'Consumer' Group Wants Netflix To Tax Customers To Give To Telcos?

from the really? dept

This one's a bit bizarre. We were just talking about the ridiculous boondoggle called the Universal Service Fund, which is one of those "taxes" on your phone bill that's supposed to go towards having the big telcos supply service to rural areas. Of course, since there's no oversight, it seems like most of the money just goes into the telcos coffers. There are all sorts of ways to deal with this, but one idea that makes no sense at all has been put forth by the Consumer Federation of America... who thinks that Netflix should be "taxed" to provide money for the USF. Why? Um, that's not clear. Basically CFA seems to think that big internet companies should now pay up just because:
"The Internet is not an infant industry anymore. It can certainly bear the burden of making sure that wires and the communications mediums are there."
So, really, what this "consumer" group is suggesting is that Netflix raise its prices on consumers, to give telcos more money that they just use to pay for operations, rather than actually investing in infrastructure for the disconnected. How does that possibly help "consumers"?


Reader Comments (rss)

(Flattened / Threaded)

  1.  
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    Marcus Carab (profile), Feb 25th, 2011 @ 7:44am

    FTA: He stressed, however, that the FCC must address the mechanisms for distributing the money before it overhauls contributions. Tackling these questions simultaneously is a recipe for "political stalemate."

    "If we have [the contribution] debate at the same time we're doing distribution, I absolutely guarantee they won't have it done by the end of the year," he said.


    So they don't know what it's for, they don't know where it should come from, and they aren't prepared to put those two questions on the same table. Remind me again why this fund exists, FCC...

     

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  2.  
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    Chronno S. Trigger (profile), Feb 25th, 2011 @ 8:33am

    Well, this is epically stupid

    Taxing Netflix for the USF is like taxing my company for the USF because we use the phones for tech support and charge our clients for it. GE, Microsoft, HP, or Dell wouldn't go for it, why the hell should Netflix?

    I'm assuming that the CFA won't just stop at Netflix. Why would they, Youtube still uses more bandwidth then Netflix. Then we have all the other video sharing sites, and then the music sharing sites, then the program sharing sites. Why don't we just tax them all and say to hell with the consumer. They'd all be happier living in boxes on the street anyways, right?

     

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  3.  
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    :Lobo Santo (profile), Feb 25th, 2011 @ 8:40am

    Re: Well, this is epically stupid

    [sarc] (In the voice of the elite)
    Here's the way the world is supposed to work:
    1% of us are super wealthy and we're supposed to get anything we want at essentially no cost because we're entitled to it and just plain better than you.

    The rest of the schmucks on this planet better break their fucking backs 20 hours and day and 82.357% of every penny they earn makes it way to my pockets anyhow--not that I need it, it's simply that they do NOT need it.

    Now you know, you my cease being ignorant.
    [/sarc]

    ;-P

     

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  4.  
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    Anonymous Coward, Feb 25th, 2011 @ 8:40am

     

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  5.  
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    Not an electronic Rodent, Feb 25th, 2011 @ 8:49am

    Am I missing something?

    Are Netflix in some way exempt from the many other taxes the government levies on businesses?

    Aren't Netflix a service providor not a business that has anything to do with "wires"?

    If Netflix is just a service providor, doesn't that mean that iTunes, uTube etc would be equally liable for such a tax? Or are they already? What's special about NetFlix?

     

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  6.  
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    :Lobo Santo (profile), Feb 25th, 2011 @ 8:53am

    Re: Am I missing something?

    Netflix has money. Hence, they're a target.

    So does Google--who owns YouTube so it's very likely if this BS slips thru they'll attempt to apply it there as well.

     

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  7.  
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    Mike42 (profile), Feb 25th, 2011 @ 9:07am

    Re: Re: Well, this is epically stupid

     

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  8.  
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    Anonymous Coward, Feb 25th, 2011 @ 9:08am

    Re: Re: Well, this is epically stupid

    I almost clicked funny, but it's sad, scary and true.

     

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  9.  
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    A nonny mouse, Feb 25th, 2011 @ 9:10am

    A thought - is it just another version of the "waaah, they're making money on them internets! Pay us!" telco argument, only with the money going to "help the underserved" instead?

     

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  10.  
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    Anonymous Coward, Feb 25th, 2011 @ 9:18am

    Netflix already pays into the USF

    I do. Everyone with a phone bill pays into the USF.

    Oh, wait that's not what they mean? They want the USF to not be a flat tax, but to be a broadband usage based tax?

    That's all we need is for the IRS to suddenly be in charge of auditing our broadband usage (please retain records for three years please).

     

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  11.  
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    PRMan, Feb 25th, 2011 @ 9:22am

    Re: Re: Re: Well, this is epically stupid

    Wow. Great charts. They really put it into perspective. I had no idea it was that bad.

