all we are afraid to offer blocking services because you might charges with blocking calls which would be a violation of our rules. so we amended the rules to say no and have now had a workshop coming up for we are bringing the carriers and other affected parties in to sit down and say exactly how do you do it? how did you handle a voice call is different. how you put those in place. this is something where we have said to the carriers our rules now specifically allow you to block calls. >> thank you. >> congressman, i.out that the safe harbor was not given enough granularity. the carrier is willing to trust the carrier myers and

not to rely on safe harbor that does not provide much guidance at all. >> you are not encouraging folks not to not block calls are weço[ together on that fact? >> on that we agree which is why i propose the agency created detail specific guideline. >> i do not want to send mixed messages. >> thank you. my time has expired. >> feel free to call us at home. >> a prerecorded message. i think that there are issues. the committee will proceed to talk. >> thank you. we go now to iowa for five minutes. >> thank you, mr. chair. i want to come back to one

issue that was already brought up. before i asked that specific question i like to talk about rural broadband and how important it is for places like iowa but all over the country. i know we have bipartisan support to make sure we have rules in place and programs in place, incentives in place to expand broadband availability to so many folks run the country. it is an economic development and health issue when we talk about the spectrum issue for hospitals making sure. i heard about making sure they have the broadband available and that they can do what they need for their patients. i often talk about the university of iowa.

it does not do any good if those folks cannot access with the university of iowa offers. it is important for farmers to have access to broadband so that they can make decisions for planning and there businesses in general and on and on. i was in iowa. and 27 people at that meeting on a weekday afternoon because it is so absolutely critical for them to have this coverage. my question goes back to what was mentioned. 115 members wrote to you urging reform of small rural broadband providers so that they could receive support for lines as is the current

practice. rural broadband submitted a data only plan in 2013 the fcc has not yet acted. other issues that prevent the fcc from acting as proposed, and if you could elaborate i would appreciate it. >> something like 114 different carriers in iowa. you represent the poster child of the world challenge for rate of return carriers. it is outrageous that if you live in rural america you are 30 times more likely not to get broadband as if you live in an urban area. there are two components. one is dealing with things to the price carriers.

we recently released 10 billion over six years to seven carriers to build their facilities command i love seeing the headlines that pop up across the country that so-and-so carrier announces they will spend 27 million as a result of our funds. then we go to the rate of return carriers. the challenge is that the program has been in place for so long and the circumstances have changed over that time. i agree strongly with the commissioner that this bifurcation makes no sense but we must do better than slapping a pending on. we must say how we make sure we can bring this whole program forward.

we sat down with the rural carriers to say how we can do that and to try and reach a consensus because there are rural carriers associations who do not agree. and we -- it is encouraging. everyone has agreed on this two-pronged process that i laid out a minute ago. and i am optimistic that the commissioner and myself who are all working together to come up with a package puzzle would be able to get this done and that we will live up to the commitment we made have it done by the end of the year. >> thank you command i yield back. >> the gentleman yields back chair recognizes the

gentleman from kentucky. >> my 1st question is for commissioner by. this all flows together. why do you oppose putting broadcasters in a duplex and why is it important? i can stop there. why do you believe it is preferable? you have suggested the commission hold them bank hearing to discuss issues related to a 600 megahertz plan. >> thank you for the question. in terms of putting broadcasters in the duplex one of the things that is this agreed-upon is that placing broadcasters would be a terrible idea.

it would impair downlink spectrum which is more critical. it is not optimal because the gap is the only exclusively reserved spectrum for wireless microphones and unlicensed advocates say if you have a broadcaster out they're unlicensed devices will get drowned out which is part of the reason i said we need toe do with the record suggests. that raises the question where you put them. i think there is no question that there is tremendous opposition. everyone carrying a smart phone around realize tremendously on downlink spectrum. putting a broadcaster in the downlink will impair spectrum making it less appealing and it will end up causing tremendous problems in terms of interference.

and the 700 megahertz option is a cautionary tale. think about what this commission had to deal with because of broadcasters and wireless carriers. we're talking about co- channel plus this is the last spectrum auction we're going to happen sometime. broadcasters will be they're permanently which is why i prefer based upon what i have seen the place broadcasters in the uplink. wireless carriers were told this is technically preferable for a couple of reasons minimizing the problems it would cause in terms of interference because you could put a base station filter on it which would be easier as opposed

to putting a filter on a mobile device. one of the reasons why it would be helpful the commission has not made available enough data the data and assumptions that underlie the simulations and we have heard from everybody. we need morewe need more data and we need to give you more meaningful input. let's bring them into around and have everyone participate so that we can never fully informed discussion. congress only give us one chance. >> another question. hopefully this is the last spectrum auction for a long time. >> do you believe enough is being done? if not what else do you believe should be done.

>> consistent with what the chairman has said we need to make sure there is more spectrum in the pipeline. the proliferation of broadband is a great thing. as a commission i wonder how we will supply the spectrum. that is part of the reason why i have been so bullish. >> do you think congressional action is needed? >> in some cases it might be new line the congresswoman have been leaders in that. >> about 20 seconds. >> yes, and i would like to identify. ifif we get a chance i would like to respond to your 1st question. >> nine seconds, so i yield back. >> the chair now recognizes the gentle lady for five minutes.

