Let roaming fees hang around for a while longer, EU countries say

The Council of the European Union – the part of the EU legislature that represents member states – has formally laid out its stance on changing incoming legislation around roaming and net neutrality. This means negotiations with the European Parliament can formally commence, and as some parliamentarians warned on Tuesday, this will be a feisty fight.

The Council’s position opposes the Commission and Parliament’s original intention of eliminating roaming surcharges for those travelling within the EU by the end of this year. Instead, from mid-2016 people would get to use a daily 5MB “basic roaming allowance” when crossing borders that would be the same as domestic mobile data costs. Above that, operators will be able to charge extra for roaming, but not more than the wholesale costs levied by the carrier whose network is being roamed onto.

It would only be in mid-2018 that member states would ask the Commission to “assess … what further measures may be needed with a view to phasing out roaming charges” and then maybe propose new laws. In other words, the Council wants the abolition of roaming fees to be put on ice, despite the widespread push for a European digital single market.

As for net neutrality, “agreements on services requiring a specific level of quality will be allowed, but operators will have to ensure the quality of internet access services.” Again, this does not gel with the strict rules passed by the European Parliament last year, but EU digital chief Andrus Ansip, who is more bullish on the issue of the single digital market, has indicated that he is more sympathetic to this particular compromise.

According to sources in the European Parliament, many countries backed the watering-down of the roaming changes, with only Cyprus and the Italians saying the proposals didn’t go far enough. The strongest opponents of a tough net neutrality text were apparently the Germans and the British. It is probably worth nothing that two of Europe’s most powerful telcos, Deutsche Telekom and Vodafone, are German and British respectively.

Interestingly, the mobile industry body GSMA said in a statement that the reduced scope of the telecoms reform proposals, under the Council’s amendments, represented “a missed opportunity”. However, GSMA head Anne Bouverot said that “the immediate priority is for these proposals to reach a positive conclusion so that we can start the process of creating a truly Digital Single Market that will benefit Europe’s citizens and businesses.” The organization is against “overly prescriptive” neutrality rules, but a bit less openly agitated about the roaming elements.

The European consumer organization BEUC blamed telcos for lobbying against more meaningful roaming changes, arguing that a focus on wholesale prices could hinder competition (after all, Europe’s big telcos span many countries and will be both the buyer and supplier).

BEUC legal chief Guillermo Beltrà said:

It is no secret that the big telecom industry has done their utmost to delay the abolition of roaming charges. The end of roaming has been in the making for a very long time, and this is something that telecoms have known and should be ready for. In fact, they are also to benefit from the new consumer demand that will emerge once roaming is abolished.

If the Parliament is to successfully push back against the watering-down of the roaming proposals, a majority of parliamentarians will need to join the fight.

So far, the second- and fourth-largest blocs in the European Parliament (the Socialists and Democrats and the Liberals and Democrats respectively) have both indicated that they will fight the Council hard.

The largest bloc, the center-right European People’s Party, has also previously taken much credit for shepherding through the reforms, and the single-market-motivated Commission will no doubt be right behind them. The net neutrality situation looks a bit less clear-cut.

Whatever happens, this should be entertaining to watch.

This article was updated at 5.15am PT to include the GSMA statement, and again at 6.10am PT to include information from my parliamentary sources. It was also updated on 5 March to include BEUC’s statement.

Alarms sound over changes to EU roaming, net neutrality and privacy rules

The European Parliament’s liberal-centrist bloc has warned over changes being made by EU countries to incoming telecoms legislation, saying they will severely weaken efforts to introduce unified net neutrality rules and eliminate mobile roaming surcharges for people moving between member states.

The Council of the European Union, which represents member states, is expected to present its position on Wednesday regarding the Telecoms Single Market proposal – this follows the European Commission’s original proposal and changes made by the Parliament, and will trigger negotiations over the final text. The Alliance of Liberals and Democrats for Europe Group (ALDE) said Tuesday that the Council’s position is so watered down that it would undermine campaign pledges made by Commission president Jean-Claude Juncker and the Parliament that came in last year.

Meanwhile, digital rights groups have released leaked documents relating to the Council’s under-development position on a separate legislative package, the new General Data Protection Regulation. The version that left Parliament would introduce very tough new rules for companies and governments handling EU citizens’ personal data, but it appears member states have been agitating for these rules to be weakened.

Roaming rumble

The member states’ keenness to water down the net neutrality proposals is already well documented, with the countries apparently aiming for aspirational principles rather than tough new rules. However, the roaming aspect of the telecoms package is also contentious.

The Commission’s original proposal would have eliminated intra-EU roaming fees, allowing people to move around EU countries without having to pay more for mobile access than they would pay at home. This is integral to the European single market project – cross-border services won’t get anywhere if you can’t freely use them across borders.

