An article of the Financial Times on the 9th of April reveals that some of Europe’s leading telecoms groups, Telefonica, France Telecom and Deutsche Telekom claim that Google has to start paying them for the use of their infrastructure for the Google’s services, mainly for Youtube. The high bandwidth needed for services like Youtube makes the telecommunication companies invest more and more money in upgrading their infrastructures, without offering them the profits needed in order to cover the expenses for the upgrades. A return in the investments they make is vital for their growth and success, so the sharing of Google’s online advertising revenue with the telecoms groups seems to be the solution to the problem. At least that is what the telecommunications companies ask Google to do.
I have posted on this blog the problem the Mobile Services companies faced in the UK by the wide use of smartphones which increased the need of higher capacity in central London. There was another case which came out the last days, according to which the services provided through the infrastructure influenced the infrastructure itself. At&T will upgrade its network in order to cope with the new iPhone device coming out in summer 2010 (this investment is mainly done because Verisson Wireless is going to give the iPhone devices in the US market from summer onwards).
The three aforementioned cases may not seem connected to each other, their common characteristic though is the connection between the services provided though the infrastructure, and the investments done for the infrastructure in order to cope with the services provided. The Google/telecoms groups case adds another constrain to that connection, where the company offering services over an infrastructure (usually adding value to the infrastructure for the users to use it) may has to give part of its revenue to the company owning the infrastructure.