Mac Musings

AT&T Proposes Extortion

Daniel Knight - Oct. 11, 2000 -

Perhaps you saw one of the articles in the newspaper (it was in USA Today) or on the Web, such as AT&T Mulls Web Charges on CNNfn. It seems that AT&T is no longer content to charge people for Internet service; now they want retailers to pay a kickback for every purchase made over AT&T's lines - and even a fee for each visitor to their site who comes in over an AT&T connection.

As an AT&T @Home subscriber, I'm appalled at this. I'm checking into EarthLink and other DSL options. There's no way I want a retailer to have to pay money to AT&T just because I buy something online, let alone simply because I visit their site to check pricing. I'm already paying AT&T @Home $40 a month for Internet access; surcharging retailers because I use AT&T is preposterous.

It's got to be even worse from the retailer's perspective. Even if they're not using AT&T for their Net connection, if this asinine proposal goes through, they will somehow have to track which visitors and which transactions come through AT&T connections. Then they'll have to pay a kickback to AT&T for letting their subscribers visit their online store.

So much for a free Internet.

If I were a retailer and saw this coming, I'd find a way to globally block AT&T Internet customers, rerouting them to a page not on their site that explains why they won't be held hostage by AT&T Internet Services. Either that or charge AT&T customers more to cover the surcharge.

Of course, the bookkeeping will be a lot easier for businesses that already use AT&T as their ISP. They get to pay a fee for every visitor and every sale. Much simpler accounting - and much more costly. It would also mean higher online prices, making these retailers less competitive than those not using AT&T for Net access.

Even the U.S. federal government has backed down on taxing ecommerce; what makes AT&T think they could ever pull this off?

If I were a retailer using AT&T Internet Service today and understood the implications of this extortion, I'd find another ISP in a hurry.

If AT&T doesn't back down on this scheme, they can count on losing me as a customer. I'm sure I'm not alone in that sentiment.

Further Reading

• Follow-up on Miscellaneous Musings, 10/16/00.