Digital Networks Act: EU reportedly waives billions in fines for Big Tech

The European telecommunications industry harbored great hopes: Big Tech companies like Netflix, Google, and Meta, which heavily utilize European data networks with their services, were to be made to pay through the Digital Networks Act (DNA) and thus help finance the expansion of network infrastructure. However, this may not come to pass, as the US news agency Reuters now reports. Instead of strict regulation, Big Tech might only face a warning finger. Instead of billions in fines, the regulation, which is to be presented on January 20, relies on guidance and dialogue.

This would mean the Digital Networks Act (DNA) would adopt a very different approach than the Digital Markets Act (DMA) and the Digital Services Act (DSA). Based on market and service regulation, the European Commission has already imposed fines in the high triple-digit million range. The EU has been in dispute with giants like Apple, Google, and Meta for years.

Will the US threat facade work?

According to the Reuters report, the EU's decision to position itself much more tamely is said to be related to the fact that European regulation is increasingly straining the transatlantic relationship. The interpretation of the US government under Donald Trump is that EU regulation is directed against US corporations and not against the way they operate in Europe. If tech corporations are now encouraged to cooperate and discuss on a voluntary basis, this is apparently intended to smooth things over – however, due to a lack of insight, it is more likely that the legislation will become a toothless tiger.

The overarching goal of the DNA, which is to be presented by EU Digital Commissioner Henna Virkkunen, is to strengthen European competitiveness and trigger investments in telecom infrastructure. The details are yet to be worked out with the EU countries and the EU Parliament. It is quite possible that the approach towards Big Tech will then be further tightened.

Specifications for spectrum licenses

Among the new rules is that the Commission will in the future determine the duration of spectrum licenses awarded in the member states. This concerns radio frequencies for mobile networks, WLAN, other wireless communication, and broadcasting. By defining the sales conditions and pricing methodology, the EU market in the 27 countries is to be harmonized. For the member states, the auctions of frequencies are a multi-billion-euro source of revenue.

Brussels also wants to have more say in fiber optic expansion. National regulators are to receive guidelines for fiber optic expansion. However, governments should retain the option to extend the deadline for switching off copper networks in favor of fiber optics beyond 2030 if the rollout is not yet complete.

(mki)