>> host: david stewart is the president of the washington independent review of books, washington independent review of books.com is the web site. >> this week on "the communicators," a discussion with congressman bob goodlatte, chairman of the house subcommittee on intellectual property and co-chair of the congressal internet caucus. >> host: congressman bob goodlatte is co-chairman of the house internet caucus. how do you envision your role in the upcoming or the current 112th congress when it comes to tech policy? >> guest: well, i think i am very, very fortunate to chair what i think is one of the best subcommittees in the congress, and it's particularly good in terms of looking at what we need most in our country right now, and that's job creation. and growth of our economy.

the tech industry the, the tech community plays a huge role in that, a very high percentage of our job growth is related to development of new technology, and a very, very large percentage of our exports are related to that as well. so promoting that through both intellectual property which is the jurisdiction over patents, copyrights and trademarks, and think about the internet as the largest collection of patents in the world. and the subcommittee has jurisdiction over antitrust issues. so, again, promoting competition, i believe, creates jobs. so this subcommittee, i think, is very key in terms of job creation, and that's what we're focused on. >> host: how does your role meld with that of the energy and commerce committee, greg walden, fred upton, etc. >> guest: very important committee, pro-business, pro-job creation committee that also

deals with some of the same issues but from a different standpoint. for example, their jurisdiction over the federal trade commission and the federal communications commission is more regulatory-focused whereas the judiciary committee generally is more focused on their creation and enforcement of various types of laws, intellectual property laws, antitrust laws, criminal laws all of which come into play when you talk about the internet. >> host: so when you talk about job creation, has the broadband policy of the last two years and its expansion many this nation -- in this nation been good for job creation? >> guest: well, certainly the expansion of broadband and bringing more high-speed internet access to more people is a very good thing. whether the process by which that's being done with massive spending under the stimulus, all of which has to be borrowed and has, i would argue, a countering

effect is good. and whether all of the rules of the road -- remember, when you talk about extending service to the additional homes primarily in inner cities and out in rural areas, you've not to be very careful the government isn't subsidizing one player in that at the expense of another that's already making investments from the private sector into the expansion and development of that internet access. it's a little, it's a historic role for the government and one that i don't object to, you know? it started with telephony and bringing electricity to rural america, but by the same token, those have always -- in the past, especially when that service was rolled out -- been monopolies. this is a little different dynamic here when you want to promote and you have a number of different internet service providers, you've got to be very careful they are using that money to, indeed, bring new access to areas where the

private sector would not invest as opposed to leveraging one company that, you know, has a base of operations in a more profitable suburban or urban area and then uses government money to reach out into other sectors of the economy as opposed to someone else who's already done that and is bringing internet service to a community based upon their business model. so the government involvement here is, it's like three-dimensional chess as opposed to the traditional forms that rural utility service and so on did in terms of promoting access to communications in the past. >> host: joining us in our conversation is gautham nagesh of "the hill "newspaper. >> host: representative goodlatte, you just mentioned the broadband stimulus grants. it's interesting because the president recently unveiled a new national wireless plan in michigan aimed at doing exactly the same thing which is expanding broadband coverage. he really focused on rural areas. he touted this 98% of america

figure to be covered by the next generation broadband. did you have any response to that? because we know that's going to take congressional action. >> guest: i think that oversight hearings should be held certainly in the energy and commerce committee, we might even look at it in our committee based upon not so much our internet jurisdiction or intellectual property jurisdiction, but from that same competition standpoint. is it being done in such a way that will continue the encouragement of private sector investors to invest in rolling out broadband? because they have done the most, and they have the largest resources available. the government, given its very difficult economic circumstances whereas you know we're in the congress right now trying to close a $1.4 trillion deficit last year, 40% of what the government spent last year was borrowed against our children and grandchildren's future. so taking money out of one pocket to put it into another has to be done in a way that

