Virgin Media O2 pushes for weaker net neutrality rules on mobile networks

Virgin Media O2 is calling for the UK's net neutrality rules to be reformed for mobile networks, arguing the requirement to treat all traffic equally is outdated and holding back investment in mobile infrastructure.

The operator has commissioned a report which claims that the rules are now having a negative impact on investment, and that reforming them would be worth hundreds of millions of pounds a year to the UK economy. Part of its case is that networks are increasingly constrained as AI agents begin using up capacity on their own.

Net neutrality is the principle that networks should not distinguish between different content providers, so that subscribers get the fastest access to whatever content they want rather than only fast access to content from companies that have paid the provider. Under the current framework, ISPs are required to treat all network traffic equally.

What Virgin Media O2 is arguing for

Rather than repeating the "sender pays" arguments that European operators have made in earlier years, the examples put forward focus on specific mobile use cases. Among them are payment apps for sole traders and market or festival vendors, so that card transactions still go through when a cell site is busy.

The underlying position is that prioritising certain traffic on congested mobile networks would deliver better outcomes, and that the current rules stand in the way.

A long-running position

Virgin Media's opposition to net neutrality is not new. In December 2010, the company's then chief executive Neil Berkett restated his opposition to the idea in an interview on BBC Radio 4's Media Show, saying that making ISPs treat all network traffic equally would be "wrong".

Berkett said his view had not changed since a 2008 interview in which he described net neutrality as "a load of bollocks". "It hasn't changed," he told the programme. "I think we need to come back to the position and say how do we go about funding the internet in the UK? And we do it by having a highly, highly competitive market where our prices for the internet are something like half the prices in the US."

He added: "Restricting potential investment by the internet service providers by putting a regime such as net neutrality in place I think is the wrong thing. Having said that, whatever you do in this space must be completely transparent."

That 2010 intervention came in the same week that executives from Skype, Yahoo!, eBay, the BBC and the National Union of Journalists wrote to the then minister for culture, communications and creative industries, Ed Vaizey, urging him to protect net neutrality principles. Their letter welcomed Vaizey's statement that the government supported access to the open internet, and backed the openness principle for both fixed and mobile access, whereby "consumers should always have the ability to access any legal content or service" and "content and service providers should have the ability to innovate and reach end users".

The signatories argued that end-users' choice of applications, content and services was "already restricted in the UK today, especially when accessing the Internet on mobile", and called for action to remove what they described as arbitrary restrictions.

At the time, a Virgin Media spokesman drew a distinction between technical traffic management and discriminating between content based on who produced it. "There are no plans to do the latter," he said. All ISPs routinely engage in traffic shaping or traffic management to ensure limited capacity is shared fairly between users, a practice net neutrality campaigners do not usually object to.

The competition concern

Critics see the reform push as the familiar argument from dominant market players who want to charge multiple parties for services where they cannot generate enough margin from their retail customers. Rather than raising retail prices and risking customer losses, such operators would strike deals with content providers to pay for a fast lane, while the performance of competing services was allowed to degrade.

That approach is seen as favouring larger content providers, who can use their negotiating power to hold back new competitors that would struggle to strike the same deals and establish alternative services.