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Wireless Providers to Pay Universal Service Fees?
andyo writes "Mailing lists are abuzz with the news that
wireless Internet providers may have to pay fees to support plain old telephone service.
My own perspective is at the O'Reilly Network." The Universal Service Fees are taxes set up long ago to assure that telephone service was provided to everyone, even people who it would normally be uneconomical to serve. The theory is a good one, the execution maybe not. (Maybe if the fees went towards Universal Broadband?)
The Universal Service Fees are taxes set up long ago...
Which means, they'll get another looking at, now that everything is going wireless. I don't anticipate this being a giant deal for a long time...
Good quote, too many chars. Seriously, the slashdot 120 char limit sucks!
The local phone service I get (through my cable provider) comes with a bill broken out according to every mandatory fee and tax, and the mandatory fees and taxes are larger then the phone service cost itself.
Whatever they may be for, the combination of added fees and taxes on phone service is exhorbitant already. Adding them to other net services is just another revenue stream for someone else.
Phbbbbbt!
Soli Deo Gloria
Unfortunately, this seems to be an old regulation that did its job and then was never updated for how the telco's work now. Nothing new -- we have seen these examples for years now. Update the regulations and make them work for what goes on today and possible tomorrow....
...we are from the government - we are here to help...
that taxation with representation isn't so hot, either.
Actually, it's worse than that. This is another form of taxing the unrepresented, since WISPs are unlikely to get the ear of Congress for a redress of grievances, when compared to the telcos who can spit out large amounts of bribes...er, subsidies...er, direct democracy to the Reps and Senators.
-- Two men say they're Jesus. One of them must be wrong. - Dire Straits
I'd say this could be a good thing. Hell, I don't even have a land line anymore! When I did, the costs of the fees and taxes simply made a cell phone much more affordable. If there's a fee on cell's now, that might not be true anymore.
My gosh... These things are just simply insane to me..
This is simple economics....
There is a market for DSL, wireless, and Cable. The government does not need to stick their foot into this market to make it work. As Adam Smith said, the 'invisible hand' will give these people their last mile connectivity.
By forcing them to move into market that is not profitable you are simply going to increase the price so that the people that you are trying to help aren't going to be able to afford it. (Not to mention the fact that everyone is at a net loss because of the added tax)
It IS NOT, repeat IS NOT governments job to force the economy into any position what so ever. If a company can figure out how to make these connections profitable they will, thanks to the 'invisible hand', and the company wins, the consumer wins, the economy wins, and it was all done without a negative effect. So how simple that works.
Welcome to the world of common sense and Austrian/Mises Economics
I was reading the other day that during disasters email tends to work a lot better than the phone. In Bellevue Washington, they're talking about deploying wireless devices to disaster workers. Here's the article:
http://www.komotv.com/news/story_m.asp?ID=17879
I can't help but think that this would be a better service to keep running than POTS with the money. Text messages are so much easier to get through than voice.
"Derp de derp."
If you read the constitution, there is nothing in there about the federal government having the right to govern communication in any way (the entire point of the FCC). However, there *is* a statement that any function not delineated as an area of federal authority will be the in the jurisdiction of the states. It is unconstitutional for the federal government to mandate such charges.
Depends on where they are. Some towns are so small that simply running the wire, or even setting up high speed wireless access points, would be uneconomical unless you charged thousands of dollars for the hookup, and a hundred a month for maintenance. And satellite has latency issues.
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Or they could just keep cutting income taxes, and then let the ball start rolling and start cutting other taxes.
BTW, don't taxes require an act of Congress to be inacted *cough CONSTITUTION cough*
Avoid The Rush, Hate OU Early!!!
You gotta imagine that the broadband ISPs aren't that psyched about this. In an economy where $40-$50 a month for an internet connection is pushing it, how about adding more taxes to the pile.
If the fee was applied to provide interner service to people who can't afford it, it would make sense. Also, it would (slightly) be an investment.
How? Well, there's an old story about how a long time ago, in a small town, there were only two phones: 001 was the Mayor's house, and 002 was the fire department. After a couple of months, the Mayor cancelled his line, since it was idiotic to pay $20 a month to be able to call just the fire department, wheter there was a fire or not.
