French Minister Thinks Netflix Needs To Pay ISPs A 'Bandwidth Tax' To 'Level The Playing Field'

from the ain't-gonna-ride-our-pipes-for-free dept

If you've followed the net neutrality discussion here in the U.S. since the beginning, you'll recall the debate began in earnest back in 2005 when then AT&T CEO Ed Whitacre declared that Google should pay an extra, arbitrary toll simply for using the AT&T network. By Whitacre's government-pampered, duopolist logic, any content company that so much as touches an ISP's network should pay a levy to offset infrastructure costs -- well -- just because. Soon, a seemingly endless array of hired telco flacks started telling anybody who'd listen that content companies were getting a "free ride" and really needed to start paying their "fair share."

As we've repeatedly explained (perhaps unnecessarily if you have anything resembling critical thinking skills), this reasoning is incoherent and stupid, since customers and content companies alike already pay plenty for bandwidth and infrastructure. Still, somehow Whitacre's absurd attempt to try and offload network operation costs to others went viral globally, and we've repeatedly seen overseas telcos trying to argue the same point ever since. Of course, whereas Google used to be the global telco whipping boy, we're increasingly seeing Netflix playing that role given its more vocal support of net neutrality.

It's the painfully dumb idea that just won't die. French Minister of Culture and Communication Fleur Pellerin has spent the last few years with an incumbent telco bug in her ear, demanding that she force Google, Netflix and other content companies to pay some kind of a "bandwidth tax." As we've seen here in the States, Google appeared willing to (at least temporarily) go mute on net neutrality, and as Glyn has noted previously, Google France appeared willing to trample neutrality principles, allowing some degree of ISP double dipping to protect mobile handset market share.

Apparently feeling encouraged, Pellerin has ramped up her efforts for this new content company tax in order to "level the playing field" for French TV and filmmakers (read: incumbent French phone company Orange):
"France's culture minister is as keen as ever to tax tech behemoths to "level the playing field" for French TV and filmmakers. According to news reports, Fleur Pellerin plans to introduce a new tax on "the use of bandwidth", although exactly how this will be calculated is not clear...In January, the minister said she wanted a "level playing field "for French broadcasters alongside the likes of Netflix. The news was welcomed by some ISPs who want to offer so-called specialised services – basically incorporating lots more speed and bandwidth."
As a general rule of thumb, I've found that almost anytime somebody claims to be interested in "leveling the playing field," they're usually busy trying to do the exact opposite. There's still no details on precisely how Pellerin's plan would work, but it's likely going to run face-first into the EU's looming net neutrality rules, which, if they're worth anything, will at the very least ban these kinds of ridiculous "troll tolls." Here in the States, most phone companies have been forced to shift their attention from ham-fisted troll tolls to more subtle, clever ways of abusing market power, whether that's interconnection, usage caps or zero rated apps.

Still, Ed Whitacre's viral meme that phone companies have the inherent, god-given right to double or triple dip is the gift that just keeps on giving.

Filed Under: broadband, broadband tax, double dip, fleur pellerin, france, google tax, net neutrality, netflix tax
Companies: google, netflix, orange


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  • icon
    That One Guy (profile), 19 Feb 2015 @ 4:58am

    If they don't want your product, make 'em pay for it anyway

    If the french broadcasters are losing viewers to services such as Netflix, then the proper response is to offer better shows and deals.

    Going the legal, 'force the competition to pay us' route is them basically admitting that they either don't care to compete, or know that they couldn't, and feel like buying the laws such that they don't have to.

    reply to this | link to this | view in chronology ]

    • icon
      Ninja (profile), 19 Feb 2015 @ 5:16am

      Re: If they don't want your product, make 'em pay for it anyway

      Many people upgraded their connections because of Netflix so maybe the ISPs want to pay a tax to thank Netflix too?

      Also, Netflix couls agree to the demands as long as the ISPs offer speeds that will allow at least 4 devices to watch 4k content in a single household simultaneously. This will guarantee such tax will only be paid in the next millennium.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 19 Feb 2015 @ 6:43am

        Re: Re: If they don't want your product, make 'em pay for it anyway

        Make it ten, and then maybe Netflix should consider it.

        reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Feb 2015 @ 7:42am

      Re: If they don't want your product, make 'em pay for it anyway

      Wasn't not long ago that the content mafia wanted the ISP to pay them a percentage or tax, as they (the content providers) said the only reason people were on the internet was their 'product'.

