we completed two preliminary tests as jamie mentioned in alaska and found the functions as advertised at first the technical lesson to modify procedures, but with a basic understanding in basic agreement that has been advertised. we have shared findings at the fcc and broadcasters and in november we will show the american public will have courage to conduct an end to a nationwide test of the system and from there we'll value bait the outcomes, take steps to correct efficient he is and will move forward from there. that it has, we are simply hoping it would work as planned. as we reanalyzed the test given to snc nonpolluting american public, we quickly realized the commish in the test was more complex than the old economy you can't have in the 1950s. multiple means and methods in the to be at all levels of government and needs to reach out the american public.

so when we decided that we would -- we also decided we needed a way to include technology new safety is the dirty exist that need a way to incorporate emerging technologies. so we threw out a concept we have requirements-based approaches and really developing applications based approach. so when we apply this approach, the fema same aggregator becomes a device that we can now use to exercise the existing cable abilities, but open countless other applications that not even considered. so we abandoned them my way or the highway approach for the common alert protocol standard. once that was approved, that shows the leadership of the nation we are looking much further in the future and standing standard for interoperability for all alerts and warnings. now if an inventor wants to develop a piece of equipment,

emergency managers can know and peace of mind that the equipment is compatible with any message that the federal government may send in any message they want to generate at their level. we've opened up the opportunity for development of countless benefits to the american people at the same time. the potential is boundless. now we can take emergency technology in the midwest for example and incorporate that. we can incorporate initiatives in the southeast. ..

to isolate the household effective and send multiple messages to affected communities with instructions on how to protect themselves. as another example, national public radio developed technology that can take one of or text messages and instantaneously translated through a voice synthesizer to a thune brail reaer so the sky and the imagination of the limits to how we can alert the public to eminent danger so to close again, thank you, commissioner and mr. chairman and commissioners for your support and in particular thanks to jamie and his team lisa, greg, eric, tom, david, bonnie, tom, jeffrey for helping us make this a reality and taking a great step forward. thank you, sir. >> thank you.

>> he's saving his voice for hurricane season is available at request. [laughter] >> thank you come all of you. let me ask my colleagues if you have any questions. >> i think it is great news we are going to do a test of the úa system. ú it's a ú national challenge buta also in national opportunity toú develop a system that we are going to increasingly rely on t@ deal with national crises and weather emergencies and man-made emergencies and anbar alerts and objected children, and i want to highlight two things. i want to commend the public-private partnership that is behind this. he mentioned the stakeholders and participants and it's a pretty wide range of folks, so getting them all working together and coordinated and pulling together for the common good is admirable and i congratulate you on that. it works best when we can do that we found that out during the dtv transition just a couple of years ago.

i also want to commend the interagency coordination that you've done here, david and mark and others, too. this is such an urgent priority, and we have to have absolutely seamless coordination and cooperation when you talk about coping with disasters like the ones we have in recent months and recent years, too, so i want to commend that interagency cooperation you've done here and i want to particularly commend the admiral for doing the same thing on other issues that are under your office and the bureau, so i think that's commendable and a wonderful example for all of us as we seek to protect people in the 21st century. thank you coming and i wish you luck in the test. obviously he will run into some problem but you are already

learning from the alaska@x@p experience. i think that's great and we will learn a lot from this one, too. i have your here. >> thank you. >> i would just echo the words of my distinguished colleague that as i travelled the country in the past five years i have heard frequently from broadcasters and public safety officials etc the need to do exactly what you're doing so this is a historic step. we are going to learn a lot and make great progress here and it's going to help protect the system and the resources of the great nation. thank you for doing what you're doing and we look forward to learning from it and hearing more about what comes about as a result and how we can learn more and do better. thank you. >> thank you. commissioner? >> i commend the staff of the public safety homeland and community, community also the security, noah and fema for the hard work necessary to conduct

this first effort top to bottom nationwide test of the emergency alert system. the goal is that all americans as they are turning into their favorite tv or radio station at 2 p.m. on november 9th should be able to see or hear this test alert. those, like me, who hail from states vulnerable to hurricanes know all too well the value of timely communications in emergencies. therefore, i am glad that under the leadership of chairman genachowski and the admiral barnett that this commission is doing all it can to ensure that all americans have access to and rely on the national eas. thank you. >> thank you so much. i want to echo a couple of points. one, interagency coordination. it's symbolic that we have here not only admiral barnett from our team but fema and the

national weather service, because we know that proper emergency alerting and response in the country can't happen without effective, efficient in their agency coordination. and the three of you here reflects a tremendous amount of interagency coordination that occurs on a regular basis and includes agencies that aren't represented here today. that's a big deal. i commend everyone for working together on this and it's reflected by the presentation today. a second point is that this is as commissioner mcdowell said this is historic. and in fact, we are what is developing to be a series of historic steps when it comes to emergency alerting and response. so this specific test, the first top to bottom test of the eas is

itself historic but the other steps touched upon today are some that were also part of a full set of initiatives that are targeted at making sure we are harnessing modern technology to communicate with people in the way that is effective in times of emergency. and so what we all grew up within the traditional eas system remains very important. but can no longer be the only way that we seek to alert people. and the work that has been done in the last several months on plans, the mobile alerting service, that's a very important part of this puzzle. the interoperability that you mentioned in the systems and protocols is a very important development.

the progress that we are now making on getting in national and air operable mobile broadband public safety network up and running yesterday the senate commerce subcommittee or full committee approved important legislation in this area. next generation 911 where there is still a lot of work to do, but it's now a matter of what is being actively pursued in another area where i believe we can make progress of historical significance. so for all of that, on behalf of the public, we are grateful to the work that you're doing and we know that the eas test is extremely important. and again, i think one of the most impressive things of the presentation is that you're thinking about the eas test, not in a vertical silo, and related to other emergency alerting

mechanisms, that you're thinking about playing field, and that makes complete sense because from the perspective that an ordinary person you just want to make sure you need to be a little something that's going wrong, that there is a way to reach you wherever you are, efficiently so that you have information you can act on and save lives and protect your family. so, very appreciative of this presentation. thank you again, to that for all barnett and your great staff to fema, the national weather service, we look forward to further reports and the work that you're doing. d d@f@f@b thank you. >> madam secretary, our next item, please. >> the final item on your agenda impact of technology on the information needs of communities

>> before it turned over to steve for his presentation let me say a few words of introduction. in 2009, a bipartisan commission of the knight foundation looked at how technology is changing the media landscape and affecting the community. commission called on the fcc to examine some of the issues more closely, and i asked steve walden to come to the commission to lead a working group to do so, to assess the landscape, identify trends and make recommendations how the community's needs can best be met in a broadband world. today, i am proud to say that they have completed and delivered the report. the project share, steve walden is here to present the key findings and recommendations of the staff report.

but before i turn it over to steve, a few brief comments about the process and steve's remarkable team. anyone that reads this report will be impressed by the thoughtfulness of the analysis and its recommendation. the report's findings and recommendations contained a strong and hopeful through line. there's never been a more exciting time than this broadband age to achieve our founders vision of the free democracy with a free press and informed and in power citizens. as the report identifies and so the prince the potential of new communications technologies, it also highlights important gaps that threaten to limit the potential. the report does all of this in a thoughtful and fact based way with a full grasp of the opportunities of new technology as well as deep respect for a long established forms of media. that the report deserves this

description is no surprise given steve walden penn press, diverse unique background. steve worked for many years as a highly respected reporter and editor at publications including newsweek and u.s. news and world report. he's also a successful internet entrepreneur, having created an online community that had millions of americans as regular users and he also wrote for "the wall street journal".com. he was the ideal person to lead the effort on this report, and on behalf of all of us, thank you for your service. this was a group effort within the agency great example of collaboration across departments and grateful to all the staff who worked on this often squeezing on top of their other responsibilities. i want to especially note the deputy chief of the office of strategic planning and the senior counsel, senior adviser for the extraordinary work. i also want to note just to lead

into the presentation steve attracted an impressive collection of outside journalist academic and scholars to help develop the report that improved professor james hamilton of duke, ellen goodman of rutgers, peter shalem ohio state, cynthia come rf ann byrd. the team conducted more than 600 in-depth interviews and a very diverse range of people across the country held multiple public hearings, made numerous visits and newsreels across the country analyzed scores of studies and compiled more than 1100 comments from the general public. the commission takes pride in this process and in the final product. with that, i would like to turn it over to you to present your findings and recommendations. the floor is yours. please take your time. >> thank you. it has been a great honor to work on this project with this great staff and with the commission.

as you mentioned this project was launched at the beginning of 2010 when it was very clear that we were in a time of rapid and seismic change in the media world. you have on the one hand a tremendous innovation, additional innovation everywhere and every day and at the same time newspapers closings, staff layoffs and the media going through a very serious contraction. so, the idea was to therefore take a good hard look at this and the answer to basic questions. one is our citizens and communities getting the news and information and reporting that the need and what. second is policy that the fcc and others are in sync with the nature of modern media markets especially when it comes to encouraging innovation and advancing public-interest goals.

the process, as you mentioned, we created an informal working group that basically demanded extracurricular time from many people at the agency across many departments as well as bringing in some really outstanding outside experts to help. would it more than 600 interviews and has a wide range of people we interviewed. media executives, such as leaders, foundations, investors, conservatives, liberals, the old media, new media, really very broad range. we had to public workshops, public comments and significantly we also did a very careful literature review because we're the first ones to study this, there are very outstanding studies and reports that we made great use of. as you mentioned, we were very fortunate to have a really

outstanding team, and you mentioned the key folks, elizabeth, andrea, james hamilton, ellen goodman, peter shane, cynthia knard and tamara who worked hard around-the-clock on this. we also as you said had people throughout the agency working on this. i'm not going to read all the names as we would use up all the time there we can see that we had contributions from every department which is fitting for the nature of the modern media landscape which isn't silo in the traditional ways that, you know, the agency is divided up. and we made a very aggressive use of free labor and in terms that too much of their work to do and this is really gratifying

process. i have to say of all the exciting moments the most gratifying moment in the entire process is when one of the folks on the stuff, and i won't mention his name, who said the first four drafts were horrible, said the fifth draft was pretty good, and i know we were finally ready to release. just starting with the six come the first principle that actually has to guide all of this is the first amendment. this confuses a lot of what we talked about and the way that we approach the recommendation as a journalist and i take them very seriously that while we care very deeply about what is happening with journalism we also have the first amendment as the basic parameters for how we approach this both in terms of guaranteeing freedom and placing the limits on the government intervention. the way that the report is structured and by the way the

report is now as i have on the web site is a major section on the media landscape which is a description of what is happening in the landscape right now. we broke into the sections on commercial media, nonprofit media, non-media institutions by which we mean there are lots of ways people get very important information that don't go through the media. and libraries, schools, government websites, and those are increasingly important ways people get information devotee of the policy and putting the fcc's policies and track record and i am proud really of the commission a pretty tough as some of the fcc i think that speaks well to the commission

and its desire to get the right. and then we have recommendations to the recommendations are not only for the fcc. we took the sec recommendations very seriously but we also spoke about possible ways that other players in the media landscape can help. the main findings and and not shelf are that first most of the media landscape is actually very vibrant, tremendous amount of innovation will go into more debt about that, but that is a central point. and there are some very serious issues and especially the one we keep coming back to over and over again is what we believe is a shortage of local accountability reporting and since i'm going to use this word accountability reporting a bunch of times, i should define it. this is basically things like covering city hall, the school board, the state house, the basic civic institutions holding those institutions accountable

and the information citizens need, so it very interesting moment where these elements will mean serious harm to communities but paying attention to them will mean we will be able to create i believe the best media system that we've ever had. i know that sounds like hyperbole, but i think when you consider the advantages that have happened and the serious gaps are going to be in a very exciting moment. so first let's talk about the basic backdrop that helps us understand what went on. the contraction of the traditional media. it was sometimes said newspapers would have been a better position of the hit just grown their web traffic and if it were only that easy the truth is that from 20005 to 2009, newspapers online web traffic doubles and

digital revenue grew $616 million which sounds like a very big sum until you hear that at the same time it lost $22.6 billion this led to the newspaper business print dollars for being replaced by digital lines and if you look at the numbers hard it is print dollars being replaced by digital pennies, and that is the nut of the problem is that it's very hard to outrun the losses in the traditional business model. what are the implications. we ended up focusing a lot on the needy gritty subject, which is staffed. what happens and newsrooms when these kind of revenue

contractions happen? and it's a really distressing set of numbers when you look at what's happened with traditional media. just in the last few years which means it's now down to the level newspapers had before watergate. a tv network news staff are down by half since the 1980's. news magazine, where i used to work, down by half since the 1980's. if you look a particular communities shall finish to see how this plays out you see the impact. so a study by a few which system the best work in this area of baltimore the look of the "baltimore sun," the "baltimore sun" produced 30 more stores in 2010 years earlier so look at philadelphia these available news but public issues is dramatically diminished over the last three years by many

measures air time story account and keyword measurements. if you look at a particular news room, the news and observer in 2000 for they had to hundred 50 newsroom employees. by 2011 they had 103. it doesn't take a lot of imagination to see that that can have a really serious impact. and specifically some of the beads that lost reporters, courts, schools, legal affairs, agriculture, environment, state education, fundamental issues of concern is to citizens and of the health of american communities. statehouses. from two dozen three to 2008, when spending by state governments went up by about 20% the number of people covering state government went down by one-third. it's not a good formula if you are concerned about safeguarding taxpayers' dollars. investigative reporting is down. this is a hard, this is hard to

come up with numbers that are exactly, but to lose. membership in the investigative reporters association from 2000 to three was 5300, and now it is 4,000. the number of submissions for the public service categories and the pulitzer prizes is up 43% from 1984 to 2010. coverage of washington, the washington bureau, 27 states have no washington reporters. the number of your nose down by about a half since the 1980's. religion, religion coverage a topic dear to my heart my chicken with a religion news writers and said what happened in the last year with a set of religion news a the local level was nearly gone, which is very sad because the previous ten years had been a period of real growth in that area.