>> thank you and our ranking member our panelists this afternoon for your updates regarding the agencies activity. i have a few concerns is% would like to have you address. one of them worries me. what is not in your testimony is whollyholy commission will address continuing challenges and diversity of representation. we are in the 21st century we look at our nation and its diversity. there is a widespread acknowledgment that what we see in terms of industry is just not reflective of who we are as a country. i would like to ask where is the commission focused on the completion of the diversity studies and how

can this be used to create a more nuanced and tailored policy advanced equity? what metrics and accountability structures are in place to assure vulnerable populations will be adequately served as. >> thank you very much. the media report that i promised to the committee by the middle of next year will include a topic on diversity it has frankly been an issue that has caught of previous reports. the -- but there are a couple of things that we can take up. there is a substantial increase the number of broadcast agencies since i became chairman in large part because of what we did

on the gsa rules because those rules were being used to keep opportunity away from minority entrepreneurs. so i am proud of that effort secondly we all must recognize the importance of how the television business is changing and the opportunity that is reflected by over-the-top providers and there has been a difference appear on whether we ought to do with this committee did for direct broadcast satellite for over-the-top which is to say that you cannot hold content back. you cannot have various leverage points because over-the-top programming creates incredible new opportunities for minorities

lastly, we have been talking about the designated entity in the wireless auction. i feel strongly that what this congress asked us to doo be creating opportunities for minorities women and rural individuals to participate in wireless which is what we did in the dg rules and what the suggestions that have been made by my colleagues on the republican side actually would have permitted the ability for real-life dvds rather than hypothetical these. >> on the subject i will have you respond it appears that we have probably

cracked the code of only one part of support small businesses gaining access to capital. how can the commission facilitate actions especially those owned by women and minorities with the private sector? >> were you addressing that? >> i think that we need to make sure that the gsa rule was helpful and has performed as expected. we have made it clear that we broadcast licensees coming for transfers and are complying with the rule which says they cannot control that they will look favorably upon them selling

those assets to minority entrepreneurs. in fact that has been successful. .. jurisdiction over the e. ftc but the fcc has the authority to

regulate broadband taking it from the ftc and now it's with the fcc. now it is under this committee's jurisdiction. the good news is i'm still with you by the folks back home want to know why what is the problem with the ftc that brought the last east that forced this change and then to respond to the questions - >> as you know the ftc act at-large says that it doesn't have jurisdiction over the telecommunication carriers. they say we are telecommunication's and that triggered that. what constituents should come as we work closely with the ftc. the jurisdiction as far as its

providers and what we do which will be forthcoming in the next few months on our privacy proposals, we will do our best so that there is a common set of concepts that govern privacy. >> your response? to have the classification it is deprived of jurisdiction as the chair man pointed out because of the carrier extension and jurisdiction has explicitly been given authorization for things. second because the fcc irrigated that issue for itself unfortunately the authority under the statute is circumscribed as pointed out section 222 is narrow arcane piece of the puzzle if you will so we don't actually have any rules in place and the guidance given out has been completely

helpful. the guidance of the privacy that said its executive privacy protection in line with the tenants of basic privacy protections. what does that mean? i have no idea. consumers have no idea. >> the level of experts that protect the consumers over many years. >> and it's important that the ftc has expertise as opposed to the fcc. >> there was another issue about privacy and its providers. the chairman in the interest group filed a petition asking you to start rulemaking to start the consumer because he protection on the providers. are we going to see a response? you believe they should have a different protection than the

isp. the rules of the telecommunication carriers isn't as if we just fell into this patch. there's a long history with regard to the telecommunications carriers insofar as extending the jurisdiction i have said that is not our intention. i do not know when the specific response to that petition will be coming out. i will get you a date. i don't know the planning process. >> this is part of the problem when the they crossed in february. if you believe that the internet is a virtuous cycle and you have to providers interacting the providers interacting with one another to provide a better consumer experience that would follow it would follow that if the edge provider is acting in

any way why shouldn't they have the jurisdiction to extend the same rules to the providers? and moreover if you look at the standard is isn't clear to me why they should limit the focus on the internet service providers, so that is a part of the uncertainty that was opened up and i hope that we don't follow that in a logical conclusion. >> thank you both and i will yield back the balance of my time. >> the gentleman from illinois. >> thank you mr. tran and i want to thank the ranking member for today's hearing. mr. chairman, i welcome both of you to today's hearing. i want to list one of the most

troubling that is under consideration and i am referring to the prison phone call rates. the phone rates for the prison phone calls said mr. chairman we must stop the practice of the unmatched reform for this phone rate robbery. i'm guessing once and for all we must do away with the practice and we must count in state.

as you know mr. chairman president calls - prison calls and if there is any doubt in the washington post article, they paid millions to call loved ones every year. now this company wants even more this article referenced how to the company and the industry brings to investors before .6 million dollar future profits on the very same.

i've been fighting this issue for over a decade and it's now time for the fcc to take action and rein in the predatory practices by capping the rate at 5 cents per minute and eliminating all ancillary fees. but more importantly, the fcc also missed the predatory companies that right now are trying to circumvent the law by offering video phone calls and the same predatory raids than the offer on phone calls. mr. chairman my question is when will the fcc rule?

>> i agree this is a very serious issue and you and i can come and people across america over a huge debt of gratitude to the commissioner who took this issue for ten years in the petition and brought it forward. but you know what happens is that. next month we have a decision on that. the point that you make about the videophones is another legitimate point but the reality that we are talking about is a monopoly that is granted to

persons to determine how people communicate and like any monopoly ends up being exploited, and the people who are hurt by the exploitation are the very people that rely on it and i can assure you that the commissioner commissioner keeps our feet to the fire on this and i'm fully supportive of her efforts. in this situation left me move on. my time is up. >> we are going to do a second round of questions so if you are here for that there will be more time.