we're being assured that we're not discouraging private investment and that we're not disadvantaging private companies that are also looking to provide those services. that's the key to making sure that a broadband rollout works well not just for right now and the expenditures right now, but in terms of future investment incentives for people to take the risk and put money into rolling out broadband. >> guest: in terms of impact on the deficit, does the fact that the administration is proposing to fund these measures through spectrum auctions effect the way you view it, or is it all revenue to you? >> guest: well, i think one has to look at the fact that we have always relied upon spectrum auctions for funds that could be used for a variety of things. so it's all fungible and, therefore, if government is proposing massive new expenditures, that has to be added against the bottom line of the huge deficits that we

already have. so not to say that making sure that high-speed internet access isn't a good thing and doesn't involve, particularly in rural areas, some government involvement, i think the whole process and the cost of it deserves a lot of close scrutiny. >> host: taking the opposing tack, if a private company were to determine that a certain coverage area were not economically feasible to cover, do you see a role in the government in supporting development to those areas? >> guest: sure. that's what the rural utilities service which is i also serve and have been the chairman of the agriculture committee, and that actually happens to be the jurisdiction of that committee. so i've worked on these very issues of fairness for a long time, and as i said, that same rural utilities service has been responsible for bringing telephone service and electrification to rural areas. so there is a role, but we need to be careful that we understand the limitations of that role due

to the fact that there has been a great deal of investment and rollout of broadband services in rural areas. i represent a district that is one of the more rural areas in the eastern part of the united states, and i can tell you that not only are services being provided in those areas -- not always as competitive as you have in a major city -- but often they're being provided by some of the smallest telephone companies and isps in the country who, you know, suddenly being confronted with a new competitor either subsidized or in some other way financed by the federal government is disconcerting to them. and, again, that has to be part of the equation. >> host: so, congressman goodlatte, would that call for usf reform at this point, and do you foresee that coming in the 112th congress? >> guest: that's certainly a possibility. that's something that is not,

basically, the jurisdiction of our committee. primarily the energy and commerce committee. but the issue of what is a fair way to finance that is something that, certainly, ought to be reviewed on a fairly frequent basis. and i suspect that now would be a good time to look at that. >> host: as someone who is former chairman of the ag committee and serves on it and represents a rural district, what are you personal thoughts? is. >> guest: well, i do believe in the important principle that the economic vitality of the entire country is benefited by having our rural areas able to communicate with the world. this is something that is a lot like the railroad in the 19th century, something that in the 19th sent by was -- century was also subsidized by the government. not without a lot of controversy, fraud and waste, but nonetheless, the transcontinental railroad and expanse of railroad into the more remote parts of the country helped to grow the economy of the country. similarly, today you do not have

to be inside the beltway or on wall street or in some other major urban area to provide certain types of job skills that you used to have to have in those areas. so this is a competitive issue for rural america. if they can communicate with the rest of the world, they can offer quality of life and jobs that makes them very competitive for people who don't want to live with traffic jams and high crime and so on and want to move into those rural areas. >> host: one other note on expanding broadband coverage to rural areas. you discussed stimulus broadband grants. i believe that up to two billion of the original grants were slated for the rural utilities service. have you guys been examining sort of how those were dispersed? >> guest: we have. and that's what led to, actually, even before the stimulus funding there was early efforts to do this during the bush administration, and that's what led to this discussion about how do you write the rules of the road, under which circumstances are federal funds

appropriate and which are not? and, of course, there aren't clear guidelines for that, so different administrations have taken different philosophical points of view about what role government should have here. and, again, i think that calls for a very close examination of what's being proposed as well as a close examination of how the funding that was put into the stimulus has been spent. >> host: this is c-span's "communicators" program. our guest this week is representative bob goodlatte, a republican of virginia. he is chairman of the subcommittee on intellectual property and the internet as well as co-chairman of the congressional internet caucus. joining us in our conversation, gautham nagesh of "the hill" newspaper. next topic area. >> host: well, doubling back to intellectual property, you mentioned you felt your committee was more the place where legislation is often written, so are you indicating that you or someone on your committee will be taking the lead on intellectual property or patent reform going into the