hamsterization this is a term a columbia internal review referred to about a hamster wheel and this is the phenomenon of reporters who now have in addition to their regular beat the have a second beat and right for the website and tweet and are learning how to do video it creates the sense they feel like they're hamsters on a wheel. since the work of the federal government i decided to bureaucratize the phrase a little bit and we are now referring to this as hampsterization, and this is a process of when you don't necessarily eliminate the become it's like it's not like there's no one there covering it but reporters are stretched and it means to use a different metaphor if you're talking about a media landscape there are still reporters who can look at the landscape and describe what is there but they have less and less time to turn over the rocks and look in the shadows. you can see in the case of calls reporting eighth important topic, the kaiser foundation did a study and said its interest in

health coverage is up, the number of reporters is down and they concluded a result of that was a loss of in-depth enterprise stories. education, there's lots of education reporters, but they are less ambitious and doing less debt. same thing with local business reporters. the ceo of bloomberg said it is currently not a market well served. now, i think this obviously has, to communities. it's wasted taxpayer dollars, corruption, schools, the did simon who was a former reporter the "baltimore sun" who may be is better known as the producer of the lawyer at a senate hearing said it's going to be one of the great times to be a corrupt politician and i wasn't there so i don't know who he was looking at when he said that, but i thought it was a very exciting moment. now it's very hard to prove in this case. we are talking the impact is on

stories not written. so how do you prove that, how do you prove what the impact is? and we try to get at this differently. we interview reporters about what are you doing now compared to what used to do? what did you use to do that you can't do any more? we looked at stories where there was journalism done after the crisis. so for instance, one of the worst mining disasters in recent years is the upper big branch mine disaster in virginia. some fantastic journalism was done after the disaster finding there were more than 1300 violations on the books. so one can only imagine what might have happened, whether there was 29 workers who died might not have suffered the fate of the journalism had gone before the disaster or if more of it had been done before. california is agree to example where the l.a. times eventually

did a terrific piece about the chief administrative officer and a working-class city in california who was being paid more than $787,000. this was going on for five years, and because bell had no one covering it, taxpayers wrapped up $5.6 million, so we can only imagine if there had been a reporter there whether or not taxpayers would have saved them. as often happens, in situations like this, it is it tends to be the least powerful and the most vulnerable and we were touched by people who talked about not necessarily journalists but people in communities on the front lines to solve problems for communities about this happened to their lives and effectiveness of solving community problems as the contraption that happened. as for instance, an expert on the family court system in

michigan said coverage has gotten smaller and smaller in the years. why does that matter? what's the impact? he says well, for example, parents whose rights are terminated who shouldn't be terminated it just takes somebody down there to get the story but nobody has ever been down there. one thing that surprised me a little bit is that because the internet and digital tools and general has been so in powering and you can see this in the literally the effect of the internet on helping to topple governments, and in many ways in the ability to have users and citizens engage in the media it has been a very in powering experience. so it surprised me a little but we found a countervailing shift in the other direction but when you don't have a sufficient accountability functioning in communities it leads to a power shift in the other direction towards institutions and government away from citizens and this is because reporters

basically right from press releases and don't have time to dig is a for instance the que study of baltimore said reported as news is supposed to faster with little enterprising reporting having the officials version is becoming more important. we found official press releases often appear word for word in first account of events though not often noted as such. a government in this study initiates most of the news. i've talked about newspapers so far in great depth because they traditionally played a special role in the ecosystem of communities and tended to be the bulk of the reporting periods of the contraction of newspapers has especial ripple affect the course they are not the only players and other media have played a central role, and i'm not going to go into quite as much debt but i want to quickly go through a radio used to play an important role providing on

the resources in communities and in some ways radio is actually doing really well and writing. national radio, public affairs, news, talk is booming. it's a very vibrant area. at the same time, local news is not. there were 50 news stations, local radio stations, there are now 30, about a third of the population has the benefit of an all news station. the number of reporters who work for the local stations have been down or as the person who did a study on this said, the number of people when played on the commercial radio news room has been one for quite a few years. tv news. i want to talk about tv news because this is a very interesting and in some ways exciting time for local tv news. local tv news is more productive than it has been perhaps ever.

the last seven years the number of hours has risen by 45%, and they are increasingly doing very creative things. they are using their multi cast channels more creatively, they are starting to do more mobile applications, user generated content. it's a great opportunity moment for local tv news. there's still the number-one source of news less about market share but they're still the number-one source of news. they are increasingly an important source of online news and the newspaper contruction creates an opportunity for them to do more of the original reporting. technology cuts have gone down so they would be able to hire more reporters and they are relatively profitable mini relative to everyone else in the community. they are not as profitable as they used to be but they had a

pretty good year so the local news is more important than ever, and i really want to highlight that since i spent most of my time in the print world as a journalist i can admit that there is a little bit of a snobbery on the part of print reporters to the local tv news and i have to say i don't agree with that because i have done circulation journalism and narrow circulation journalism and there is nothing harder and more valuable than coming up with serious substantial reporting and having packaging it in a way that is available and accessible to a very wide range of people and they do that investigative reporting and news that is really the heart and soul of what communities want and need. the next slide is interesting and is basically this is basically the volume of local news minutes.

on one axis, left access and then the market size on the bottom axis and it's not surprising is that as you get to smaller markets there's less local news being produced. and the economics have become more challenging. of course there's a lot of variation as this points out in a local news. the many that are seizing the moment and doing very exciting things, but some are not. and i do believe that some local tv news operations are not seizing this opportunity. so we have a few problems. the old phrase if it bleeds it leads is still true, maybe even worse than ever. the beat system. most of the beat system like newspapers, less and less is that true which means there's

less expertise being developed. the study of the l.a. market showed the results of the phenomenon was i think a pretty shockingly small amount of time being spent on the sickly important information. specifically, they said that a little over one minute of a typical half-hour newscast was going to education, health care, government, important topics like that. i think possibly one of the most alarming things that we saw or something that we call pay for play and these are basically situations where a station will allow an advertiser to dictate comment. it's an advertiser that literally says yeah, you can have an added deal and all you have to do is promise you only interview people from our hospital or that you were kafka story list that we have created for you. in one show they actually were charged in, half the guests to

appear on the show. things like this, you know, this is not the majority of stations buy any means. but nonetheless it is a serious problem, and we had mixed evidence on whether or not it was merely persistent or growing it's a big deal. others that worried us it's that the amount of tv news that was produced and is being produced is up by 35% they did this while cutting staff on average at tv stations. in some ways there are legitimate efficiencies built into the system that might have allowed them to do that. the term is one man band, and that means you used to have a crew of reporters and a sound video person if it was a network show it might be a three-person or four person crew and its as a result of the technology of reporter can be the videographer

and the camera person and sound person as well and in some ways this is a fantastic development. i talked to reporters who said this is great for one thing i don't have a whole crew with me so i can get into city hall in a way that is less conspicuous than i used to. it makes me more mobile and go more places and the number of people said this could be a fantastic development because instead of having 20 reporters and 20 crew, we could have 40 reporters that's not what has happened. instead of 20 reporters and 20 crew we of 20 reporters or maybe 18 reporters and as a result the reporters are doing more doing the reporting and the shooting and the audio and filing for the website and tweeting. in some cases this works well. i want to make it clear i am not actually of the view this is an inherently bad thing and i don't think many stations used the savings and efficiencies that have gone from this disease the

opportunity that they had in the local markets. i've offered some criticism was of local tv news but it should be said even the ones i have been talking about arriviste doing local programming. we look at the question of are there other stations during local programming at all? to was a limit to how granular we could get on this but we did for three different analytical approaches take a look at this and they all kind of came out in the same direction, which is about 21% of stations do no local news. if you add in the stations that do for 30 minutes or less, that is about one-third of the stations. now, i am offering no comment on whether that is good, bad or indifferent. i think it's somewhat depends on the situation. it is not necessarily obvious that we would all be better off if every station in america did

local news. but it is nonetheless an interesting phenomenon and one of importance to the fcc to understand those that all stations to local programming. swift and talking about a contraction of the old media. so two points. first of a two years ago when you talk about the old media, traditional media is a bifurcation between the old guys and you guys. not that the newspapers and tv stations and radio stations are doing innovative things online, too it's just as much as they are printing so that is a distinction that is getting blurred and despite the use of the phrase and the second thing is this is just part of the story. the contraction, if they happened but they were being filled and went by the growth of the new media we would be in great shape so that was a central question is we made a tremendous amount of innovation on activity.

where is the trend in the gap and where is it not falling under the caps? we can spend the entire time talking about the incredible bounty of innovation that his seventh as a result of the alternative summarized and i think we all have a sense of them but lower barriers to entry, the vast amount of space on line has led to greater diversity of the voices of increased debt for many types of coverage. there's sometimes this i think idea that the internet is a good at providing a way for people to mouth off with uninformed opinions, internet provides opportunity for tremendous debt. technology has reduced the cost of gathering news, producing news and a disturbing news. in some cases substantially. whether you're talking about computerized databases that enable someone to do a story in two hours that might have taken two weeks previously with cost publishing images or video or the most obvious one of all, which is you can use a search engine to find things out that

used to take three days to find out. citizens are in power and i think it is very telling that if you think about are the most searing use images of the 1960's and 70's from the vietnam war and some images come to mind. there were images shot by brave and courageous professional photographers. the most searing image of the sort we have now is this image of a iranian martyr being shot because she was protesting shot by someone's cell phone, and this is the potential power of user generated content. we've also seen an explosion of new web sites and those that get the most attention, the huffingtonpost.com of the daily collar, politico, there are many others really also very exciting stuff happening on all local

level. texas tribune, based citizen, chicago news cooperative, these are names i think you are going to hear more and more. these are entrepreneurs concerned about what is going on in the community comes all the gap and tried to move to fit it. some are for profit, some are non-profit, but the have brought tremendous energy. some are even become self-sufficient and profitable. as i said earlier, these are hatchery's, these are tools that are no longer just limited to what we call the web native businesses, they are bleeding into all sorts of different media. maybe one of the area's most is hyper local news, it's kind of a buzzword. well it is a word that had to be invented because it didn't exist before. at least it didn't exist in the same way that it's happening now. that's because the media models

for such that in the happiest days of newspapers they couldn't get a granular down to a house by house block by block level. it's not economic. you have a weekly in things like that. but hyper local information has gotten more vibrant than it has ever been. a lot of them are not big commercial enterprises, they are sick enterprises and they are not profitable, but they don't have to be. this is a sort of civic enterprise a thousand points of journalism sprouting up in communities around the country. in 2010 as a result of all these changes, a major milestone was achieved which is this is the first unit people of the news on the internet and through the paper newspapers. and if you look at the charts, which is an age breakdown, the left chart is the youngest cohort and the right chart is the older co-worker you can see which way this is heading.

