Neelie KROES
Vice-President of the European Commission

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Next steps on Net Neutrality - making sure you get champagne service if that's what you're paying for

When it comes to the issue of "net neutrality" I want to ensure that Internet users can always choose full Internet access – that is, access to a robust, best-efforts Internet with all the applications you wish. But I don’t like to intervene in competitive markets unless I am sure this is the only way to help either consumers or companies. Preferably both. In particular because a badly designed remedy may be worse than the disease - producing unforeseen harmful effects long into the future. So I wanted better data before acting on net neutrality. One year ago, I asked BEREC, the body of European network regulators, to give me the evidence: are users provided with the right quality of service? How much blocking and throttling is taking place? In practice, how easy is it for users to "switch" operators or services? In short, how easy is it for consumers to transparently choose the service that works for them, including full Internet access if they want it? I also asked European national legislators and regulators to wait for better evidence before regulating on an uncoordinated, country-by-country basis that slows down the creation of a Digital Single Market. BEREC has today provided the data I was waiting for. For most Europeans, their Internet access works well most of the time. But these findings show the need for more regulatory certainty and that there are enough problems to warrant strong and targeted action to safeguard consumers. For the first time we know that at least 20%, and potentially up to half of EU mobile broadband users have contracts that allow their Internet service provider (ISP) to restrict services like VOIP (e.g. Skype) or peer-to-peer file sharing. Around 20% of fixed operators (spread across virtually all EU member states) apply restrictions such as to limit peer-to-peer volumes at peak times. This can affect up to 95% of users in a country. At the same time, in nearly all Member States, most if not all ISPs offer fixed and mobile Internet access services that are not subject to such restrictions. According to the BEREC figures 85% of all fixed ISPs and 76% of all mobile ISPs propose at least one unrestricted offer. So the market is generally providing choice, butthe choices are quite limited in some EU countries. But are customers really empowered to choose well? Do they realise what they are signing up for? I didn’t read all the pages in my mobile contract and I bet you didn’t either!  I believe we all need more transparent information. Given that BEREC's findings highlight a problem of effective consumer choice, I will prepare recommendations to generate more real choices and end the net neutrality waiting game in Europe. First, consumers need clear information on actual, real-life broadband speeds. Not just the speed at 3 am, but the speed at peak times. The upload as well as the download speed. The minimum speed, if applicable. And the speed you'll get when you're also watching IPTV as part of your triple-play bundle, or downloading a video on demand via a premium "managed" service. Plus, you should know what those advertised speeds typically allow you to do online Second, consumers also need clear information on the limits of what they are paying for. Clear, quantified data ceilings are much better than vague "fair use" policies that leave too much discretion to Internet Service Providers (ISPs). They allow low-volume users to look for deals that suit them. And they incentivise ISPs to price data volumes in ways that reflect costs, and so support investment in modernising networks as traditional voice revenues decline. Third, consumers also need to know if they are getting Champagne or lesser sparkling wine. If it is not full Internet, it shouldn't be marketed as such; perhaps it shouldn't be marketed as "Internet" at all, at least not without any upfront qualification. Regulators should have that kind of control over how ISPs market the service. But I do not propose to force each and every operator to provide full Internet: it is for consumers to vote with their feet. If consumers want to obtain discounts because they only plan to use limited online services, why stand in their way? And we don't want to create obstacles to entrepreneurs who want to provide tailored connected services or service bundles, whether it's for social networking, music, smart grids, eHealth or whatever. But I want to be sure that these consumers are aware of what they are getting, and what they are missing. Our guidance will make it easier to "switch" service providers, and service offers, so that you can choose the market offer that suits you best. And I will continue to monitor the market to ensure that European consumers generally have access to competitive full Internet products, fixed and mobile. At the same time, products that limit Internet access often require monitoring of online traffic, through so-called "packet inspection". This raises privacy concerns, and we need clear guidance on responsible behaviour by ISPs; and on how consumers can exercise effective and informed control if they opt for such products. I am in favour of an open Internet and maximum choice. That must be protected. But you don’t need me or the EU telling you what sort of Internet services you must pay for.
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  • Rick's picture

