Remember last week when the FCC trashed the rules limiting broadcast ownership? One of the reasonings given by Chairman Powell and the networks was the competition from the Internet. The major problem with this line of reasoning is that not everyone has access to the Internet, unlike free, over-the-air television.
It looks like the FCC is going to do its best to ensure that not everyone gets broadband. Declan McCullagh reports that:
The FCC is considering levying an additional tax of up to 9.1 percent on the revenue of cable modem providers. In theory, a cable provider is not required to pass the tax increase along to customers, but in practice, companies tend to do just that. EarthLink said last week that it would raise prices because of digital subscriber line (DSL) taxes imposed by state governments. It’s safe to assume that EarthLink will do the same thing if a cable modem tax comes along from the federal government.
He goes on to report that the revenue would be used for “universal service,” which, in theory, helps bring telecommunications services to rural areas and schools. Ah, but:
The idea of universal service is certainly a worthy one. But when cellular phones are so popular, do we really need to spend billions of dollars a year on subsidizing rural America’s landlines?
In addition, blame the companies and special interest groups that benefit from the Universal Service Fund and have every incentive to lobby to keep the current system in place. Instead of handing out corporate welfare to fund recipient Walt Disney, why not give “telephone stamps” to the needy, modeled after food stamps?
And blame the rest of Capitol Hill, which has agreed to higher and higher taxes while ignoring all but the worst abuses that accompanied the Universal Service Fund from the start.
An October 2002 report from the FCC’s inspector general noted “weakness” in oversight of the e-rate program, which is handled by the FCC but overseen by the government-created Universal Service Administrative Company. The inspector general said audits were still under way, “but preliminary results indicate potential irregularities at many locations.”
I’m already paying more than $60 per month for a cable modem – because I refuse to accept the “bundling” of services that the cable company insists upon. See? I told you that the Republicans would have to raise taxes elsewhere when they cut them on the richest Americans. A 9% hike in my cable modem bill would cost me $65 annually. Sounds like a hefty tax hike to me.