>> thanks to both of you for showing up today thank you for your testimony. in march we discussed the public safety complaint responses and the result in the quarterly report which you thought was a good idea. would you provide the committee on the website so the public can see what's going on and what you're doing? have you posted online? >> i can't answer that question specifically. >> can you get that to us as soon as possible. >> and if you haven't can you post that online as soon as possible? >> commissioner thursday in a lot of attention and concern regarding the auction rules. do you the leave that there are now correctly balanced and if

not both what should be done to fix them? spinnaker i don't think that they have moved in the opposite direction. my principle for the small business program is that they should benefit small business. but unfortunately the agency had enlisted the restrictions in posted the bipartisan basis has now opened the door for the large corporations to use the program and ironically enough to squeeze out a lot of the small businesses of those that need access to capital in order to provide us the service is a weasel services that we saw in the option where the small carriers try to compete but they were not able to because of the fortune 500 corporations to prevent them from bidding and that is part of the reason why i proposed proposed my thought what i thought were commonsense reforms if you're making in the upper eight figures you don't need the taxpayer-funded discount on the option. if you are a genuine business with less than $15 of revenue you don't need 50 million in

taxpayer-funded credits to get the spectrum in the option. if you are a genuine business you should be able to provide facility-based service not to flip the spectrum to the corporation. the proposals have restored faith in the small-business programs. it's been a good meal than the order you committed to take the steps to prevent increases in the attachment rates that might result from the reclassifies broadband. what steps have you taken to prevent such increases, and what additional steps are expected? >> there is a proceeding under way and we started in the last six or something like that. and it's designed to make sure that sure the disparity between the telecommunication service and cable service.

can you continue to update us on this appreciate it very much. >> thank you mr. chairman. >> in the recent response to questions for the record as to whether you think stakeholders who cannot afford to have regulatory lawyers or lobbyists in washington, d.c. should also have the same access that other speakers have, you made a point that the commission does not have funding for routine field hearings. they've been traveling to various event and it seems that both you have been wheels up

quite frequently in your travels, select the pose the question this way. given that you have a robust travel budget, isn't the issue how you elect to spend the money? the people i keep turning down saying i'm not going to cut talk disagree and my travel is significantly less than other members of the commission but your point is the well taken point and that is the positions designated. there is a travel but each commissioner has. >> you've answered my question. it really is up to your discretion on how you spend the money. if so, could you let us know for

the record how much the fcc has spent on travel in fy 2,013th for 2014, 2015 so far? >> okay, great. i would like to see that. commissioner i was listening to your discussion with my colleague mr. bilirakis regarding the designated entity program and i'm struggling with the commissioner's decision to eliminate the attributed relationship rule and the facility requirement in the rule for a couple of reasons, and you pointed those out. you made a compelling case that this sets the stage for arbitration. how are we going to prevent that from happening, what action does the commission need to take to

make sure that these small carriers are able to get the credit that it was designed to give them so that they can serve those underserved and underserved areas? stanek to be honest we need to return to the status quo before the most recent and about commonsense reforms to make sure the corporations don't get in the system again. it's in the same option that we have low hanging fruit that's already prohibited by the antitrust law. i'm talking about genuine reforms to make sure the people that want to serve the folks in ohio and kansas can do that and lending the amount of credit people can get and making sure that they can't own the majority of large companies and that we

preserve that as it is known so people don't end up flipping over spectrum they'll have a partisan affiliation and i wish the majority had agreed with me. >> is a concern for me and other colleague that represent the areas of the country. i've got high school students that don't have access to broadband internet service and as a result they have to go to a public library nearby or some other location where they can get a wireless signal or something like that to do their homework and research into that kind of thing and this is 2015 for crying out loud. hispanic one of the reasons the requirement is so important is in a lot of cases they don't see the business case building out to that area where the smaller

provider who does want to connect them to the internet wirelessly they have a strong incentive to make sure they are connected so when they are squeezed out because there is no more that really doesn't cut the consumers. >> thank you mr. chairman. i yield back. >> thank you all for being here today. mr. chairman or chairman wheeler, july trade with your agency announced granted with conditions the approval of the transfer we hear much about the agency's 180 day shop for reviewing such transfers yet the congressional grant of approval took over twice that amount of time as you are aware.

i have some questions i would like to have answers to. >> it is aspirational to begin with but it's something we try to manage in this particular situation. we were hung up by a court proceeding and a court decision that itself took as long as the shot clock but that's specifically dealt with the kind of information we could have on the public record and we had to get through that before we could get to the decision. >> on the 170th day of the shot clock, your agency stopped it for three months. the reality here is there is right now pending before the commissioner on the protective

order so we have put out in order for outlining how you protect confidential information so that we can be in compliance with the court so that this will not happen again added the absence of that is what held up this proceeding. >> same question to you. in the context of the transaction at another transaction we decided to get the confidential information from the programmers and without any kind of due process.

there's issues in of the transactions into the dc circuit court of appeals calling the decision and unexplained insubstantial departure from the previous policy. and even though they amended it and told them here's the roadmap you need to follow if you want this information despite that it was critical to mislead the data and seek it or rely on it and making the decisions of the shop clock needs to be more than aspirational. we give the public and the parties have uncertainty as to how they are going to do it. they control the license operation from directv to at&t. the department of justice announced after an extensive investigation that concluded the combination of the land-based

internet business from a satellite based business does not pose a significant risk to competition although the justice department closed its investigation without any conditions on the transaction your agency announced that it was opposing a number of conditions to address potential harm presented by the combination of at&t and directv despite the justice department's view that the combination of the two video businesses did not pose a risk to competition. what significant risks to competition that your agency identified that the justice department last? stanek we worked closely with the justice department on this and i don't think there was a sliver of light between us. we have a different test. they have an antitrust test of a face and we have a public

interest test so we have two different standards that we measure. what was happening was that in about 25% of the area of at&t service area, direct tv was a competitor to at&t for video service. and if so, eliminating that competition, the question became does that create an incentive to eliminate the broadband competition as well. so what we required is that they expand its broadband coverage which increased competition for broadband by a significant amount and create an opportunity for those video providers not to

have to go through an increasingly - a decreased chokepoint. >> we have a red light, so i will be back around. back in june to at pretty much every new york member of congress as well as the essential letter and while the issue may not be a terrible issue in some parts of the country actually is evidenced by not often you can get 27 members of new york to the very upstate and downstate. so we are extraordinarily disappointed that the fcc is clearly set a priority.