so, that is the story of abundance. but one of the counter intuitive things we found is that despite this abundance, it turns out you can have an abundance of media outlets and a shortage of reporting. so again, to return to baltimore, where the most in-depth study was done, to research looked and felt there's an enormous number of proliferation ways people can get their news, blogs, radio stations, newspapers, they counted 53 outlets that are doing the news, but then they did an interesting thing, they did a content analysis they looked at the articles and the series on the tv news and they said what was the source of reporting and discover most of it came from the "baltimore sun" and one of the tv stations. as we said before the "baltimore sun" is doing less than they used to be so to use a metaphor

of one scholar referred to this as the iron core of reporting. it's the iron core that can then be sculpted by affairs and the media food chain but if the odierno core is shrinking there is less to work with. by the way it wasn't just a spew study that from this, there were several different studies looking for several different ingalls that came to the same conclusion. so we can to the conclusion that on this one area of the local accountability reporting so far the new media isn't filling the gap but this was driven home to me i was at a conference put on by the foundation of which has been taking a tremendous lead in funding and stimulating innovation and they brought together the leading local news web sites, the top most influential innovative and most well-financed of the new operations, and they were

discarding what they were doing and how many reporters there are and then i counted them up and was 88 reporters. that's pretty good until you consider the fact 15,000 reporters have left newsrooms in the last decade so it gives a sense of scale. the energy is there, the excitement, the quality, the innovation, the scale was not. another study from the institute said that there has been a drop of $1.6 billion a year on spending from the newspaper newsrooms. foundations have been trying to make out some of the difference by pouring money into it and in fact one study said they put $180 million over five years. but that tells you something. $1.6 billion per year out 180 million over five years experts in this area including folks who are think our web e

evangelists who have high optimism for the nature of the web to conclude there are gaps that are not being filled. michelle who did a comprehensive survey on the study's said a tired ideas will replace the traditional news media is wrongheaded and it is past time that academic research on the reports reflect that. mr. dyson who was a pioneer and internet investor said start-ups are rarely profitable by and large no thinking person who wanted a return would invest in the news startup i hope she's wrong, she hopes she is wrong with that as her honest assessment of the current situation. and why is that? some of it is what we refer to as the great unbundling and this is something we were not really conscious of before but the internet made us conscious of it. when your body and a newspaper you worry essentially subsidizing an elaborate scheme

developed by the newspaper. you're buying it because you might have wanted the box scores or horoscopes or in your case you wanted the tilled international coverage. but perhaps your body and for the back scores better absolutely to become actually subsidizing the city hall reporter. now you don't have to do that. you can go straight to the website that just as the box scores and by the way it's a bitter experience. the change minute by minute. i have a moment theater day i was looking at the box score in the newspaper and i kept staring at it waiting for the score to change because i had gotten used to that. it's a better experience on line. there's another cross subsidy that was happening or bundling which is the advertising side. the ad executives was quoted and i was not able to determine whether this was apocryphal or not he is quoted as often my people tell me i'm wasting half my advertising budget but they

can't tell me which half. now he knows which half. now the precision of the ad targeting, the precision of advertising metrics enables the advertiser to know how many people were looking at the had and clicking on the had, whether it's the right demographic, how many people have clicked on the data are buying the product it enables advertisers to be very efficient so it has tremendous benefits for advertisers. but it is one of the main factors that has led to the decline in ad rates. rates are on line a fraction of what they are offline. in fact if the rates on line with the same as they are in the print newspapers we wouldn't be having this conversation. the problem would be solved. revenue would be at such a level that would more than pay for the journalism that we've been talking about. so, with lots of discussion why is this, one of the issues is

something economists refer to as news in the public good or a free riding problem and the issue how is you can get news without paying for it. that's true you can benefit from a news without paying for it. one of the six samples we had in the report is the news of server did a fantastic series about major flaws in the provision system where people are getting out of jail and probation to orderly and there were several hundred people who died as a result of the provision system so they spent several months during this study, the uncovered, the governor fixed it and so now there are people walking around the streets of a rally who are not did who would have been probably the they don't know who they are. there is no way of knowing who they are and what's more is they didn't have to subscribe to the newspaper to have benefited. from what the newspaper did. this is tested basic fact of the way the news is public good works.

it's not a.g. need to put in the bottle but it's an explanation of why it's hard to make these models work. advertising is disconnected from content because it used to be advertisers wanted to be next to the content because it was a proxy for reaching a certain type of audience. he wanted to reach women aged 25 advertising mademoiselle because you knew that demographic read that. now you can go directly to the demographic without having to put your ad next to a piece of content. it's true for search engines and i think a very remarkable chart shows the percentage of online advertising search engines in 2000 was 1% and now it's 47% and the same is true for social media and things like that it enables advertisers to go to the consumers without putting the ads of the content. it's good for advertisers and consumers. it just means less revenue for

the media outlets. i've mostly talked about the commercial media, and one of the most interesting things to me about this is learning more about what has been going on in the nonprofit media center to beat the nonprofit media sector has become a much more diverse and very devolving innovative sector and really is a very important part of this puzzle. we even think of as being part of this little public access channels, public access channels realize their original mission which is to provide a platform for people to speak out and being taken up by the internet so they are trying to evolve. they're doing digital literacy and local accountability. journalism schools used to teach journalism through a book come

true pedagogy in the classroom. they are increasingly adopted what they refer to as the medical school model which is to say why don't we teach journalism by giving this into this is great for students but also the communities. you have thousands of journalism schools on the ground and in the communities and they are not just giving abstract exercise website careerbuilder websites people read. foundations who start to play a major role, no power fm stations which already are important players and our hope is the passage of the recent law and the actions from the fcc will make them even more so. the nonprofit news websites we have spoken about a very exciting. i talked about the local ones, there is important national nonprofits which saw a gap in what they saw was insufficient investigative reporting going on at the national level as a result of these attractions so

they created something within the first year they won the pulitzer prize so there isn't an inherent get in quality and then come on commercial it can be done in any form. and i want to pause for a second on something i wasn't aware of which is the state public affairs support these are basically c-span at the state level. i mentioned before that as spending by states have gone up the number of state house reporters has gone down. there are 23 states that have the state stands and the jury in depth and quality but the good ones are basically doing what c-span does. the show the legislative hearings and the shows the floor and they do candidate debates. and things like the local tv news would do more. but in only four cases are they being funded by the cable operators in the way that the

cable industry funds c-span. and in quite a number of circumstances they are funded by the state which in some cases worked out okay but i have to tell you i don't think it is the best model in the world to have the state funding coverage of the state. public broadcasting. obviously the anchor, the biggest player and then on the media world as public tv and public radio. we've run into great that what they do, some of the structural issues, how they are evolving, tremendous innovation on line in the public media space as well to break it down a little bit further on the public tv side there is real strength and educational programming, national public affairs, everything from the front line of newshour, firing line to date myself a little bit, we would say that we think there is not

that much local programming on public tv. very few public tv stations to local news. we were not able to get a solid number of local programming but it seems that isn't what they do for the most part and really economic limits on that. public radio is trying to do quite a bit more in the local news space. from 2004 to 2,009 the number of public radio stations reporting the carried local news or talk rose from 525 to 61 so they're actually trying to step into the gatt is the sea in the market to and especially the gap we talked about before where commercial news radio is not prevalent in a lot of many parts of the country we have also seen an exciting development which is increasingly the collaboration between the commercial media and nonprofit media. i used to think of these as a sort of parallel universe that operate separately from each

other in some cases antagonistic way to each other, and now we are seeing some very interesting sending out at relationships evolving. one for a simple, knsd, channel four, nbc in chicago, we want more in-depth work, meanwhile the exciting new start-ups in a scene diego was doing great work so they worked out a deal, voice of san diego gas, a few times a week and a segment called san diego explain and another one called a san diego fact check. it makes the newscast better and it is a huge value to the voice of san diego that gets fantastic exposure. they can then go back to the donors and look at the impact we are having and we are seeing is actually quite a lot and it's -- i think it is potentially a model five years from now we may

look at and say this became a really significant element in this ecosystem. to work it does require some nonprofits to have a critical mass of revenue. it requires them to have functional business models. so, where does this leave us? the diagnosis to oversimplifying this is - i local, better than ever come of local, municipal level really struggling, national we really haven't talked much about and it is quite a dynamic sere we have our complaints about particular national media and things we like or don't like but i believe it is very dynamic and very vibrant. we are seeking business models tickle on the national level in the ways the on local levels and so i really didn't come away worried about it in the same way as the others.

international is a mixed bag. on the one hand you have clearly some of the players we used to rely on for international news argon or have pulled back. the regional newspapers like "the chicago tribune," the l.a. times, "boston globe" used to be very important players in oversees coverage and basically have packed up for the most part and do much less. the networks do less. but on the other hand, we have way more people on cable news to the international coverage than we used to. npr has increased come bloomberg has increased, and probably more important as one person put it, the typical citizen has more information at their fingertips about the rest of the world from the internet than a network tv producer did ten years ago. and you can watch bbc and al jazeera and there are other ways you can get information. it's a mixed bag. ..

and i'm not going to go through all of them but i wanted to mention a couple. a few stacks was a program set up on cable to try to encourage independent programming including local programming. he was supposed that lead to position about the 15% of programming and independent. actually currently less than 1%

is used. the satellites that aside, operators and the maoist past helping to enable satellite. congress said the icc was set aside somewhere between 7% satellite for educational programming, much in the same spirit of 25% of the commercial commercial -- of the broadcast airwaves from educational programming. the congress set aside between 4% 7%. fcc chose were because the satellite industry with a fledgling industry backed men and women to make sure it would get off onto a cd. at this point, programmers are turned away because the satellite operators have hit the cap and ejecting other programmers. we looked at the fairness doctrine and concluded as i believe all of you have the fairness that turn would

undermine news instead of improving news and would chill speech. and so even though this was a topic that it already -- opinion saturday been expressed on, we decided to weigh in on at least saying from the point of view of the topic we're looking at, we think that there is no case for reinstituting the fairness act. it would be a bad idea. we came across this fact that came to light recently, that there are shards of the fairness doctrine still on the books. did not make a lot of sense to us that the policy was dead. to have bits of the fairness doctrine on a book of living laws. so i'm glad to see that it's being cleaned out. sponsorship identification. these are the laws and rules the fcc has that basically say the tv station simply like to a pay

for play arrangement, like we talked about before. they are latched to do it. they do have to disclose it. the problem is they disclose it quickly, on the air and you have to look really carefully and be a very attentive viewer. and they are not disclosing it online. noncommercial broadcasters. the a lot of the issues of whether it's a commercial product testers could have better business models if they have less restrictions. we go into some thoughts there. there were ways in which i think the cpb, the corporation for public broadcasting would like to have more flexibility so that they could better incentivize collaborations and innovation and less duplication and more local programming. they agree with the idea that they took my local programming, but to some extent they are hemmed in by the rules that govern them. something else came to us, which is brought to our attention by

the religious broadcasters. religious broadcasters have asked. they pay to have the ability to spend some of the time, up to 1% of their time raising money for charities. perhaps raising money for a soup kitchen in their community or global hunger charities that fits very much with their mission and it also provides useful information. currently the fcc provides waivers in the case of extraordinary circumstances like a tsunami or hurricane. i frankly had a hard time understanding the justification for why the fcc would want to be in a position where he could say okay come you have a waiver for a catastrophe that involves rain and weather, but a famine killing a million people in africa, no, that doesn't get a waiver because it's not a natural disaster. last but not least, brought in. obviously i think you've heard about right and in other

capacities at the fcc. i wanted went to tennis to the the topic we're focusing on. and i look at it from two different ways. one is a negative way, that if you were to summon any community that has on the one hand the speakers contracting and not doing that he used to do, but maybe some really good things i might to counterbalance them and you have the worst newspaper, but you're not online, you're worse off. you have the worst of both worlds. from an economic point of view, it's also important because a lot of entities trying to develop successful business novels, the more people viewing them, the more likely they'll be able to sustain the business model. the scale they need to succeed will be approved as the universal brought in. and the final fcc thing i wanted