The point being: If you have a phone, the value to you is increased as more people have one, since you have that many more potential people to contact. The same principle would apply to internet.
Sorry for the long rant. I'll shut up now.
The biggest problem with Uiniversal Service Fees is that there is no oversight with regards to how phone companies collect them. The FCC recommends rates that telephone companies should use to collect these fees (6.9187% for fourth quarter of 2001 and 6.8086% for first quarter of 2002) but allows telephone companies to set their actual percentages to anything they want. Qwest is already collecting 8.1462% from their DSL subscribers, in addition to rates collected on POTS service, not because it's mandated, but BECAUSE THEY CAN. When they collect more than they need, they pocket it rather than lower the rate. Take a look at your phone bill, people. Then call your state's utilities commission and bitch about it.
I would hate to say, but I believe that cellphones have an edge here ..
BTW, if it's cost keeping people from having cells, then get rid of the POTS, and use that for a cell.
Karma? Karma? I don't need no stinkin' karma.
If everyone has a cell phone...
There would be a boom in the "stress lowering medication" industry. Soon, it would be a necessity to check the news every ten minutes, just to "stay in touch".
Coming to the main point, does this universal tax result in additional antennae/base stations setup in remote places so that people can get a signal? In the old days, this would have meant laying lines over long distances. Now, it would mean just setting up a set of base stations/antennae.
Is line of sight. Sure, they could move. But then who would grow the food? Society does benefit from their staying out there.
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I don't think it's too much about the money that would be raised, since most small wireless operators are not making very much (if anything, some are free).....I see this really as a way of bringing groups like "Seattle Wireless" and others under governmental control.
By making every group subject to audits, federal fees and filings, every group can be identified and investigated as needed. That's their hook into you. Kinda like the IRS, where even if you don't make any money, you have to provide them with all of your information and "allow" them to verify it. There's no "opting-out" of the information game.
I've thought that it was just a matter of time before the government stepped in to regulate this....John Ashcroft can't have people communicating OUTSIDE the system!....How can he get Carnivore around this "wireless thing" if he can't force everyone to fill out forms and obey our regulations?
The RIAA & MPAA also can't have people communicating outside of ATT and AOL either, who would they sue in a distributed wireless city-net? They couldn't force anyone off the air through their DCMA takedown suits! Although, if you had to have a liscense.....they could take that!...and then force you off the air.....
The very idea that they would try to do this on an "unregulated" band shows what their intent is. I'd look for further attempts to limit power of WAP's, force a band change (making current units illegal by "out of band") and forcing some type of identification of base-stations. I could imagine some type of system where people would have to "activate" their base-stations by logging into the manufacturer site and giving some personal information or something like that.
The government's intent is to limit annonymous speech and communication between individuals....they can't do that if we keep jumping out of the cattle chutes that they've errected at all of the big ISP's....
"There has grown up in the minds of certain groups in this country the notion that because a man or corporation has made a profit out of the public for a number of years, the government and the courts are charged with the duty of guaranteeing such profit in the future, even in the face of changing circumstances and contrary public interest. This strange doctrine is not supported by statute nor common law. Neither individuals nor corporations have any right to come into court and ask that the clock of history be stopped or turned back, for their private benefit." --Robert Henlein
Whan this tax on phone service was created it was to help farmers and others get phone service. This was needed because no company would touch these areas, including Bell. This was to every one's benefit. City folk could now call their county cousins and country folk could call the fire department when their barn caught fire. Non-monopoly ag has alwaus been a very low profit proposition and it was clear that rural user could not afford the high cost of teleco infrastructure. This was also done for rural electrafication along time ago (by general fund taxes I think). If you don't think you benefit from community civil works than I suggest you move to Chad and see what it's like to live without a real government.
I grant I haven't read all of Adam Smith, but I don't recall anything about "last mile connectivity." That was a joke.
"It IS NOT, repeat IS NOT governments job to force the economy into any position what so ever. If a company can figure out how to make these connections profitable they will, thanks to the 'invisible hand', and the company wins, the consumer wins, the economy wins, and it was all done without a negative effect. So how simple that works.