we got the letter from you yesterday and i understand the budget concerns. i guess what i am trying to emphasize is this is an issue even though it's not to you and you are the chairman we really don't appreciate you saying as you put in here the time and expense of the cases in the budget environment where the staff is 30 years the time is available so we must prioritize our work based on existing resources and hard to the public. matters posing a threat to public safety are directly harming large numbers of consumers and must take precedence over other matters such as the radio. so i understand what you're saying but what is the size of

your budget? >> the letter in those particular words that i wrote were not designed to say that this is a low priority but to say the first issue is public safety. it has to exist inside and i believe we have been aggressive. during the chairmanship we have had 200 private radio enforcement in the last we had 100 or - >> how many in new york? >> i don't know the exact number but may be% of those. and the commissioner meeting with broadcasters focused on that and helped us focus on that so we formed an inner agency working group task force to work with new york broadcasters.

>> so you had a meeting at the fourth point that can out is basically you need more folks in the local enforcement office. there was additional enforcement options. but we talked about how you've been reducing the local field offices and pulling those folks back to headquarters and some of us would presume that would-be the title to disagree on us all but it seems a little disingenuous and/or big concern is words are words and actions are actions and the actions haven't convinced me it is at all a priority in your letter y. ... maybe someday if we've got nothing else to do what i could to find but that is a low

priority. >> if that's how you interpret this i apologize because that isn't what was meant. the office where it tends to exist this is a lockable. one of the things i encourage this congress can also be helpful because we can't - weekend showed somebody down and then we are just constantly changing. if congress could also an act and make it legal to carry this out and i think that's also what the group has recommended if we can get at those that are eating and abetting because they pull this off you my move to mine

over here and you don't know anything about this and so there's a totality of the package. the 200 enforcement 200 enforcement we have a task force working on it we can use additional authority - >> i'm about out of time. maybe this is a rhetorical question that there've been suggestions that the fcc directed the field offices to step down and back away from enforcement. any truth to that? >> i've heard that suggestion but i didn't hear that command. can you provide me the language that you might suggest because i can appreciate and can you bring me the language we might then that might assist you, it is important for us in new york and

we don't want to be the last thing. >> the chair recognizes the gentleman. >> thank you once again for suffering along with me. thank you, commissioner for referencing the letter that 114 of my closest friends invite sent to the chairman regarding the standalone and to both of you for addressing it so thoroughly today. and i might go in and a little bit on the finer points regarding the timeline because in the letter that i received you've often referred to a lack of consensus there seems to be consensus pledged by the end of the year we will solve this but we need more from stakeholders. as you both know the community

presented a plan in 2013 and modified the last couple of years to meet the moving targets. i'm asking you, you offered up. there are assisting amendment as an outcome and one of the things i noticed. that is the model or are there other issues that have caused this to take so long? >> thank you for the kind words about the proposal is modeled on your letter. if studying back the problem is basically this. there's a number of problems.

my position has been to the companion letter in the senate to targeted changes to the rules to make sure that we have to return to care. that's not to say that they are not important but for the purposes of this issue. the issue in the consensus, i appreciate the effort of my efforts of my colleagues to find that consensus but nonetheless number one it is not necessary to adopt the standalone broadband issue and number two if we end up waiting until it leaving until it emerges on those other issues we will not bring the deadline we set forth for ourselves and publicly to get this done by the end of the year. are we attaching to any other things to the simple solution?

>> those are the questions. i expect to do it. a couple of points. in order to do that, you cannot be wedded to consensus. as you know from your previous somethings you have to pull up and shoot. but if you can't get everybody to agree at some point in time and we will put forward a timely basis by the end of the year because at the root of this we have to do better for the consumers, period and it's not just one simple fix, it is a broad set of fixes because i'm in agreement on the issue but

it's not enough independent enough independent of irresponsibility for the people that are paying for this agreement agreement and therefore google to make sure the money is spent responsibly and i hope we have consensus. but if we can't have consensus, we need to have progress. >> i don't want to consensus to mean 100% as you might imagine. in my remaining time we spoke of course about the auction and that's what it used to be called it is in fact voluntary and as you know the one $7 billion congress put in for the fund is probably not good enough considering we're looking at about 1100 tv stations will have to involuntarily move.

there's a plan to deal with that shortfall but i can assure the broadcasters they won't have to bear all the costs. >> i've long suggested we should treat the relocation funds in the budget and start the auction in such a way as to minimize the possibility and it did -"and i heard from broadcasters 36 months isn't necessarily as long as it might seem that there is a shortage of people able to do the work and the equipment that's necessary and that the commission should be mindful of that as well. >> i want to make sure that they are held harmless in the expenditures.

>> we do need to make sure that we live in the budget and want to manage things in the budget. you gave us a number. we can't change that number and we have to come up with a program that will make it work. >> if you hang around we are going to do a second round. we are going to go to the gentleman from new mexico. >> thank you for having us here today. ranking member it is an honor to be here with you. thank you for joining us as well. i appreciate the testimony. as the commissioner said he represented a rural district in as we talk about many parts of the country that need propaganda access and affordability and you heard me say this many times we can have connectivity at 30,000 when we are flying across the united states there is no reason

that we cannot have the activity when we are on the ground traveling all across america not only in the rural communities and states like new mexico. with that being said 77% of those in the rural communities do not have access to the rock band. as you sit in your testimony you pursued an aggressive agenda that includes reforming the program modernizing the wifi program and extinguishing. can you discuss with this agenda means for people that have access to broadband and communication services not just with the build output making it more affordable for people are able to take advantage? >> thank you, congressman. and i hope that we can do better than those that are covered in the area that is what we are doing. i have been in new mexico

