Net Neutrality in Europe
Frode Sørensen (@ipfrode)
Norwegian Communications Authority (Nkom)
Open Net Korea, Seoul, 13 February 2019

My background and brief bio
Norway• Norway – in the north of Europe• Nkom – Norwegian regulator• Net neutrality rules issued 2009
• Senior adviser net neutrality• European economic area (EEA)• BEREC – European regulators• Net Neutrality Expert Working Group• Chairing NN EWG 2010-2018

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Content of presentation
1. Introduction to European net neutrality
2. Traffic management (also covering 5G discussion)

3. Specialised services (also covering 5G discussion)
4. IP interconnection (also covering charging)
5. Zero-rating (challenging issue in Europe)

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What is net neutrality?
Content andapplication
providers(CAPs)

Content/applications
are decoupled fromthe network layer

ISP A

ISP B

Network layer

Internet

Net neutrality means application-agnostic treatment of traffic in the network
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ITU

ARPAnetIP protocol

Web application

Net neutrality

US Open Internet

Norwegian guidelines

EU Regulation

Net neutrality and Internet history

186519691983

1991

2003

2006

2009

2015

today15 years

50 years
150 years
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2003

62004

2005

2006

2007

2008

2009

Nkom chairs BEREC NN EWG

Net neutrality objective

2010

2011

2012

2013

Trump

2017

2018

NN
regulation

Report& order

Report& order

BEREC net neutrality EWG

Report& order

Telecompackage

EU

Norwegian net neutrality forum

Obama

NN
regulation

NN

NO incidents

Verizonvs. FCC

NN
soft law

Comcastvs. FCC

Telecompackage

US

PolicyStatement

Timeline for net neutrality regulation

2014

2015

2016

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BEREC Net Neutrality Expert Working Group2009
Regulatory
Framework

2015/2016
Net neutrality
RegulationCo-legislation
Net neutrality objective

EC

2010

2013

2011

2012

EPApril 2019
Evaluation of
NN Regulation

Council2014

2015

2016

2017

2018

GL

BEREC NN EWG
takes the first steps

7European lawmakers
regulate net neutrality

OpinionUpdate

BEREC explains thenet neutrality rules

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Regulation – Guidelines – National enforcement
Open InternetRegulation(“the NN law”)

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Mandateto issueGuidelines

BEREC
Net Neutrality
Guidelines

Takeutmost
account of• Case decisions• Assessments• Etc.

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Section 2. Traffic management• European net neutrality• Traffic management

 Congestion management• Specialised services

 Quality of Service classes• IP interconnection

 Reasonable traffic management• Zero-rating Exceptional traffic management

5G vs. NN/traffic management

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Is 5G challenging NN regarding traffic management?
No, because of…
 Internet traffic management which is based on built-in congestion management Reasonable traffic management(*) which is allowed in networks such as 5G
 Quality of service traffic classes(**) which are allowed in networks such as 5G
 Exceptional traffic management(*) which is allowed in networks such as 5G…to be elaborated on the following slides(*) Reasonable and exceptional traffic management is terminology in the European NN rules(**) Quality of service traffic classes refers to application-agnostic traffic management

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Internet traffic management model
Traffic management
type 2

Traffic management
type 3

Application
layer
Networklayer
Endpoint

Network-internal nodes

Endpoint

Traffic management
type 1• Traffic management type 1 – executed at the network layer• Traffic management type 2 – executed above the network layer in the endpoints• Traffic management type 3 – executed above the network layer in network-internal nodes

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Congestion control / congestion management• Major difference between traditional telecoms and Internet communications- Note the end-to-end principle regarding the design of the Internet• The scope of the Regulation: Electronic communication services• Two types of congestion handling: 1) endpoint-based and 2) network-internal• 1) Endpoint-based congestion control – this is how traffic is regulated on the Internet- Endpoints back off when facing congestion in the network (e.g. TCP)
- Currently significant standardization effort in this area in IETF

• 2) Also, any application-agnostic network-internal congestion management is ok!
- Such measures are often assisting the endpoint-based mechanisms

