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Vodafone and Deutsche Telekom's all-you-can-watch deals violate EU rules -court

Stock MarketsSep 02, 2021 10:41AM ET
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2/2 © Reuters. FILE PHOTO: The Vodafone logo can be seen on top of a building outside Madrid, Spain, April 13, 2016. REUTERS/Andrea Comas 2/2

By Douglas Busvine

BERLIN (Reuters) -All-you-can-watch video products offered by Vodafone (NASDAQ:VOD) and Deutsche Telekom (OTC:DTEGY) in Germany violated regional rules on roaming and net neutrality, the European Union's highest court ruled on Thursday.

The landmark ruling targeted popular mobile products such as Deutsche Telekom's StreamOn deal, which offered unlimited data for watching video while customers were in Germany but slowed transmission speeds when they went abroad.

Germany's BNetzA network regulator ordered https://www.reuters.com/article/us-deutsche-telekom-regulator-idUKKBN1E91VM Deutsche Telekom in 2018 to offer such products on the same terms throughout the EU, triggering a court battle. Germany's VZBV consumer association objected to a copycat product launched by Vodafone.

Zero-tariff options "are contrary to the regulation on open internet access," the European Court of Justice said in a two-page ruling made after two German courts hearing the cases against Vodafone and Deutsche Telekom https://www.reuters.com/article/deutsche-telekom-regulator-idCNL8N24G2WX sought its opinion.

"It follows that limitations on bandwidth, tethering or on use when roaming ... are also incompatible with EU law."

In response, Deutsche Telekom said it had already adjusted StreamOn to remove throttling, meaning no changes were needed as a result of the European court ruling. The German regulator said, however, that such products could not stand even in their amended form.

EU rules require mobile operators to allow customers to "roam like at home" and to pay the same tariffs regardless of where they are located. Net neutrality bars the throttling of data speeds depending on location.

Operators counter that such rules, if applied across the EU, would encourage people from outside Germany to sign up as customers there to take advantage of unlimited video products, forcing up costs and straining networks.

Deutsche Telekom said that StreamOn no longer featured data throttling. "In this respect, StreamOn will not change," it said in a statement.

The BNetzA said, however, that decisions by the German courts went beyond its own initial order.

"It is therefore to be expected that the products amended in 2019 based on the BNetzA directive cannot be maintained in their current form," it said.

VZBV, which had challenged the Vodafone Pass product, said the ruling "sets an example for net neutrality" and was a "victory" for consumer protection.

"In their current form, zero-rating products like the Vodafone Pass have nothing to do with free internet for all consumers," it said.

Vodafone said it would review the ruling and adjust its products accordingly. "In the interest of customers, Vodafone carefully designs its tariffs in accordance with the EU net-neutrality and roaming regulation," it said in a statement.

Vodafone and Deutsche Telekom's all-you-can-watch deals violate EU rules -court
 

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