multiple times in the tribal areas and other remote areas to personally visit and talk to the individuals involved. i remember a situation there was a fiber going down the road and there was a high school didn't appear was the letter he and they couldn't get a connection from the fiber to the high school because it was cost prohibitive. now we pay for that candidate is in and that is in large part because of these kind of specific examples that we have seen. we need to make sure that this is the case and also that while income individuals that are disproportionately represented or in tribal areas have access

to broadband support and that is why we are not only over hauling butt changing the orientation of the lifeline program to go to broadband. >> at all of these areas i will submit some other questions into the record but as we do this i appreciate the conversation that we've had today and the focus to see how we can grow the family as well. the other place i want to compliment you is on modernizing you've embarked on decreasing backlogs and responsiveness to consumers. can you both tell me what you're doing to provide greater information to consumers

including transparency and accountability standardizing forums? >> i'm glad you asked that question. >> in my first trip i saw in the corner a humongous machine to staff proudly announced distaff proudly announced could take 17 different forms and put them into one envelope and i said why aren't we sending up 17 different forms and they said because that's the way we do it so you contact the fcc and we will send you the form as well as the form for loudness on commercials as well as any other complaint.

we now have totally updated it and put it on the web. we just won a prize for being the best government site and taking that information and putting it back into what should we be doing to help us focus on our priorities. >> if there's other areas i look forward to having those conversations and if i'm able to because of the length . >> going back to the translators does there is all this talk now about setting the channel is not for the unlicensed. we've made a lot available and there is more to be done but old setting this aside contributes

to the problem that we are hearing from? >> at will by definition. it means the station can't occupy it. >> in its reality probably not because what we are talking about are using the spaces and creating these kind of additional applications. in those areas where the gap is not sufficient that is going to be a handful of areas that i doubt will be in any areas that are the typical. >> will you commit to that having the priority over the

unlicensed. >> it was clear - i think the mandate from the cavity is clear there is no priority given. i don't think that it comes down to that kind of a solution with all due respect. it's possible what we are breaking our tale on its to be able to accomplish both of these and i think that - >> my recollection of the statute was never satisfied on the nationwide band. we had a lot of discussion about the fact that you don't clear all of this instead give it away to affect pretty major operators >> part of the reason that i suggested we adopt the solution where to put broadcasters if we

put them in the uplink then we avoid this issue altogether wherein the duplex gap they have to find a home - >> this is a good point that the commissioner has raised that there is a serious concern. so first of all let's remember what you are talking about here is how do we minimize the aggregate impact across the country and that is in the handful of the markets it is a percentage that can be in the single digits. he is proposing that you put in the uplink. what that does is knock out an entire station to impact. >> i think that you have a disagreement with the commissioner but i have to move along. i hear from my colleagues they are concerned translators will go dark because they will get

squished out and if they get out because you created a whole band of unlicensed if it only adds to the problem and there is a public interest obligation underpinning all of this to provide for. realize they don't have all the rights. i was with the translators myself myself and i knew i could be pushed out through this you've got flexibility to manage i want to switch cheers here quickly because this issue in the autodialer has come up and in your order, you adopted a pretty broad definition of an autodialer although you acknowledged there are limits and there must be more if it can be modified to the definition. is my iphone and autodialer? there are at least three that we found the bug turned my iphone

into an autodialer. >> what we were trying to deal with on this order was not the hardware but the impact because since congress acted in 91 the technology has changed and what the instructions to us were is no contact without their permission. >> if i push somebody's name i don't ever dial your number i just push chairman wheeler and it dials. is that an autodialer? if i have a database of names i want to reach out to let's say voters and has a device that calls until somebody answers than i can take the call is that an autodialer?

>> yes sir. >> if i have a town hall in my office which i do and there is a company that does call for thousands of people are they prohibited from doing this? >> unless the consumer asked to get this, the congress - the statute is explicit, so the town halls now - those are prohibited and they always have been. >> part of the reason why is if you look at the statute it says the capacity means in actual capacity the smartphone has in itself intrinsically the ability to do that and the majority rejected inside

"-begin-double-quote an act and there's other things to make it an autodialer even if it isn't in terms of cleaning transit. that is part of the reason why every communication device is the subject to the ability. >> it's time for you to come in and have some tests done. maybe prohibited. are you aware of that? >> it doesn't surprise me because we've seen from a number of industries has been uncertainty but the rules of the road are. >> what we are doing is responding to remember if petitions.

people said what is the view interpreted so if somebody wants to petition us on the kind of things you talk about they have an exemption to have fraud and how. things like this i know you spoke out and said basically they could go the way of blacksmiths. >> they have been, right. that industry and effect in terms of trying to do a random sample is put out. how do you do a random sample on the pole if you can sample and dial clocks we wrote a piece on that insofar as wireless.

that went by the board. the issue is if you come to us and say the statute says that it's the only folks that aren't allowed to be are allowed to be called are those that want to be called and i'm supposed to be strict on the statute. >> it seems to be they would disagree with the interpretation and you are constantly encouraging me to be. >> it's an important discussion and i think that we need to talk about this more because of the

statute it's like holding a mirror to the up to the country n91 that's a long time ago when you think of the generations of how many have taken place so whether someone wants to be a strict constructionist we have to have the elasticity to stay up with the times. maybe we have to reach out to every single one of them if we possibly can not in my view, meeting with people relative to the telephone townhall meeting has been overwhelmingly been braced plus it saves tons of money.

i don't think they could be satisfied with the statute and change whatever they have to change but keep up with the changes that are taking place. since we are going into a second round. >> to talk about -- to talk about the budget. the appropriators have we have members asking questions today. i think that whatever you do and how you you doing do that it would be interesting to see.

