Internet Fragmentation > Brazil’s Cost-Sharing Proposal

Cost-Sharing Models Undermine the Global Internet

Region: Latin America and Caribbean
Threat type: Regulating Business Relationships
Last updated: 1 December 2023

Brazil is considering cost-sharing between telecom and Internet services. What’s at stake?

The Brazilian regulator, ANATEL, opened a public consultation in 2023, which included open-ended questions on the topic of ‘cost-sharing’ (also known as ‘fair-share’, ‘sender-pays’, and ‘network usage fee’ in other regions). It requested feedback on the impact this proposal could have on Brazilian businesses and Internet users.

This model would regulate fees around network usage and connections between networks. The argument is that some networks or services send disproportionate amounts of data traffic and should therefore pay more to network operators.

Big telecom operators in Brazil have proposed this model for the Brazilian market. They want to charge ‘tolls’ for traffic, and they argue that it would counteract the impact of large Internet platforms. Because it uses the language of ‘fairness’ and ‘sharing’ it can sound like a positive move. But in reality, it would only benefit large telecommunications operators, and damage the entire Internet landscape.

Internet users already pay a fee to our Internet service providers when we subscribe to our access plans, and we also pay service and content providers, for what we want to watch, read, listen to, or consume.

Adding such ‘tolls’ would fundamentally fragment the Internet and make it more expensive for companies to actually deliver those services to users–and these costs would ultimately be passed on to users who already pay for Internet access and using services. Users might have less access to these services, if companies stopped providing them, or if they became too unaffordable.

End users would no longer enjoy the open, global, and seamless Internet, and we would transition into a reality where access is even more limited by cost.

It also undermines the Brazilian Civil Rights Framework for the Internet, which sets network neutrality as the standard. The Framework includes regulations around access and usage, which stipulate that data flows remain unaltered and are equitable across the Internet.

Large telecom providers have advocated for policies like this for many years. A similar policy has been introduced in South Korea, and has led to increased traffic costs there. It has also been proposed in the EU, and there are rumblings in India too. In each case, the only proponents of the policy have been large telecom providers. Everyone else–including governments and regulatory bodies–stands against it.


Brazilian regulator ANATEL opened a consultation that ran until July 2023. This consultation looked for submissions from all interested stakeholders, and did not have any concrete proposals. There were open-ended questions relating to cost-sharing, and the possible benefits for Brazilian companies and users.

ANATEL has publicly stated an intention to open a focused public consultation with a concrete proposal for cost-sharing in Brazil in 2024.

Our Position

The Internet Society is supporting our Brazil Chapter, which has created a campaign to oppose this policy. It aims to create public awareness and encourages a broad range of stakeholders to communicate with others—including ANATEL—on this issue.

The Internet Society conducted an Internet Impact Brief on the Sender Pays policies in South Korea, where key risks and negative outcomes were identified. This brief has been our most used document on this issue across the world. We believe such policies are a clear example of how the Internet can fragment. And though they can be read on the surface as ways to hold large platforms accountable, they are actually some of the most pressing threats to the Internet and will negatively impact users.

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Talking Points

  • It is users, not services, which ‘generate’ traffic. When we pick a video or film to play on a platform, we demand that data. That data is traffic that is generated by and paid for by the user by way of their access fee to the ISP.
  • Supporters of this model argue that streaming services create a high volume of traffic online. But streaming services have sparked substantial innovation, including development of infrastructure like content delivery networks (CDNs). These services facilitate delivery of content to your home or device, provide a superior user experience, and reduce latency. These types of innovations would be severely limited if the cost-sharing model is implemented.
  • Larger companies are usually in a better position to absorb higher costs, and in fact, could use it to consolidate their advantage. Smaller and newer entrants to the market would face higher operating costs, which would make it harder to compete.
  • These rules break network neutrality, which is enshrined in the Brazilian Civil Rights Framework. The relationship between traffic and network costs is about capacity, not about traffic volumes. Shifting to a traffic volume model would harm access to the Internet for those who need it most.