was momentarily flummoxed when this was put to him by the Politico moderator. "Who on earth would not distribute content that is popular?" he said on rediscovering his voice. No telco that wants to keep its customers, is the obvious answer.

Networks are fond of behaving like cartels – the UK's operators all apply the same dodgy formula of inflation plus 3.9% for annual price rises – and if they did the same here then Internet giants would have no sanctuary. But this is much more of a high-stakes gamble than the pricing mechanisms that British competition authorities seem to have ignored. The prospect of luring subscribers to a Netflix service blocked by other networks will probably convince someone to break ranks. The rest would then have two options: 1) follow suit; 2) watch customers disappear like water down a plughole.

BEREC has already been largely dismissive of the fair-share arguments. The worry for net neutrality's keenest advocates – along with anyone who thinks Europe's telcos should prioritize innovating over wealth redistribution – is the close alignment of people further up the EC food chain with the region's big operators. "It's not about the if. It's more about how this fair share is going to take place," said Timotheus Höttges, Deutsche Telekom's CEO, on a recent call with analysts. "It's not a violation of net neutrality." Luckily for him, the EC seems to agree.

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— Iain Morris, International Editor, Light Reading

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About the Author(s)

Iain Morris

International Editor, Light Reading

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

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