    I am really happy with this research! I'm from the Netherlands but currently located in Denmark. To keep in touch with my family and friends over the internet is all right, but calling is still pretty expensive. I therefore would like to get a Danish mobile subscription, however I'm having some serious trouble choosing the right provider. It's so important to me I can use VOIP (Skype) to call for 'normal' rates to family members, but none of the providers is clear about it and in many cases their employees either don't know or just say 'yes' to sell. But in the end, I hope one day I don't have to use VOIP. Hopefully one day you can get a 'European' mobile phone subscription where the rates are just local rates and equal no matter what EU-member country your calling from and to. Just like in the United States where there are no different rates to call to different states... But I guess that will not happen anywhere in the near future. The providers love roaming and still earn a lot with it. They won't give that up easily. Also did you know that when I call with a Dutch mobile subscription from the Netherlands to Denmark, it's more expensive then when I would use the same subscription to call from Denmark to the Netherlands? To call from Denmark to Holland with my dutch subscription costs me 0.42 cents a minute while calling from Holland to Denmark costs me 0.64  cents (landlines) and even 0.92 cents for mobile! This seems a bit absurd to me as well. You would expect it's more expensive to call to home when your in another country. I'm wondering what the difference is based upon. Technically it shouldn't matter so it's probably just a cost price providers charge each other. But I feel like it's unnecessary high. And as last, thank you for what you've achieved so far! For someone like me, that is constantly on the move within the EU, it really makes a difference!
  • HGerken's picture

    But I don’t like to intervene in competitive markets unless I am sure this is the only way to help either consumers or companies. Perfectly reflects the wimp order policy of Neelie Kroes. Europe didn't drive protectionist strategies like the russians and chinese successfully did in the online sphere, instead she is making us the e-slaves of American software and network monopolists. Fine! but a fulfillment does not help us either. She failed to show strength to the lobby and enforce the RULES. RULES serving EUROPEAN interests and which are supposed to be  RESPECTED by everyone who wants to get on out market. The primary task of a government under an ordoliberal mindset is to set the environment for competition, and then let market players compete. this sort of non-interventionism only pursues the corporate rule agenda of her Davos friends. Corporations are not supposed to become the buddies of our political class. 90% of digital lobbyists should be put in their plane back to Washington DC. We are fighting for our sovereinty here and have a political class which "regulates" with a wet hand. They did the mistake with the EURO which they completely screwed up and they did the same with the internet by selling out on the basic principles like liberty, freedom of speech, net neutrality, openeness, source code disclosure and privacy protection.
  • Adam's picture

    Let me just say that I am really impressed with your thorough grasp of the topic, the clarity of your ideas, and the straightforward manner in which you present them. I feel lucky to have someone smart and open-minded in charge of this area - so important to modern society but still poorly understood by government officials and lawmakers.
  • john peters's picture

    Commissioner Kroes :   Thanks for your post, it puts these very important issues  , Net Neutrality, Broadband and multiple choices  , on the table, now the EU Consumers must speak up.   This December , in Qatar, at the ITU ( United Nations ) meeting ,  http://www.itu.int/  ,  some countries are talking about changes to the Internet-Web core, changes to the TCP/IP , Apache, HTML5 , etc., the set of standards and protocols that have made the Internet and the Web what they are today : great tools for communications , democracy and growth, and one of the fathers of the Internet , Vint Cerf, has a lot to say abou this - a search of   "  Vint Cerf  - ITU   '"  provides about 30 articles - since some of these proposals want to turn the net-web into a " private proprietary content delivery business ", for a fee and under political control, and the potential for abuse by political and economic groups can be huge and disastrous, and what will be the position of the EU here ? We must remember that the Internet and the World Wide Web were invented  in the USA and the EU and fully financed by the USA and the EU Taxpayers.  From your post, Commissioner, I trust you will be the best defender of EU and USA Consumers and Taxpayers interests, and for all users around the World, and of free speech and multiple choices. Thanks in this difficult issue , keeping the Internet Community together in peace and honesty and growing.
  • Anon is enough's picture

    I really hope she defend our European interests and not US interests. Since we all now what theirs are..
  • Göran Johansson's picture

