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US States Ask Netflix, Hulu, More Streaming Services To Pay Cable Fees

US States Ask Netflix, Hulu, More Streaming Services To Pay Cable Fees


  • Some officials say that streaming services are subject to the price;
  • Netflix and Hulu won their cases in some places last year;
  • Streaming companies argue that their distribution strategy is unique;


That was the question before the Ohio Supreme Court at a hearing on Wednesday, when the court debated whether streaming services like Netflix and Hulu are subject to a state law requiring them to pay to play.

The argument is similar to one being made in a number of other jurisdictions, where localities are attempting to compel streaming service providers to pay cable operator costs.

The state’s 2007 Video Service Authorization law is in dispute in Ohio, and it directs the state Commerce Department to identify which organizations must acquire authorization to physically place cables and wires in a public right-of-way.

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According to the law, companies that are classified as video service providers must pay a fee to local governments. Streaming services, according to officials in Maple Heights, a suburb of Cleveland, are liable to the tax since their content is supplied over the internet via cables and wires.

The state Supreme Court in Tennessee will hear arguments presented by Knoxville against Netflix and Hulu next month. In Missouri, a similar complaint has been filed by the city of Creve Coeur. In 2020, four Indiana communities filed a lawsuit against Netflix, Disney, Hulu, DirectTV, and Dish Network,

demanding that they pay the same franchise fees to local governments as cable companies. Netflix and Hulu won their claims that they can’t be regarded the same as video providers in related lawsuits filed in Arkansas, California, Nevada, and Texas last year.

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us states ask netflix, hulu, more streaming services to pay cable fees

Streaming firms say that their technique of distribution differs from that of traditional video providers. They further claim that in the Ohio case, the Commerce Department must classify them as a video service provider, which they claim cannot be done through a lawsuit. The state is backing the streaming providers, claiming that Ohio’s statute only applies to corporations who create cable infrastructure.

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“Those who dig must pay,” Ohio deputy solicitor general Mathura Sridharan told justices on the state Supreme Court during oral arguments on Wednesday. “They don’t have to pay if they don’t dig.

“It will be months before a judicial decision is made. Maple Heights’ lawyers say that nothing in the 2007 statute requires a video service provider to own or have physical access to wireline facilities in the public right-of-way in order to be charged video service provider fees.

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Streaming providers “could not send their video programming to their users” without that equipment, according to Justin Hawal, an attorney for Maple Heights, in a December court filing. According to Hawal, the “modest 5% video service fee” is not costly,

but rather reflects a small return on the billions of dollars in benefits that streaming services receive across the country from the network infrastructure. Maple Heights’ arguments were met with skepticism by the justices, who questioned whether the issue was even one for the court to decide.

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Surekha V A
Surekha V A
My name is Surekha Venkatesh , am from Shimoga, Karnataka. I am studying a Bachelor of commerce in Jnn college, Shimoga at Kuvempu University. I am interested in cycling, cooking and reading books. And I am capable of handling a variety of responsibilities in high-pressure situations.
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