A Tax On Streaming!?

February 26th, 2009 by · Leave a Comment

What will they think of next.  In the state of Washington, the legislature is considering a bill that would add a special tax on streaming media, i.e. video and audio.  Of course, there are already taxes on digital media downloads in some states, but streaming isn't a download.  When you watch a streaming video, you don't actually come away with it with a physical asset - just the experience.  Streaming is much more like radio or TV broadcasts, except that it is a developing industry still trying to figure out how to become profitable rather than an established one.

What is running through these people's minds?  I can just imagine one side of a phone conversation with a constitutent...

[listens]

Well, yes there's a bad recession going on but we have a revenue shortfall and that's more important, so we thought we'd tax the sales of  a new and rapidly growing industry that doesn't make any money yet.  You know, sit on its head so it grows more slowly, doesn't hire as many people, etc.

[listens]

Yes, I know we are trying to stimulate broadband growth by handing profitable carriers and rural ilecs more money to spend, this is, err, part of that effort.   This way, people won't generate so much traffic, which will unburden those pesky backhaul circuits.

[listens]

What do you mean, of course that makes sense.  We want broadband everywhere, and that's easier to pay for if nobody actually uses it.

[listens]

No, high tech companies will love the new tax and won't leave our state in droves.

Yeesh, I think it's hard to imagine a dumber idea.  But if one state does it, others will probably follow like lemmings.  Dan Rayburn and Streaming Media are already organizing an effort to fight such a tax, and Telecom Ramblings will stand with them.
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