Vodafone has announced that it wants legislators in Europe to take action so that big tech firms, who are driving up the demand for data, are made to pay for some of the costs around infrastructure upgrades. In Vodafone’s view, these companies are profiting massively without shouldering their part of the cost to maintain the networks that their businesses rely on.
According to Vodafone, 70% of all traffic running over mobile networks is coming from places such as video streaming, gaming, and social media – all of which can require large amounts of data usage. Vodafone says that firms like Google and Facebook, who are driving most of this traffic, aren’t paying for the mobile infrastructure and this is making it harder for mobile carriers to operate. It said that as time goes on, retail markets are in perpetual decline in terms of profitability.
Mobile operators are in no position to negotiate with these tech platforms, according to Vodafone, due to their strong market positions. As Vodafone says it and other operators can’t make viable returns on significant infrastructure spend, this could put further development at risk which, it believes, will lead to deteriorating network performance.
Rather than overcoming this adversity by developing new technologies or throttling heavy data applications, Vodafone is asking legislators in Europe to force big tech platforms to help shoulder the cost of network infrastructure so that the 2030 connectivity targets in the EU can be met. While the immediate benefit of Vodafone’s plan is easy to see, hidden is the fact that big tech platforms will have less money to reinvest in their own companies to develop new products and services.