AT&T Gets Loyal Lawmakers To Push A Broadband Tax For 'Big Tech'

from the you're-not-helping dept

Hoping to capitalize on legitimate animosity against "big tech," AT&T lobbyists and policy makers have been busy recirculating a fifteen-year-old talking point. Namely, that big tech companies should throw billions of dollars at big telecom companies to subsidize their broadband deployments. The argument that AT&T has been pushing since 2004 or so is that since big tech companies get a "free ride" on telecom networks (which has never been true), they should pay telecom giants billions of additional dollars... just because.

The argument never made any coherent sense. Tech giants like Netflix and Google pay not only billions of dollars for bandwidth, they also spend billions of additional dollars on cloud, transit, undersea cable, CDN, and other broadband infrastructure. U.S. consumers and businesses alike also pay an arm and a leg for bandwidth courtesy of limited competition. When it comes to U.S. telecom, nobody gets a free ride.

Telecom giants like AT&T also invest billions of dollars in telecom infrastructure. But they also receive billions upon billions in taxpayer subsidies, dubious tax breaks, and regulatory favors in exchange for network upgrades that are always mysteriously half-delivered. There's not a day that goes by where some telecom company isn't getting ridiculous sums of money for projects that don't make sense or simply never get deployed. So if you were serious about reforming the FCC's USF or subsidy systems used to expand broadband access, that would be the place to start.

Instead, AT&T has asked captured regulators like FCC Commissioner Brendan Carr to push for a broadband tax on tech giants. Carr recently pushed the idea in a an editorial over in a Newsweek Op/Ed, and since then outlets from CNET to Axios have been parroting the idea as if it's a good faith effort. It's not. It's an AT&T policy and lobbying missive being dressed up as a legitimate idea by corrupt lawmakers and regulators.

Now, Senators Roger Wicker, Shelley Moore Capito, and Todd Young have introduced a doomed bit of legislation dubbed the Funding Affordable Internet with Reliable (FAIR) Contributions Act. It too suggests that "big tech" has gotten a "free ride" on US telecom networks and should be subject to a new tax to fund broadband deployments:

"For too long, Big Tech has been able to profit off of the critical infrastructure used for common day-to-day activities while not helping at a sufficient level to improve those capabilities with broadband investment in states like West Virginia. With communications platforms moving away from telephone networks toward internet heavy platforms, it’s important now more than ever that we start looking at ways that Big Tech can step up and help close the digital divide and secure true universal service for West Virginians."

Again, the gross irony here is that for the better part of twenty years, West Virginian lawmakers have been in persistent thrall to regional telecom monopoly Frontier Communications. This generally involves doing everything the telecom giant asks, then throwing billions in unaccountable subsidies at the company in exchange for jack shit. The same problem is repeating itself in most states across America. So to come out and suggest the country's broadband shortcomings are Google's, Netflix's, or Amazon's responsibility to fund and fix is fairly laughable.

Our broken and corrupt telecom regulatory approach is precisely why US broadband is so expensive, patchy, and slow by global standards. Yet you'll note that the AT&T loyal Republicans (and some Democrats) pushing this stuff never acknowledge the need for reform of the telecom industry and the subsidies we throw its direction. They're usually not even capable of acknowledging the sector has any problems.

Josh Hawley and friends have spent several years hyperventilating over "big tech monopolies" but rarely (if ever) acknowledge the problems with regional telecom or energy monopolies. They're using legitimate concerns about "big tech" to push policies of interest to "big telecom." But with very few exceptions, the modern GOP is genuinely not interested in fixing any problems. They're interested in keeping campaign contributions from the likes of Comcast and AT&T flowing. And their only interest in "big tech" is finding leverage that will force them to carry race-baiting disinformation, a cornerstone of modern GOP power.

That's not to say "big tech" doesn't have ample problems that need fixing. It's also not to say that the subsidy and FCC funding mechanisms propping up our feeble broadband efforts aren't in dire need of reform. But this "big tech gets a free ride and therefore should throw billions at the telecom industry" is not a serious argument, and anybody treating it as such hasn't been paying attention to more than fifteen years of telecom history. If you want to fix the US broadband industry and improve service the path is obvious: tackle regional monopolization and the corruption that enables and protects it.