to talk about is a very important one, which is the historic public obligation of broadcasters aired we spent a lot of time and patience looking at this. as you know, there was an effect and has been since the very beginning a quick prayer quote that taxpayers provide the use of the public's airwaves to broadcasters in exchange for a commitment that they serve the communities. this is a pack of broadcasters, almost a broadcasters only embrace. they very much like this arrangement and they support this but to pull. and i should say even during deregulation, even liberals receive regulated in the 1980s, the principle still remained was not abolished. that broadcasters have purchased the deal is supposed to provide response to issues of concern to the community. so how's this for now? in the last 75 years, the fcc is

granted the estimate of 100 license renewals. and only four cases was the license renewal denied because the license fee failed to meet the public interest obligation -- programming obligation. the last 30 years, no one license has been denied on these grounds. they are required to have what are called issues program list that is supposed to be the mechanism for enforcing the current obligation and stations but in this file, and a cabinet, on paper, a list of what they think a significant issue sorry. the fcc has been fairly vague about what do we mean by a significant issue? which we mean by programming? so, people -- stations have gone to be creative in some states on how they define it. for instance, when station we

saw their issues program list, with the listed in the area of they were serving important community leads with america's next top model casting call, an open casting call for cycle 14 of america's next top model on july 11 at 7 sushi ultra lounge, sponsored by senators heron lakes and it went on and on like that. some stations had very detailed memos describing very significant public affairs programming debut, i've obviously picked out one of the more amusing ones. there's actually a broad range. but it's a broad range because stations really don't know what is expected of them. and part of this -- i don't want to sound like i'm basically saying this is the fcc staff that was screwing around this whole time and if we just been on the ball we could have done this. you know, i think he might make

an argument at some points there might've been for many policy here are. but the biggest issue is there is a real dilemma. there is a real dilemma, which is on one hand you have this real concern. on the other hand you have the first amendment. companies get into a situation of getting prescriptive enough that you can have a very easy to enforce rule, you start to a situation where someone at the fcc is going to have to decide what is important legitimate programming? at the back off if they were not going to get that detail, but we want to have certainly brought principles, then u.k. fake and he gave and weight as a key feature of the program issues. in short, i think this system is broke. the public is system currently has the fcc is broken. we also talk about non-fcc area. i am only going to talk about two, even though we go into a

number of them in the report. two in particular want to mention. tax issues. one thing that came back a number of times from websites was, you know, we are trying to create websites, but we are very confused about whether we are going to get dean by the irs and shut down the website because i wanted to take advertising. when they are told and to take it, the others shouldn't. he was very defeated at the irs was shut down. he's a two-person operation, didn't have the money to have money to the whole operation chilling with irs reporting so we stopped. this is not an example of current law fostering innovation a recommendation, part 3. first, just to review what we said, obviously we said the media landscape is very vibrant, but a couple areas of concern. some of the rules intended to advance the public interest arafat is. i would add another which is

that technology has evolved in a way that increases potential potency as transparent as a policy tool. we are going to talk about the end of that. another point which is i actually do not think the government is the main player in this drama. i think what we do is very important. there were obstacles the government should remove. i think fairways policy can encourage innovation. the resources it has been well spent, which ought to be well spent. i still don't think that the government is the main determinant of what is going to happen. if so, let's get it right and must make it easier for i think in some cases to really inspire people trying to solve this problem. point number one is that emphasize online disclosure as a pillar of fcc media policy. this is a number of different implications. over time, frankly, the paper file should be a pang of the

past. it's called for public inspection file. it is time we made it for the public to inspect it an easier way. putting it on the internet is a way that can actually take this policy that was debated in the first place and give it life and effectiveness it is really not have it. at the same time, i think it is also time to eliminate some rules that are either buried in some, potentially burdensome for discouraging the same behavior whereafter. so, we are recommending that the fcc consider terminating the localism proceeding, repealing the amendment said the fairness that train, maybe a party taking care of that one. they should cross that one off. and replacing the enhanced disclosure rule. enhanced disclosure rule is something the commission passed a few years ago with a good principle behind it, which is that, you know, instead of

having detailed program rolls, let's have serious disclosure. but it was overly burdensome in and of itself and it require to much and also wasn't done in a way that was -- really took advantage of the internet has things have really changed. we are at a point now where we can make this much more effective. so we are suggesting replacing the enhanced disclosure rule for something else, which is a streamlined web based form online, which broadcasters would sell out to have a shorter list, but important list of important information. most important is the amount of programming you are doing about your community. i think it also should include things like new sharing arrangements, partnership arrangements, how the multicast channels are being used, website accessibility for people with disabilities, whether their website is accessible.

and i think this is really a great opportunity to do something about to pay for play arrangements i type about before. these types of arrangements are not illegal. they are already prior to be disclosed. what we are suggesting is any time a sponsorship i.t. rule is required to be disclosed on the air, it should also be disclosed on the internet, which will create a permanent record searching by anyone in the community, citizens, watchdogs, competitors will be able to see what stations in a community or country are doing this. we also believe that the fcc should agree to the proposal to religious broadcasters and other noncommercial broadcasters that do not receive funding from cpb be allowed to air or use up to 1% of their time for raising

money for charity. and they should disclose that, too. they should disclose it so people can see it's being used well, but this seems like a sensible thing. the same sort of disclosure operators, there should be online. i think it is also time to look at the program and the least access program in greater depth to see whether they are really for filling needs they were sent out to congress. the next categories make it easier for citizens to monitor government by putting more proceedings, documents and data online. we talked about importance of disclosure and transparency at the fcc. so, this goes way beyond the fcc. there is a real exciting movement for governments in general to put data online. this is fantastic and tremendously important. it makes it easier for citizens to get useful information, makes it possible for citizens to hold institutions accountable and it lowers the cost of journalism.

when you have more data online, things that would've taken a lot of time can be done quickly by reporters. so it makes sense in many, many different ways. it should be done in different formats to make it easier for analyzing. it actually has a essential creating jobs. when you put the information out, they look at and say i can create. i will package this data with this data and sell it to people to create an even better thing. this is happening now and will continue to happen the more we put this information out. on a more old media idea is to go back to the states now. every state should have a statement. every state should have a state-based system so people can watch the legislative session of the state legislature watch the hearings, watched debates and be more informed about their communities. there are a lot of different ways of doing this. once some states that public tv

station where is the stamp. in some cases it is the cable operators. in wednesday, only wednesday, satellite operators are operating in general i hope that the commercial operators would approach this in the way they approach c-span. they view that is one of their civic achievements. i think it would be an equally signal achievement they did the same thing on the state level. we recommend congress look at whether it are incentives that could be given to the operators. for instance, we threw out as an idea perhaps they should get a regulatory relief on their release access requirement if they support a state c-span. or if they support a local cable news chapter. the third set of recommendations is i think the really interesting one. consider direct an existing government advertisers towards local media.

the federal government, last time this discounted spent $1 billion on advertising for things that whate'er recruiting, public health announcements, safety, things like that. test of the national media, entertainment media for the most part and cared towards important functions. so we thought, is it possibly could be done in a cost to play that would achieve the goals of these marketing campaigns, but has a target to local news media because of the serious problems we have in the american communities of oakland is media. and it turns out there was a fascinating proposal sent to us by the local broadcasters are basically said yeah, you know, 10 years ago this understandable someone who wanted to do a national ad was more efficient and affect it. but now there are ways were to elegy because businesses has developed you can do a national ad buy to local tv here turns

out the newspaper industry is done the same thing. you want to buy an added 100 newspapers across the country coming back to call newspapers. you can go to one place. same thing on the internet. so we are recommending that the government look at the possibility of targeting the ad money toward local media. it has to be done in a way that doesn't undermine effectiveness of the campaign. this can't become primarily and media helper program. it's got to be a program geared toward achieving goals that the agency. but if it can be done in a way that helps local media, that would be fantastic. it has to be done in a way that has a rocksolid local law because you do not want to go back to the 1800 when andrew jackson was doling out advertising contracts to his favorite newspapers. this can be done because their ad networks that are very blind

and they think it's very solvable and something we should turn to. nonprofit. i'm not going to go through these recommendations come up with quite a few in the report that basically says the private sector is important to me should really make sure we are not importing the innovation and the nonprofit site here. do you i think folks that are more expert in tax matters than we are should take a good hard look at this and look out tax rules can be clarified to make it more likely to nonprofit can get traction. i believe foundations should put more money to this area. philanthropists, individual donor should put more money we should not look at it as something you do with status and being for the cause you care about. will make because you care about more effective. cpb, we recommend they be given more flexibility so they can target more locally and be more innovative than fund more innovation. the community media centers can

continue with innovation they are doing and we really would hope that patrick centers that really are doing this, that are really trying to adapt to the new world and come up with really powerful ways of serving communities should not be cut off by state governments or city governments. they are too important. low-power access, same thing. i can access. i guess i don't need to go into great detail about the importance of universal broadband, but i want to underline it again because it is something that really is almost a prerequisite for everything i screwtop about. finally, as we go through this transition, we really need to make sure that the historically underserved communities that are sometimes left out of media evolution are not. and you know, there are a number of different approaches to this. we suggest in the report one of them, for instance is that

congress should consider reinstating the tax certificate program that was pretty affect the flow is therefore encouraging ownership of small businesses, including minorities and women. so to summarize, it's a really important moment of opportunity. i'm the one hand, you have this very, very vibrant media landscape. at the same time you have serious gaps and we believe that if we take the right steps and avoid taking the wrong steps in a way that can preserve all of these strengths, reserve the innovation, was the same time addressing these problems we've talked about, we really will end up with the best media system we've ever had. thank you very much. >> steve, thank you very, very

much for all the work that went into that, for the thorough report. i'll have a couple of comments. first let me ask my colleague. >> well, a lot to talk about. i promise i will be relatively brief. thank you, first of all, steve, for your energetic presentation of the report and for all the hard work you put into it and i'll have more to say about that later. obviously we have some very serious problems here in the issue is, what are we going to do about them? let's begin with a basic truth. the future of our country's media is an issue that goes to the heart of our democracy. a well-informed public. a well-informed public. a well-informed public. a well-informed public agreement. to make the compact work, it is imperative the sec play a vital role in helping to ensure that

all americans have access to diverse and competing news and information that provide the greatest for democracy is churning mill. for most of the past 30 years, the commission has turned a blind and sometimes hostile i towards this responsibility. application is no longer an option. it will come as a surprise to few here this morning but this just-released staff report and company recommendations are not entirely doubled response for which i hope and dare to dream. instead, the overarching pollution of the staff report seems to be america's media landscape is mostly vibrant and there is no overall crisis of news or information. but it is a crisis when is the report says, more than one third of our commercial broadcasters offer notice what the weather to their communities of license.

america's news and information resources keep shrinking and hundreds of stories that confirm our citizens go untold on a date undiscovered, were his favorite day when hundreds of new strains and tens of thousands of reporters are walking the street in search of a job rather than walking their feeds in search of a story. i think it goes beyond local news. i cannot say that i share the conclusion that national and international news is in good shape. the shrinking resources put into investigative reporting that you talk about the diminishment of investment and nationally in washington and overseas faith and tell a different story, which leads to off into the substitution of entertainment for the hard news that people really need.

where is the urgency? the real urgency for the commission to weigh in and really grapple with the shortfalls that you document in this report. enlightened policy that promotes the public interest is basically glossed over as having been tried and failed. let's look for example at the claim that policies like broadcast relicensing failed and therefore need to be replaced with something new or perhaps pay nothing. i agree that our current licensing process has failed and is primarily because beginning 30 years ago the commission white from its books most of the public interest guidelines for consumers and advocates had won after long, tough struggles of media reform. licensing approach became one of sending us a postcard every eight years in the renewal is a

slamdunk certainty. no questions asked. as you point out, the sec has not taken the license away from public interest nonperformance for the 10 years i've been here for the 10 years before that. where does the commission issued warnings or impose a probationary period giving a poor performing licensee a chance to clean up its act. the point here is not to take license as a way, but she is the public interest processes available to us to in court greater emphasis on local news and information. it can be done. when the majority of meaningful rules will dismantle it in the early 1990s, we were told there was little impact on viewers. excuse me, that turnout demonstrably not to be the case. before releasing any more rules, we should pause to recognize the yacht training of tv no longer an toaster is one chairman in the fcc put it back in the early 1980s. when the actions of government

weekend to force the state, there's less of a check on government health. the report and presentation course the assignment on the next 10 or 15 years in this country will be an area for state and local political corruption. that is frightening. vigilant journalism can discourage that from happening. only if we take action now. yes, the fcc has a role to play. one of the three pillars underlying interest is globalism. localism is about making sure the citizens and local communities are supplied with in-depth programming about public and civic affairs that they have available, programming to reflect the needs, interests and cultures of diverse people living there and that those views have some opportunity for expression on the airwaves. local means plus program homogenization.

