Comment Dividends of ISP's should be heavily taxed (Score 2) 353
From TFA:
"The best way to resolve chronic network congestion in the long term is to invest and expand capacity. Yet, a review of the publicly available financial document for some of the largest ISPs in the country shows a decline in capital expenditures—the costs associated with building, upgrading and maintaining a network, such as construction, repairs, and equipment purchases—for their wireline networks.Many ISPs are spending less money on capital expenditures now, both as a ratio to revenue but also even in raw dollars,than they have in years past."
Lack of competition coupled with the payment of lucrative dividends by telecommunications is the culprit. AT&T pays 6% and Centurytel pays 7.5%. There needs to be an incentive to redirect the money to modernizing the networks. Maybe a tax credit for re-investing in plant and equipment, or a lower corporate tax rate if the dividend rate is reduced, and the money used for plant and equipment.