next session? >> guest: you bet. the chairman of the full committee, congressman lamar smith of texas, has been working on patent reform for many years as have i. and he has tasked me with being very fast out of the gate on patent reform. in fact, i left a patent reform hearing to come over and be with you right now. fortunately, i was able to get my portion done, and someone else -- the vice chairman of the committee -- took over to recognize many other members who were there. lots and lots of interest in this both in the congress and in the various sectors of our economy, not just, you know, the technology sector but, obviously, a very, very keen interest there. we have run into a number of problems in past congresses in trying to get to the finish line. the house passing legislation that couldn't get through the senate. the senate passing legislation that was not of interest to many

of the people who are intellectual property rights advocates. so we're now both in a bipartisan and a bicameral way working very hard to try to find what patent reforms are necessary to enhance job growth in our country and what can get across the finish line so it actually can be signed into law by the president. and that, i think, focuses first and foremost on the efficiency of the patent office both in terms of how quickly they can make decisions about patents because there are increasing backlogs that are very concerning and about the quality of the patents coming out. are these really new ideas, new inventions deserving of the kind of protection that the patent system affords genuine inventers which gives them an incentive to invest a lot of money in bringing that product through the manufacturing phase and then

into the marketplace, or are they efforts to simply climb on the back of somebody who has done that legitimate work, already has a patent or is attempting to license somebody else's patent ideas? so trying to find our way through that is very, very important. fortunately, here in the last several years the courts have taken a more dynamic, more renewed focus on how the patent system is working, and a number of reforms have effectively taken place through court decisions. so that has helped to narrow the focus on what the congress actually needs to do and may make it a little easier for us to pass legislation. so we're holding a hearing today listening to a number of the stakeholders. we will hold another hearing to hear from legal experts as to what the courts have done in recent decisions and how that

might guide us. and we've held hearings -- we've had the commissioner of the patent office come in and talk to us about what he's doing to try to speed up the process and improve the quality. so there'll be a number of contentious issues, and we're going to try to sort through which of those we can find common ground on and which of those need to be left by the wayside because we can't get enough votes to pass through the congress. the chairman and my determination is to get a bill done and signed into law. >> host: well, what are some of the differences? why has it taken years to get to patent reform? >> guest: well, you have, basically, two different points of view here. you have people -- and this is very general because there are probably as many different viewpoints as there are people who hold patents. but, basically, the basic confrontations tend to come from people who, who utilize by license other people's ideas and create a device or software that

is very complex and might incorporate hundreds of different patents. and you have people who are inventers and desize a single patent -- devise a single patent or something that only contains a small number of patents. they don't encounter the same problems. if you're building a piece of hardware or software and it's incorporating several hundred different patents and one of those turns out either legitimately or illegitimately to be the basis of a claim, that can hold up that entire product from coming to the marketplace and make it no longer attractive to invest in bringing it to the marketplace. obviously, that's a job killer, and we want to make sure that that doesn't happen. on the other hand, if you're the holder of that pat pent and you -- patent and you believe you have a legitimate claim and you see somebody else utilizing it in their product, you want to make sure the legal system works to protect you and reward you for somebody else infringing

upon what is your property right. if you're in the pharmaceutical industry, you probably have a drug that only has a few patents attached to it. and so the current system works better for you to defend yourself than if you're developing something at, you know, cisco or intel or major technology company and you're incorporating hundreds of ideas. and then, of course, the underlying genius, that individual whether they work for a large company or whether they're an independent inventer, that's what we want to ultimately reward and make sure that they have the incentive to go on inventing, but also then the incentive to get that invention to the market that people will take a risk on them and invest in their patent idea and build a business around it and create jobs. if we can devise a system that improves our current one which a lot of people think is starting to falter, to lag behind because of the fact that it's become cumbersome, it takes too long to