it may be something for us to discuss. the bill has $315 million. it's below the fy 15 and acted the level level and 73 million below the request. they've also placed and writers a relative net neutrality. what i would like to ask is if you've ever had conversations with the appropriators is there anyone in the majority here that's been asked to leave and we are constantly putting on the oversight of these issues come up. i don't know who is going to do this work and follow-up.

members said it don't close them, we need them open. an open. but there are so many things that are reliant. i am talking about the agency. have you had conversations with appropriators on the majority side, have you had conversations with the majority side to see what can be worked out with the budget? the president isn't going to sign something like that and at the end of the day the appropriations process is so messed up around because we don't have regular order speaking of transparency and process and all that but we are going to end up an omnibus bill

so compare and contrast and address any conversations to the budget of the agency. >> we have had conversations with anybody that while listening to someone who won't and i'm not saying people aren't listening. we talked to this committee the first time i've ever known a chairman and - the second time i was there last year. i was there right behind you.

we have to live with the number that congress gives us. >> worthy cutting were they cutting the budget or were they against the? you know what i would like to ask you to do, to things. what will you be able to do with the budget. it will be the voluntary option

and all the topline items and also if we have an omnibus bill and i look forward to revealing that and i think it should be sent to everyone on the committee. we are walking into the members of the committee that has oversight responsibility to understand the have to curb the appetite for giving the fcc assignments if they don't have the dollars to carry them out. one of the current things we are out of the employees in modern history for the agency.

>> i thought he really do like me. that and i looked around and no one else was here. it fell into the legal gray area where the companies may not even realize they are doing anything wrong. i know that you've raised concerns about this. can you kind of explain your concerns and what can be done to address? >> many of the enforcement initiatives have the due process going back and i think part of the reason why we've been so outspoken about it is that the private actors from companies all the the way to individuals told about the rules of conduct are than they have no reason to know the conduct is violating what they think should be with

respect to the notices of the liability the agency has issued its almost more for the headlines first and we will figure it out later if at all but that has it but that has it backwards. we should look at the facts and if there is a gap it's changed to make sure people are abiding by what we think is a proper conduct. we can't sanction someone for violating the rule if they have no reason to know. >> to the two of you i am curious about the broadcaster's relocation fund and how the money is going to be spent. ..

and so let me give you the number. >> i appreciate it. same question. north of $3 billion. if that figure is correct we have 1.75 billion the relocation fund which is

something i hope to avoid. >> well do you have any estimate? >> no, i do not. >> i have heard figures and have difficulty believing it will cover the estimated numbers they are talking about. i am going to yield back with 1,000,037 to go. >> the chair recognizes the gentleman. >> i would like to associate myself with the questions pertaining to be our ability to the american people.

when i travel especially in rural communities one of the things i here from members is sometimes we have to travel three to four hours how much they appreciate being able to weigh in. if the rule requires them to often how would we reach out to constituents with them too often? we cannot send them an e-mail. based on the press release only 48 percent of those have broadband service at home. if we cannot reach out to often do i send them a letter? you don't want to be sending letters and forms out. i certainly hope we can look at this to see how we can

address this. i visited the chairman to look forward to working with you on that as well. some additional questions about broadband penetration. there has been conversation about broadband. do you see broadband penetration or accessibility as a necessity your luxury? >> thank you for the question. my goal has been to make sure that any american anywhere anyone who wants digital opportunity should be able to get it which is why we have proposals to make sure we have competitors out they're competing to provide every american with an opportunity

that is something i will leave to wiser minds than myself. >> the semantics associated how would you characterize the importance of accessibility to broadband? >> it is absolutely critical i have enjoyed having a chance to travel to us and how people have used broadband. this is the case in your district that if you don't get that high-speed connection there will somewhere else. in rural america it will whether on the vine which is something i am passionate about. >> i would characterize it as a necessity and appreciate you considering it for characterizing it is absolutely critical.

with that as we look to the lifeline program and in the testimony your dissent and it they're were concerns associated with the cost to the program to date and you did recognize that they're have been reforms that we have looked back to 2012 understanding that we saw a transformation from landline phones to going in the mobile phones. since then the commission came forward with a unanimous opinion which resulted in a reduction of 214 million in savings with the substantial projection. trying to stoke of the numbers on those real life savings but you listed a concern where they're were

providers that were signing people up fraudulently which we need to crack down on. in the 2015 order there was a reform that stated the ftc would remove the ability for providers to sign people up. with that principle is that something you agree with? is a something we can work on together? >> i think that verification is a critical issue. one of the problems is the case that friday night operators have created lifetime customers. he spent it on his own private expenses which is something we need to weed out. we need to have that conversation.

>> i appreciate the reforms. is 1.6 billion the right? share a concern and know that we agree is not just accessibility but affordability. should it be arbitrary are based upon data? >> i think that it should be fact-based. the program was at 800 million and is the only one of the programs that is not. we need to have a balance making sure we target people who are off-line and make sure we are responsible stewards of the consumer tax dollars. 1.6 seems to be a good

starting.to have. >> based upon last year's numbers. that is what the number ramped up. thethe inflation from 2008 to 2012 was because reforms were necessarily in place to back the number down. this scenario we can work on it together as well probably forward to having more conversations. >> thank you, and we put -- we appreciate your participation. in closing the quadrennial review the last one is a years old. ii hope the commission will deal with the quadrennial ownership report on a basis. a.m. modernization is something that is high. we ask that the commission deal with the downloadable

security issues and it appears that committee was given direction work on disaggregation of data. again we are after the downloadable security issue. oneone letter to put in the record from care payment. i think you heard bipartisan concerns. you are implementing the law that was created when you get charged for incoming phone calls. no one is talking about robo calls but there is an issue that we need to take a look at. thank you for your diligence and patients. with that, the subcommittee stands adjourned. [inaudible conversations]