However, the Council appears set to allow carriers to charge roaming surcharges for anything above a measly 5MB of data per day. The surcharges would be capped at the maximum wholesale rates charged between carriers, but they would still stymie the original intention of the legislation.

According to ALDE president Guy Verhofstadt:

This is a scandal. An end to roaming charges and the delivery of a genuine single market for telecoms was a campaign priority for all parties, many of whom are today responsible for blocking this measure…

To say this text lacks ambition is an understatement. Certainly our group will not accept this text, as the only winner from it is national telecoms operators themselves. Member States should hang their heads in shame.

Privacy shambles

As for the new data protection package, which is also intended to unify the disparate rules of the 28 EU member states, the rights groups EDRi, Access, Privacy International and the Panoptykon Foundation have warned that the package is “becoming an empty shell”.

On Tuesday the groups issued an analysis (PDF) of leaked documents about the Council’s position on the regulation. Here are the main points to worry about, according to EDRi et al:

  • Consent: The proposals would allow the failure of browser users to opt out of being tracked to be read as a form of consent for tracking and profiling. They would also weaken the limitations on what that consent can allow. “Germany undermines transparency still further by proposing that consent should cover unknown future uses of the data for ‘scientific’ purposes,” the analysis read.
  • Data subject rights: Gone is the article that would mandate “concise, transparent, clear and easily accessible policies” about data use. Governments would also be allowed to cite “national security, defence, public security and ‘other important objectives of general public interest'” as legitimate reasons for profiling people.
  • Fines and remedies: The new rules were supposed to introduce fines of up to five percent of annual turnover for serious data protection infringements, as a deterrent to the likes of [company]Google[/company], who shrug off today’s fines. The new proposals would lower that amount. The possibility of class action lawsuits would also be nixed, and individuals suing over data protection will only be able to take it to local regulators, not courts.
  • Data breach notifications: Companies would only have to tell people that their data has been stolen if the theft is “high risk”.
  • Cross-border complaints: There’s supposed to be an EU “one stop shop” for data protection complaints, which makes sense as the whole point of this regulation is to create a unified EU framework. But no, the Council would want multiple national data protection regulators to be brought in first to try reach consensus, because member states don’t want to cede control.

The deadline on this one is a bit further out, with the Council expected to produce its position on the data protection regulation in the summer, before commencing negotiations with the other legislative branches of the EU.

According to EDRi: “Unless something is done urgently, the Council will simply complete its agreement, at which stage only an absolute majority of the European Parliament would be the only way of saving Europe’s data protection reform.”

I have asked the Latvian presidency of the Council (it’s a rotating presidency) for comment on the leaks, but haven’t received a reply at the time of writing.

EU publishes details of Amazon Luxembourg “state aid” tax probe

Last year the European Commission opened an in-depth investigation into Amazon’s Luxembourg tax arrangements, which may be illegal. Amazon funnels its European revenues through a complex transfer pricing set-up in the duchy, effectively resulting in an especially low tax rate (see also: Skype). This nets Luxembourg a lot for a country that size, but countries in the rest of the EU get way less than they should. On Friday the Commission published a public version (PDF) of its decision to launch the investigation, detailing why it thinks the 2003 arrangement represented a special deal for the company, making it illegal state aid. If the investigation finds as much, Amazon may have to pay a whole bunch of back taxes.

EU seeks opinions on using 700MHz spectrum for mobile broadband

When it comes to freeing up the valuable 700MHz airwaves for mobile broadband, Europe’s wheels are slowly turning. Last September, former trade commissioner Pascal Lamy recommended that the spectrum should be made available for mobile broadband use by 2020 — it is currently used for TV and wireless mics in the E.U., while the U.S. and Asia already use it for 4G. Now the European Commission has launched a consultation on the Lamy report, seeking public opinion with an April 12th deadline. The U.K. recently announced plans to free up 700MHz by 2022. The spectrum is valuable because low frequencies carry data over long distances and are good for in-building coverage.

Europeans have two weeks to return iTunes purchases for a refund

Apple has quietly introduced a 14-day return policy for iTunes, App Store, and iBooks purchases in several countries in Europe, according to 9to5Mac. The new policy is apparently in response to a European Commission recommendation. Previously, to receive a refund, you would have to contact Apple support and provide a reason. That’s still the way it works in the United States. But for Europeans, there’s now an automated refund process through Apple’s “Report a Problem” feature. Google recently extended the Google Play app refund window to two hours, even in the United States.

Microsoft axes its EU browser choice mechanism after five years

Five years ago, Microsoft began offering a choice of browsers to European customers who were booting up a copy of Windows for the first time. It did this in order to settle an antitrust case with the European Commission and avoid a hefty fine.

