back to article Obama wants to wring fat dollar from mobile operators

President Obama has proposed squeezing $4.8bn out of the mobile network operators with a levy on the spectrum for which they have already paid, or thought they had. The levy starts at $50m in 2009, rising to $200m in 2010 and eventually hitting $550m a year per company - raising $4.8bn over the next decade, which could go some …


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  1. Nate


    " seems unlikely the industry is going to hand over just shy of $5bn without a fight."

    Right. And we all know where that extra money is going to come from: our wallets.

    I mean seriously, we'll just see an extra "Spectrum license user fee" tacked on to our bills. It's added to the Carrier's bill, and they'll turn right around and add it to ours.

    But at least it's not a tax increase, right? ...right???

  2. Dave Turner

    And so it goes...

    Business as usual. Wonderful. We overpay now for a convenience that goes down in an earthquake or with sunspots and now we're going to get charged more because Obama needs the cash? He really can't be that stupid to think that the company isn't just going to pass the increase on to the consumers.

    Ah well, pas the lighter fluid. Rome is burning and I don't know how to play the fiddle.

  3. Stu

    Sounds good...

    ...should do something similar over here in Blighty - the rip off merchants.

    All u need do is stop to look how totally posh their shops are, and the profits they rake in year after year.

    Anybody doubts this, just say one short sentence - "12p per SMS"!

    And before you say ' well i get 5,000,000 free SMSs a month.' just do the maths - include every penny you pay them in relation to every benefit you get out of it month after month.


    Only trouble with Obamas master plan - the mob operators would only hike up the costs and get the gen public to fit the enormous bill.

  4. Sandmich
    Thumb Down

    Not Enough $$$

    "...raising $4.8bn over the next decade, which could go some way towards addressing America's $1.7trn budget deficit."

    $1,700,000,000,000 deficit is for one year, $4,800,000,000 over ten years is a finger in the dike.

  5. Kevin Silver badge
    Jobs Horns

    Wireless Spectrum Fee

    There's already precedent for doing this. As the airwaves in the US are, by law, owned by government in trust for the public, the Fed can charge usage fees. Just ask anyone who buys any software. You're only buying a "license", not the product. So the software house can keep gouging you for for $5 of code or take you to court for letting anyone else use your copy of the software.

  6. Brandon
    Thumb Down

    I love my country, but...

    Is there anyone from whom he will not steal?

  7. Eddy Ito
    Thumb Down


    Who does he think is really going to pay? New rate plan: $12.00 /min peak, $11.99 /text message and unlimited nights & weekends only $1099.00/month. I can see a rebirth of pay phones with one popping up on every corner, VISA & MC accepted. Gold cards only please.

  8. Oneil Stuart

    user fees, user fees

    While i think it would be ridiculous if the gov't got away with charging a fee like that, it really would be nice for the mobile operators to know what it feels like to be a plain ol' user gouged at whim.

    I almost bet he's going to turn it around on them when the lawyers start complaining (Wishful thinking). If the operators don't want to be gouged, they shouldn't gouge their customers.

    But this is definitely a strange way to open a dialogue about Net Neutrality.

    And I know for a fact that when the Chevy gets to the levy, not only will it be dry, but the operators will be crying poor and looking for their bailout.

  9. Anonymous Coward

    Hold The Phone

    Does anyone present really think that the likes of Verizon, AT&T, T-Mobile and Sprint are going to eat $4.8Bn in additional expenses while keeping their pricing structures the same?

    Didn't think so.

    Corporations don't pay tax. They just don't. Whatever their taxes amount to, they pass through to their customers in the form of higher prices. The margins upon which they operate stay remarkably consistent year on year, unless the company finds a technology breakthrough that allows a dramatic improvement in productivity per unit of cost, in which case the margins go up. So whether the mobile telcos win or lose their bid to knock back this new fee (tax), is almost immaterial - you can rest assured that they won't end up eating the loss on it if they do fail to to convince the government on the issue - their customers will.

    This is a fairly typical government ploy - make a big show about how they aren't going to raise taxes on the little guy, then take a number of actions that end up costing the little guy a bunch more money to keep his lifestyle the same. But they didn't raise taxes, right? True to their word, right? Just an honest pol doing his honest day's work, right?


  10. David Wilkinson

    We already spent the money ... this is just the bill.

    The USA has been spending more than its taking in for a long long time. You can't keep spending more than you take in forever without consequences.