      Now the ISP want the content providers to pay them to allow their (the ISP) customers access to the providers content( well competitors content)

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Feb 2015 @ 8:35am

      Re: If they don't want your product, make 'em pay for it anyway

      If the french broadcasters are losing viewers to services such as Netflix, then the proper response is to offer better shows and deals.

      That would require them to offer video on demand, and commit fully to an Internet based business model.

      reply to this | link to this | view in chronology ]

  • icon
    Ninja (profile), 19 Feb 2015 @ 5:12am

    In another news, French Minister thinks car makers need to pay road operators to level the playing field. Fast lanes for Renault, now!

    reply to this | link to this | view in chronology ]

    • identicon
      Zonker, 19 Feb 2015 @ 1:28pm

      Re:

      There are entirely too many Ford F-Series pickup trucks on the road congesting traffic. We need to make Ford pay a "traffic tax" to level the playing field for Chevrolet to be able to put more Avalanche series trucks on the road.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 6:14am

    you need to remember how the UK has been totally ignoring EU laws and rules, so i bet France will do the same. the problem is there are no punishments in force for such situations. if a country wants to ignore the rules, they will. what i dont understand is if you are in the club, in this case, the EU, how can you not play by the rules? if you want to ignore those rules, running on your own all the time, why be in the club? as for Google, it was prepared to pull out of a country, was it Spain, rather than do what that government was trying. it may be the option here for Netflix and others to take

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 6:28am

    This seems counter-intuitive. Surely a tax on bandwidth would only be payable by big earners like Netflix? If a smaller start-up service suddenly found themselves using Netflix-level amounts of bandwidth, but didn't have the Netflix-level income to support paying this proposed tax, they'd be forced out of business by it

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 6:30am

    French minister is either severely misinformed or someone is intentionally misleading him.

    reply to this | link to this | view in chronology ]

  • identicon
    Baron von Robber, 19 Feb 2015 @ 6:48am

    If ISPs need to be paid by Netflix, Google for usage, then wtf am I paying the same ISPs for?!

    reply to this | link to this | view in chronology ]

    • identicon
      David, 19 Feb 2015 @ 6:51am

      Re:

      For your mail server. Try getting your movies by mail, and you'll make use of your bandwidth.

      reply to this | link to this | view in chronology ]

      • identicon
        Baron von Robber, 19 Feb 2015 @ 7:27am

        Re: Re:

        I already get my Netflix by mail, ergo I don't stream. Netflix is getting ripped off. They are paying ISPs even though I don't stream. Looks like the ISPs owe Netflix some money.

        reply to this | link to this | view in chronology ]

    • icon
      Ninja (profile), 19 Feb 2015 @ 7:11am

      Re:

      Good question. Why are they (Netflix) paying for their own bandwidth consumption too boggles the mind with that reasoning.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 19 Feb 2015 @ 7:34am

        Re: Re:

        Well, it makes sense that Netflix would be paying their own ISP. They do need to be connected to the internet to upload stuff in the first place.

        The problem is that a bunch of the other ISPs are demanding that Netflix pay them as well, even though Netflix otherwise has no direct dealings with them. When their demands went unmet, they started playing games with network interconnections to force Netflix to have direct dealings with them. In effect, demanding that Netflix use multiple ISPs to deliver content that only one ISP should be required to send.

        reply to this | link to this | view in chronology ]

        • icon
          Ninja (profile), 19 Feb 2015 @ 9:02am

          Re: Re: Re:

          That's what I mean. If they are already paying for their connections then this shit already makes no sense (except for bought, corrupt politicians of course). If they are going to pay for the privilege of using a connection then they shouldn't pay further. I wonder if the ISPs would like to handle Netflix bw costs...

          reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 6:49am

    Would he like this too?

    Wonder if he would also like paying for his and the recipients phone bill every time he places a phone call?

    Thats essentially what he is advocating.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 6:58am

    Basically anything the government says needs to be done for the internet to thrive, the exact opposite is true.