That commitment – which [company]Microsoft[/company] wasn’t entirely consistent in sticking to — ended on Wednesday. The firm has accordingly axed its browser choice mechanisms, telling users: “Microsoft encourages customers who want more information about web browsers or want to download another browser to do so by visiting the websites of web browser vendors directly.”

Windows is obviously still a big deal, but not as market-dominating as it was back in 2009. Back then, if you wanted a personal computer, you were most likely to buy a Windows PC. As of next year, according to analyst estimates, you’re as likely to buy a tablet instead – though don’t write off the PC just yet, particularly in Europe and the U.S.

The main reason that the European Commission wrung the browser choice concession out of Microsoft was that the company was trying to extend its market dominance past the operating system to the next big platform: the web. It was doing so by making Internet Explorer the default browser in Windows, something that the Commission saw as an anticompetitive abuse of its dominant position.

By removing that default status, other browsers got their chance to shine – it was no longer necessary for users to already know about that other browser and consciously visit its download site on Internet Explorer, for them to be a click away from downloading it. Five years later, Chrome is now the most popular browser in the world.

Internet Explorer browser choice

And the statistics for Europe versus North America, for example, are telling. Looking at desktops specifically, in North America, Chrome has a 41.52 percent share of the browser market and Internet Explorer is in second place with 32.75 percent. In Europe, Chrome has a 47.2 percent share and IE has just 17.53 percent, putting it in third place behind Firefox (on 25.68 percent.) While regulatory intervention isn’t the only reason for this situation — Chrome still beats IE in North America, where there was no intervention — it’s likely to have been a big one. Defaults matter.

The rise of Chrome across the desktop and mobile, with [company]Google[/company] as its default search engine, has become a key factor in Google’s 90+ percent dominance in the EU search market. Now it’s that company’s turn under the Commission’s antitrust spotlight, thanks to its abuse of that position to stamp out vertical search rivals and the like. If the Commission manages to cut Google down to size with whatever the settlement of that case entails, who knows which future monopolist will get the chance it craves?

This article was updated at 9.20am PT with some statistics about browser share, and slightly rearranged around that addition.

EU digital economy chief downplays “Google tax” reports

Ever since Germany’s Günther Oettinger became the new EU commissioner for the digital economy, with copyright reform as part of his brief, he has been making noises about getting Google to pay some kind of “levy” for using European “intellectual works.”

I and others have been interpreting this as a desire on Oettinger’s part to extend the so-called ancillary copyright concept – where news aggregators such as [company]Google[/company] have to pay royalties to publishers for using snippets of their text in search results – across Europe. Google’s not the only company that’s affected but, given that it has more than 90 percent market share in European search, ancillary copyright is often called the “Google tax” in the EU.

From events on Wednesday, it seemed clearer than ever before that this was what the commissioner was after. But according to subsequent pronouncements from Oettinger and sources in the Commission, he doesn’t want to extend rules that don’t work.

Oettinger met with members of the European Parliament’s copyright working group to talk with parliamentarians (MEPs) about his plans for a new EU-wide copyright proposal, scheduled for 2015. And Julia Reda, the Pirate Party’s sole MEP, seemed to come away from the meeting in an incandescent mood.

“At today’s debut meeting of the European Parliament’s copyright working group, digital Commissioner Günther Oettinger expressed his wish for an EU-wide ancillary copyright law for press publishers, citing it as an example area of copyright where action was required at an EU level,” she said in a statement.

Reda pointed out that the two existing examples of ancillary copyright being rolled out nationally, in Germany and in Spain, had both turned out badly. In Germany, local publishers were forced to grant Google free use of their text snippets and thumbnails after the company delisted them from Google News and traffic to their websites predictably plummeted. In Spain, the severity of the local ancillary copyright law has created an even worse situation – the publishers, who lobbied for the law, can’t grant Google free access even if they want to, and now the company has axed Google News in Spain altogether, again hammering their traffic.

“By pursuing an EU-wide ancillary copyright law for press publishers, Oettinger is ignoring the recent spectacular failure of similar laws in Germany and Spain,” Reda said in her statement. “They did not fail because they were implemented at the wrong level, but because the idea itself is wrong-headed.”

However, Oettinger said on Twitter that there would be no extension of national rules across the EU:

One source within the Commission told me that Oettinger only wants new EU copyright legislation to “cover those areas where national legislation has no impact,” and suggested he had mentioned the experiences of Germany and Spain “as negative examples.” Meanwhile, another source said the Commission “will monitor the implementation of the law to see whether it delivers the objectives set by the Spanish government.”