more local mosque in music and community news originated in the market for its broadcast, rather than being imported from faraway studios controlled by absentee owners. in the continuing era of media industry consolidation, we have no coverage of local music, local talent, local sports, local diversity communities, local political issues in election campaigns of odds making are more the exception of the rule. the staff report does recognize problems in local news and information than the lack of accountability you much to its credit this underscores points i've been making for years. instead of calling for stepped-up commission, direct commission action, but too often tinkers around the edges. for example, urging philanthropy is to find better ways to do their business, asking congress to change tax code and suggesting the government to act

more advertising to local media. and rather stunningly, i thought the staff report recommended shutting down a penny and localism proceeding. i participated in dozens of hearings in hundreds of meetings on the stockade. i have traveled to hearings and town hall meetings across the country to learn directly from tens of thousands of citizens what they think about their local and national media. they listen to folks fire tonight in session that sometimes lasted as long as nine hours. we have had notices of inquiry notice of proposed rulemaking on this proceeding. we have done the analysis. we've made proposals and now it is time to act. i remarked after the localism npr and cannot for some of his proposals could and should be modified. no question about it before they became final rules. this could be quickly and easily

accomplished and makes more sense to me than walking away from a huge and still relevant record. the staff report also delves briefly into media ownership and correctly alludes to some of the harmful effects of consolidation or less local news, few to reporters a diversity. and the recommendations, there is hedging about what they're consolidation we are living with today, although local independent stations brought up by make immediate interest has been good or bad. the report suggests some additional newspaper broadcast mergers could well be beneficial in some circumstances. the policy prescriptions here as elsewhere in the staff report to track the diagnosis. keep in mind the paucity of resources dedicated to accountability. i hope the commission that some coming quadrennial review will weigh much more seriously than it has in the past, to have caused by media consolidation has inflicted on america's news

and information infrastructure. diversity is another pillar in the public interest. i'll put this simply. in spite of occasional instances of progress in recent years, media's overall grade in covering, reflect and comics waning and mirroring america's amazing cultural diversity is tried for. diversity of viewpoint, diversity ownership in doing what we see on tv and diversity in who runs the companies, all of these are worse than media than most other american industries. the staff report seems aware of a serious problem here. you alluded to it. what is lacking our recommendations for strong, implementable programs that begin to make a difference for generations of media and just as. as a starting point, i repeat my suggestion some month ago that weak tea at the face one of the recommendations of the diversity advisory committee at every meeting for the next year.

the staff reports primary policy prescriptions as disclosure. but more and better information online with consumers and advocates can readily access and good things will happen. i am all for disclosure and i was happy more than two years ago when my colleagues and i voted for enhanced disclosure item which would provide significantly more program information than what is currently available. since then, the item seems to be stuck somewhere in the kind of limbo.take could relate to come the stranded somewhere between the fcc and the office of management and budget. why don't we resolve to get it on., to whatever fine tuning is needed and vote next month's agenda meeting on the revised order of for this notice of proposed rulemaking to finish the long pending job. let's also remember that disclosure is a means to an end, not an end in of.

as disclosure brings to public life actions that require retries, where is the redress to be found? somewhat doubt whether it is to be found in a commission that has sworn off public-interest rules and guidelines. why would consumers by thereupon the internet looking at public fires if there is so little confidence their effort will be rewarded with remedial action. over the years, some hardy souls have gone through paper files to petition the commission to deny relicensing, all to no effect. what is the incentive to move that hapless process online? also on the disclosure fun, i continue to believe the sooner we can ensure fuller disclosure of political advertising sponsorship, the better off our democracy will be. voters have a right to know who's really behind all those glossy and sometimes wildly

misleading ads we see on tv. concealing from voters than a gnat brought to us by the citizens for a more beautiful america is really sponsored by cabal of cable companies polluting the water we drink. it is not just nondisclosure. it is deception aimed at buying elections. we need to fix this in the fcc has been a good girl. i suggest the commission tia tonight and then the next two months in this list was made full disclosure of political advertising. the digital age, as you point out holes in the same promise for expanding the scope of our democratic discourse. the staff report recognizes this in the present commission has focused tremendous energy on both broadband deployment and adoption. let's recognize upfront that they needed time where paved with broad and breaks and stacked with good news and information is not going to happen on autopilot.

right now the vast majority of the news we read on the internet is produced elsewhere in traditional media newsrooms. interesting new and information innovations have developed on the map, although it would take some exception to the new site and the low, low, single-digit as addresses really go. the more important part is what happened to the on the internet is the model for the mass or the momentum to sustain the resource hungry journalists and that informed electorate requires. an open internet is not the entire solution for robust 21st century journalism. it's a tougher problem from that. i for one don't believe we'll get their accents and public policy solutions. we have never had successful

dissemination of news and information in this country without some encouraging public policy guidance. going back to the earliest days of the young republic on washington and madison and jefferson saw two of the newspapers were financially able to reach readers all across the fledgling young republic. they didn't see it is violent of the first amendment that they wrote. and the supreme court more recently has not seen as violent of the first amendment to strip is we are told by the preservation of a vibrant marketplace of ideas to sustain our democracy. the same purpose of expanding the information infrastructures, what gave rise to broadcast licensing much closer to our

own. so i don't see any reason why we should forsake america's workable past and deny her own history this point. there's more to be said about the staff report and i will be talking about it in the days ahead. but rather than parsing the contents of a particular report, i intend to spend most of my time encouraging the commission to take up this charge of responsible public interest oversight and to do everything it can to encourage the news and information and diversity that americans have a right to expect from their media. at the staff report touts generated dialogue towards that end, it will have served a purpose. if we can learn from history traced in the staff report, much of it very good, we will be able to craft stronger public policy proposals. if the commission can move

swiftly had on some of the good ideas offered and there are indeed good ideas offered, we can reap real benefits from it. i know very well that compiling the staff report was not an easy task. in fact, the undertaking was enormous and cognizant and appreciative of the work stephen and his team put in the report. and i hope steve and his colleagues, for whom i have tremendous respect will take the comments i've made today in the spirit in which they are intended so we can move beyond this report after we read and digested to an action plan making the fcc central to solving the challenges we are talking about. launching a rededicating ourselves as pristine enhanced disclosure and diversity and localism in political advertising and media ownership in reinvigorated public interest licensing will put us on the road we need to travel.

i also want to assess the commission should talk directly to the american people about all of this. in full commission hearings in various parts of the country. i suggest to my mr. chairman, three and the months ahead to see how well citizens across the land think they are being served by her present news infrastructure and to elicit their ideas for the future. i'm unfortunate enough to have this listening for 10 years and they never come back from such conversations without knowing more than when i went out. let's hold these hearings, talk with citizens can't expeditiously enhance the record and take actions by the end of the year. there is real urgency here. i am cognizant of the fact that the fcc can't solve all of the problems with this report describes. but it can address and help

resolve many of them. these issues mean a lot to me. i believe they mean a lot to her country. i have been outspoken about them and sometimes blunt. i know and i intend to keep speaking out about them in the months and if needed, the years ahead. this nation faces dark and threatening challenges to the leadership that brought us in the world successfully through so many dire threat in the century just past. now we confront fundamental new uncertainties about revival of our economy, where new jobs will come from. how we will prosper in a hypercompetitive global arena, how to support the kind of education our kids and grandkids will need to thrive, indeed to survive in this difficult time,

how to open the doors of opportunity of every american, no matter who they are, where they live or particular circumstances of their individual lives. we've had a lot to get on top of that the country. and if we don't have the facts that we don't have the information and we don't have the news about what is going on in the neighborhood and the talent and the nation and the world around as, our future is going to be very vastly diminished. that's why so much rides on the future of what we are talking about today. and i'll say it again how these issues get decided will deeply affect our country's democracy and our country's future. i cannot and i will not leave these issues where they are. thank you. >> thank you, commissioner copps.

commissioner mcdowell. >> thank you, mr. chairman. first of all, thank you. you and your entire team that looks like the cast to the credits for sosa b. demille to you should at the very beginning. before all of your absurd to unmask him a really significant amount of information and analysis about the current state of the media information marketplace. i look forward to reading your voluminous report in greater detail. i've been chewing on it since i got the draft a few days ago. i also look forward to thinking further about how the developments and trends to identify the new small role in affecting just one corner for broader media landscape. at the outset, i do want to applaud you for your guidance of the process that led to the report and for your own very thoughtful nuanced and responsive leadership style and enjoyed our meetings and discussions on this. next, for the sake of those of you may not be familiar with how

the commission works. i've only been here five weeks and am still figuring this out. distress of the report is simply vast. which the generated by a hard-working group of agency staffers has no binding effect. in other words, the report does not establish new fcc rules. it does not repeal any old rules. it does not even formally propose adopting new rules were discarding old rules. rather, the report contains a set of recommendations, only some of which are directed to the commission that mankind hope she proposals for new rules to come our old rules to go. if and when that happens, forced the agency will launch proceedings that began as the lie requires, with notice and comment opportunities that afford interested parties an opportunity to weigh in with their own perspective facts and analyses before the fcc adopts

any new or amended regulations. so now that i'm done with the legal disclaimer, no applause. look at some later. this one contains statements and a substance with which i agree and some with which i disagree. the responses i will share at this point are all preliminary because i have several hours of reading left to do. i would expect to read a person takes issue with reports characterization of media and information marketplace that is vibrant, competitive, innovative and rapidly devolving. the facts supporting those conclusions have been right in front of us for years and they should no longer be ignored when it comes to making reality-based public policy. i also shared the reports general optimism about the future and welcome recognition of the government's limited ability as both a practical and legal matter to affect neither the operation or output at

tomorrow's successful media and information platforms. more importantly, the government should keep its heavy hand off of journalism. journalistic freedom, as steve pointed out, is the primary protection of the bill of rights. and full disclosure, both my parents were journalists. with respect to the reports of specific recommendations, will come as no surprise to fcc watchers that i agree with several suggestions given my own past statements on many media issues correct for example, through the enhanced disclosure form, calling it overly complex or just putting it mildly. i cast the only dissenting vote against creation of the four may may 2007 and anything we can do to hasten its demise would serve the public interest. they also agree with closing the localism proceeding without further action.