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Reasonable traffic management – Article 3(3)• Definition of “reasonable traffic management” different from other jurisdictions!
• Reasonable TM shall be transparent, non-discriminatory and proportionate• Shall be based on technical QoS requirements of specific “categories of traffic”- Applications with similar QoS requirements must be treated equally• Such measures shall not monitor the specific content• Specific content = transport layer protocol payload (BEREC NN Guidelines)- I.e. IP header and transport layer protocol header (e.g. TCP) may be monitored• Such traffic management is not commonly implemented, as far as we know

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Quality of Service classes – Article 3(2)• Different rationale than Article 3(3), but might use the same technical measures• Subscriber agreements on characteristics such as price, data volumes or speed- Could also include other QoS parameters, e.g. latency, jitter and packet loss

• I.e. different subscriptions with different non-discriminatory QoS classes• Important : These QoS classes shall be application-agnostic- I.e. any application may populate any QoS class (user-controlled)• Subscribers may buy more than one subscription with different QoS classes- Subscribers may use different QoS classes for different applications• TM based on 3(2) is more common than TM based on 3(3), as far as we know
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Exceptional traffic management – Art. 3(3) 3rd subpara• Three specific exceptions going beyond reasonable TMa) Legislative measures – compliance with European law, including court ordersb) Network integrity – DoS attacks, hacking, malicious software, viruses, etc.
c) Congestion management – see further elaboration below• Exceptions are subject to strict interpretation (Recital 11)• Regarding the congestion management exception,- 1st defence against network congestion is endpoint-based congestion control- 2nd defence is network-internal measures assisting endpoints (possibly AQM)
- 3rd defence is application-agnostic congestion management (throttle all traffic equally)- 4th defence is the exception allowing application-specific congestion management

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Section 3. Specialised services• European net neutrality• Traffic management• Specialised services

 The NN service model• IP interconnection

 Principal discussion• Zero-rating The necessity requirement
 The capacity requirement

5G vs. NN/
specialised services
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Principal discussion of specialised services• One should not regulate absolutely everything, of course• Therefore “specialised services” are introduced as a regulatory concept• Innovation is a major argument for net neutrality, as we know
• Some argues about innovation with specialised services too• Compare with “innovation without permission” on the Internet• Distinguish between innovation at the edge and in the core
• Should also ensure that the latter is not restricted by NN

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The Net Neutrality service model
CAPs(OTTs)

Internet
AccessService(IAS)

Terminal

AccessnetworkSpecialisedService(SpS)18Internet
Applications
decoupled fromnetwork layer“Closed”
IP networks
Verticalintegration
e.g. IMS

e.g. IPX

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Is 5G challenging NN regarding specialised services?
No, on the contrary,
5G network slicing is actually contributing tocompliance with the NN rules for specialised services!
The NN rules clearly state that for applications with requirements fora specific level of quality, specialised services are allowed.
The NN rules require the provision of specialised services not to be to thedetriment of the general quality of IAS, and using separate network slices
to provide IAS and SpS should be a perfect match…to be elaborated on the following slides

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The necessity requirement – Article 3(5) 1st subpara• Specialised services (SpS) =services other than IAS which are optimised for specific applications, where theoptimisation is necessary in order to meet requirements for a specific level of quality• Example SpS
Typical examples of specialised services provided to end-users are
VoLTE and linear broadcasting IPTV services with specific QoS requirements,
subject to them meeting the requirements of the Regulation, in particularArticle 3(5) first subparagraph.
• SpS shall not be usable or offered as a replacement for IAS (prevent circumvention)• However, VPNs could be a SpS, if application-agnostic TM is used internally
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The capacity requirement – Article 3(5) 2nd subpara• ISPs may offer SpS only ifnetwork capacity is sufficient to provide them in addition to any IAS provided- In simple words, SpS should not be provided at the expense of IAS• SpS will typically have some built-in “protection mechanism” based on theQoS architecture operated by the ISP – this is the nature of SpS- Note that the Regulation safeguards IAS (not any SpS provided in parallel)• SpS shall not be to the detriment of the availability or general quality of IAS- Challenge: How should “the general quality of IAS” be assessed?

