EU's Digital Networks Act sets telcos squabbling before the ink is dry

Comms harmonization plan already drawing fire from operators and Big Tech alike

The European Commission's proposed Digital Networks Act (DNA) to harmonize telecoms regulation is drawing criticism from industry bodies who either say it oversteps the mark or doesn't go far enough to galvanize the sector.

The legislation, published Wednesday, aims to create a single market for telecoms across the whole EU. This, it hopes, will stimulate investment in modern networks, an area where Europe is lagging other regions.

To achieve this, the EC says it is necessary to establish an EU-level spectrum authorization framework, rather than leaving this at national level. It also wants to make mandatory a Europe-wide phase out of copper networks in favor of fiber, with a deadline between 2030 and 2035.

Likewise, it wants to implement a single authorization for satellite services to support the rollout of direct-to-device satellite phone communications.

By modernizing the regulatory framework, the EC says it will reduce the administrative burden on companies so they can focus resources on investment instead.

It also proposes a voluntary cooperation mechanism between connectivity providers and other players such as content, application, and cloud providers to "facilitate dialogue on technical and commercial arrangements."

The latter has aroused the ire of the Computer & Communications Industry Association (CCIA), which accuses the EC of implementing a backdoor policy to allow telcos to charge network access fees.

This issue caused some controversy a few years back, when the EC was mulling whether cloud providers and social media firms should pay fees to the network operators to help fund infrastructure, with the reason being that they generate a considerable and growing amount of the traffic flowing through those networks.

However, the idea was quietly shelved following a consultation in 2023.

Now the CCIA claims the proposed voluntary conciliation procedure "could turn into a binding IP dispute-resolution system, effectively resurrecting the widely rejected network fees." This would allow telcos to extract unjustified revenues from popular online services, harming consumers and undermining net neutrality, it says.

The CCIA's membership comprises giant American tech firms such as Amazon, Google, Meta, Cloudflare, Ebay, Pinterest, and Apple, so it is only to be expected that they oppose any kind of European regulations which might affect them.

The GSMA, which represents mobile network operators, says the DNA proposals don't do enough to address the lack of investment holding back telecoms across Europe.

"Aside from far-reaching proposals on radio spectrum policy, it is now clear that many of the reforms originally promised have unfortunately been left on the table, and that the DNA proposal represents regulatory evolution where revolution is required," the GSMA said in a statement sent to The Register.

We are almost seven years into the 5G era, yet deployment of this technology across Europe continues to trail other major regions such as the US and China, which the GSMA claims is the result of an unfavorable investment environment resulting from regulatory complexity.

"While Europe's mobile operators continue to invest heavily in critical digital infrastructure, they do so with ever-diminishing returns... at present, they are not able to invest enough to ensure Europe's digital capabilities catch up and keep pace with other major territories," it states.

The DNA proposal now begins its legislative journey through the European Parliament and Council for approval. If accepted, it will replace the 2018 EU Electronic Communications Code.

"Our goal is a digital environment where new technologies are readily available, affordable, and grounded in fair trustworthy rules that benefit people," said Henna Virkkunen, the EC's EVP for Tech Sovereignty, Security and Democracy. ®