pending proposals in the doctor for government mandated community advisory board from a 24 hour manning of broadcast stations and detailed accounting of local music content are indeed overly bureaucratic, unworkable and unnecessarily burdensome to quote the report. there also impractical, unneeded and classic examples of regulatory overreach. those are my words. and of course, i endorse the reports call for a for nominating remnants of the so-called fairness.turn that still litter our rulebooks are the long-standing opposition to anything resembling the unconstitutional policy was no secret. accordingly, i call upon the commission to complete the emanation at the end of the year coming merely offering a recommendation today has no legal effect. in that spirit, commissioned by that time also should finish out the regulatory elimination proceedings discussed not only

matcher magenta chassis june 6th letter to chairman upton of the commerce committee but in many 19 speeches while. i would also like to consider the elimination of the outdated newspaper broadcast day and in their upcoming quadrennial review over media ownership rules. my hypothesis is that the ban caused the unintended effect of reducing the number of voices, especially newspapers and scores of american communities. given that however, the demise of american newspapers have been written about for quite a long time. tombstones have been written for quite some time. this reminds me of a book that i keep in my office and i'll just read you a couple quotes from it. the first quote is the printing presses on the way to obsolescence. yet journalism marches on. it goes onto say that journalism migrates into new areas of

communications. its practitioners who are on the move, the commerce and information flourishes and quickened its tempo. new skills developed in the major problem for newspaper journalists is to keep their readers are migrating, too. this could have been written today. i found this in my mother's library. she passed away in 2005, a few months before i was appointed to its defeating american news ether. very clever container with a fading. you have to ask yourself, when was this published? 2004? was a published in 1976, the year after the newspaper ownership fans are put into effect? was actually published 51 years ago, back in 1960. and my point is these issues have been around for a long time as the debate continues that journalism does mark john and continue to live. i have some reservations about other wreck nations in the report. for instance, while i appreciate

calling for a new online quarterly disclosure record for broadcasters, stuffed rafters attempting to craft a more streamlined and useful obligation, continue to wonder about the need for mandate in the first place. after all, not exactly broadcasters or the business of trying to hide her on-air content from the public hear the government want to know what is being broadcast, it can turn on the tv or the radio out of the big brother implications of that also concern me. i'm also not convinced there is a new pricing policy justification for potentially increasing the satellite tv sign for noncommercial content from the current level of 4% of satellite operators capacity to some higher percentage. many reports recommendations, as steve is violated, not corrected at the sec at all but it had intended to start debate in action elsewhere, including among private-sector entrepreneurs, nonprofits as well as other sectors of government from the federal

level to local lawmakers. passionate debate ignite easily in this arena and i sense that these are subjective in this regard authority been achieved. i will watch with interest to see which numbers catch fire beyond our out regulatory balance. and just to reiterate, please keep in mind the fcc actually has not done anything today. [laughter] what we have before us is a report with a few recommendations. it is up to the four of us to turn the more constructive recommendations into deregulatory action that better fits a competitive and dynamic marketplace. so let's get going with that. thanks again to steve and everyone on the report team, especially including alma mater, duke university. a shadow for giving us so much to think about. thank you, mr. chairman. >> steve altman and his team are to be commended for the amount of time and energy that went into publishing this report and

the chairman is to be thanked for commissioning these findings. the issue covers here fall into many categories. some new, some timely comes some sad and yes, some scary. the findings and recommendations contained in these 465 pages that include said noss will hopefully begin conversations of new and innovative ideas for both improving and saving our existing media landscape and platforms. i am hopeful we all take advantage of an incredible opportunity to get a constructive dialogue going. when i served for 14 years as publisher and general manager of a small weekly newspaper based in charleston, south carolina, i went out of my way to highlight significant people, issues and positive topics of interest that quite frankly were being ignored by the larger and better financed media outlet.

times are changed and there are very few people like the old mignon around anymore. medius about environment all around us. but for all of us on the president for the people i used to touch each week been better served. quality local stories and reporting our precious avenues of knowledge for residents of small towns and big cities and today, despite all of these outlet, they are at risk. this report explores the media landscape detail and i am hoping it will shine a strong and urgent light on the state of local media. it touches on causes of a potential remedy that issues of grave concern and all of us, not just the fcc need to consider them very seriously. we must not -- we must not stand idly by and watch the evaporation of our precious news outlet. we face not a broad crisis of the news or content, but

something more specific, a shortage of local professional accountability reporting, language and the report states, this is likely to lead to more government with local corruption or schools, a less informed electorate and even lives lost. the loss of 13,400 newsroom positions in just four years as attention grabbing and should move us to ask, what does this mean when it comes to the in-depth coverage of issues than local concerns when it comes to industry, government and communities at large. others such as gradients state a c-span, targeting advertising spending to local news media and help a nonprofit news operation to succeed are positive steps towards improving local accountability of reporting. apart from local concerns, i am intrigued by many of the other

findings in the report, from the coverage of regulatory agencies to services available to individuals with disabilities. one of the more intriguing aspects is the section regarding modern media policy and historically underserved communities. it is essential to introduce as many people as possible to the vast opportunities in modern technology provides and the requirement for tv stations to disclose whether websites are accessible to the visually and hearing in eric is something we should take very seriously. also, information about minority and female ownerships pose a further debate the issues surrounding existing this rarities and i intend to take a deeper dive on this in the months to come. additionally, attaining more accurate information about racial, ethnic and gender employment at broad stations as

they massed and i look forward to a more robust dialogue on that as well. i am also pleased by the suggested focus on communications programs and historically black colleges and universities. the idea of a minority capital institute to help would-be entrepreneurs locate opportunities for financing is one idea that i look forward to discussing further. numerous recommendations were making more data available online for public consumption are in line with the fcc's goal of greater efficiency and transparency. one of these proposals is to television broadcasters by all and i might form containing essential data as opposed to the current requirement of reporting on 365 days of programming. this could and would reduce the burden on broadcast file paper reports, while providing more transparency are more important information for the public. i look forward to working with broadcasters on this issue as

well. the more transparency there is an government, the more confident people can feel about what their government is doing for them. it is my hope that this report will also pave the ways to more discussions about what we can do to help making online filing easier simpler while still giving the public easy access to this important information. i am eager to listen and be part of this discussion that flows from the release of this report. it highlights very clearly that all of us have the capacity and the opportunity in our personal capacities to be influencers and change agent when it comes to the state of our media. i hope that the commission will continue to find ways to work with the private industry and local entities on many of the recommendations and concerns that the report highlights. i am confident that we can make

meaningful strides towards improving our media landscape on the local level and filling the gaps routines that work so well in the past and the people are looking for in the present. i want to again thank you, steve and your team for your tillage over. there is a quote that i am not sure, but it struck me today as i was listening to the comment. journalism is the first rough draft of history. if we believe and embrace the quote, then the publishing of this report has the capacity to serve as an incredible conduit for enhanced community and civic engagement. and the presenting of multiple examples in which we can and will read more about, options and opportunities, all of these things highlight the diversity

and dexterity of every single market and their ability to involve and best serves the communities, their people and all americans. thank you or image. >> thank you, commissioner cliburn. steve intime, thank you again for the achievement this report reflects. i want to thank each of my colleagues for their thoughtful comments. in particular, i want to recognize commissioners said terry for his long-standing commitment and passion in this area. any of the issues and recommendations highlighted in this report are directly related to topics on which commissioner copps has long been educating the public and his fellow commissioners. the amount

.. and opportunities of today's landscape and tomorrow. i think it is. and different levels of optimism of news and information, entrepreneurs both new entrants and traditional using new media platforms can achieve for open

and universally available internet and whether business models will emerge and strengthen and on this i am optimistic. cautiously but optimistic. these points and the fundamental fact the only thing certain about a future in this area is on going to change to focus on the steps including achieving universal broadband for all americans ensuring low entry barriers for news, information entrepreneurs, using public information online and it is easily available to consumers, citizens and reporters and enabling the business models that can sustain a vibrant and strong news information industry and the 21st century. these and fielder approaches outlined today are preferable in my opinion to ones that involved a heavier government and particularly in the area of speech and content. it more strongly reflect the law of the first amendment and i

believe more likely to achieve the objectives than the past approaches which will certainly well-meaning have proven ineffective as the report shows and a number of respected commentators who have been involved in these issues for decades have concluded. despite the differences that exist, i believe we all share the same goals. a vibrant free press and an informed and enlightened citizenry pay central roles in our democracy in our economy. the report issued today is on the core principles. it's important for many reasons reporters but i would like to highlight three areas. first, the report makes clear that new technology is creating a new world of opportunity to keep the public informed in ways we couldn't even imagine just a few years ago. digital innovation has made the gathering and distribution of news and information faster less-expensive and more space. with the internet connected to

have access to goods, personal printing press or even tv stations new communications technologies are connecting more people in more ways and more places and cite the u.s. and out. twitter, facebook, mobile phones and other new technologies are connecting and empowering citizens and journalists around the world helping open closed societies and paving the way for democracy and freedom. in the u.s., we see more and more news on the entrepreneur is pursuing their vision online and on the mobile of creativity and confidence. empowering individuals of tools to give us breakthroughs like hyper local news as we've discussed. in many cities to be confined news on your individual neighborhood or st. even in the heyday of newspaper this type of

clock information coverage wasn't available. but the nation's history we've never had a greater opportunity to realize the founders' vision of a free society, bolstered by a free press and informed citizenry. the contribution of the report is its focus on the opportunities of new technology. had the second is its focus on the challenge. foremost is the disruptive impact the internet and economic pressures have had on local news gathering. as we have heard newspapers have cut back staff and something impossible ten years ago shut down the material number. local broadcast news continues to play an important role with some stations increasing the commitment to their community seizing the platform opportunity but many other tv stations have cut back or offered no news or limited local content. with a multitude and emerging

gap in the local news coverage that has not yet been fully filled by other media, this matters because if citizens don't get local news and information, the health of the democracy suffers. professional journalists to provide a final check against corruption in both governments and business. the lescol the local reporting we have, the less likely we are to learn about government, schools that field children, hospitals that miss st. patients, factories that pollute local water to the accountability and tom esters and said he would rather have newspapers without government and a government without newspapers. the technology has changed, but the point endures to read the third contribution to the report is it is a thoughtful and practical initiative to help address the challenges that identify it. in crafting recommendations the reports start with the

overriding and correct recognition of the first amendment circumscribes the role for government can play in improving local news. but also recognizes the only thing certain about the future in this area is on going to change and technology and markets. but steve walden and the team didn't throw up their hands and say there's nothing to be done, nor would it have been the right answer. while government is not the main player in the drama, there are areas where government can make a positive difference and steve developed a creative set of recommendations for the government, for the private sector and the nonprofit sector that can collectively have a big positive impact and make it possible for cedras duty to citizens into entrepreneurs to solve the problems to do so. the report's recommendations as we heard focus on several areas. on achieving universal broadband access for all americans, on ongoing vigilance to ensure low entry barriers to information for entrepreneurs and entrance including preserving the

internet freedom and openness. on streamlining and removing obstacles the traditional news providers seeking to distribute the news and information on multiple platforms with strict new and innovative partnerships in a dillinger the development of business models that can sustain new information and the 21st century. on ensuring that the media policy works but historically underserved communities. on government transparency encouraging the development of ideas like states. on using public information from paper online in a way that is easily available for consumers become citizens and reporters there's more room for progress by agencies of all levels of government 70 to federal, state and local and much benefit that can be had with accelerated progress and moving information from paper to longline we have an example of that in the first item this morning this report

identifies additional areas for progress for example there's data and information that the fcc asked broadcasters and others to disclose the information is being disclosed in paper form generally in filing cabinets at the stations themselves. in a broadband internet world that just doesn't make any sense. the report recommends accelerating the move from paper disclosures to the line would be eventual goal of making all public information available online some things are harder to and more costly on covers are forcibly taking into account the goal should be clear and correct. in the internet age we have to be moving in this direction. the general call to move from pittard is closer to digital it makes imports a recommendation of what exactly we ask broadcasters to disclose. but to suggest we tasted could

change course and rather than creating programming course for broadcasters rather than implementing the overly burdensome we create a streamlined web based system will more effectively and efficiently provided to the communities more information for example the sensations are allowing advertisers to dictate news coverage in the arrangements the public should be able to find out about that and be able to find out about on line. they're doing far more coverage of the community and others the public should know that too. the report calls this a shift of emphasis to it is for the shift because i think it not only is more respectful of the first amendment but also because would be more effective than what the agency has been trying for the past decade. the technology of the internet makes it possible for the disclosure based public policy approach is to be far more effective than ever before let's use them. another streamlining recommendation involves the will of religious broadcasters to play helping charities and communities around the world including times of crisis

proposing increased flexibility for charitable fund-raising. the report also states we should be vigilant about relieving barriers to innovation and online on to the north and news gathering information sharing the barrier costs ensuring more public information is available on line not only help citizens directly and also reduces the cost of reporting and journalism akaka research reports and previews dewitt tichenor reporter weeks a month to be done in a daze or faster. another entrepreneur should the news and inflation areas of america's broadband to plummet and adoption gaps the access to information gets back to the early years of the public. 1930 to newspapers accounted for more than 95% of the week to read by the postal service and es commissioner copps pointed out receive a discount for postage. the primary news delivery mechanisms in the past is bigger radio television were all universal. the emerging news delivery mechanisms of the future

broadband of course should be too. doing so what have multiple benefits. bringing the vast information that's all the information that's on the internet to all people and another benefit is the potential for improving the business model for all in japan or some. -- on knorr. adoption and the united states from where we are today is a 50% increase in the on-line audience. the larger the online market, the greater the scale, the more likely a key online business can succeed. the public information online would help promote a broadband adoption, more broadband subscribers and larger broadband base for advertising. even other measures to increase broadband adoption would help improve our online business models for news and information on to the doors, stirring new innovation and increasing

broadband demand this is a virtuous cycle that will help the businesses in the u.s. and help all others participate in both of a democracy and our economy. steve walden and his team have produced an incredibly thorough and thoughtful report. one that is done a huge service by a deepening our understanding of how technology has affected the information needs of communities that provides a road map for a wide variety of players including the fcc to understand the media information landscape that can take sensible actions to fill important gaps. this issue is essential for the health of democracy and i look forward to working with my colleagues to act on its recommendations. with that, i think to begin on behalf of all of us very much. we appreciate your work and service. thank you.