The government cannot help but "force the economy." It is, after all, a huge consumer. This demand helps shape the market. Now there is of course a difference between consuming pencils and gasoline and nuclear triggers on the one hand and planning an economy on the other. But the government has a role there too. The government's job should be to serve its citizenry. If that means that markets do not operate with maximal efficiency, who cares? "The market" is just an abstract concept, a tool that helps us understand how parts of the economy function. It is not something to be a slave to.
I do not understand this obsession of deeply ideological Libertarians with the capital-M Market. It seems as though it is their deity and that cost efficiency is the only axis on which they measure morality. The logical conclusion of such single mindedness is that if one cent more wealth, in aggregate, will be created by my gutting you like a fish, I am morally obligated to do it. Obviously (I trust and hope) this isn't what Libertarians really want but the most ideological ones don't seem to have any appreciation of nuance.
If no one can figure out a way to make last mile connections profitably, no one will build them. And no amount of "leave it to the market" mantra will change that. But if people want the connection, why shouldn't the government change the regulatory environment to make it profitable for companies to do so? This is just changing the ground rules for the market. Market forces themselves still exist. Is it possible that the government will do something so stupid that they will make things much worse? Of course. But they might also be able to make the change so that the effects aren't so bad. Does that mean that some person or company will incur costs that they wouldn't have otherwise? Yes it does. But again, so what? Money is not the only value. It is merely the easiest to calculate.
Q:How many libertarians does it take to stop a Panzer division? A:None. Obviously market forces will take care of it.
Geez man my cousin lived in the downtown/inner city/ghetto area and couldn't get a phone line into his building - no one would install it.
The telephone companies coporate offices are about 10 (actually 8) blocks away. There is apartments 6 blocks away with T1 lines to the highest priced apartments.
The problem is the tax doesn't get paid back. At least the money doesn't trickle down. The problem was that he lived in a building which never had service - they refused to setup the line (drop it into the window?) without funds from the city which "weren't there".
He was willing to pay for everything except what they (the company) has to pay by law. So we collect tax and it's not even paying to get real customers! I feel sorry for people who need 911 services but can't get a phone. It's been ruled here in my city that 911 is a right because it's funded by taxes.
The problem was the pay phone was always being used by crack dealers. But for some reason it was only 20 cents so maybe it all works out?
We just figured the police paid the other 30 cents and listened in...
[the moral of this story is that sometimes taxes are good. if the funds are used right it might get people back into market (or whatever). the error isn't in the amount of taxes we take, the error is that we don't try to stretch it as far as we can. know where investments are[
Get your Unix fortune now!
What they do is help all these schools get on board to recieve this funding.
--------------
I sig, therefore I was.
(Maybe if the fees went towards Universal Broadband?)
;-)
Fine with me, as log as it didn't go to Vivendi Universal.
These days, you never know... they *do* get some dime on every cd-r, after all.
if you use a good enough junk-filter, slashdot.org will display a single, *blank*, page
The Universal Service Fee provides telecommunications and information services to schools, libraries and rural health care facilities; it also serves to subsidize local service to high cost areas and low-income households. This fee still has a purpose to provide schools with the appropriate amount of students from low income families grants to allow the purchase of technology and communication equipment and services. I know in the state of Georgia, we refer to the money we get from the USFs as "e-rate" money.
"If it ain't broke, it doesn't have enough features yet"
I do believe that calls from cell phones work with together with POTS.
Isn't it correct that once your call reaches the nearest cell tower, it travels over POTS to get the cell tower of the person you are calling?
Most companies trey to pass costs on to their customers in some way, of course, but this is more than that. The fee actually appears as a separate item on the phone bill, and is never included in the advertised prices. Customers don't know how large it will be until they get the bill (and with a cell phone, the long contract length makes it then too late to change).
What's even worse is that many phone companies actually like to collect this tax, because a loophole in the law allows them to tack on an arbitrary collection fee (pure profit), which is not distinguished from the tax itself on the bill. This makes the tax appear to be even higher than it really is.
It's exactly the same as if the grocery store decided to charge you double sales tax, and you didn't find out about it till after you got your receipt.