    Content companies need to pay ISPs to deliver content to paying customers.
    Communications should not be encrypted or should contain backdoors into the encryption.
    Content needs to be censored and removed.

    reply to this | link to this | view in chronology ]

  • icon
    Richard (profile), 19 Feb 2015 @ 6:58am

    Twisted

    As so often there is a half truth in there - but it is twisted.

    The way the logic could work is this:

    People get Netflix but find that their connection is too slow to use it properly. Netflix then decides that it is in their interest to pay the ISP a subsidy to upgrade the connection to make their service viable for more people.

    There is nothing wrong with that scenario - since it is entirely voluntary and both Netflix and the customer will gain from the deal.

    Superficially it resembles what is proposed here but it is not the same.

    reply to this | link to this | view in chronology ]

    • identicon
      jackn, 19 Feb 2015 @ 10:19am

      Re: Twisted

      That logic wont hunt because netflix and the customer are already paying.

      Here is your logic with another take.

      I pay for my phone service, and you pay for your phone service, but I can't call you unless one of us pays more.

      reply to this | link to this | view in chronology ]

      • identicon
        David, 19 Feb 2015 @ 1:04pm

        Re: Re: Twisted

        I pay for my phone service, and you pay for your phone service, but I can't call you unless one of us pays more.

        Well, the basic rate is already for the busy signal. After all, it can be used for tuning a piano. And if you take a look at the hourly rates of professional piano tuners, it is a steal.

        reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 7:01am

    I don't have an ISP because I like the company but because I want to see cat pictures. Without those pictures I don't need an ISP so maybe the ISPs should pay the people who put up the pictures and not the other way around.

    Note to self: create huge content provider just to send a bill to ISPs

    reply to this | link to this | view in chronology ]

  • icon
    Padpaw (profile), 19 Feb 2015 @ 7:04am

    should be some sort of law against office holders accepting bribes

    reply to this | link to this | view in chronology ]

  • identicon
    Bengie, 19 Feb 2015 @ 7:08am

    derp

    Company A is doing too well and other companies have not figured out how to compete. I know, lets create a new tax that negatively affects Company A's bottom line and hope it somehow encourages other companies.

    Analogy.

    Toyota is doing too well, so lets create a gas tax and that will somehow encourage people to purchase Fords!

    What kind of retarded logic is that? Seriously, how can these people not be mouth breathers?

    I only see one of two extremes. 1) Incredibly stupid 2) Incredibly corrupt

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Feb 2015 @ 7:16am

      Re: derp

      I only see one of two extremes.
      1) Incredibly stupid
      2) Incredibly corrupt

      Has to be number 1, never attribute to malice that which is adequately explained by stupidity.

      reply to this | link to this | view in chronology ]

    • icon
      PaulT (profile), 19 Feb 2015 @ 7:48am

      Re: derp

      Why not both options?

      Seriously though, that analogy is flawed. As suggested above, this is more like introducing extra costs for all non-French cars and allowing French cars to use a different, faster lane. Without making sure that the French cars are as good, as reliable, as full-featured as the other cars, of course, and then hoping people merely decide to buy Francais rather than going elsewhere.

      As with most of these kinds of things, it's as much about control as it is profit. The French are notoriously nationalistic and protectionist about its language and culture. So, not only do they have the usual dimwittedness and lack of foresight when it comes to adapting to the new media age, they can't bear the thought of a non-French company reaping the rewards that they've failed to deliver.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 7:26am

    If France blocks Netflix, then French users can merely use a VPN to bypass it. I can see now why Netflix is reluctant to ban VPNs.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 7:36am

    one baby step away from general internet tax revenue

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 7:36am

    According to news reports, Fleur Pellerin plans to introduce a new tax on "the use of bandwidth",

    What about digital TV over the same cables as the Internet, will that be charged as well, after all it is competing with Netflix for the use of the total bandwidth of cable distribution systems, but has an advantage that the bandwidth is reserved.

    reply to this | link to this | view in chronology ]

    • icon
      PaulT (profile), 19 Feb 2015 @ 7:50am

      Re:

      That's kind of the point of this whole thing. Is the digital TV provided by a French company? If so, it's exempt. Everyone else pays an extra fee. That's what these fools think is "levelling the playing field".