    Dear Commisioner, It's very unfortunate to allow Internet service providers to limit the access to specific online services. This seriously harms the free market and EU should take a clear stance against it. Eg. Swedish operator Telia is about to limit access to or charge extra for VoIP. Even though they only provide the bandwidth. This is like if the electric company would charge extra for electricity to appliances not bought from them! If this continues, the Internet will develop into several networks where the services you can access are limited by your wealth and your ISP. Unless of course the people in power have the guts to say no. It may sound dramatic, but net neutrality is a question of democracy. Please don't give it away.
  • hofhv hghign's picture

    Eg. Swedish operator Telia is about to limit access to or charge extra for VoIP. Even though they only provide the bandwidth. This is like if the electric company would charge extra for electricity to appliances not bought from them!
  • Tim Kuijsten's picture

    "And we don’t want to create obstacles to entrepreneurs who want to provide tailored connected services or service bundles..." What about the entrepeneurs who work on the next Facebook, Google, YouTube, Skype etc..? Small teams, low budget. Even todays big players all started small. They had the pleasure that the net up till today is pretty net neutral in most places. I think in order to keep maximum competition and let the best product grow, we have to keep it that way. But the current trends are alarming since more and more operators start monetizing on the sort of traffic, not just pure bits anymore. I'm a little afraid that if we end up in a market where most people have some "standard access" subscription to most popular and biggest websites, it will be a lot harder for our next generation entrepreneurs (service/website creators, not ISP owners) to grow as big as todays giants. From my opinion (and I'm a webdeveloper) not enforcing net neutrality in a market where the trend is more and more service based access, is like letting the obastacles for innovation grow. Letting the web become less neutral is almost like intervention in the web developers market (when comparing the current "pretty net neutral" situation to a future where most consumers only have fast optimal access to the big popular services). I think making it harder for new websites/services to become accessible by the majority will make it easier for big players stay on top of the market with less innovation.
  • Dimitrov Popow's picture

    Dear Commissioner Kroes, you have done a lot for the average European citizen. But I am seriously worried that you are heading in the wrong direction this time. For this reason I appeal to you to read the article that was published in the German computer magazine c't (number 15, 2. July 2012, page 72-74), which contains a substantiated critical view of your current opinion on this issue. Maybe you want to reconsider? I would welcome it. Thank you!
  • Glenn's picture