    Everyone is going to have to pay more in taxes.

    For years the amount of wealth produced my this country has grown and yet the average income was shrinking. Too much money accumulating at the top of the system. A healthy economy needs consumers who can afford to purchase the goods and services the companies they work for produce.

    The distribution of wealth is largely controlled by the tax system. Working class people pay 33% tax on their income while the owners of the companies they work for pay less than 20%.

  11. Anonymous Coward
    Anonymous Coward


    He's right to go after these guys as a source of money. They're greedy. They practically have a license to print money with some of the fees they charge.

    Of course, to combat this, all they'll do is raise their fees.

  12. Martin Lyne


    If one operator takes that extra fee hit and DOESN't pass it on, they will gain a lot of business from people who move providers.

    But, of course, you'd rather have your Prez print some more money and devalue the dollar so you end up buying bread for $2mil in $100 notes stacked in a wheelbarrow.

    Governments have fairly limited ways of making money. If they ask for more business tax, companies pass that on to you, if they charge companies more for things, companies pass that onto you.

    If governments spend less money anyone working for the gov (or anyone working for a company that has a government department as a client) get less/redundant. That'll be a lot of 'you' too.

    Capitalism ROCKS. You could always set up a PayPal "Donate" button on and see if the 20% that hold 85%* of the wealth will help out the cause. G'luck with that one ;)

    * Circa 2005 -

  13. Adrian
    Thumb Up

    They will pay it

    Wiireless companies been buying up spectrum and just sitting on it but now Cableco's(TWC and Comcast) who are thristy for that spectrum will force the big two(att and Verizon) into massive bidding wars against them

  14. Jonathan Bruha
    Dead Vulture

    From Engadget since they closed comments...

    First and foremost, I'm not an Obama supporter.

    That said, he isn't the guilty party in this decision. AT&T and the rest of wireless carriers have been raping their customers for YEARS now and putting all of that extra money towards ANYTHING useful is better than into a rich CEO's pocket. I'm sure AT&T will pass this along to their consumers as well, but that's our beef with AT&T, not Obama.

  15. Anonymous Coward

    Ah well???

    I suppose it will have to happen? But it will be a shame if it has to.

    Q: How will western 'free world' governments finance the indulgences, lifestyles, bonuses and income of its finance sector?

    A: by upping all revenues of stuff that are robust through the finance sector folly.

    Corollary: anything that is presently returning a profit will be taxed to the hilt?


    As in the case of RBS ex-chair running an income of some £11,000 per day (yes, per day! Yes, per 365 days a year!) now allegedly on a pension of some £1,800 per day (Yes! Per day!) the best way is to seek at least some satisfaction from those that brought the event about. It also begs the question: what was the lump sum? And possibly: isn't that small beef compared to the bonuses claimed by some immediately before some institutions went bankrupt?


    Unlike the UK (going for legal advice on how to recoup the gross overpayments) perhaps the best way for the public to recover at least a part of the theft is to say "Yes, you can have all of your pension as agreed. Yes, we will freeze it until our investigations have been completed and then you will lose it"?

  16. Anonymous Coward

    Now, rather than that do this...

    1 - each of the individuals and corporations involved with bonus payments or high incomes should be invited to create a government observed fund using their own income as a means to finance organisations through the credit folly they started (polluter pays principles)

    2 - if 1 above is not doable merely seize all personal assets on the basis that 'normal rules of engagement do not exist due to exceptional circumstances'

    3 - a perception of 'toxic loans' should be done away with soonest. It merely conveys a sense of misappropriated money that has ended up as high income, pensions or bonus payments to individuals in the finance sector

    'nuff said?

  17. Doug Glass

    When IT Come to Cows....

    ... it ain't spelt s-a-c-r-IT guys.

  18. Tom

    Re: Not that one can blame Obama - more money has to come from somewhere

    Absolutely not true. I can blame him, and intend to do so loudly at every opportunity for at least the next four years. If he and his socialist buddies hadn't passed a porker that in one month explodes the deficit more than Bush did in 8 years, he wouldn't have to collect the money. There is almost no stimulus in the so called stimulus bill.

    If you want to restart the economy, the only proved way to do so is the method used by John F. Kennedy and Ronald W. Reagan: Cut taxes across the board. And no, transfer payments from people paying taxes to people not paying taxes don't count. It worked in the 80's; it will work again if tried.

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