No sweet spot

It is not clear to me at all that this means Oettinger doesn’t want an EU-wide ancillary copyright law. It could be that he does want such a law, but he doesn’t want it to be as ham-fistedly implemented as it was in Germany and Spain. If that is the case, I struggle to see where the sweet spot between those implementations might lie. The German implementation was too ineffective to give the hard-lobbying publishers what they wanted — Google successfully called their bluff — and the Spanish implementation was so idiotically heavy-handed that it amounted to a publishers’ suicide pact.

The problem is, as Reda said in her statement, that “legislative restrictions on free linking do not lead to better compensation for journalism, but to increased barriers to access for the public and losses for publishers and authors.” Companies such as Google – and European aggregators too, let us not forget – are under no obligation to keep linking to sources that lose them money. What’s more, those links benefit publishers by giving them traffic that they can convert into advertising revenue. It’s not like they lose out in any way from being linked to with snippets of their text.

To my mind, there are two underlying motivations behind the big publishers using their political leverage to push for ancillary copyright laws. The first is that they want money for nothing. The second is that the internet erodes their power. Once, they had loyal readers who bought their paper each day, but now aggregators such as Google News have made their articles options on a long and diverse menu.

Many casual readers are now driven to stories because of their relevance, not because they appear under a certain brand, and this new world gives newer, smaller publications a chance to shine. That’s awful for powerful press barons, but great for readers, great for media diversity, and consequently great for democracy.

Let’s hope that Oettinger is taking away the right lesson from the German and Spanish debacles as he formulates his copyright proposals (and sorry to paraphrase Reda again here, but she’s right on this): European citizens and online businesses benefit from barriers coming down, not barriers going up.

EU digital chief tries to maintain single digital market momentum

European member states may be keen to water down current net neutrality proposals and push back against the centralization of radio spectrum policy in the EU, but new digital single market chief Andrus Ansip isn’t having any of it. In a speech on Monday, he adopted a tough stance on these issues, and on the abolition of roaming fees for those travelling within the EU. Ansip also told the member states to hurry up so the proposals can be become reality.

Ansip told telecoms providers at the GSMA Mobile 360 conference in Brussels that the concept of net neutrality “has to be solid and clearly defined.” Member states are more keen on unenforceable principles that can be interpreted differently in different countries, but Ansip noted that “if 28 countries have 28 different approaches, it makes the market even more fragmented.”

On spectrum, member states are trying to stop the Commission gathering any more powers of coordination. Ansip argued: “The more this natural resource is divided, the less efficient it is. Ideally, EU countries should be working together much more on allocating spectrum. After all, radio waves know no borders. Why should the internet? We don’t need national fragmentation of internet traffic.”

Ansip said roaming fees for travel between EU countries were “an irritant and an anomaly”. He said he “will continue to push for an end to roaming surcharges in Europe” because “they have no place in the telecoms and digital single markets that Europe so badly needs.” Member states want to see “fair use” policies inserted into current legislative proposals for allowing people to use roaming data within their domestic tariffs.

The Council of the EU, representing the member states’ governments, represents the last hurdle in the European legislative process. The debate over the Telecoms Package, proposed by Ansip’s predecessor, Neelie Kroes, is now heading into the new year. Ansip said he hoped an agreement could be reached within months. “Otherwise, I fear that we may lose momentum,” he said.

So far, the Council hasn’t even begun negotiations with the European Parliament over the package, as it must. Ansip pointed out that the Council itself had pushed for a single EU telecoms market, and suggested that the telcos should also be keen to see this creation because would aid cross-border consolidation and allow them to offer services across the EU.

“It is up to those in the market to invest in the necessary infrastructure. However, the market cannot always provide all that is needed. That’s where public authorities have a role to play,” he said. “Firstly, by providing the right and adequate regulatory environment, which we plan to achieve through the Digital Single Market strategy. And secondly, by incentivizing and leveraging more private investment.”

A single telecoms market is of course a necessary base for a single digital market. Beyond what Kroes had already proposed regarding telecoms, Ansip called for simplified rules on online purchases, an end to the geo-blocking of digital services, and the reform of Europe’s copyright rules.

How Europe could cut Google down to size without splitting it up

Google’s EU search antitrust case is a complex beast that is being overloaded by vested interests. Competition commission Margrethe Vestager would be best advised to keep her solutions simple, and here are some suggestions for what those solutions might entail.

Looks like the EU net neutrality debate will run into 2015

The Council of the EU, representing the 28 member states, is currently debating how to finalize the strict net neutrality rules that the European Parliament handed it earlier this year. It looked like the Council was about to water the rules down, but then the European Commission and the Parliament both pleaded with it not to, and now the decision has reportedly been delayed. The Italian presidency of the Council said Thursday that none of the compromise drafts had achieved consensus and a Council official quoted by IDG said the debate will now go through to 2015. The Commission and Parliament want strong rules and definitions but the member states want more flexible “principles” – we’ll have to wait to see who wins.