     

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  12.  
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    Chronno S. Trigger (profile), Feb 25th, 2011 @ 9:26am

    Re: Re: Re: Well, this is epically stupid

    Another reason for Dark Helmet's "Horrifying" button? (I can't remember if DH said that, or it was said in response to his comment)

     

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  13.  
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    Martin, Feb 25th, 2011 @ 9:29am

    Can the Telcos and Cablecos use the misappropriated rural fee money to pay Netflix subscription for all of their customers?

    Anyone would like to create Consumer Group for that purpose?

     

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  14.  
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    The Infamous Joe (profile), Feb 25th, 2011 @ 9:35am

    Re: Re: Re: Re: Well, this is epically stupid

    I had no idea it was that bad.

    Yeah, if you're American, the fourth graph already told us that. :P

     

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  15.  
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    Simon, Feb 25th, 2011 @ 9:51am

    Response?

    Dear Telcos

    Your customers are requesting an ever increasing amount of data from our servers. It is not cheap for us to run the hardware to fulfill these requests. Accordingly we will be requiring you to pay us a little extra cash to ensure your customers are served to a reasonable standard.

    Thanks a lot, love Netflix.

     

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  16.  
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    Havoc (profile), Feb 25th, 2011 @ 10:23am

    Cool!

    I can fix this. Netflix is now a service, $8 per month. Change it to a membership fee, $96 per year, free streaming. Not a service, but a club.
    Oh, and sue the FCC- for anything. It's 'Big Government', and that kind of thing will fly right now. We'll get Congressional panels and hearings and in the end, 5 years from now, it all just goes away because we've all forgotten.

     

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  17.  
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    Anonymous Coward, Feb 25th, 2011 @ 10:26am

    Sounds like an astroturfing campaign . Telcos want to handicap Netflix so they can push their poorly designed wares.

     

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  18.  
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    Jay (profile), Feb 25th, 2011 @ 10:46am

    Re:

    Hasn't the CRTC pissed off Canadians enough?

     

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  19.  
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    Mark Cooper, Feb 25th, 2011 @ 11:18am

    Let Him know...

    I think everyone should let Mr Cooper know what we think is his "wonderful" , new idea.

    Mark Cooper
    Consumer Federation of America
    mcooper@consumerfed.org
    301-384-2204

     

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  20.  
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    Ryan Diederich, Feb 25th, 2011 @ 11:26am

    What About Me

    But what about me????!!? I use the internet, shouldnt I be taxed for using it?

    What about my table? My laptop sits on the table and I use it for piracy. Shouldnt the table maker pay a tax to help fund anti-piracy efforts?

    What about asshats? Should asshats be able to tax everything on the planet until they are satisfied?

     

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  21.  
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    Dahovove, Feb 25th, 2011 @ 1:34pm

    Since you can access Netflix via the internet to view movies and tv shows this would be double taxation which I thought was illegal. You already pay this tax on your ISP bill. Please government take all my money and just tell me what I a can and can't have. Oh wait they are almost already doing that.

     

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  22.  
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    The Infamous Joe (profile), Feb 25th, 2011 @ 3:15pm

    Re:

    Do you pay income tax? Do you pay sales tax? Double tax!

    It's worth noting that one can use Netflix with the US Postal Serviceand a dvd player. Why did they get picked for the tax? (versus Hulu, or youtube?)

     

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  23.  
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    Anonymous Coward, Feb 25th, 2011 @ 4:30pm

    Goodbye good old USA

    It's clear the only thing coming out of America is lawsuits and stifling of consumer and human rights. What a frigging joke of a country.

     

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  24.  
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    Anonymous Coward, Feb 25th, 2011 @ 6:19pm

    Is it really fucking hard to understand that these "internet companies" pay for their internet bandwidth? Astroturfing ftw.

     

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  25.  
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    Anonymous Coward, Feb 25th, 2011 @ 7:02pm

    USF

    Having worked in a school district, I should mention that some of the funds from the USF goes to supporting the technology infrastructure in schools and libraries (servers, switches, routers, etc.).

     

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  26.  
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    Anonymous Coward, Feb 25th, 2011 @ 7:23pm

    Re: Re: Am I missing something?

    Well, Google has at least one thing for them, they are building their own physical network so they don't need to deal with that crap anymore, they even have transoceanic cables that they paid for.

     

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  27.  
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    Shine (profile), Oct 25th, 2011 @ 2:31am

    taxes

    Too much taxes! How can people cope?

     

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  28.  
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    Andrew, Dec 3rd, 2011 @ 6:15am

    Re: Re: Well, this is epically stupid

    I totally agree with you.

     

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  29.  
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    Joy, Jan 25th, 2012 @ 8:23pm

    The USF should be more transparent in how they are spending the funds generated.

     

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  30.  
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    Andrea, Feb 27th, 2012 @ 4:53am

    Are you talking about University of South Florida ?

     

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  31.  
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    Ann, Mar 30th, 2012 @ 10:11am

    USF is Universal Service Fund...I think they have this also in our electric bill.

     

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  32.  
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    Florinda, Apr 23rd, 2012 @ 9:24pm

    With taxes being raised on products or services, it's the consumers/users that get affected anyway since they usually will have to pay more now coz of tax increase.

     

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