>> allin the meeting with chairman genachowski spoke with reporters for about five minutes. going back from a retrospective question anything you might have done differently in terms of expectations for the report the expedition that cannot last year and a couple of weeks might have done recently to publicized and promote the report said that the fcc would have pronounced that this would be the meeting where the full report would be unveiled. the answer to the first is no, and on the second, i was under the impression that there was notice he would be at this meeting but i would have to look in to that further.

>> next question? >> a little bit more of what you think zeroth of this reporter or how it will guide you. i mean, a lot of it seems to focus on the print media etc. which is kind of of the realm of authority and in a more concrete sense where do you think this guy is your policy making? >> as i mentioned earlier today we took this up after a bipartisan, the knight commission recommended we look into issues raised by the information needs of communities and an agency that focused on broadband media based as he mentioned today his various rules and regulations that affect the media business caught it made sense to me then and now the commission should be assessing the landscape understanding what's working and what's not working and

considering whether there are steps and problems and whether there are any steps to take. as use of the report concluded for the news is good, the internet and abroad and is leading to greater vibrancy and innovation and entrepreneurship when it comes to news information but there are some issues around local reporting and what i thought for a set of fossil and practical steps that could be taken some by the commission's some outside in the context of the recognition that as one report says the government does not demand the main player in this drama and the first amendment is a very big player in this story but that there are some sensible steps to look at including expanding universal broadband, making sure that public is on line in ways that our searchable, accessible to

citizens and reporters to get more information out and lower new cover. i'm with politico pro which i understand is available in the building now and i'm one of those you should go pro if you're serious about keeping a journalist employed does this mean the media concentration is a dead issue at this agency? >> we have a media ownership review that is in the works. as you know, we have an obligation on a regular basis to review the ownership rules where in that cycle now i think this report will hold informal the media ownership review and its course the media bureau is doing other work to gather the necessary facts, and to assess media ownership rules and

whether or not the changes are made. >> i want to get your -- i'm sorry? >> what is on your computer? >> my daughter's stickers. thank you for noticing. she will be very pleased. there's staunch bob, that's mine. did you have any other questions, mr. schramm? i can follow-up q. like. thank you. [laughter] you're generic response to the supreme court's decision in the america course this morning and also specifically whether you can address justice scalia's concern the fcc might start using amicus briefs as a backdoor way of free regulating issues that have already lost. >> i'm gratified that the fcc position was upheld and that the court's opinion recognized the important role the fcc played in an expert agency in this area. i will have to get back to you on the point because i have not read that yet. i couldn't answer anything i haven't read it yet.

>> would you like my daughter to bring you some stickers mr. chairman? >> i have a sticker bringing a daughter myself. for the second part of the question of the policy side, what is your vision -- >> it was a two-part followed by another part? that is not allowed. [laughter] >> you've got to bring vv to read the fine print. what is your vision for what should happen with the cable regime because that's something the report does mengin. >> i wish it could give you a fully thought out answer and the answer is it's something i think as the report says should be looked at and considered in the changing landscape, but i don't

have a fully thought through view on that. >> thank you, mr. chairman. >> [inaudible conversations]

intergovernmental affairs is one hour. >> [inaudible conversations] >> i will call our meeting to order here. first one to welcome senator paul to his ranking membership of this subcommittee. this is the first time he's had a chance to sit in as the ranking member. so thank you for your service and doing this and i look forward to working with you. i would also like to thank our panelists today and the distinguished audience that is here today because many of you all have been following these

issues for a long time and just want to thank everyone for their attendance. we are going to examine the progress of the u.s. customs and border protection and preserving corruption -- excuse me, preventing corruption in its work force as well as the work of the inspector general office at the department of homeland security and investigating and prosecuting those individuals who have been accused of corruption. securing the the united states border is a constant struggle for the residents of the border streets and officials who represent them. the mexican cartels dominate drug trafficking into the u.s.. their operations and methods are sophisticated, roofless and well funded. they are mature his presence and power in mexico is made possible by a bribery and corruption, intimidation, paramilitary force and murder. the impact on the operations in the united states and widespread

the subcommittee held a hearing in march of 2010 at which we learn the cartel's operations are changing. they used to rely mostly on stealth techniques and the u.s. distribution operations and an estimated 230 american cities according to the national drug intelligence center three of the cities are in arkansas. the good news about the changing operations is heightened the u.s. border defenses have put a squeeze on the cartels. unfortunately the cartels are not easily deterred and they seek to regain an advantage by exporting to the u.s. their experience and success in driving and corrupting government officials who can facilitate their business. we must continue to do everything that we can to disrupt and prevent these from penetrating our communities. that's why i am pleased that

last year the congress passed and the president signed the entire border corruption act of 2010. this bill was designed to complement the work force integrity plan and present robie border agents from being hired and retained. the bill requires that cdp all of its own employment policies regarding polygraph tests of all new applicants for law enforcement positions. it also directs cbp to initiate a background checks on all of the backlog employees within six months. hiring new border patrol agents will help secure our borders only if the agents were truly committed to protecting the country. i look forward to hearing from the commissioner person on the progress he has made in implementing this bill. another area of interest today is the ongoing concern about the lack of true collaboration and information sharing between the cdp and the inspector general's office.

when it comes to investigating that such corruption. corruption is vital to protecting the borders and securing the communities. we must aggressively attack and investigate these cases if we are going to end corruption within the u.s. law enforcement agencies. however we must conduct these investigations in an efficient and collaborative way that leads to results in the quickest way possible. back based on reports this is not seem to be the way we are currently operating when conducting these investigations. i also look forward to our witness comments in this area. so our witnesses today are both very experienced individuals. commissioner bersen of the cdp and charles edwards, the acting inspector general at the department of homeland security, these gentlemen are leading much of the u.s. government's efforts to fight against drug-related corruption. we welcome their testimony before the first would like to welcome senator paul.

>> thank you very much mr. chairman. thank you for coming to testify you today. i, like senator pryor, am concerned about lawlessness stop of the order and whether or not that creeps across the border. i think the lawlessness has gotten so severe in mexico people fear traveling to mexico. there are people now referring to mexico as a failed nation state and is that an overstatement, i don't know, but i'm worried about the lawlessness coming across the border. corruption is a problem but i'm also worried about the lawlessness coming in actually killing our law enforcement agents, border of petrol agents, our sheriffs, our citizens across the border. so i am very concerned about where we are. i am also concerned about legal immigration and diseases and whether we are monitoring those who we let into the country. just last week we have captured two alleged terrorists who came on an asylum program.

we admitted last year 18,000 people from iraq this to me sounds like a large number. i wonder are we monitoring these people, are we doing a good enough screening process? this goes for other people coming here. it's not just illegal immigration i'm worried about to be i'm worried of legal immigration whether it is being monitored properly. we have 40,000 students coming from all over the world. you know, are they what the attackers, the people that it tacked on 9/11 were here on student visas overstaying their visas. was anybody monitoring them? are we overseeing where the students are who are in the country now? are we overseeing the refugee process? one of the guys in bowling green captured and alleged to be part of terrorism was in jail in iraq and his fingerprints were on an ied unexploded ied. his fingerprints were in our database for two years before we figured it out. i don't know that we are doing a good enough job. i fink as a country we are

spending an amazing amount of resources on a screening everyone universally as if everyone is a potential terrorist think that is a mistake we are coming through everyone's bank records. we are in feeding the privacy of everyone in our country. we are doing pat-down strip searches and our airports but are we spending enough time and resources targeting those who would be attackers or potential attackers of the country, so i want to learn a little about how the visa process is working and whether or not we are overseeing the people who have been admitted to the country and whether or not there are safeguards to protect the country in the illegal immigration aspect. thank you. >> thank you. sometimes we say that these people don't need any introduction and a really on these to you don't, going to be very brief and say our first witness today is allan bersin, commissioner of the u.s. customs and border patrol. we look forward to hearing from you, mr. bersin, then we will

hear from the next witness, charles edwards. he's the acting inspector general of the department of homeland security. thank you very much for being here. we have a timing system today, and i think we are doing five minutes on the opening statement. so if you keep your store five minutes we will submit written statements for the record so those will be made part of the record but we look forward to hearing from you and we look forward to good discussion afterwards. >> good morning mr. chairman. ranking member paulson, it is an important day for me to appear before you today to update the progress on the border protection is making to combat the corruption and maintain integrity within the work force. senator pryor, you and this committee has been an important force in getting recognized the threat that we face on the u.s.-mexican border and generally in terms of the men and women of the cdp now 60,000

strong 48,000 on the front line and the borders. if you recognize and we emphasize the commitment bravery vigilance character demonstrated by the vast majority of cbp agents and officers who indeed put their lives on the line to protect the nation. having said that we recognize there are bad apples in the beryl and it is our job to minimize those and to prevent corruption and detected when it happens. prosecutor after investigating its with other agencies in the united states attorney's office and the department of justice. unfortunately, cdp employees have been in dark targeted by criminal organizations as the chairman suggested and as the ranking member confirms. as we continue to see successes and our efforts to secure the

nation's borders our adversaries continue to grow more desperate in the attempt to smuggle humans get illegal contraband into the country. our most valuable as well as in some rare cases our most vulnerable resources are our employees. i am here today to candidly confront with you this vulnerability in the steps that we are taking with your assistance, the assistance of the administration to mitigate this threat. recently i put forward my first statement of intent in policies, the commissioner of cbp after a year of service outlining specific and high-level positions to be incorporated to all aspects of the cbp interactions. with the public with other law enforcement and we then will our own institution. that statement is intent on policy dhaka, integrity. it outlined the absolute importance that we attach to

integrity in the discharge of our duties. we pride ourselves on being the family, however, when one of our own strays into criminality, we do not forgive him or her such was the case with the market will get the cbp to retrieve her country and her fellow officers betrayed her trust and now sits in federal prison for 20 years as she so richly deserves. we recognize we need to confront this and are doing so with the help of the resources and the entire border corruption act that this chairman and this senate and congress passed in the president signed. s to those of four in october 127 cbp personnel have been arrested, charged and convicted corruption. this breach of trust is something we do not stand for and while seven years and tens

and thousands of employees are to discouraged by these evidences of corruption, we take each and every one of them seriously. the antiborder corruption act of 2010, which the chairman championed is one of the first steps to address the issue of corruption within the work force before it can take hold. i look forward to discussing with you this morning the steps we've taken in order to implement that act and be prepared to meet its debt lines. we recognize that there is work to be done and we are committed to doing it, and i believe you will be satisfied that we have made a good start along the path to being able to meet these deadlines. we also need frankly, mr. chairman, to recognize our best defense against corruption are the men and women of the cdp themselves and therefore we taken on the so-called code of silence within our institutions.