>> energy secretary joins martin dempsey. watch coverage on c-span3. the c-span city tour is at cities across the country. this weekend we're joined by comcast. he was also awarded a metal of honor. >> about ten years ago a decision was made to do a

military display to honor jimmy when i did my research on the book, i went through over nine thousand it turns out he's the only person ever to have earned both awards. he would almost for sure said he did not deserve it. he was very humble. when i interviewed people who knew him when i did the book a long time ago, people knew him well. most of them will tell you, i didn't deserve this metal. it should have been given to someone else. it's a piece of human ill --

>> president wilson moved to this house when he was three. he was standing on the front gate and two men came by in a hurry and they said abraham lincoln has been elected president and there's going to be a war so young tommy ran inside to ask his father what was war what did that mean, why were they so excited. i think it's remarkable that his very first memory was about another president, abraham lincoln and another war the

civil war. >> see all of our programs from agusta on c-span2 book tv. now discussion about digital mus -- music streaming and what role congress plays in the new industry. this is an hour. >> welcome folks. thanks for coming. happy friday. a few more weeks till recess and today's panel is called taylor swift of congress.

this event is hosted by the congressal caucus committee, on the house side it's shared by congressmen. it's been for almost 20 years and created basically to do educational discussions on these really interesting and new innovative internet policy discussions. the issues have gotten more interesting and more new. thanks for showing up to -- today. i would also like to extend my thanks to them, this particular issue, i think we're having fun with title. we're not try to go pick a fight between congress and taylor swift. giving it some latitude for me

to hang myself in the particular discussions. if you are following or follow the conversation, hash tag policy extreme. we'll be posting audio so you can enjoy the conversation that way. next -- our next event we should have -- we have an event next week in remote access to stored e-mail that will be on our twitter account as well. you can find that in our web site. every week we do a different thing, so keep checking the twitter account for upcoming events. let me start off i'm the least qualified person to modify, i am a person that is shocked at what the role is in the music that we listen to, it's not really well

known. i might be actually in a good place to keep it at a high level and if we come out of it today with explaining and have a better understand of the role that congress plays and how it affects the music over your favorite services and how artists get compensated that would be great. we're not try to go get into any discussions about legislation that's on the table. my understanding that the house of representatives are reviewing copy right in this area. other agencies are looking at this issue. in the meantime we thought we lay a good basic insing of -- understanding of how this works at a level. the entire semester not really

understand. you probably still wouldn't understand fully this entire complex space. wrote a piece and said it was practically complex and i think that's a really good december description. wewe are going to keep a high level and keep it at that. that's our goal, at the end we will ask if people have an opinion about congress in a marketplace. lets start with taylor swift. you might have read that she had a disagreement with the most valuable company on the planet a couple of weeks back and wrote a polite letter and the most valuable company on the planet

changed its mind. it's a breath taking display of power. wow, that's pretty amazing. her twitter followers they pleaded to her to save the wales. and also affects, you know. everybody listening to apps and accessing in different ways. that wasn't the case, you know 10, 20 years ago. it's really interesting that today we have this really -- everybody has invested in this. so we wanted to frame this discussion not to pick a fight as i said, but really to show the kind of role that congress

plays in this. so a bit of mangled legislative history, you can go back to the original copyright act. i'm going back as far as 1995, it's limited only to digital transmissions. so basically for lack of better -- internet transmissions. that's the scope of what we're talking about today. it created the right. there hasn't been a performance copyright before. performances the sound recording on your -- your tape or on your digital file whether it be mp3 on hard drive. that's the sound recording the

performance. it created two rights, which we can get into a little bit about. you can't kind of control what specific song you listen to. you can fast-forward one or thumbdown one. so they have -- the act requires them to -- those services to pay a statutory license accomplished by a copyright board. also internet transmissions. you can kind of select the music ewe want, what types of songs you want. you don't actually own them. that's the best -- ting best well known. for that congress said you have to negotiate a license agreement with the copyright holder.

but in 1995 when they passed the act, what were you doing in 1995? a lot of were busy being born. i don't know what they were listening to. baby einstein. no one raised their hand. it would have been pirated material. there was no music streaming in 1995. of course, towards the ladder part of that decade, you know, you had -- you start today -- started to see more and more and

had mp3 players. what you would do is take your entire cd library and rip it to mp3 player that would hold like 10 songs or something. in 2001 apple introduced a massive ipod music player. your entire cd catalog which was prettiy cool. you could download songs, 99 cents basically and goes up to 1.9. you own that song. and of course, through this entire time piracy continued going. and then later it wasn't until

later that up and down -- pandora came into the fold. you can fast-forward one and you get what you get. and that -- that is grown tremendously over the past several years. while this is going in europe there's a company what we would call interactive services. it was growing growing in europe and washed in u.s. shores in 2011. now we have a really amazing marketplace, it's more and more interesting. now what we're going today -- to do is try to explain how congress has a role on this. maybe ask folks to later on very simply, the different types of

roles that people, government has and how it works out, we will go back and do it again and finally questions and answers and the question that has more power. going to my right alec, he also represents an important player in this phase. we have julia, vice president of global for sound exchange. a company that was born out of 1995 act she can explain how that happened. to her right group that does lots of education and things like that. and jonathan potter. we wanted jonathan potter to explain apps on your phone and explain this in a little more

detail. my understanding is that taylor swift was not available to the panel, which also said these are four really great speakers. we would like to have a panel of 100 people to represent piece part of this system. that's obviously not possible. we are going today our -- to do our best. jonathan represents app developers. jonathan can explain kind of like the music services that you have in your pocket you know, how all this works. jonathan. >> thank you tim and thanks to the internet caucus for inviting. i was not listening to baby einstein.

