'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”?

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Companies: consumer federation of america, netflix

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Comments on “'Consumer' Group Wants Netflix To Tax Customers To Give To Telcos?”

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Marcus Carab (profile) says:

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…

Chronno S. Trigger (profile) says:

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?

:Lobo Santo (profile) says:

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.


Not an electronic Rodent says:

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?

Anonymous Coward says:

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).

Havoc (profile) says:


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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