Swiss Army Phone

I’m not sure who first observed that cell phones are fast becoming the Swiss Army knives of personal communications, but anyone who doubts this should pay attentions to some recent developments.

Both Google and Yahoo! Are getting serious about bringing powerful search functionality to cell phones through SMS. Google looks to bring full on web-based searching to cell phones in the near future. Cell “phones” is becoming something of a misnomer ““ these devices are turning into (or have already, as some would argue) sophisticated application environments that can be used to deliver all types of information to users through a staggering array of channels (voice, e-mail, text message, IM, etc.) These are just of a few of the indicators that radical changes may be under way in how people use cell phones.

Given this trend, it makes sense for governments to be aware of how the taxes they impose on telecommunications can influence activity. If you believe the old adage that “the only (legal) way to avoid taxes is to change behavior” then there is a powerful message in these recent developments for government administrators. Tax systems change at a glacial pace, while the half life of many technologies can sometimes be counted in months. Reconciling these two factors requires foresight and an awareness of how technology is changing.

There is an interesting article in USA Today that highlights some recent actions taken by state governments enhance their revenue collections from telecommunications taxes. There is also an interesting report on the Congressional Budget Office site regarding USF taxes.

It would be nice to be able to point to a report or analysis on this issue conducted by organizations like the Federation of State Tax Administrators, or the National Association of State Legislatures, or even the National Governor’s Association. Sadly, I couldn’t find anything relevant through a search of their sites. Not a good sign.