I love this -- I'm always impressed with how happily we pat ourselves on the back when schools get The Internet and New Computers, which provide an instant IQ boost to all the underprivileged children. Because putting one workstation in a classroom of thirty to forty kids, of course, is the solution to all our educational woes. Pie jesu, did no one ever realize that forty kids can't all use one computer at the same time? Even if the administration is wise enough only to purchase computers for computer labs, only a fraction of the students can use them at any time. And for what is the web (all we allow the kids access to anyway) useful? Easy: teaching them to "research" by pulling up those dubious sources most attractive to the eye, to ignore the resources of the library, never to read a book, an article, or any literature that might give you a broad perspective on an issue when you can nail a transcribed sound-byte in Google. I am a teacher at a school serving free or reduced lunches to the majority of our population, one "benefitting" from increased penetration of high technology at reduced cost. It never ceases to gall me when some politico or bureaucrat congratulates himself and his corporate sponsors for "bringing computers to the classroom" and hooking up the school to the internet... gee, now the kids can look up video game cheats and the prices of tires and rims, but they still can't write a thesis statement or multiply two numbers in their heads.
Ok, good arguement, but how much longer until all the schools are wired? A report just 2 or 3 years ago stated that 95% of all schools were online, so how much longer do we keep paying for the last 5%?
Avoid The Rush, Hate OU Early!!!
However, for digital systems, I can call another digital phone, and I believe that hop towers instead of going through POTS ... though, I don't work for the phone company.
But you wouldn't need it to the homes. So, the current telcos would be a middleman for different cell companies.
Karma? Karma? I don't need no stinkin' karma.
First,
why do you think libs are nuts?
Yes I am libertarian. My beliefs are straightforward and consistant. YOU are responsible for your own actions. Not me, nor the government nor anyone else. That IMO is the core of the libertarian philosophy. If you are an alcoholic and drink, guess what it was YOU who did it, not the beer company etc.
Government nowadays seems to think its mission is to protect us from OURSELVES. This is contrary to the very ideal of freedom.
Actually though I do vote, I think the system is broken as it stands. If you believe that your neighbors are intelligent, and (while they may not agree on everything with you) have enough in common with your worldview, it would be better IMO to hold a draft to select representatives.....
That way you have no special interest groups aka
Disney etc giving big $$$ to congress critters for re-election campaigns.
Crazy idea? Perhaps, but remember self governement
through representative democracy was also thought of as crazy and unworkable by the aristocracy in Europe when the US was formed.
Service guarantees Citizenship! Questions Guarantee GITMO.... Amerika Uber Alles!
You forgot coverage. Cell phones don't work at my house (we're behind a hill) or I'd have dropped USQWest a long time ago.
Cell phones don't work in a lot of places, including urban places. I drive two interstates in my commute, and the signal comes and goes -- not even complete coverage on the damn interstates! Rather than put all their money into 2.5G systems, they should build out the 2G coverage -- idiots! And they wonder why they have 3% churn each month, and why they're all losing money. I'd be part of that churn, but there's nobody with any better coverage that the outfit I'm with today.
If all this should have a reason, we would be the last to know.
That's why in an emergency you will often find you can call other customers of your cell provider, but can't call anyone else; the local telco is down and can't route the calls to any other company, but the cell networks are up and can route calls within themselves. This happened last year in the Seattle earthquake.
If all this should have a reason, we would be the last to know.
I guess... if you are trying to fit words you don't need.
;-)
Something that is futile is without utility... look at it that way
Get your Unix fortune now!
I work in telco billing software, when I work. (no I'm not particularly proud of that fact) The USF, regardless of original intentions, is a fee that telcos manipulate to charge their customers more than their published rates allow. Since it typically shows up in the "taxes" section, people are much less likely to call in and complain. Anytime the company risks complaints, it walks a fine line, because call centers are really expensive. The USF is handy, since no customer realizes when it is tweaked, even though they have to inform the regulatory agencies.
I don't usually look for idealism in any company, even a cool tech company. When I leave aside the whole cross-subsidy thing I can't help but think that the WiFi companies will do the exact same thing when they are required (allowed?) to charge the USF. Maybe that's why they haven't uttered a peep in protest.
later,
Jess
ps. This is an evil thought but ususally after "three decades", an industry no longer needs to be coddled. That only happens again much later, after about a century. Witness the U.S. steel industry.
I am programmed for etiquette, not destruction!