A discussion draft of the Online Sales Tax Simplification Act of 2016 is expected to be introduced in Congress soon.
More than 100 companies urge the Federal Communications Commission not to allow Internet providers to charge varying prices to Internet companies.
More than 100 internet companies, including several Top 500 e-retailers, have signed on to a letter urging the Federal Communications Commission not to pass proposed rules that would allow Internet service providers to charge content providers—including online retailers, search engines and news and entertainment sites—a higher price for faster speeds.
The idea that Internet access should be non-discriminatory is known as “net neutrality,” which requires all Internet traffic be charged the same rate. The proposed law would allow Internet providers, such as Comcast and Verizon, to charge more money for delivering data at faster speeds. Those providers of broadband Internet access argue that they have invested billions of dollars to expand their delivery systems in recent years, mainly because of the explosion of online video streaming services like Netflix, Hulu and Amazon Instant Video.
The companies that signed the letter are worried that charging more for delivering high volumes of data would open the door for Internet providers to essentially pick favorites and require Internet companies to bargain for rates with providers.
"Instead of permitting individualized bargaining and discrimination, the Commission's rules should protect users and Internet companies on both fixed and mobile platforms against blocking, discrimination, and paid prioritization, and should make the market for Internet services more transparent," the companies say in the letter. "The rules should provide certainty to all market participants and keep the costs of regulation low."
The letter, sent yesterday, including the names of e-retailers such as Amazon.com Inc., No. 1 in the Internet Retailer Top 500 Guide; Etsy Inc., No. 30; and Netflix Inc., No. 7. Also signing the letter were online marketplace eBay Inc. and Internet companies Facebook, Google, Twitter and Yahoo.
The proposed change would have the largest effect on sites with a lot of streaming media, experts say. That would affect streaming video at Netflix and on Amazon Prime’s video service. But this could also affect e-retailers that use a lot of videos on their sites, such as Amazon’s Zappos, which features videos for many of the shoes it offers.