told me that was the first streaming company. so when i think about internet music and we're obviously just not talking about streaming if you will, have come and gone, i group them into four basic business activities and tim has asked me to basically talk about some of the business and the other folks talk about rights and royalties. one of them is internet radio. take your internet station put it on the internet that other people are programming. at the purest sense, think about

local radio station they're just happen to be streaming that was the original, that was mark cuban second company which now made him the owner of the dallas mavericks. he did very well. he sold that to yahoo for $6 million. yahoo didn't do so well with that. we can talk about all wa it means to be interactive. at the basic level think about preprogrammed or consumer influenced. that's basic internet radio. pandora is probably the base now. you can specify which song you

want to hear. you can specify to shuffle on the internet radio stream, right. so you go to and hear a mix of songs that you like and know and you want to mix it up a little bit, some of it maybe on demand. you can take it from your collection. some mix of that and that's your on-demand radio. your next traditional model is buying music. some of you were old enough to remember when there were record stores. they also use today sell other things. at least in my town. think about just purchase music. 13.99 an album.

once you own that music today you can generally pour it to whatever device you want. the branding is interesting. but he wants to do higher quality streams. so he's clearly defining what's the bigger deal. the most interesting business model for apps and digital music is conditional downloads or subscription services. you're paying $10 a month, $8 a month, $13 a month the old basis. what's that?

title. right, right. another one where it thinks it's going to make a difference. they let you do almost anything. you can stream music that you purchased. think of temporary down -- download. you can probably pour it to hard drive and car. cars have hard drive. those different business models are out there. some of them are free and some of them are advertising supportive, test it for 30 days and then they try to up sell you. some of them are sub descriptions. pandora for free is advertising supported. they're both internet radio.

they're both not interactive internet radio. that's really -- you know, some sub -- sub >> some offer. we want to license these service so two people can listen to the music at the same time. we can't do that, we have to charge them double. you know we can let them because if not one person will listen and the other will steal it. you have the apple family plan and, of course, just on your cable you can watch four tvs at once. we want to make this attractive.

it has come a long way. all the services are legal they are licensed. known of them -- none of them have anything today -- to do with piracy. so thank you. >> that was great thanks, john. i mentioned and john referenced to it as well, sound recordings was for sound recordings. that's what you catch on tape, mp3, sound recording of it. there's other rights that are what makes this more complicated. we are going to layer on that now. those conversation that is you hear on the news, tv, in the industry. if you can explain the next

layer of complexity. >> sure. i want to thank for having me here. ♪ ♪ ♪ >> everyone has heard that song. does anybody know who wrote that song? there's a copyright on sound recording. the fact that that's her voice everything you hear there's a copyright. but there's also a copyright in what's called a musical composition. someone said down and wrote the

musical notice. so you have some guy you never heard of who is the writer of the piece of music that then was recorded kevin you probably wouldn't want to go see him in concert because you don't know him. you are probably not going to buy t shirts because you don't know him. he's a writer. that's his job that's what he does. it's a completely copyright and a completely different business. i'm going to talk about the song writer that's who i represent. you have two copyrights. when you have a copyright. copyright gives you the exclusive right, you have the

right to do certain things. for music the ones that are important you have to exclusive right today copies, publicly perform musical composition and third right to distribute. well, to get to kind of a core of what this panel is about you as a song writer have exclusive rights. you don't actually have the right to go out and exercise the rights in free markets in most cases. in most cases your ability to license those rights to others who want to have them is regulated in one way or another. and just kind of give you a quick overview of what thats. this is a right tim talked about 1995 act.

that only plies -- applies to sound recording. when you want to publicly perform a song writer's work whether on radio station a bar restaurant venue cable television with any of those services want to perform music they have to get the rights from the song writer. imagine how complicated it would be if a radio station had to go out and find and then negotiate with the song writers of all the music that you hear on the radio station. up and down ora is mls. mls of song writers. that just isn't an efficient -- you couldn't have that negotiation with the song writers that are out there. >> names of people you never heard of.

so you have market problem. ..

meet and license the music.

jonathan mentioned itunes and spotify you may not know also involves copying because to do streaming you have have a separate copy you send a stream farm. that world of how to songwriters

license reproduction copies of the music to folks like apple or cds or osha, people wanting to copies that is a completely different regulatory regime that congress has control over because every reproduction is subject to what's called a statutory license. congress in 1909 going way back actually said if someone wants to make a copy of a musical composition that a songwriter created a will have a right to do so. they don't have to negotiate with a songwriter in the free market. you don't have to go and sit down with them. congress is going to create in this case there's a three-judge panel sitting in a library of congress actually, three administered law judges who determined the rate that he songwriter will be paid each time the music is copied. the rate today is 9.1 cents. in 1909 was 2 cents so it's gone up a little. but that's a copies are

regulated. the third and last is there's one area of the marketplace where songwriters rights is regulated by the free market. every time a movie or television studio takes music and wants to incorporate it into a movie or tv show, they have to get the rights from the writer. they are making a copy of that composition to include along with the sound recording in a movie or tv show. background music soundtrack theme song, et cetera. that negotiation between the producer of the tv or movie and songwriter is a free market negotiation. they have to get the rights and they have to commit a songwriter doesn't like what they are being offered, capital city, safe and sound, they don't like the price they can say no. excuse me the songwriter. so those are the three big baskets and the ways

functionally the songwriters licensing of the rights is regulated. >> we've only scratched the surface. alec went over the composers rights and we talked about how the system is covered by doj consent decree. another portion, a copy portion being controlled i a three-judge panel somewhere that is the copyrighted the board. and those other rights. let's get back to what congress did in 1995 which the digital performance rights, the sound recording. that does a lot to explain the services you listen to on your phone. two of us understand that it over the past 20 is how the marketplace has grown and what is enable that to grow because alec said his organization like ascap and you may have enabled songwriters to get compensated and focus on the great and they did not on the business side the marketplace for the performance rights that congress made