Tags: Barack Obama | Fox News | net | neutrality | immediate | tax

FCC Official: 'Net Neutrality' Would Mean Tax on Web Users

By    |   Monday, 17 Nov 2014 07:37 PM

Web surfers will be hit with an "immediate" new tax for their Internet use if so-called "net neutrality" — one speed for all online traffic — becomes the law of the land, says one of the six Federal Communications Commission members who will decide the controversial issue, Fox News reports.

Commissioner Mike O'Reilly said on Friday that if the FCC sides with President Barack Obama, who threw his full support behind net neutrality last week, Internet providers will promptly pass a new set of costs on to their customers, Fox News reports.

"Consumers of these services would face an immediate increase in their Internet bills," said O'Reilly.

In order to require net neutrality, and prevent Internet providers from opening up online "fast lanes" to big-content companies — such as Netflix — willing to pay a premium, the FCC will have to reclassify Internet providers as something akin to an essential public utility instead of a lightly regulated industry.

If that happens, O'Reilly explained at a seminar in Washington held by the non-partisan Free State Foundation, Internet service providers will become subject to the same decades-old law that governs telecommunications companies.

One feature of the law is the FCC's Universal Service Fund (USF), which telecoms must contribute to on a regular basis — a cost they recoup by charging a monthly fee to telephone customers.

O'Reilly said Internet providers operating under the new rule would also have to pitch in to the USF, and would in turn bill their customers to defray the extra cost.

"Let's accept a truism: consumers pay [the costs of the fund], not companies," said O'Reilly.

The USF is also set to expand dramatically, because the FCC wants to boost spending on the federal "E-Rate" program — which connects public schools and libraries to the Internet — by $1.5 billion, Fox News reports, citing an Associated Press report.

O'Reilly said he thinks the FCC "intends to go on a spending spree" with its USF fund, and the money has to come from somewhere.

The president gave full-throated support to the concept of net neutrality last week, arguing that Internet providers should not "pick winners and losers in the online marketplace" by favoring companies that can afford faster transmission speeds.

The FCC is a bipartisan agency whose six commissioners — three appointed from each party — operate independently of the president. It's not known when exactly the panel will make a decision. But the chairmanship, currently held by a Democrat, Tom Wheeler, rotates next year to one of his Republican colleagues.

A majority of commissioners would have to agree to reclassify Internet providers for net neutrality to take effect.

Ohio GOP Rep. Bob Latta, vice chairman of the House Communication and Technology Subcommittee, told Fox News that an FCC ruling for net neutrality "would be increasing the cost of Internet service for all users, hurting consumers and job creators."

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Web surfers will be hit with an "immediate" new tax for their Internet use if so-called "net neutrality" — one speed for all online traffic — becomes the law of the land, says one of the six Federal Communications Commission members who will decide the controversial issue, Fox News reports.
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2014-37-17
Monday, 17 Nov 2014 07:37 PM
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