The FCC Ponders A Hugely Problematic Tax On WiFi
from the this-won't-end-well dept
For years, we’ve noted how telecom and media giants have been trying to force “big tech” to give them huge sums of money for no reason. The shaky logic usually involves claiming that “big tech” gets a “free ride” on telecom networks, something that’s never actually been true. This narrative has been bouncing around telecom policy circles for years, and recently bubbled up once again thanks to FCC Commissioner Brendan Carr.
Carr’s push basically involves parroting AT&T’s claim that big tech should be funding AT&T network upgrades. You’re to ignore the fact that giants like AT&T routinely take billions in tax breaks and subsidies for network upgrades that never arrive. This quest to punish “big tech” with unnecessary new surcharges is something that’s also supported by the National Association of Broadcasters, who have long hated companies like Microsoft’s efforts to use unlicensed spectrum from unused television channels (aka “white spaces”) to deliver new broadband options.
The FCC does desperately need to find more funding revenue to shore up programs like the Universal Service Fund (USF) and E-Rate, which help provide broadband access to schools and low income Americans. So it recently announced it would be considering a new tax on unlicensed spectrum. Pressured by NAB, the Biden FCC’s plan would assess regulatory fees on ?unlicensed spectrum users,? which would include users of Wi-Fi, Bluetooth and other consumer wireless devices. It’s a tax on tech, proposed by telecom and media companies that want to punish their ad and data collection competitors in tech.
Harold Feld, who probably knows more about wireless spectrum policy than anybody, has penned a helpful piece over at Forbes explaining why this is a terrible idea. He outlines that NAB’s real goal is to punish companies like Microsoft for daring to use spectrum the broadcast industry falsely believes belongs to them:
“The NAB has made it abundantly clear this is payback against tech companies ? particularly Microsoft. Broadcasters don?t just claim to own their individual channels. They claim to collectively own all ?broadcast spectrum.? About 10 years ago, the FCC authorized unlicensed access to unused television channels, aka ?TV white spaces.? Broadcasters vowed to strangle the new technology in its cradle rather than share ?their? spectrum and, unfortunately, were largely successful. But in recent years, Microsoft has tried to resurrect the TV white spaces as a way of bringing broadband to rural America.”
The FCC’s proposal may go nowhere. Interim (and soon permanent) FCC boss Jessica Rosenworcel may just be doing her due diligence, and opening the door to a conversation about various options to shore up dwindling FCC broadband program funding. But Harold makes it very clear the proposal, if adopted, would be hugely problematic and defeat the benefit of unlicensed spectrum:
“The idea that a tax on unlicensed spectrum would only hurt Microsoft or ?big tech? is absurd. The whole point of unlicensed spectrum is that it?s open for everyone to use. The effort by broadcasters to impose a Wi-Fi tax should be as laughably ridiculous as modem taxes and email taxes. But rather than simply deny the proposal, the FCC has put it out for public comment.”
While Harold’s correct that this particular push belongs to NAB, the broader push to hit “big tech” with various new FCC regulatory fees is something also being supported by telecom giants, and the regulators who love them. Both broadcasters and telecoms realize the FCC is desperate for new funding for low-income programs, and want to exploit that with efforts that predominately benefit themselves. For NAB, it’s punishing big tech for daring to innovate using spectrum it falsely thinks it owns. For AT&T, it’s forcing “big tech” to pay for network upgrades it routinely fails to finish despite billions in tax breaks, regulatory favors, and subsidies.