The browser tax and Internet credulity

Internet denizens tittered a bit last week as online retailer Kogan instituted a so-called “browser tax.” The tax (which is, of course, not an actual tax but rather a private surcharge) applies to anyone still using Internet Explorer 7. Users still browsing the web with IE7, superseded by Internet Explorer 8 in 2009, must pay a 6.8 percent surcharge. Internet Explorer is currently on version 10, a preview version of which was released on May 31, 2012.

The so-called “browser tax” caused giggles, but it follows one of the main rules of economics: Tax behaviors you want to curtail and subsidize behaviors that you want to encourage. Kogan has done both, discouraging customers from using old browsers and encouraging the same users to update their browsers. However, there’s a little add touch of nastiness in Kogan’s recommendations for a “better browser.” Chrome, Firefox, Safari and Opera are all represented. The latest version of Internet Explorer is nowhere to be seen.

But the company isn’t just jumping on the IE pig pile. Kogan, which sells consumer electronics, claims it was spending piles of money to ensure that new versions of their website worked with the archaic browser. A post on the website’s blog highlighted the problem with continuing to use the six-year-old browser, not just for Kogan, but for ecommerce in general. "It's not only costing us a huge amount," the post reads, "It's affecting any business with an online presence, and costing the Internet economy millions."

Note that no consumer actually has to pay the tax. It goes without saying that they can easily find another place to buy the same goods online. However, disregarding going to another shop, Kogan goes out of their way to provide its customers with several options for a new browser, as stated above. This provides a net benefit for just about everyone but Microsoft. The browser tax is perhaps best thought of as a cheeky way to remind customers to update browsers regularly. Indeed, even though the newest version of IE isn’t offered by Kogan at its prompting page, a customer can avoid the tax merely by updating to a current version of IE.

Some customers will no doubt be frustrated by having to update their browser. But those still using IE7 represent a tiny fraction of total Internet traffic, about 4 percent. Those who are terribly tech unsavvy (presumably most IE users, as the browser came out six years ago) won’t even know to search Google for the answer.

Late-breaking reports state that the tax might actually be a publicity stunt. An article on Mashable said that the tax appears on a customer’s final statement, but that customers are not actually charged the tax when they check out.

So the story here is two fold: first, that there are millions of dollars going to waste in ecommerce because a tiny minority either don’t or won’t update their browsers in a timely fashion. While Kogan might have just been doing a publicity stunt, they’ve brought to light a very important issue -- how a tiny minority can suck millions out of the economy through sloth. But the other story is nothing new: Internet media needs to do its job in following up and researching these types of quirky human interest stories. From the word “go” something didn’t smell right about this story. Citizens of the Web should be used to stories like this at this point. The amount of credulity on this story from people who should know better might be what we should be taking away, but it’s likely that we’ll soon be fooled again.