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Filed Under: big tech, brendan carr, fair share, fcc, free ride, universal service fund


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  • icon
    PaulT (profile), 27 Jul 2021 @ 5:30am

    "For too long, Big Tech has been able to profit off of the critical infrastructure used for common day-to-day activities while not helping at a sufficient level to improve those capabilities"

    For too long, Big Retail has been able to profit off of the critical infrastructure used for common day-to-day activities while not helping at a sufficient level to improve those capabilities"

    I don't recall this being used as an excuse to force Wal Mart to pay for additional power grids, roads and health inspectors. What's the difference here, I wonder?

    Let me guess - despite online platforms both paying for their own bandwidth and the people visiting them paying for their bandwidth, the ISPs aren't getting the 3rd cut they wish for?

    Also, I'll say what I usually say again - any definition of "big tech" that doesn't include giant telecoms technology companies is broken from the start.

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

  • identicon
    Glenn, 27 Jul 2021 @ 5:58am

    Telecomm profits... built on fraud and corruption and lack of choice. "Big tech" profits... built by ads and user choice.

    As far as your "legitimate animosity" is concerned: don't like it? don't use it. (Just being big causes problems.)

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

  • identicon
    Ned, 27 Jul 2021 @ 6:15am

    Heroic FCC Chairman search

    • "Our broken and corrupt telecom regulatory approach is precisely why US broadband is so expensive, patchy, and slow by global standards."

    ...thus we have clear evidence of a major government-failure in the sacred Regulatory-Model of economic centralized control.
    However, our faith in the government regulatory model is not diminished in the slightest.
    Obviously, we just need to find the "proper" FCC Chairman -- with vastly superior integrity, management skill, technical knowledge, and wisdom. /s

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

    • identicon
      Anonymous Coward, 27 Jul 2021 @ 7:21am

      Re: Heroic FCC Chairman search

      Obviously, we just need to find the "proper" FCC Chairman -- with vastly superior integrity, management skill, technical knowledge, and wisdom.

      True, but Optimus Prime comes with a lot of baggage of his own.

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

    • identicon
      Anonymous Coward, 27 Jul 2021 @ 7:34am

      Re: Heroic FCC Chairman search

      Still works better than the sacred model of no regulation.

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

    • icon
      sumgai (profile), 27 Jul 2021 @ 8:10am

      Re: Heroic FCC Chairman search

      Obviously, we just need to find the "proper" FCC Chairman -- with vastly superior integrity, management skill, technical knowledge, and wisdom.

      You had him, once. And he's still alive, you can have him again! Although at 95 years of age, he may not want the job.....

      Newton N. Minow, the author of the famous "TV is a vast wasteland" speech in May of 1961. That man had everything you asked for, so no sarcasm need be expended, it is possible to find these people, they do exist in real life. But more to the point, he had a vision for the future, and we're still living in it, 60 years later. That vision? Consumer choice. Check it out.

      Notably, he has never stated that the Internet was/is a vast wasteland. So I'll say it for him...... ;)

      p.s. The person who actually coined that phrase for Minow's speech was a journalist by the name of John Bartlow Martin.

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

    • identicon
      Anonymous Coward, 27 Jul 2021 @ 8:35am

      Re: Heroic FCC Chairman search

      The problem with much of the US regulatory system is that it is designed to allow political interference and influence, because of the political patronage involved in selecting and sacking the leaders of the regulatory agencies. That problem needs correcting to enable proper regulation, as reducing the power of politicians to direct a regulator means that campaign contributions become much less effective as a means of determining regulations.

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

  • icon
    That Anonymous Coward (profile), 27 Jul 2021 @ 6:18am

    Its truly sad that these elected officials are unable to obtain actual facts before opening their mouths & making it clear that they are pretty much bought off.

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

    • identicon
      Anonymous Coward, 27 Jul 2021 @ 6:32am

      Re:

      Facts just get in the way.
      Even if they had the proper facts (and understood them) they would just misrepresent those fact to push whatever agenda they are being paid to push.