  • Matthijs van Bergen's picture

    Dear Commissioner Kroes, I am very glad that the results of the BEREC research has made you aware of the urgency of preserving net neutrality in Europe. I know that in the past you have called the legislation of the Dutch Parliament on the matter "premature". I hope that these alarming results will cause you to look at the Dutch legislation in more detail. I am confident, or at least quite hopeful, that once you have a better understanding of the rationale and desirable application of said legislation, you will conclude that the intervention is not "premature", but rather a well-balanced and well thought through correction of undesirable behavior of oligopolists in a less-than-competitive market (this last point has already been confirmed by Centraal Planbureau Netherlands in its contribution to the EC's previous Internet consultation on net neutrality). For further information about the rationale and desirable application of the Dutch legislation, I gladly refer you to my contribution to the 'net neutrality issue' of the Dutch jurist's magazine for media and communications law, called Mediaforum, as well as my blogs on our company website (my article for Mediaforum can be read in full here http://www.hostingrecht.nl/geen-categorie/mijn-bijdrage-aan-mediaforum-over-netneutraliteit/). To provide some background information about myself and my opinions to you, I have researched the topic of net neutrality since the summer of 2010 and have advised Bits of Freedom (on a voluntary, free of charge basis) on desirable policy on the matter. I am currently performing research as an unsalaried PhD candidate at the University Leiden. For the better part of the week, I work from my home in Brussels as a legal advisor for the Dutch company ICTRecht, and I work from farther abroad than Brussels with some regularity (I have stayed in South Korea several times, one time for longer than 6 months – you should try the Internet access services there, they make our European telcos' offerings appear quite lackluster). I am able to enjoy this freedom to move and stay largely where I want, thanks to the Internet. Wherever Internet access is good, I can work. Because I have a Dutch SkypeIn number, which is usually put through to my mobile number in case I have no (sufficiently capable) Internet connection, my clients have even hardly noticed that I stay abroad at all. If it were up to the telcos, obviously they would rather let me pay the highly regulated but still quite ridiculous (for any proclaimed “internal market” at least) roaming and foreign-call rates, instead of providing me with a capable do-it-all (mobile) data connection that can be used to communicate with anyone in the world in any way that I want without any added charges. In my own experience, Belgium is quite bad in this respect: although Mobistar's mobile Internet offering looks okay on paper, coverage of its 3g and 4g networks is still extremely patchy: in many if not most locations I get 'old school' and nearly unusable Edge connections. In terms of fixed line, I cannot get any fibre or even coax Internet connection at all in my home; the very best theoretical speed I can get is a VDSL line with 30 mbit/s down and 5 mbit/s up, which I have to pay about 50 euro's per month for at EDPNet. I had to buy the wireless modem myself for 99 euros and after delivery I had to find out that the wireless modem was in fact only capable of reaching speeds up to 11 mbit/s. I had to hook up my own wireless router to the modem, and now somehow the connection drops a few times per day, requiring a soft or hard reset. Before I was able to have any Internet access at all, a technician from Belgacom had to 'activate the line' for 50 euros, which was never announced in the offering itself, but only after I had already ordered; an unfair commercial practice, which I pointed out to EDPNet, but the only available remedy was to annul the agreement altogether, meaning I would be without Internet for even longer (as it was it already took almost a month before my connection was operational). For your reference, the Internet access I enjoyed in Korea was 30 mbit/s both ways, for about 20 euros per month (hard to say exactly, it was a triple play offering for about 35 euros). If there was any problem with the line, a technician would come almost instantly without cost. I am sorry for going on about this. This post is not intended as a general complaint about Belgium's lackluster digital communications infrastructure and services or as an advertisement for Korea's superior Internet services (even there it seems net neutrality may become a bigger issue). I hope that my story does help to show however, that the current regulatory telecommunications framework in Europe has brought results which can be quite disappointing for consumers on many facets. In this respect I would also like to bring to mind Youp van 't Hek's campaign about the truly dreadful help desk service that most telcos in the Netherlands pester their customers with. Clearly the market in the Netherlands has not worked well enough to provide consumers with decent support services for their connections. Therefore, with all due respect, I find your confidence in the sole remedy of consumers 'voting with their feet' as a response to unreasonable traffic management practices of Internet providers short-sighted at best and positively naive at worst. It is a bit like saying food safety regulation is not necessary, because consumers would not buy products with poison in them as long as producers were required to put on the label that the product contains poison. In addition, much of the same rationale underlying the regulation of roaming rates, e.g. the idea that a terminating network has a monopoly on providing termination services to third parties wishing to communicate with the end users of its networks, also applies to a large extent to Internet access services. The access provider has substantial control over who can reach its subscribers and how. Access providers have been looking for ways to monetize this control, but they should not be allowed to monetize it in a way that is essentially blackmail (also described as Tony Soprano style networking: 'pay up or else your traffic will run into a little 'accident' on our networks'). In addition, if each low-demand subscriber chooses a cheaper package which blocks some services of which this consumer thinks at that time he/she will not use, these consumers will then to some extent be locked into the online services they currently use, diminishing the possibility for all others to communicate with these individuals and distorting and adding entry-barriers to the market for online services and content. The consumer only sees a cheaper package, but does not see the (longer term) negative consequences for him-/herself and the information and communication environment as a whole. In this sense such a development could be compared with environmental pollution. The polluter does not pay a proportionate price for his or her pollution. Everybody else pays disproportionately (a so called 'negative externality'). It also must be said that an obligation for Internet providers to abstain from unreasonably blocking or hindering online services and content, really cannot be compared with an obligation for a supermarket to offer every brand of milk in the world, or a TV network to offer each and every program in the world, which comparison has been made by some. Because of the Internet's architecture, transmission is the default and transmission requires no active intervention by the Internet provider. Not transmitting, or hindering traffic, does require active intervention by the provider. Although traffic management can help to keep time-critical applications such as VoIP working in times of congestion, we see from BEREC's results that VoIP traffic on mobile networks is normally hindered rather than helped. From technical literature it becomes clear that true QoS on an interconnected network of Internet Protocol networks still remains somewhat of an unattainable Holy Grail; it appears is much easier to use traffic management for negative purposes than as a means to properly mitigate a shortage in capacity. This is not surprising. Consider that traffic from the Netherlands to Korea usually passes about 15 nodes (networks). Each network may have its own ideas about which traffic needs to be put ahead in the cue and the same packet that was put ahead in one node, may be put last in the next node. Allowing Internet providers to provide 'Internet' offerings where added charges apply for access to certain services or content (such as Skype, WhatsApp or Wikipedia) can be compared with allowing the traditional post to charge whatever it wants to have a letter delivered based on the content of a letter (try sending any important letter then, it would likely cost you at least triple the price). Or imagine an electricity company detecting which brand of appliance you use, deciding it doesn't like you to use that brand, and cutting off power every now and then, so that the device keeps switching off briefly for no apparent reason. Regardless of the beneficial effects which stimulating competition and transparency may hold – I am not against such additional measures at all! – this type of negative behavior should not be tolerated. If we make an analogy with a constitutional democracy, trusting on the ability of consumers to vote with their feet alone is like having a democracy relying on the right to vote alone, without any constitutional rights. Civil rights organizations across the globe have argued for protection of net neutrality, since telcos have been quite clear about their intentions to violate this paramount principle, in additions to the violations they already engage in. Those civil rights campaigns are being held for good reason. The Internet which we as its citizens have come to love and rely on is democratic in nature. The decision of whether to communicate and how is principally up to the end points, while the network itself interferes only if such interference is really necessary. In this sense the end-to-end design principle is quite similar to the constitutional principle of subsidiarity. Power and autonomy is to be left to the individual (edge), unless central (network/government) intervention is really necessary for a legitimate (public) purpose. On the Internet every end point can communicate with any other end point that is also willing to communicate, without any interference and without having to ask anyone's prior permission. A long long time ago, before 'Al Gore invented the Internet', Al Gore spoke about the (almost utopian) promise of the 'GII' (global information infrastructure, i.e. the global Internet) bringing about a new Athenian Age of democracy (in 1994, http://cyber.eserver.org/al_gore.txt). We should not allow a collection of oligopolistic markets to undermine this promise and indeed the very democratic nature of the Internet itself. Judging from the blogosphere and the (amount of) civil rights organizations campaigning for net neutrality, it seems very clear that most Internet citizens want the principle of net neutrality to be protected. Arguably, if no barriers to enter into the Internet provision markets existed, providers were perfectly transparent about their offerings, and consumers were econs rather than humans (in the sense of Thaler and Sunstein's “Nudge”), the market would never need any rules to safeguard an open Internet. The reality we live in is different, however.
  • Encummaneex's picture
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  • cablelettra's picture

