On 30 August 2016, the Body of European Regulators for Electronic Communications (“BEREC”) has published its “Guidelines on the Implementation by National Regulators of European Net Neutrality Rules“ („Guidelines“).
Net neutrality has for many years been an intensively debated political issue. The way in which internet service providers (“ISPs”) may treat internet traffic is for tremendous importance both for the telecommunications sector as well as for the content and application providers (“CAPs”) who offer customer applications via the internet. The European Union has sought to come to a balanced compromise in this matter by allowing for reasonable differentiations of traffic, thereby enabling ISPs to develop new business models without impairing the opportunities of different services to compete with each other. The Guidelines mark an important step towards the practical implementation of this compromise.
In 2015, the European Union adopted the Regulation 2015/2120 concerning inter alia measures for safeguarding open internet access (“Regulation”). The Regulation laid down net neutrality rules in general terms, asking the national regulatory authorities (“NRAs”) to ensure compliance and to impose the appropriate measures on providers of ISPs. In order to ensure a consistent implementation across member states, BEREC has been assigned by the Regulation to set up the now published Guidelines. As BEREC does not exercise any regulatory power itself, the Guidelines are not legally binding, neither for the NRAs nor directly for ISPs. However, the Guidelines will most likely have a decisive influence on the implementation of the Regulation across the EU.
BEREC had initially published a draft of the Guidelines on 6 June 2016 opening a public consultation process. This consultation has received an unprecedented public response: in the six week long process, BEREC received close to 500,000 responses from a wide range of stakeholders from across the world, including civil society groups, academics, governments, ISPs and CAPs.
The Guidelines contain clarifications for central elements of the Regulation’s net neutrality rules. The following key recommendations will likely be of paramount interest to the telecommunications markets:
The Regulation demands that the commercial terms of ISPs shall not restrict the end-users rights with regard to the open internet, i.e. to use the internet access indiscriminately, without regard to the content or application used. The Guidelines now clarify that zero-rating offers where the use of certain applications (e.g. a specific music streaming service) is not counted toward data caps are not prohibited per se. Only those offers where all applications but the zero-rated one are blocked or slowed down once the data cap has been reached are deemed inadmissible. Beyond that zero-rating of specific applications is generally possible, as long as those offers do not materially reduce the end user’s choice of applications which requires a comprehensive assessment of the individual offer.
Quality of Service
Under the regulation, ISPs are not prevented from applying reasonable traffic management, in particular on the basis of objective quality of service requirements (“QoS”). The ISPs may thereby implement certain traffic classes (e.g. for real-time applications or streaming services) demanding for specific QoS standard in parameters such as latency, jitter, packet loss and bandwidth. The Guidelines specify in particular that such QoS measures must relate to generic application types and must therefore be handled application-agnostic.
In the telecommunication markets there is an increasing demand for the provision of so called specialized services that cannot be assured through the general internet access service (“IAS”). The Regulation has recognized this demand and thus allowed the offer of specialized services under certain circumstances. The Guidelines name VoLTE, linear IPTV services, real-time health services and business services for corporate customers as typical examples for such specialized services. The Guidelines demand that the providers of specialized services demonstrate that the service may objectively not be performed via IAS. At the same time, the Guidelines demand the NRAs to closely monitor the performance of IAS and take necessary regulatory measures ensuring that their service is not deteriorated by the offer of specialized services and that sufficient network capacity is ensured for IAS.
Finally, the Guidelines further specify the transparency requirements of the Regulation that demand in particular that ISPs give a comprehensive explanation of the minimum, normally available and maximum speeds that the IAS provides. The Guidelines define such speeds in the following way: minimum speed as the speed that the IAS never falls short of, expect in cases of interruption; normally available speed as being available at least in 90% of the peak hours and at least in 95% of the rest of the time; maximum speed as being available at least once a day.
The actual implementation of the Regulation will now be the task of the NRAs. In order to foster a consistent application as well as an exchange of experiences, the NRAs are assigned with the task of annually reporting their activities and experiences regarding the implementations of net neutrality. The first national reports are due on 30 June 2017.
Compliments of Noerr – a member of the EACCNY