Some of my Mobile World Congress-going friends may yawn at this one, but a few days ago, Thierry Breton, the European Internal Market and Industry Commissioner brought up again, the imbalance on how many tech giants like Google and Netflix (sometimes called over-the-top services), benefit from the existence of high speed networks, and how they don’t really pitch-in for the deployment of these -other than the very important aspect of generating consumer demand for these services-.
In the opinion of the Commission, there could be a world where these tech giants co-invest with large operators to put the technology in place.
The question, while it sounds inherently European -and a way to also shift some of these US-based giants to the EU- has some logic when you consider that that large, global telcos, and regional telcos have exhibited a Total Return in the range of 1%-5% in the last three years, while -just as an example- Netflix is at 17.1%. If there are more incentives to build out services, these may outpace the network’s capacity, and conversely, if networks are built faster than services or content are made available, the operators may bankrupt themselves.
What’s the magic formula to ensure that both the network and the services evolve at the same speed?