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

    • icon
      That One Guy (profile), 27 Jul 2021 @ 11:29am

      Sometimes it is malice

      I see no reason to give them the benefit of the doubt in even the slightest way, they want to make it clear that the telecom industry owns them then by all means address them as such.

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

      • icon
        That Anonymous Coward (profile), 28 Jul 2021 @ 4:38am

        Re: Sometimes it is malice

        Racing suits with patches... it should happen.

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

        • icon
          That One Guy (profile), 28 Jul 2021 @ 5:56pm

          Re: Re: Sometimes it is malice

          While both funny and fitting with how many companies own individual politicians I imagine you'd quickly run into a 'not enough space problem' where the logos would quickly be overlapping each other due to how many there were.

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

  • icon
    Bloof (profile), 27 Jul 2021 @ 6:46am

    If they ever got this, they'd funnel every penny straight into the pockets of shareholders, declaring they've had a bumper year, and the following year, they'll demand the fees paid by big tech be doubled because they can't possibly fund the infrastructure upgrades they're expected to perform because the cupboards are bare because net neutrality still exists in places people live and municipal broadband isn't illegal.

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

  • This comment has been flagged by the community. Click here to show it
    identicon
    Anonymous Coward, 27 Jul 2021 @ 7:05am

    YAY! Covid Works!

    1. "leak" Corona to the international populous
    2. let media spread FUD
    3. watch and eat popcorn as the survivors kill each other over mask vs. no-mask & vaccinated vs. antivaxxers

    On topic:
    Legal bribery (a.k.a. lobbying) sucketh. End lobbying and enact Congressional Term Limits and maybe things will improve in American Law.

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

  • identicon
    Anonymous Coward, 27 Jul 2021 @ 7:29am

    Those sore Richard Bennett kneecaps are going to have to pay off somehow, you know.

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

  • identicon
    Anonymous Coward, 27 Jul 2021 @ 8:55am

    Lobbying (the right to assemble and seek redress from the government) is not only a constitutional right, but it's one of the foundation-stones of democracy--and of justice, right up there with jury-of-peers and the secret ballot. All of these things can be used for evil purposes. And it may be that the people in a society get so corrupt that they cannot rule themselves honestly--that all of these things are mostly used by vicious people for unjust purposes. But the problem is not in the process, it is in the people.

    Lobbying is not bribery, and in fact bribery is, for federal public officials, fairly rare--because it is expensive and risky. What is done, instead, by most anyone who doesn't want vindictive lawmakers mad at them? Very simple. Contribute token amounts to BOTH candidate's campaigns. And then, if a lawmaker causes too much trouble for you, wait till the next close election and POUR MONEY TO HIS OPPONENT. There's no way of making that illegal, and nothing has to be said because everyone is aware of the possibility. Again, changing the process won't address the problem.

    I am not persuaded that congressional term limits would help. Augustus tended to leave his governors in provinces for long terms, even knowing they were very corrupt. His reasoning was, a corrupt man with a short period of opportunity for grift has to grab all he can get with both hands; but if he knows he has longer to make a fortune, his corruption may not be so impatient. Remember the corrupt reaction to short terms is the "revolving door policy"--people who serve the rich and powerful in a brief term of office may find it easy to get remunerative sinecures after their term of office--a temptation not so strong for officials-for-life. Again, the problem is in the greed of the people who might seek public office, which is a reflection of the moral state of the rest of the people.

    Understanding the problem is the first step towards a solution. Random uninformed changes to processes is as effective in politics as--random changes in C++ programs as a debugging tool. Sure, that's what beginning comp-sci students and MBAs usually do, but experienced programmers or managers never do.

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

    • identicon
      Anonymous Coward, 27 Jul 2021 @ 9:44am

      Re:

      I'll agree that greed is the root of this corruption, but you and I both know that greed, hate, ignorance, etc. can not be outlawed.
      Greed is the reason why politicians can be "influenced" to vote the way they do. This same greed propels these same politicians to seek re-election, so that the cycle of pay-for-law can continue.
      -if you get elected
      -get paid (bribed)
      -get re-elected
      -continue...
      -else, get hired as a lobbyist

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

  • identicon
    Pixelation, 27 Jul 2021 @ 9:12am

    Loser pays

    And, that would be us, in this case. Either a higher bill or more ads jammed in our faces.

