The Netherlands remains against EU levy on internet traffic: ‘Problem that does not exist’

The Dutch government opposes an EU plan to make it compulsory for large tech companies, such as Netflix and YouTube, to pay a levy for internet traffic. The cabinet denies that telecom providers incur much higher costs due to the strong growth in internet traffic.

The Dutch government has expressed new criticism of a proposal to have tech companies that cause a lot of internet traffic, such as streaming services and social media, pay for the European telecom networks. The EU ministers for telecom affairs will discuss such an internet levy in Luxembourg on Friday.

In a new memorandum, the government questions an important claim made by the telecom providers, namely that they have to incur much higher costs because internet traffic continues to rise. Contrary to persistent claims, the large telecom companies have not been confronted with higher network costs in the past due to the strong growth of internet traffic. seen by Reuters.

“This is because network equipment is becoming more and more powerful for the same price. By omitting this crucial insight, a problem is suggested that does not exist,” said the cabinet.

‘Consumer interests leading’

According to the cabinet, the ‘total network costs have remained constant’, despite the large growth in recent decades. In addition, the profit margins of European telecom providers have “improved significantly” over the past decade. The major providers in the EU had a total turnover of 188 billion euros in 2021. “Protecting major telecom companies should not be an end in itself, as the interests of European consumers and companies must be leading.”

The proposal for the levy is after years of lobbying by the European telecom giants. EU member states appear to be divided on the issue. The Netherlands and Germany are critical, while countries such as France and Italy are in favor of the new allowances.

‘Paying twice’ threatens

The Netherlands also objected to the EU plan for internet tolls in February, saying that telecom companies would be ‘paid twice’ as a result.

“A consumer chooses whether or not to stream for a fee via, for example, Netflix, Spotify, Viaplay or YouTube and also pay subscription costs to the telecom provider. Streaming services will pass on extra costs, partly, to their customers. Consumers are therefore expected to pay more,” said Minister Micky Adriaansens of Economic Affairs.

The internet levy is also being criticized by politicians and action groups who fear that it could harm the principle of net neutrality. EU rules on ‘net neutrality’ prohibit providers from blocking, slowing down or charging separately for internet traffic. Net neutrality means that no distinction is made between types of internet traffic. As a result, providers are not allowed to unnecessarily restrict internet traffic, for example.

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