Chiefs at Deutsche Telekom, Orange, Telefónica and Vodafone have called on European lawmakers to push Big Tech to contribute to expanding internet infrastructure.
Telecom giants accuse the likes of Netflix and Youtube from benefiting from their billions of investments, without contributing financially.
It comes as video streaming, social media and gaming take up an increasing share of bandwidth, which is putting increasing pressure on providers.
Firms like Vodafone and Orange have therefore needed to pump heavy funding into copper to fibre to speed up networks, as well 5G deployment to keep up with the booming demand.
This has had a knock on effect on profitability, and Europe’s telco sector rose to €52.5bn (£44bn) in 2020, a six-year high.
In an open letter published by the Financial Times, the telecom bosses said that the “burden must be shared in a more proportionate way”.
They flagged their lack of bargaining power and warned that Europe could fall behind if the imbalance was not addressed.
“We now urgently call upon legislators to introduce rules at EU level to make this principle a reality,” said the letter, which was signed by José María Álvarez-Pallete, chair and chief executive of Telefónica; Tim Höttges, chief executive of Deutsche Telekom; Nick Read, Vodafone chief executive; and Stéphane Richard, outgoing chair and chief executive of Orange.
It comes after the European Commission published a proposal last month in its declaration on digital rights, which said “all market actors benefiting from the digital transformation . . . make a fair and proportionate contribution to the costs of public goods, services and infrastructures”.
There was also a letter last November, which was signed by the chief execs of KPN, BT, Telekom Austria, Vivacom, Proximus, Altice Portugal, Telia Company, Swisscom and Telenor.
The joint statement said: “A large and increasing part of network traffic is generated and monetized by big tech platforms, but it requires continuous, intensive network investment and planning by the telecommunications sector.”
“This model – which enables EU citizens to enjoy the fruits of the digital transformation – can only be sustainable if such big tech platforms also contribute fairly to network costs,” they said.
Video streaming firms have come back and suggested that providers should not be able to charge companies differently based on use or content.
Commenting on this move, Kester Mann, Director of Consumer and Connectivity, at CCS Insight, said: “Leading European operators have long complained that burdensome regulation makes it hard for them to make a fair return on pricy network investment and the joint-letter only serves to reinforce many points made several times before.”
“Still, with the value of connectivity never higher following the crucial role played by operators during the pandemic, now might feel like the best opportunity to campaign for greater leniency. Further, the European Union has started to show a greater willingness to stand-up to technology giants in a bid to protect consumers.”
“The plea comes as Europe risks drifting further behind the US and leading Asian markets. It also coincides with another very strong period of financial reporting from big US technology players such as Amazon, Meta and Alphabet. By contrast, European operators are enjoying little more than marginal revenue uplift.”
The counter argument to that put forward by the telecom operators is that they significantly benefit from the services of big technology partners as they seek to upsell customers to premium plans and differentiate their services.