get a patent to market and then there's too many questions about whether the quality of those patents are good, all of that is what our focus is. >> host: so i did want to ask you in terms of the administration's recent efforts, they've prioritized intellectual property issues to some degree, the chief released an update report, we've seen immigrations and customs seizing domain names. how have you reacted? are you satisfied with some of the actions the administration is taken? is have they shown you they are serious about patents? >> i think they are serious about patent reform. we had the commissioner in. he had taken a number of aggressive stands, and i think he deserves some credit for looking to modernize the system. i think there is a long way to go, however. the testimony that we've been hearing here in the committee of late focuses on the lack of the use of, you know, some of that very technology that's been developed and patented to speed

up and make more accurate the review process. so, you know, if you have the opportunity to use technology to deploy how far-reaching your examines of what other ideas are out there to see whether this is a new idea or not and to accurately compare and you're not doing that, you're still doing things the old-fashioned way completely by hand, that slows down the process. obviously, we need more examiners, but we also need more and better use of technology to speed up that process. then there are other things. there are legal reforms. there may be some things that we need to do in the courts. as i mentioned, several things related to venue, forum shopping where people pick a particular court because they always know they rule in favor of the plaintiff and bringing their lawsuit there. the courts have done some good in that area. and in the area of damages. the courts have ordered the judges when they -- the supreme

court has ordered judges based upon new standards that they've come forward to look more carefully at about how they apportion and assign damages in a case where they have found infringements have taken place. you don't want -- with 400 patents in a product, you don't want one item to get so much compensation when there has been infringement found that it makes the whole thing unprofitable. on the other hand, if that one thing is the key idea behind that entire new piece of equipment, then they are, obviously, deserving of more compensation if they have been infringed on. very complicated and, again, sometimes the courts are better suited to decide some of these things than the congress. but we need to look at that and find out where they've gone. there are internal things with regard to once a patent's been issued, can you go back in and look at what's called post-grant review? an idea goes through the patent

system, not a lot of attention being paid to it. the examiner decides, yes, this is a good idea, grants the patent, and somebody else, hey, i've already got something else that is exactly the same thing. under what circumstances can they come in and challenge the issuance of that patent after it's already been issued? a lot of examination behind that as well. >> host: one other note on patent reform, senators leahy and hatch have introduce add bill that has gained support, how do you guys view that bill in the house, and is that something you would use as a framework? does it prioritize the same topics? >> guest: we're going to start from scratch, and we're going to look at what we think there is widespread support and that could pass the house with strong support, but as we do that, we're going to take into account where the senate is, where they have been and have some chose discussions with both senator leahy, senator hatch and other senators to make sure that we're not creating a divide here that

can't be closed. we don't want to start with a senate bill, not at all, but we do want to take into account what we think is achievable in the senate and what is achievable in conference between the senate and the house. >> host: congressman goodlatte, what about the theft and bootlegging of intellectual property? do you see action in the 112th coming forward, and if so, how do you see that legislative action being framed? >> guest: very, very important. the scenario that i've worked in for many, many years, worked with the customs office, got legislation pass add long time ago that -- passed a long time ago that allows customs officials to seize counterfeit goods coming into the country. in the old days, they had to just turn it away. they couldn't seize it, and it would just go around to another port or to another country, and it would perpetuate that piracy, that copyright theft. that's helped, but today the problem has gotten of much

greater magnitude. first of all, more and more countries are manufacturing counterfeit, you know, cds, dvds and so on, but of even greater concern is that much of it now is not even tangible. it's going across the internet in ways that you can't have a customs examiner seize it at the port. and recent studies have said that one-quarter, one-quarter of all international internet traffic is, basically, involved in infringing on other people's intellectual property rights, primarily the copyright rights or sometimes trademark rights as well. and that's staggering. that's not one-quarter of goods, one-quarter of music sales, it's one-quarter of all the communications of an international nature going through the internet involves somebody stealing somebody else's music, movies, software,

