Fair Share of Network Costs and Regulatory Myopia: Learning from Net Neutrality Mistakes

Forthcoming in Law, Innovation and Technology

ICLE Research Paper

23 Pages Posted: 3 Jun 2023 Last revised: 20 Jul 2023

See all articles by Giuseppe Colangelo

Giuseppe Colangelo

Università degli Studi della Basilicata; Stanford Law School; LUISS Guido Carli, Department of Business and Management; International Center for Law & Economics (ICLE)

Date Written: July 18, 2023

Abstract

To boost the roll-out of the next generation telecommunications infrastructure, EU policy makers have advanced a proposal mandating some large online platforms to compensate network operators with a usage fee. Framed as a matter of large market players paying their fair share of contribution to telecommunications networks, the proposal would represent another unnecessary and harmful regulatory intervention. Indeed, the paper aims to demonstrate that the fair share debate is the poison fruit of a previous intrusive government initiative, that is, the net neutrality regulation. Furthermore, like net neutrality anti-discrimination rules, a fair share Big Tech tax would be a solution that wouldn’t work for a problem that doesn’t exist. Moreover, the debate on fair share reflects the general EU industrial policy approach to the digital transformation, which essentially revolves around the unsound belief that innovation could be delivered through regulation and by subsidizing legacy homegrown companies via the transfer of rents from successful global players. Instead of continuing to interfere in market dynamics and private negotiations without any solid evidence of market failures, the EU should learn from past mistakes and acknowledge the limited scope for regulation in these dynamic markets.

Keywords: Regulation; Telecommunications; Fair share; Network costs; Net neutrality; Broadband providers; Content and application providers

JEL Classification: L50; L52; L86; L96

Suggested Citation

Colangelo, Giuseppe, Fair Share of Network Costs and Regulatory Myopia: Learning from Net Neutrality Mistakes (July 18, 2023). Forthcoming in Law, Innovation and Technology, ICLE Research Paper, Available at SSRN: https://ssrn.com/abstract=4452280 or http://dx.doi.org/10.2139/ssrn.4452280

Giuseppe Colangelo (Contact Author)

Università degli Studi della Basilicata ( email )

Via dell'Ateneo Lucano 10
Potenza
Italy

HOME PAGE: http://sites.google.com/site/giuseppecolangelouni/home

Stanford Law School ( email )

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LUISS Guido Carli, Department of Business and Management ( email )

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