Telecom, Broadcasters Convince FCC To Explore New Taxes On 'Big Tech'

from the this-probably-won't-go-well dept

Earlier this year, we noted how FCC Commissioner Brendan Carr had launched a bad faith effort suggesting that “big tech” gets a “free ride” on the internet, and should be forced to fund broadband expansion. Carr’s argument, that companies like Google and Netflix somehow get a free ride (they don’t) and should “pay their fair share,” is a fifteen year old AT&T lobbyist talking point. AT&T’s goal has always been to “double dip”; as in not only get paid for bandwidth by consumers and businesses, but to get an additional troll toll simply for, well, existing.

AT&T has long tried to offload its (often neglected or half-completed) network build and maintenance costs to somebody else to make investors happy. That somebody else is usually taxpayers, who’ve thrown billions in pointless tax breaks and dubious regulatory favors at the company in exchange for fiber networks that are always (so mysteriously!) left half completed and jobs that never arrive. Now AT&T (and their broadcaster allies) want tech giants to pay as well.

Over at the right wing Washington Examiner, you can see how this effort is framed in order to sell it to the public and regulators:

“The Federal Communications Commission is looking to hit Big Tech companies with new regulatory fees related to their high use of broadband facilitated by the agency ? a sign of Washington’s growing skepticism of Silicon Valley wealth and power.”

You’re given no indication that this is a telecom (AT&T) or broadcasting (the National Association of Broadcasters) bad faith political play. Carr (read: AT&T’s policy folks) had originally suggested in a carefully seeded editorial that tech companies should be forced to pay into the Universal Service Fund, which helps fund broadband expansion to schools and low-income communities. Now, Carr’s argument has also been piggybacked onto by broadcasters, who want tech companies to pay a tax simply to use unlicensed spectrum (like Wi-Fi hardware). Fortunately, the Examiner at least includes experts who point out the idea is stupid:

“Unlicensed spectrum was first established by the commission in 1985, and allows the general public to freely use, without a license, services such as Wi-Fi networks, Bluetooth waves, garage door openers, and other wireless technologies.

?The FCC is asking the public if we think fees on unlicensed spectrum is a good idea or not,? said Harold Feld, a telecom policy expert and lawyer at the consumer advocacy group Public Knowledge. ?And I?m here to say it?s a bad idea. In the spirit of Halloween, I plan to take a chainsaw to it.”

So I think the FCC is considering this route because it’s true the USF needs more money if we’re going to help make sure low-income kids and schools have decent connectivity. The problem is that the FCC’s proposal is written in such a way that it sounds like you could potentially be seeing annoying new taxes on Wi-Fi networks, Bluetooth devices, garage door openers, and more. The other problem is the core motivation here is by telecom and broadcast companies who simply want to offload their costs to somebody else. If they’re the ones writing the proposal (and it sounds like they are), the end product isn’t going to be particularly balanced or productive.

But to me the bigger problem is that if we’re genuinely interested in shoring up broadband funding and expanding access, we should first be targeting the billions upon billions in tax breaks, regulator favors, merger approvals, and other perks we give to telecom and broadcast giants (in Comcast and AT&T’s case one in the same) in exchange for jack shit. The idea that we waste billions by throwing it mindlessly at regional monopolies seems like a good place to start if you’re serious about reform. But please take a moment to notice that this idea never gets mentioned by folks like Carr. That’s fairly telling.

Nothing gets fixed in U.S. broadband (especially affordability and access issues) without addressing regional monopolization and the state and federal corruption that protects it. But not only do we not do that, if you watch regulators and lawmakers on both sides of the aisle, they can barely even candidly acknowledge it’s even a problem. As a baseline (and it has been the baseline for 30 straight years) that’s not a great recipe for success.

Filed Under: , , , , , , , , , ,
Companies: at&t, facebook, google

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Comments on “Telecom, Broadcasters Convince FCC To Explore New Taxes On 'Big Tech'”

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20 Comments
Anonymous Coward says:

It’s simple big telecom att etc make big donations to Politicans in return they keep their billion dollar tax breaks regional monopolys lack of competition they divide up certain regions so the public has maybe the choice of cable or broadband providers
It’s obscene that someone is even thinking of charging a fee for WiFi devices
And many areas have no fast broadband at all millions of americans only use phones to acess the Internet
The fcc needs to bring back net neutrality and
Make municipal local networks legal in all states
America is falling behind other country’s in average broadband speed in a time when Web acess is needed for a schools students work from home
Etc
I see no sign of any improvement of in the situation unless the government forces changes to allow more competition in the marketplace

That Anonymous Coward (profile) says:

Imagine how much more awesome out networks could be if instead of bribing Congress (yes it is bribery no ifs/ands/buts) they put that money into actually maintaining their product.

Parking lot owners demand a special surtax on car makers because they are getting a free ride to park cars in their lots… that the drivers already paid for.

Anonymous Coward says:

Easy way to stop telecom tax breaks

Condition them on
a) fixed goals
b) an equity stake (in voting stock) in the company that accepts, to an amount equal to half the value of the tax break/subsidy, which the company can buy back from profits over the next x years
c) a penalty clause where the company forfeits twice the previous equity stake on failure to meet the fixed goals, which the company cannot buy back.

Watch the lot of them go "Nope!"

ECA (profile) says:

Re: Easy way to stop telecom tax breaks

For all the money Given to them,
A Owners share of stock, In the corp/company we are favoring.

Some odd reasoning, long ago the gov. gave away rights to Utilities to private concerns. Lets base this on the Gov. Taking back controls with Stocks, AND specific dividends amounts. 1-10% per year, Even if its just More stocks. AND the corp can buy them BACK with interest.

That One Guy (profile) says:

Re: Easy way to stop telecom tax breaks

Alternatively stop giving them tax breaks or subsidies and start offering refunds, where if they build out a certain amount then they can file to get a portion of their money back with each ‘refund’ conditional on previous goals being met. No build out would mean no refund so if they don’t do the work they don’t get anything.

ECA (profile) says:

Love Total contrib. for State elections

https://www.followthemoney.org/

Seems interesting the amounts of money given to state and fed.
Billions.
But whose pocket is this from? In the end its Not the corp paying anything, they just raise the prices WE have to pay.

For all the money in payoffs, wouldnt it be cheaper Just to STOP and let this all balance out.
Take consumer money, pay the Politicians, then get it back out of fed/state Funds that the Consumer/citizen pays. LETS JUST over tax the politicians. At least let them Pay for the Benefits and lunches they write off.

That One Guy (profile) says:

'If we don't get ALL the money we're being robbed!'

AT&T’s goal has always been to "double dip"; as in not only get paid for bandwidth by consumers and businesses, but to get an additional troll toll simply for, well, existing.

Not double, triple.

The customers are paying them for access to a particular piece of content, the tech companies are paying them for providing that content, what they want is to get paid a third time for moving the exact same content.

As always anyone pulling the ‘tech companies are getting a free ride’ argument needs to be told to put up or shut up. Either pay the internet bills of one of those tech companies for a week and provide the documentation showing that they did or admit that it’s a dishonest argument and shut up, with any attempts to dodge treated as an admission that they know they’re making a dishonest argument but are too cowardly to admit it.

PaulT (profile) says:

Re: Re:

I’ve often said, the whole "big tech" label is just idiotic anyway, a clear attempt to scaremonger by trying to use the same tactics as referring to "big oil", "big pharma", etc. If your definition of "big tech" only includes a handful of websites, but doesn’t include the massive telecommunications, hardware and other gigantic companies that revolve around tech – many of which are required to operate for those websites to exist in the first place – you’re not making an honest argument.

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