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 7:49am

    How does leveling the playing field make any sense when google isn't competing against the ISPs in any way?

    reply to this | link to this | view in chronology ]

    • icon
      PaulT (profile), 19 Feb 2015 @ 7:56am

      Re:

      According to the linked article, they're not playing fair because they're located elsewhere and therefore the French government aren't reaping the full tax rewards of that tasty ad revenue.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 8:05am

    Their motive here is simply to hamstring the foreign company under the guise of regulation.

    This, of course, is why investor-state dispute language in treaties exists in the first place. Not that such treaties are good. But now you see why they exist.

    reply to this | link to this | view in chronology ]

  • identicon
    DigDug, 19 Feb 2015 @ 8:20am

    In other news...

    Netflix turns off all direct feeds to anyone with an IP address geographically located in France.

    e-mails sent to instruct customers how to use a proxy service outside of France to get access to the feeds.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 8:30am

    Meanwhile at the cycling race

    "IT'S NOT FAIR! He is only winning because he bought a newer bike... with gears and everything. I use my grandma's 50 year old bike, but I demand a part of the prize in order to compete!"

    reply to this | link to this | view in chronology ]

  • icon
    John Fenderson (profile), 19 Feb 2015 @ 8:44am

    Level, huh?

    The playing field is already as level as is reasonable to expect: Netflix and the people who use Netflix are paying for the bandwidth they use, just like everyone else.

    Apparently, the French minister is using an odd definition of "level" that means "tilted toward French companies".

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Feb 2015 @ 8:56am

      Re: Level, huh?

      Or maybe she means "level" as in "level a building". The playing field will be "leveled" and nobody will be able to play there.

      reply to this | link to this | view in chronology ]

      • identicon
        Nyarlathotep, 19 Feb 2015 @ 9:45am

        Re: Re: Level, huh?

        Some entity should "raze" some French media providers...uh...that really was a bad pun and makes no sense...oh well, screw it.

        reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 19 Feb 2015 @ 9:46am

        Re: Re: Level, huh?

        no they mean 'level' as in the political definition: "Tilted so as much cash as possible ends up in the politicians pockets."

        or in this case maybe the tax revenues

        reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Feb 2015 @ 10:30am

    Doesn't this translate to French Minister thinks Netflix should be burdened with fees that will likely result in a Netflix blackout in France. That sounds great for culture.

    reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 19 Feb 2015 @ 12:17pm

    lETS CHECK SOMETHING

    IF a company does not THINK a service is worth it...
    Turn it off..
    Then see how many people Complain.

    IF Netflix is taking up so much bandwidth, then it must be a service people WANT.
    Cut netflix, and watch people QUIT your service.

    reply to this | link to this | view in chronology ]

  • identicon
    Rudyard Holmbast, 19 Feb 2015 @ 12:35pm

    What the French GOVERNMENT minister said is so fucking crazy, the French need an unelected government commission to "remedy" the "problem" by usurping legislative authority and issuing decrees it has no statutory power to promulgate. Because, as we all know, once such a precedent is set, unelected government bureaucrats never take it as a license to do whatever the hell they want. Plus, if there is anything governments are known for it is their almost supernatural power to foster both innovation and entrepreneurship while, at the same time, being acutely aware of how much regulation stifles both.


    And if these unelected bureaucrats are called out for their power grab, they can enlist the aid of like-minded tech bloggers, and their comment section sycophants, who can then claim anyone, whether they be libertarian pundits, conservative politicians, small business owners, government commissioners or other tech bloggers, voicing opposition to this bureaucratic overreach is necessarily acting in bad faith and therefore must be in the back pocket of Verizon's CEO. And if that isn't enough, these bloggers can behave as if they have more practical knowledge than people who have run tech businesses, large or small, since before these bloggers were in diapers. Of course this would also mean they would pretend they have more insider knowledge of a commission's intent, motives, and actions than someone who actually sits on that commission.



    And, if all else fails, these bloggers, who are often skeptical of bureaucratic overreach, unless it furthers their political goals, can use a two-pronged strategy whereby everyone deludes himself into believing that a comedian on cable television is an unimpeachable expert on the topic, while also pushing favorably-worded polls supposedly demonstrating support for this overreach coming from both conservatives and "progressives"(evidently they are too fucking awesome to be referred to as "liberal"). This strategy would naturally require ignoring any and all polls that would bolster the opposite conclusion.

    reply to this | link to this | view in chronology ]


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