when we ask our officers to uphold the honor and integrity of their service, we and security to the border. mr. chairman, again, let me thank you for the entire border corruption act and the role that you've played in securing it. i look forward to answering your questions and the ranking member as we proceed this morning. thank you. >> thank you. mr. edwards? >> good morning, chairman pryor, a ranking member paul and distinguished members of the subcommittee. i am charles edwards, acting inspector general for the department of homeland security. thank you for inviting me today to testify about the role of the effort to eliminate corruption in thus cdp workforce at securing the nation's borders. the smuggling of people and goods across the nation's porter is a large scale business dominated by organized criminal enterprises. the mexican drug cartels today are more sophisticated and

dangerous than any other organized criminal groups. these torture and brutality to control their members and intimidate or eliminated those who may be witnesses or informants to devotees. the drug trapping or additions also turn to corrupting the dhs employees. border corruption and pact national security. the corrupt employee may accept a bribe for lobbying what appears to be undocumented aliens into the u.s. while unwittingly helping the terrorists into the country likewise what seems to be drug contraband with the weapons of mass destruction such as chemical or biological weapons. oig has made the investigation of corruption a top priority. in accordance with the inspector general lack of 1978 and homeland security act of 2002, the oig texas as an independent element within the dhs pass with coordinating, conducting and supervising investigations relating to the dhs programs and

operations. these statutes rest oig with the responsibility of dhs in just getting allocation of criminal misconduct of the dhs employees. the statutory independence and dual reporting responsibilities department and to the congress make it ideally situated to address the corruption. inspectors general play a critical role in assuring a transparent, honest, effective and accountable government. the organizational independence of the criminal investigators free to carry out the work without interference by agency officials is essential to maintaining the public trust. the dhs management detector establishes the right to the refusal to the investigations of criminal conduct by the dhs employees and their right to supervise any such investigations that are conducted by the dhs internal affairs components. it is the oig policy to

investigate all levels of corruption of dhs employees are compromised systems related to the security of the borders and transportation networks. the department internal affairs offices play a useful role to the oig by enabling the oig to leverage its resources. cbp focuses on preventive measures to ensure the integrity of the cbp workforce through preemployment screening of applicants including a polygraph examinations, a background investigations and employees and integrity briefings that all employees recognize corruption's signs and dangers. these preventive measures are critically important in fighting corruption and worked hand-in-hand with the criminal investigative activity. the oig has been tirelessly -- working tirelessly to negotiate a cooperative working arrangement that would detail the agents to the participated investigation of the employees along. these additional assets are

especially necessary as the cbp work force continues to expand significantly while it remains relatively flat. the dhs works cooperatively with external colin for some agencies on the border corruption matters involving the dhs employees. the key component of our investigative strategy is to leverage the limited resources and share intelligence with other law enforcement agencies. the dhs also participants in border corruption task forces in many parts of the country. these cooperative relationships serve to ensure the different law enforcement agencies are not pursuing the same targets which duplicate efforts and place law enforcement agencies and safety at risk. in conclusion, i appreciate subcommittees' attention and interest in the work of the oig to investigate corrupt employees with the dhs work force. we will continue to aggressively pursue these investigations with all of the resources at our disposal and in cooperation with law enforcement all levels to

ensure that employed corruption does not jeopardize our national security. chairman pryor, this concludes my prepared remarks and i would be happy to answer any questions that you or the ranking member may have. >> thank you very much. let me start with you if i may, mr. edwards, on this chart. my understanding is to provide these numbers to the committee as part of your testimony today, and i see a big upswing in a number of investigations. do you know why that is? why are you seeing a pretty dramatic strike? >> a 38% increase against the cbp since 20,043,112 to 4,162. these increase because we have to, you know, as the act that was passed last year, we need to go back and cdp needs to go back

and do the investigation of the politics of the employees because the 60% of the employees who go through this are they don't pass it because of the corrupt criminal background so there is a big spike in that. >> so say that again, that as you are doing more of the polygraphs more and more are showing up. >> no cbp has gone back and has done that without doing that there was a huge spike and they haven't caught up and are hoping by 2012 they will be able to do it 100%. >> perfect. that makes sense. there is also a pie chart you provided to the committee that is a part of your testimony, and in this these are named cbp employee investigations and i

think the name is important because this doesn't mean that it's all but it's the one that's a certain category of them at least. so there's 613 total and the navy blue is for corruption to sit for the audience that's 44%, and then the red is civil rights, and the green is suspicious behavior, so if you add the corruption and suspicious behavior together, you get 78%. that seems like alarming numbers to me. could you talk about that for a little bit? >> corruption is abuse of public power, the tax disclosure, law enforcement information. the cartel, the drug business, organized criminal enterprises are becoming very sophisticated.

so, and they are trying to infiltrate our cbp work force, and as our investigations, we have to get to the root of the problem if you just get rid of that one employee we still haven't gotten to the bottom of the problem, you know, and there is a huge percentage that is on named, and we have recently established forensic analysis unit to get to the bottom of this. >> did you want to comment on that, mr. bersin? >> mr. chairman, i think as you know, we are openly confronting the issue and the challenges that we face, and i want to point out i commend the oig as well as the cbpia and fbi in the investigations. we have to recognize though and put in perspective that it's the kind of emphasis that the agencies are giving to the problem that put more resources

into the problem that began in the first instance to seek an increase in the number of cases opened so the more cases that has been referred by the cbpia to the joint information system and infect those cases are being taken at a greater rate by the dhs oig, for which we are thankful but this is an issue of attention and focus and resource allocation. >> let me follow up on that if i can, mr. bersin, because one of the things that you have had a large backlog on is your periodic investigations, and i think he went through some members in your opening statements, but could you go through those again in terms of how many periodically investigations completed so far? >> yes, sir. we realize and the anticorruption border act we are obliged as a matter of law to complete the periodic

reinvesgations by 2012. we will meet that objective by july of 2012. we also understand the polygraph responsibilities. every preemployment will be polygraph as of january, 2013. where we stand today, and as you know, we have been working with keeping your staff and you informed of this we have 15,197 periodic reinvestigations backlog. all of those have been initiated, but they remain pending and to be precise, as of may 31st of this year, 5386 periodic reinvestigations have been reset adjudicated, 92 -- pending investigations or adjudication. what we've done to be sure that

we are on line to meet this, notwithstanding the hiring requirements of the southwest border supplemental bill, is to have the professional services division of internal affairs that handles this have the will of the resources to these periodic investigations. so, while the task has been complicated by the additional hirings of the supplemental bill have provided us we don't complain about those. but it does get to another 1500, just actually 1250 additional cases so to speak to the backlog. what we are on target, mr. chairman, to meet the requirements of the act. >> timoney de think he will not completed by the end of 2011, the end of this year? >> i wouldn't -- we have -- the

difference between, let's see, we have -- we have in the area of 800 that are in the agitation now, so i expect we are talking between now and the end of the fiscal year perhaps 1200. so we have a fair amount to do. but we expect we will be on line to meet the end of fiscal year 12th deadline. >> if you do the real investigations and polygraph, what percentage of the employee turnup what issue? what percentage are you? >> the last number, the one referenced by my colleague, the inspector general is the 60% present initio it depends on the population that you polygraph, and the nature of the issue, for

instance, what we are attempting to do because of the expense involved in a polygraph is to have a process in which we can rise to the top those applicants who are less likely to face issues in a polygraph examination. but the number will depend on vara actual population of applicants that to put through the examination. >> so, you're not saying 60 per cent is the number of folks that are, you know, showing corruption, you're just saying -- >> absolutely not. >> what is your sense of the number of applicants who somehow get, you know, it had with corruption? do you know that? >> i could not give you a specific number. i will tell you in the course of reviewing these, we do come across cases in which people who feel themselves to either have criminal backgrounds or links to

criminal links based in mexico or gangs based in the united states which disqualified them that it would be a disservice to the applicant pool to suggest that this is a large or even a significant percentage. what we have to do is be sure that we have the filter that catches each and every one of those. but i don't give my background in education. i don't think that this is a generation of young people that presents a generally more problems than my generation did. >> i'm going to ask one more question and then turn it over to senator paul in just a second. this is a question really from another context and that is the fmcia, the federal motor carrier investigation is doing a

trucking company to bring material in. i really have two questions for you. one, have you heard from fmcsa on this and are you taking any special precautions or any special procedures for these mexican owned trucking companies bringing goods into the united states? >> mr. try and, this is the pilot program away from the issue that will permit the mexican to readers to get across the border and not have to read continue into the united states. in the first instance, this is a department of transportation safety certification and a shift. we of course will be involved in clearing and expecting the containers on those trucks and we are keeping abreast development says the pile that unfolds. but it's a safety issue in the first instance and then the

issue of inspection targeting, risk management that we do with regard to each of the 27,000 trucks to enter this country every day. >> the reason i'm asking if course is because if the mexican drug cartels are successful and corrupting local officials and police and judges potentially and military commander who knows who else, it seems to me pretty likely they could also corrupt these mexican trucking companies, and they could just bring matters and unless we pay special attention to them. so that would be a concern of mine. the other question i have is something i talk with the d.o.t. about is the challenges you have in your agency about finding corruption and drug cartels actively in some cases successfully corrupt agents. i asked them to reach out to you about some of the lessons you

have learned and making sure that their work force will be done on the order to maintain their integrity. have they had a chance to reach out to you yet? >> we haven't specifically talked to we do work together on the interagency policy coordination on the border, and i will reach out to the department of my colleagues at the department of transportation. >> that would be great. >> mr. paul. >> mr. bersin, do you keep a database on owls those visiting the country on the visa, travel or student visa? >> cementer paul, with the cbp does and the admissibility of every one that crosses to the united states every day, and we have a million people coming to the united states a free day whose admissibility is handled by the cbp officers at airports connally and ports and seaports, so we have a record of every person entering into the country on the basis on which he or she does so. yes, sir. >> you also have a record of when they leave?

>> we do not have the biometric exit system in place yet. we have been working within dhs to look at the exit system, and there's been a number of pilots that have been handled by the tsa and cbp in terms of coming up with recommendations as to how an exit system can be reliably handled, recognizing that the airport context is one that is a manageable environment. land borders are actually the environment that present the greatest challenge to our exit of verification. >> you have to go through customs on the way in. do you have to go through customs on the way out? >> only when we do the outbound inspections which we are doing on the u.s.-mexican border in keeping with our new relationship with mexico, but we do not for the most part exit except on a surge basis in

places like the northern border. so there's a million people coming into the united states every day from other countries. yes, sir. >> returning u.s. citizens. it's amex. >> my problem, and i am still concerned about it, is the people who get here, do we note the you're overstating their visa, do we know if they are obeying the rule of their student visa? that gets under the purview who is checking that, is it i.c.e. or who checks to see if they are overstating their visa? >> this would be the responsibility of the dhs in terms of homeland security investigations on the visas overstays, but this is an issue that, as you suggested in your opening remarks, is one that has to be handled on a risk-management basis. this has to be an ability to identify high-risk entrance into the country, because we do not obviously have the resources, nor should we be devoting people

wind resources to every one of those million people. and the million people may also involve u.s. citizens just coming back. if i'm in london and by coming back that's part of the million. can you break the million down further? how many are visiting from another country? >> i will supplement the record. >> i would think that's what we need to do. if you are looking at a million, you would find out if 500,000 of them are u.s. citizens traveling on business. obviously they wouldn't be as someone meeting as much scrutiny. middle eastern countries might need a little more scrutiny but we would have to do good police work to do that, but then we also -- it almost seems like once you narrow that down you need to know who comes in and leaves and the difference between the two is those who are overstaying their welcome, and we live in such an electronic age even if you are going across in a car in canada now would be entered into a data bank and it should be easily reconcilable with who is overstaying their

welcome, and i just think after 9/11, we sort of -- we have done so many things to think that we are all terrorists and universally we have to scrutinize everybody. instead of doing what - could be just a good police work. it would be less expensive and intrusive to our privacy, but looking at the people who did attack us and continue to attack us and not u.s. citizens. >> the essence of the system in the cbp and dhs increasingly is risk management. it's exactly that. it recognizes we have limited resources and we have to do targeted attention. after making a risk assessment in terms of the trust high risk shippers, trust travelers, high risk travelers we have to segment to deal with it in sequence, but just to indicate your general point i couldn't agree with more, when we look at a faizal shahzad who is a u.s. citizen, naturalize, we have to

recognize that this risk assessment system can't just be cut. >> it's not just u.s. citizens. if you are a u.s. citizen and you have been two yen in three times in the last year, a businessman or woman in yemen, you might -- there might be a red flag for us. it's not simple as what your religion is, the color of your skin, it is more complicated but the whole host of figures we need to look at and exclude people traveling frequently on business. the same what we are doing in our country the, tsa, how many people fly every day with in the u.s.? a million or more fly every day. and i think we are wasting resources and we are distracted from the real police work we could do because we have to treat everybody universally as a potential terrorist. but anyway, i would recommend at some point in time, and it sounds like this is ongoing that we do talk about monitoring and who comes in and who leaves and should be easy to determine from that, but i don't get a good

feeling that, a decade after 9/11 we know where everyone on the country is whether a student visa and obey eagle and they're being checked whether or not they are in the country and obeying the will of their entry. the other question i have, i don't know if you know the answer to this or not, what percentage of visa approved by the state department initially i guess in another country once they come from customs are then reject it? because that happens, right? >> yes, when a visa is presented at the point of that mission there are circumstances in which the cbp officer will refuse admission, and based on information that would be available and the officer of the visa can be set up for revocation. i would need to supplement in terms of the millions with which we deal with the actual percentage of the repetitions. >> i would like to know because it would be