Technological neutrality and network neutrality in telecommunications regulation

Policies at the 5G crossroads?

The paper “Technological neutrality and network neutrality in telecommunications regulation. Policies at the 5G crossroads?” will be presented at the 10th FSR Annual Conference (10-11 June, 2021).

ABSTRACT:

Technological neutrality has been for many years a rather uncontroversial mainstay of the European regulatory framework for electronic communications. It has been introduced in the 2002 “new” regulatory framework, with the aim to enable firms to leverage on their competences in freely choosing technological solutions and to prevent regulators from picking winners in the competition among technologies, and it has ever since found its way in a broad set of regulatory domains (e.g., spectrum, data protection, security). Although more controversial, network neutrality regulation can be considered one of the key policy developments in telecoms regulation in Europe in the past few years. Network neutrality rules concern vertical relationships along the value chain. On one side, they guarantee non-discrimination among content providers and, on the other side, they obstacle agreements between Telcos and other digital players for the provision of specific levels of QoS.

In this paper, we explore the future of these two principles in light of the broader evolution of the EU regulatory framework and of current technological developments (particularly 5G/IoT technologies). The explicit emphasis on investment in very high-capacity connectivity of many EU policy documents (including the new European Electronic Communications Code) raises the issue of compatibility of ambitious connectivity policy targets with technological neutrality. At the same time, 5G may be a game changer of competition along the IP-based value chain by turning networks from general-purpose connectivity platforms to specialized services and by enabling network sharing among network operators and OTTs/verticals (e.g., automotive, health, smart domotics etc.). This, in turn, suggests the risk that network neutrality rules, in principle contrasting vertical agreements, might unduly distort firms’ technological choices and thus end up being at odds with the principle of technological neutrality.

The paper will connect both to previous research on technological neutrality and net neutrality and official documents defining both issues, particularly from the EU Commission. It will start from the official definitions and the interpretation in economic and engineering literature of these two apparently different concepts showing the relevant points of contact.

Our expected result is twofold. The paper will first give emphasis to the important and largely unexplored trade-offs that present themselves by attempting to pursue both the two objectives. Second, it will try to propose an equilibrium of goals that can be realistically and effectively attained.

A specific application of the inquiry will be dedicated to the evolution of 5G standards and the consequences for the mobile industry, but also for the many possible industrial verticals that, at least potentially, may affect and even reshape different and apparently unrelated industrial activities. The paper analyzes these issues and puts forward some policy suggestions.

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