• 5G network slicing could actually contribute to compliance with the NN rules!

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Discussion regarding “the general quality of IAS”
Article 5(1) – shortened/simplified wording• NRAs shall promote the continued availability of non-discriminatory IAS atlevels of quality that reflect advances in technology.
Recital 17 – shortened/simplified wording• In order to avoid the provision of SpS having a negative impact on the availability orgeneral quality of IAS for end-users, sufficient capacity needs to be ensured.
ISPs should therefore, offer SpS only if the network capacity is sufficient for theirprovision in addition to any IAS provided.
• NRAs should assess the impact on the availability and general quality of IAS by analysing,inter alia, QoS parameters (such as latency, jitter, packet loss) etc.
BEREC Opinion on the Regulation (2018)• BEREC will, as a mid-term goal, seek to leverage on the NN Measurement tool to further
develop the measurement methodology regarding measuring of the general quality of IAS.
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5G – and retrospect to 3G and 4G• QoS architecture in 3G and 4G: PDP Context / EPS Bearer params- How many years did it take to get differentiated QoS running?
• Multimedia in 3G and 4G: IMS/VoLTE/RCS (vs. Skype, Viber, WhatsApp)- How many years did it take to get VoLTE running on 4G?
• Where are all the specialised services? (Compare with IAS growth)• There has never been any regulatory prohibition of specialised services!

• So what is the problem – the Regulation or simply unnecessary concern?
• Isn’t SpS reverse engineering traditional telecoms into IP networks?
• 5G network slicing is a new way of providing virtual networks

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Section 4. IP interconnection• European net neutrality• Traffic management• Specialised services• IP interconnection

 Interconnection and CDNs

• Zero-rating

 Principal discussion
 Internet interconnection

 Internet charging

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Internet interconnection and CDNs
«Bill & keep»
B&K

Content and application
provider (CAP)ISP T

End user
TransitAccessTransitAccessTraffic

ISP A

ISP B
Peering

CDN
Content Delivery NetworkEnd user

ISP 1CachingserverCaching
server

ISP 2

ISP 3

OriginserverCDN

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Principal discussion of charging on the Internet• The relationship between ISPs and CAPs is a win-win relationship- Without Internet access, there is no access to content- Without content, there is no interest in Internet access• Growing Internet traffic sometimes described as a problem- But the growth is actually an indication of the success of the Internet- And it is a business opportunity to ISPs to sell more bandwidth• CAPs and end-users already contribute to paying for Internet connectivity- No evidence that ISPs’ costs are not fully covered in the Internet value chain already (BEREC)- The current model has enabled a high level of innovation and growth in Internet connectivity• This approach has been successful for many years in the evolution of the Internet

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Internet interconnection (European perspective)• BEREC report on IP interconnection in the context of net neutrality (2017)• Internet interconnection has managed to adapt without regulatory intervention• Some observations from the BEREC IP-IC report- Internet traffic volumes continue to increase, mainly due to video streaming- Prices for transit and CDN services are still declining due to competitive market- CDNs are contributing to limitation of the need for interconnection capacity- Economic relevance of CDNs continues to grow due to increased traffic share- Paid peering seems to have been growing in importance during the last years- Interconnection disputes are typically resolved without regulatory intervention

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Termination monopoly discussion
Charging at call-level / follows call setup

Telephony
Calling Party
Network PaysA

TTerminationmonopoly=> regulation

B

Charging from edge towards core

B

Eliminatesterminationmonopoly

B

Reintroduce
terminationmonopoly?

InternetA«Bill & keep»

InternetSending Party
Network Pays

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T

Detailed charging at packet-levelReq.

ATResp.