books, video games, you name it. if it's digitize bl, it is vulnerable, and that takes the whole incentive out of creativity that we rely on as one of the basises for our free enterprise system. so we have legislation in mind, and we also are holding hearings. we're going to hold a hearing on what are called rogue web sites, basically -- oftentimes that has a wide definition, but a characteristic of it would be someone posing as a legitimate business looking exactly like the real thing, and you can buy it online, download it, and they may be located anywhere in the world. the customer doesn't know that. they're actually being sold something that is effectively stolen from the legitimate owner of the business. and what kind of tools can we use? we need to have much more international cooperation, and we need to continue the message to countries like china and russia that these are countries with tremendously creative people, and if they don't devise

a system in their country to protect intellectual property rights of americans and others who are trying to do business around the world and seeing their property stolen, they'll never become more than just that, you know, a country where they develop things based upon idea, technology stolen from elsewhere and not -- if they can't reward and protect their own citizens and others, they're going to miss out on the potential that they have of the creativity in their own country. >> host: gautham nagesh. >> host: now, two notes. that study you referred to with 25% of the traffic, i'm familiar familiar with it, but there are concerns with customs actions and dhs that the domain name seizures are taking place without adequate review, and there is some concern that if government is given this unilateral control, ability to take down domains that they feel are rogue, that this can be abuse potentially for reasons other than copyright infringement.

how would you react to that? >> guest: well, absolutely. we don't want to be egypt, nor, you know, when you talk about cybersecurity, a broader issue that goes beyond theft to concerns about what can be done to harm the function of the internet itself, we don't want to give government so much power that they have a kill switch or something like that. and then narrowing that down to individual domains, we need to be very careful that we're doing it in a way where due process is properly followed. so, again, there have been some criticism of senate legislation geared at that. we're not going to start with what the senate's done. we're going to start by taking a careful, fresh look at this and making sure that people, we can utilize a judicial system or adapt that judicial system to fairly deal with these issues. we're also going to hold a hearing on ican and some of its proposals which is going to -- in fact, it's more than a proposal, it's a plan that

they're in the process of implementing to dramatically expand the number of end domains that are available which could complicate immensely the ability of people to protect their intellectual property rights. so we want to, we want to ask them some really pointed and be tough questions about that and also hear their ideas about why they think that is necessary and important to do. >> host: one other note on that. president obama met with, obviously, the chinese president when he was here recently, and they discussed intellectual property enforcement. the president only received a very small concession which was that the chinese government itself would take care to avoid purchasing pirated software. what can be done to convey the importance of this issue to the chinas and russias that pose a problem? >> guest: well, that is important. if china actually does that, which we'll wait and see if they do, that would be a good first step because if you, if you are imposing that ethic on the

people who are charged with enforcing the laws in china, then they might have a greater appreciation for the rampant amount of piracy that's taking place in china. far worse than, i would say, any other country in the world. recently, steve balmer, the ceo of microsoft, came and talked to me and a few others and said that comparing china to russia which has a bad reputation itself, they believe that the rate -- now, china's a much more populace country than russia, but the rate of internet theft based upon the number of computers in chi compared to the number -- it's six times as great in china as it is in russia. and that worldwide the piracy that's taking place is costing 40-60,000 american jobs. this from a company that has, i think, only about 88,000 jobs total in the unite. so -- in the united states. so if they could almost double, certainly increase by 50% that

one company's employment in this country by handling this problem -- and we'll never completely handle it, but getting a better handle on it will create a lot of american jobs. >> host: and, finally, congressman goodlatte, net neutrality. the energy and commerce committee is holding hearings on the issue of net neutrality, fcc is very active on this. what is your view of the government's role in net neutrality? >> guest: well, i think that the judiciary committee has a very important role here. in fact, i and former congressman rick boucher who were the co-chairs of the congressional internet caucus, we introduced legislation almost a decade ago. we didn't call it net neutrality, we called it open access, but it was exactly the same thing. assuring that people getting access to the internet, doing business on the internet have the opportunity to fairly compete and that the people who control that access -- primarily the internet service providers -- do so in a fair way.