    Jest owo niezmiernie intrygujący w telewizorni tytułowanych mężczyzn, który omawia w filii reklamowej w 1960 roku. Ich technika przedłużony do panelu nastawnego przez kilku operatorów, którzy wsadzili wiązadeł w środku pośrednictwem obszernych biur w budynku. Nie było oraz powielarki Xerox, który otrzymywałby się z biurem, sama, toż nie jeden symbol z laptopa w umownym miejscu, podczas gdy owo było na mozolnie zanim IT Boom przemysłu. Bezpieczeństwa był wartownikiem w recepcji w hallu, zaś pogodnie z inspekcją tytułu za pośrednictwem entuzjastów.
  • prentex d?ugopisy's picture

    Dokonać świadomego sortymentu, iż chcę, iżby wygrywać finanse w metoda, kto umożliwia mi mieć moc samowładnego okresu gwoli sobie, moje tężyzna fizyczna.
  • PZ's picture

    Dear Commissioner, When making the Champagne analogy, please consider that unlike the grapes, radio spectrum is scarce, finite (not really feasible to lease to more than 4 parallel mobile operators), highly valuable and strategic natural resource. If promoting digital economy and open internet is a strategic aim of the owner of the spectrum assets, i.e. the Member States, they should strictly prohibit their partners ("sub-contractors"), entrusted by the exploitation of the national resources to apply any discriminations that harm the owners' strategic interests. We all know that incumbent telcos with heavy financial dependency on historic voice and sms revenues will never promote open, affordable internet on mobile phones on their own initiative. In such a conflict situation the regulators must stand firmly on the consumer's side and not the side of the industry lobby.
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