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

    • icon
      Toom1275 (profile), 27 Jul 2021 @ 10:45am

      Re: Loser pays

      Or, when Comcast forced Netflic to pay ransom in millions in fraudulent charges, less resources with which to direct to improving their own product.

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

  • identicon
    Anonymous Coward, 27 Jul 2021 @ 10:44am

    For too long, Big Tech has been able to profit off of the critical infrastructure used for common day-to-day activities while not helping at a sufficient level to improve those capabilities with broadband investment in states like West Virginia.

    Doesn't Big Tech pay for the critical infrastructure they use? If the amount they're paying isn't enough, wouldn't the telecom company just raise prices?

    Isn't broadband investment the job of the telecom companies? You know, taking revenues from paying customers and using it to expand service?

    So how, exactly, is Big Tech not doing their part? Also, I seem to recall what happened when Big Tech actually tried to invest in broadband. Google Fiber. I didn't see telecom helping there.

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

  • icon
    freakanatcha (profile), 27 Jul 2021 @ 11:00am

    AT&T is looking at this all wrong

    Telecom should pay big tech for its content, just like their cable arms pay Disney for its content. Then the the telecoms would be free to slap consumers with beaucoup fees while misrepresenting their advertised rates. So it's a win-win (not so much for the consumers, but screw those guys).

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

  • icon
    That One Guy (profile), 27 Jul 2021 @ 11:44am

    Turnabout is fair play

    If tech companies 'using' the telecom infrastructure means that they should be paying telecom companies then it seems it's time for those telecom companies to start paying out the nose to a lot of other companies since the ability to communicate and share content doesn't mean much if there's no content available, which means the telecom companies owe pretty much the entire value of their service to other companies and platforms.

    I mean, unless this wasn't an honest argument about paying for others getting value off of your stuff and was just a blatant cash-grab, but how often does the telecom industry make use of those kinds of tactics?

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

  • icon
    ECA (profile), 27 Jul 2021 @ 2:27pm

    When?

    Did we give corporations rights?
    What happened to the anti lobby laws, that they ASKED FOR YEARS AGO??

    What happened to taking the ISP's and Cable TV to court for over charging customers? $1 per channel is getting close to reality. Even after they paid $0.05-0.35 PER channel per customer.

    Soon, most of the major channels are going direct with the internet and get $10 per person, Per channel.
    Since the Top tier internet is held by Many of the Major companies that OWN the cable and ISP's, Think they will raise prices? Wont affect Google.

    Anyone get the strange feeling, the Much of the Major players, are owned by the ISP's? And are being Bought up By them even now?

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

  • identicon
    Anonymous Coward, 27 Jul 2021 @ 7:00pm

    How likely is this bill to pass?

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

  • icon
    Uriel-238 (profile), 27 Jul 2021 @ 7:38pm

    Late-stage capitalism

    My impression of late-stage capitalism (of which AT&T is a skilled, veteran participant) companies invest as much as possible into lobbying the government to give them subsidies for no reason, and anything the company actually does commercially is incidental, or at best a justification for those subsidies.

    At this point, I bet there is good argument to simply nationalizing the ISP industry, especially those that own or license access to poles and cables.

    Not that we'll do that until we decide government serves the public and not corporate interests.

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

  • identicon
    Owen, 27 Jul 2021 @ 7:48pm

    Billions to Telecom - How About This?

    Firstly, I know this is a dumb idea which would never fly...but what if Big Tech (a.k.a a cooperative between Google, Amazon, Microsoft, Twitter, Facebook and whoever else they can get interested in the idea) got together several billions of $ and made a hostile takeover attempt on AT&T or Comcast.

    Just for shits and giggles...

    Wouldn't that be fun to see?!?!

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

    • icon
      ECA (profile), 28 Jul 2021 @ 12:23am

      Re: Billions to Telecom - How About This?

      Because ANY of those great companies would Love to FIX the cable TV ideals.
      Having 200 channels, with 7 major corps repeating Programing DOWN the line, until everyone knows the story Inside and out and word for word.
      How many cop shows could you get rid of?

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


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