By differentiating it from the ‘fair share’ debate, Vodafone appears to have captured the curiosity of regulators who see the proposal as a mature way of trying to solve the problem
A new debate, whereby the problem is solved commercially rather than through regulatory intervention
On 10 April 2025, Vodafone Group hosted an event in Brussels on a responsible use of networks, the subject of a report it published back in February during MWC25. Ben Wreschner (Regulatory Policy Director, Vodafone Group) explained that the issue at hand is "absolutely not” a rehashing of the fair share debate, instead a “tragedy of the commons” exists whereby operators’ networks are treated as an infinite resource and being depleted, and therefore can no longer produce the same sort of outcomes (i.e. long-term investment) everyone wants to see. Wreschner outlined three areas where Vodafone considers investment capacity is constrained by:
A lack of incentives for content and application providers (CAPs) to optimise traffic (e.g. streaming ultra HD unnecessarily to smartphones);
limited ability to expand the commons due to spectrum constraints (citing Germany's campus network set-asides); and
difficulty in managing existing traffic due to complex open internet rules “that make your head spin” (likening them to “you can drive a car, but not cause traffic.”).
Amaia Betelu (Director, EU Affairs, Telefónica) shared the challenges Vodafone highlighted, with many players not using networks as efficiently and responsibly as they could – but that Telefónica was nevertheless working with CAPs to help optimise traffic on their network. Tomas Jakimavičius (Director, EU Government Affairs, Microsoft) said that he couldn’t agree more that traffic optimisation is – and should be – top of mind given that concerns are evident across the internet ecosystem; however, he stated that it would be incorrect to assume that there is no incentive for CAPs to route traffic as efficiently as possible. For now there seems to be an open debate as to how much CAPs are currently doing this.
Claudio Teixeira (Senior Legal Officer, BEUC), opened with a tone of skepticism, reflecting his concern over the recent policy paper with the comment: “Oh god, another paper.” While he acknowledged the potential of such papers to provide "good food for thought," he expressed worry over how these could be interpreted by policymakers. He emphasized consumer experiences, particularly drawing attention to issues such as intrusive data practices and commercial surveillance – like personalized advertising on YouTube – which he argued do not align with the principle of managing traffic responsibly. For Teixeira, the debate should focus not only on managing traffic efficiently but also on the responsible use of networks, which, in his view, is not always the case currently. He further cautioned against rushing into solutions: “Let us not waste time, but let us not rush into it.” This was a warning against the current climate of hastened policymaking, which he believes risks setting the sector back. Teixeira highlighted the contradiction in the desire for advanced AI and 5G use cases while also calling for traffic moderation.
There was general consensus, however, among the panellists on the need for regulatory reform, with Jakimavičius pointing to some helpful and well-known measures that could be applied, e.g. longer spectrum licence duration and different auction practices, that would stop “squeezing operators” out of billions of euros. He also cautioned that any upcoming changes to the current framework shouldn’t be radical but made with surgical precision so as to avoid unintended consequences. Teixeira echoed this view, warning that the potential fixes could end up delivering worse outcomes than the original problem.
The EC has promised change which is what DG CNECT will deliver, even if there’s some hesitation among NRAs that it risks replacing a framework that has worked well
In the following fireside chat, Joakim Reiter (Chief External and Corporate Affairs Officer, Vodafone Group) bemoaned the earlier speakers’ careful tone and approach towards changing regulation, stating that this seems to be “the European way”. He stated that this doesn’t tend to lead to innovation and competitiveness, and has left the region not only falling behind China or the US but middling countries as well. Reiter argued that at the core of the matter is the question of the type of economy Europe wants to create, stressing the need for policymakers to think differently and have the courage to face up to learnings (going back to the drawing board where necessary), or be left in the same place several years from now.
Renate Nikolay (Deputy Director General, DG CNECT, EC) emphasised that there is a moment now for Europe to act, that she is up for it, and that the Digital Networks Act (DNA) presents that chance to develop a regulatory framework that is fit for modern realities. She added that the DNA would build on the success of liberalisation almost 30 years ago without losing sight of competition and consumers, while recognising the bloc’s ambition to boost competitiveness and the fact that times had changed. According to Nikolay, the three main pillars behind a modern regulatory framework are simplification, deregulation and the single market, which together would position the connectivity sector centre stage once again to attract investment.
Robert Mourik (Chair, BEREC) stated that he was not as negative as many others (including the EC) seemingly are about the impacts of regulation, arguing that it is not “completely dysfunctional” and that lot of good outcomes have been achieved under the current framework. He was complimentary of the open internet regulation, although noted that some of the wording is perhaps not clear – especially in relation to network slicing where, in light of repeated calls for more clarity, he believes the EC should be more explicit.
He views the Vodafone report as a mature way of trying to fix things commercially rather than running to a regulator to solve the problem which would likely invite more conflict than resolution. He recognised what Vodafone are advocating “is clearly not the same debate as ‘fair share’.” Nevertheless, as a regulator, Mourik didn’t want to be accused of holding the sector back, particularly given the amount of deregulation that has already taken place. For him, the problem is the amount of adjacent regulation that feeds into the overall burden facing operators. Reiter agreed, urging policymakers to look more broadly than telecoms and at all the different pieces of legislation that are driving cost (which are either passed on to consumers or absorbed by the business). He added that because digitisation leads to a convergence of industries and technologies, a pure sectoral mindset towards regulation does not work. There were calls for more horizontal regulation where you regulate services from the point of view of the end user rather than the provider.
An open invitation to learn from each other to optimise traffic
In the Q&A that followed, conversation turned to the challenges faced by telecoms operators in monetising services and their financial health. Mourik reflected that telecoms operators have become something of a bit-pipe with little realisation of value. We were reminded that 5G was supposed to solve problems for operators because it was cheaper for them to run, but that we haven’t seen a rapid deployment (particularly of 5GSA) – and a reflection that we see a lot of use cases but not a lot of business cases. Reiter was quick to explain that Europe is ‘capitally constrained’ to invest in 5G to save itself money – and that whenever Vodafone goes to the market saying they want to deploy more 5G in Europe they get rerated down in terms of market cap. Investors see Europe as a bad deal where the lack of previous returns are informing lending decisions today.
Wreschner had the final word and brought the debate back to the thrust of the paper they were debating. He asked us to imagine Amazon being required to drive an empty lorry into a city to deliver a single toothbrush. He claimed that’s how it is in telecoms, with operators being asked to hand content to consumers without any regard for how it’s delivered. The challenge is to get everyone around the table to agree this is stupid and agree to a code of conduct of how to do it better. It felt like this was an open invitation to discuss at a deep technical level, where lessons in optimising traffic would be freely shared with competitors if it meant a lasting improvement for the sector as a whole.