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Sending Party Network Pays (SPNP)• Traditionally internet was characterized by bill & keep and approximate accounting• SPNP is an (alternative) Internet interconnection charging mechanism- Must not be confused with Calling Party Network Pays (CPNP) for telephony• With the traditional Internet charging model, regulatory intervention is limited• With bill & keep, ISPs seek to recover their cost at the retail level from the end-users• Request for traffic stems from the ISP’s own customers (already paying), not from CAPs
• Ultimately, it is the success of the CAPs which drives the demand for access bandwidth• If B&K replaced with SPNP, regulatory intervention may be needed under EU rules• Ref. BEREC statement on the SPNP proposal from ETNO on WCIT-12- ITU World Conference on International Telecommunications 2012 (previous 1988)- WCIT is a treaty-level meeting on International Telecommunications Regulation (ITR)

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Section 5. Zero-rating• European net neutrality• Traffic management• Specialised services• IP interconnection• Zero-rating Global overview
 Principal discussion
 European ZR rules
 European ZR cases

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Global view – Net neutrality and zero-rating
Zero Rating Map
www.zerorating.info
The Zero Rating Map is an official
outcome of the UN IGF Dynamic
Coalition on Network Neutrality,coordinated by Professor Luca Belli.

• Net Neutrality and Zero Rating are regulated.
ZR is not tolerated.
• Net Neutrality is regulated, ZR is tolerated andthere is Data protection.
• Net Neutrality and Zero Rating are not regulated
but there is Data protection. Zero rating is available.
• Net Neutrality, Zero Rating and Data protection arenot regulated. Zero rating is available.
• Special cases

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Principal discussion of zero-rating• Regarding net neutrality: Zero-rating is an application-specific measure• Operators shifting focus from technical to economic discrimination?
- There are currently zero-rating products in almost all European countries• Influences end-users freedom of choice (pre-selected applications)• Increases entry barriers for Content and Application Providers (CAPs)• The latter is of course a particular concern for non-US CAPs
• Current models of ZR regulation: Canada and India (and California)

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Overview of European zero-rating rules• “Commercial practices” – Article 3(2) of the Regulation- Typical example: zero-rating• Zero-rating is currently the most challenging question- Only general norms, compared with the specific norms for technical practices• ZR neither explicitly allowed nor explicitly prohibited in the EU• Article 3(1): End-user right to access and distribute content of their choice• Article 3(2): Commercial practices shall not limit the exercise of end-users’ rights• Note, many offers combine technical and commercial practices- Typical example: ZR + data cap, where non-ZR apps are blocked after cap is reached33

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Zero-rating case assessment• “Pure” ZR cases (assuming TM in line with the Regulation)• Overall assessment based on several criteria (BEREC NN Guidelines para 46)
1. Market position of the ISPs
2. Effects on CAPs / market position of the CAPs
3. Effects on end-users
4. The scale of the commercial practice
5. Eventually, circumvention of the goals of the Regulation• Some considerations related to the criteria
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Effects on end-users: Relative size of the data cap (smaller data caps)
Effects on CAPs: Exclusiveness of zero-rating (category of applications)

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Zero-rating case examples• Norwegian ZR cases 2017, Telenor and Telia “Music Freedom”• Nkom expressed concerns
1. the significant market position of the two ISPs in the national market
2. the CAPs included are relatively limited, and cover only larger well-known CAPs
3. the end-users’ choice is limited, relatively small data caps in proportion to the price4. the scale of zero-rating practices is increasing in the national market• Nkom overall assessment35

zero-rating practices still has a limited scale in the national market
at the time of assessment, no basis for issuing an order to take corrective action
follow up on zero-rating going forward, initiate corrective measures if necessary
if the zero-rating schemes in the market are not functioning as anticipated, especially if thescale increases significantly, Nkom is likely to have to reconsider the analysis

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Further reading• EU, 2015, Regulation 2015/2120 of the European Parliament and of the Council laying down
measures concerning open internet access• BEREC, 2016, Guidelines on the Implementation by National Regulators of EuropeanNet Neutrality Rules• Frode Sorensen, 2016, European Net Neutrality at the beginning of a new era(Annual Report of the UN IGF Dynamic Coalition on Net Neutrality)• BEREC, 2018, Opinion for the evaluation of the application of Regulation 2015/2120• BEREC, 2017, Report on IP interconnection practices in the context of NN• Nkom, 2017, Assessment of the zero-rating offer Telia «Music Freedom»• BEREC, 2012, Statement on ITR 2012 (covering among else SPNP)

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