Comcast’s New Data Fees Follow $1 Billion In Public Subsidies
The government-subsidized telecom giant is imposing new levies on customers who are more heavily reliant on the Internet during the COVID lockdown.
This report was written by David Sirota and Julia Rock.
With millions of Americans trapped at home to protect themselves from a deadly pandemic during the holiday season, the Internet is one of the only conduits connecting them to friends, family and the outside world. Now, Comcast, one of the monopoly corporations that controls the conduit, is extending its fees on bandwidth usage to all 39 states where it operates — even as the company has received hundreds of millions of dollars of public subsidies and new tax breaks.
Whether or not those data caps remain permanent could hinge on whether president-elect Joe Biden and Democrats are willing to take action against a corporation that has been one of their major campaign donors.
At issue is Comcast’s move on Monday that caps home internet usage at 1.2TB of data per month for its customers in 12 additional states, and charging customers up to $100 per month if they exceed the cap. Comcast’s move was flagged by Stop The Cap, which discovered that the company had quietly updated language on its website.
The new limits, which will take effect in March, are being imposed in states that have given Comcast and its subsidiaries more than $738 million in tax subsidies in the last few decades. Those states include New York, Connecticut, and Pennsylvania, where state and local governments have given Comcast and its subsidiaries $484 million, $132 million, and $79 million in tax subsidies, respectively, according to data from Good Jobs First.
In all, Comcast and its subsidiaries — which include NBC and MSNBC — have received nearly $1 billion in state and local subsidies. Additionally, Comcast received $861 million in federal tax subsidies during the first year of the Trump tax cuts, according to the Institute for Taxation and Economic Policy.
“This is why monopolies are bad,” tweeted Public Citizen, a consumer advocacy organization. “Comcast can arbitrarily exploit us for profit during a pandemic just because it feels like it. Meanwhile, Comcast collects tons of tax breaks and government subsidies. Comcast should be broken up.”
The Federal Communication Commission (FCC) recommended in March that internet service providers relax their data cap policies in order to “promote connectivity” during the pandemic. The recommendation was attached to an FCC campaign to ensure continued internet service throughout the pandemic, called the “Keep Americans Connected Pledge,” which Comcast signed. The pledge expired on June 30.
In 2018, Comcast announced that it had disabled the system it used to slow down heavy Internet users because its network was strong enough to handle the traffic. Without the need for a congestion management system, it was unclear why data caps were ever necessary in the 27 states where Comcast included them as part of its Internet plans. Comcast reportedly said it was keeping the data caps in place “based on a principle of fairness.”
FCC Could Take Action, But Biden Has Close Ties To Comcast
In the past, Congress and the Federal Communications Commission have floated the idea of restricting or banning data caps. In 2012, for example, Democratic Sen. Ron Wyden authored legislation to limit data caps, but the bill was bottled up in the Senate.
That same year, the “telecom industry spent more than $97.6 million on lobbying and hired 603 lobbyists to argue on its behalf – more than half of the industry’s lobbyists were former government employees,” according to the Center for Responsive Politics, which noted that was part of the nearly $1 billion the industry spent on lobbying over the last decade.
More recently, FCC Commissioner Jessica Rosenworcel in March 2020 said: “Where data caps are in place, we need to explore how those limitations can be eliminated.”
New FCC appointees by president-elect Joe Biden could in theory crack down on data caps — but Biden and his party have deep ties to Comcast.
In all over the last decade, Comcast donors have delivered more than $25 million to Democrats.
During the presidential primaries, 17 top Comcast executives maxed out their federal contributions to Biden, while Pete Buttigieg was the only other Democratic contender to receive a contribution from a Comcast executive (and he received only one), according to reporting from Sludge in January. Comcast’s senior executive vice president and top lobbyist, David Cohen, hosted Biden’s kickoff fundraiser for his presidential campaign in 2019.
Comcast is an aggressive political player in Washington — the company belongs to Broadband for America, an industry group that submitted more than 1.5 million fake comments, impersonating individuals, to the FCC opposing net neutrality rules protecting Internet users. Buzzfeed called it “the most prolific known instance of political impersonation in U.S. history.”
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Reporting like this is especially poignant now, as Biden and his people appear on the mainstream shows, commiserating with their corporate cohorts, and an outspoken progressive like Jamaal Bowman gets cut off for talking truth about Rahm Emanuel.
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What would you like us to do, other than be annoyed? A suggestion would be nice, as annoyance is not a good enough reason to subscribe. I could be annoyed at Fox news for free, except I would need Comcast.
I have some anecdotal knowledge of Cambridge, MA's relation with Comcast which has a monopoly for providing wired (as opposed to satellite) connection to the internet. Sometime ago Comcast was given a monopoly to operate in the city for x years. In exchange, Comcast would provide free connectivity for the city's library and schools or whatever. I don't know the exact quid pro quos. Service is expensive in comparison to an option available in Mansfield provided by Verizon FIOS. (Apparently there is choice in Mansfield, hence no monopoly pricing.)
This sort of deal making takes place in big and small cities and towns. The town officials are happy that they have saved their budget the expense of hooking up schools or whatever, and the townspeople see the alternative to an increase in taxes as an increase in their Comcast bill. Some agreements are probably done naively. Some benefit the official directly or indirectly. Some seem like a good idea at the time and prove to be less so later on.
You could invoke the Sherman Act to (do what?) separate Comcast from NBC and MSNBC. You could (I don't know how) make it illegal to offer companies deals on reduced taxes in cities or states. All companies would have to decide on location based on existing tax policy. But this is unrealistic as there is no single tax policy for the country. As long as the US is not one state with a policy that applies the same tax rates to every house and person and then divides the returns among the people on a per capita basis, you will have these problems. How else to deal with our problems. This is not going to happen because we are a federation of states, each with its own thinking, and approach to taxation.
This may seem unrelated to what Julia and David are writing, but I think it is why solving the problem they describe is so difficult.
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