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Net Neutrality’s Holes in Europe May Offer Peek at Future in U.S.

December 10, 2017

Europe has sought to combat such practices by adopting net neutrality rules aimed at ensuring that I.S.P.s in the bloc’s 28 member states can’t pick the web’s winners and losers. The regulations are binding and enforced by each country’s national telecom regulators.

For the European Union’s sprawling market of over 500 million citizens, the rules have mostly helped prevent bad behavior.

“There is not a long trail of abuse by telecom operators in net neutrality,” said Philippe Defraigne, a director at Cullen International, a Brussels-based consultant that covers telecoms and the digital economy.

That’s largely because unlike in the United States, Europeans have plenty of choices for internet access at home and on their mobile phones. France has four major mobile and internet operators and nine low-cost offshoots. Britain has more than 50. And there aren’t dominant giants born of megamergers, like the ones between Comcast and NBC Universal, and Verizon and AOL.

Even so, telecom operators in Europe have tried to take advantage of some of the gray areas in the rules.

When Netflix entered the European market in 2012, some national telecom companies forced it to pay “tolls” to deliver content to customers. Netflix did not name the companies but told a regional regulator in a letter that the dispute showed “the importance of strong net neutrality rules.”

The bloc’s rules also left open a major regulatory loophole for a practice called zero rating, in which a mobile network does not charge for data used on certain applications or services, giving them a leg up against competitors. The few regulatory disputes that have arisen in Europe have mostly involved big telecom companies that steer users to Facebook and other services.


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Mr. Pai dismantled zero ratings protections in the United States even before he unveiled the plan to undo net neutrality rules entirely.

In Europe, the loophole created a confusing patchwork of interpretations in different countries over whether zero rating violates net neutrality. Sweden’s regulator concluded that the Telia offer didn’t treat internet traffic equally and should be halted. Want to stream music from a scrappy Spotify competitor? Telia would “throttle,” or artificially slow, that service once users reached their data caps, although they could keep listening to Spotify.

That doesn’t necessarily bother consumers.

“From a user perspective, I don’t think it’s a problem and I think most consumers don’t think it’s an issue,” said Magnus Haglunds, a Stockholm-based independent music producer who uses the Telia service. “There are those who may have to change from Apple Music to Spotify. But then they get free surfing on Spotify.”

Wasn’t net neutrality being compromised? “It’s not Cuba,” Mr. Haglunds replied. “Cuba has a problem. There they don’t have any internet at all.”

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But the offer alarmed Swedish media companies, which warned that the deal gave Facebook an advantage over competitors, and Telia an edge over other telecom operators.

In February, Indian regulators shut down a separate Facebook zero rating deal with the mobile phone carrier Reliance Communications, saying carriers should not be allowed to “shape the users’ internet experience.”

A Swedish court ultimately overturned the decision on technical grounds after Telia appealed. Telia continues to offer the service in Sweden and other Nordic countries. But Sweden’s administrative court is expected to issue a broader decision on zero rating rules this year.

Critics of the rollback in the United States have cited zero ratings schemes in Europe, or versions of it, as an omen of how the web may be split.

Representative Ro Khanna, a California Democrat, posted a screen grab on Twitter from the Portuguese mobile carrier Meo that went viral. The shot showed basic monthly subscription plans with names like Social, Messaging and Video, each appearing to favor a batch of established apps.

“Providers are starting to split the net into packages,” Mr. Khanna wrote.

In Portugal, with no net neutrality, internet providers are starting to split the net into packages.

— Ro Khanna (@RoKhanna) Oct. 27, 2017

In Germany, a similar case involved a Deutsche Telekom offer called StreamOn, which allows users to access unlimited videos and music from specific partners like Netflix. The country’s telecom regulator approved the deal, drawing criticism from consumer activists. StreamOn sought to address some of the concerns by expanding the offer to include around 50 partners.

“This a battle for the next century,” said Klaus Müller, the chairman of the Federation of German Consumer Organisations, a lobbying group. “We can either have oligarchical markets with huge players, or a big variety of companies with lots of competition, which would be good for consumers but bad for big business.”


Robert Beens, the chief executive of StartPage, says his privacy-based search engine would be jeopardized if net neutrality protections were eroded.Credit Dirk-Jan Visser for The New York Times

Many in Europe are watching the F.C.C. ruling with trepidation. Over 200 European companies signed a letter to Mr. Pai warning that ending the net neutrality rules will undermine privacy, free speech and competition on the internet.

Robert Beens, the chief executive of Startpage, a Dutch privacy-based encrypted search engine used by surveillence-wary consumers who don’t want their search data recorded, said his company could be put in jeopardy.

Half of the 2 billion searches done annually through Startpage are in the United States. If American I.S.P.s start charging companies to be in the internet’s fast lane, Mr. Beens said he would not be able to keep up with deep-pocketed competitors like Google, Bing and Yahoo.

“People want privacy, but what if we can’t pay the amounts of money that I.S.P.s are looking for?” he said. “In the U.S., people would have a slower connection to our search engine. It could really harm our business model.”

Perhaps the biggest issue for Europe — and other parts of the world — is that countries watch what the United States does.

“The U.S. set good standards for the globe, but now they could go backward,” said Maryant Fernández Pérez, a senior policy adviser at European Digital Rights, an association of civil and human rights organizations advocating an open digital environment.

“The consequences are not very good internationally.”

Christina Anderson contributed reporting.

A version of this article appears in print on December 11, 2017, on Page B1 of the New York edition with the headline: Europe’s Lessons On Net Neutrality. Order Reprints|Today’s Paper|Subscribe

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