union positions in my district enjoy great benefits. how would at&t plan to extend this industry leading respect for the rights of employees to directv as a result of the proposed merger? >> as you mentioned, congressman, we have the largest full time union in the united states. we have a long history of working with our union members and doing collective bargaining. we have always been open to car check neutrality and allowed employees to make that choice whether they wanted to be part of collective bargaining or not. with directv you should say directv employees will be offered that same option, to collectively bargain or not. it will be their choice. >> thank you. mr. wade. >> i agree we certainly welcome the opportunity. i think there's fabulous talent

at&t brings and we think directv has talent as well. i think world-class enbenefit programs for employees will be a good thing. >> thank you, sir. all right. mr. stephenson and mr. white, i'd like to ask you both to talk a little about the company's commitment to diversity, the merged companies commitment to diversity in a number of different contexts. i know everyone will agree having a diverse group of individuals as real partners both inside and outside of the country is important. at&t's public interest statement pledges at&t's diversity best practices will be applied to directv. such action would be laudable given at turkey's his with supplier diversity and inclusion. mr. stephenson, please describe the best practices referenced in the public interest statement.

>> yes. first i'll start with employees we have a strong belief our employees reflect the market they serve. i don't think you can be successful in the marketplace employees, executive all the way up to the board that reflects the people they serve. i think we have a very good track record in that regard down to the board and frontline employees serving the market. we also extend, as you pointed out, that commitment and expectation to supplier community. in 2013 if you look at the total spent external to at&t, over 25% of our spending was with diverse suppliers. that is in excess of $15 billion in at&t's spend that was invested with diverse suppliers. i would also suggest one of the things mike and i realized our

cultures are compatible. we look at at&t and see compatible practices and are confident this will be a seamless in that regard. >> anything to add? >> 40% people of colors, 42 new hires people of color, 40% of summer interns are people of color. having spent most of my career in consumer products i passionately believe you can't understand customers if your employee base and management base and your board -- and our board does as well -- reflects that diversity. so we're proud of our commitment in diversity with at&t. i look forward to leveraging supply work at&t has done best in class in this area we'll be able to take advantage of. >> that's great to hear. do these best practices apply to

banking and finance? >> yes, sir through all the disciplines, external spend. i won't say 25 through all disciplines but across all disciplines we impose these supply requirements, diverse supply requirements. >> thank you, and i yield back. >> something that concerns members on both sides how merger affects americans jobs. let me go further and say also prices constituents above video and internet, in other words how would customers benefit and will this create jobs. i'll start with mr. stephenson or mr. white, whichever y'all. >> this statement about growth,

very enthusiastic for a couple reasons. first of all, as we both stated, these are complimentary assets. not have the overlap like you do in traditional merger. they are not overlapping. 75% of the united states we don't even compete at any degree. it's going to mitigate a lot of overlapping responsibilities. to the extent there are overlapping jobs that need to be taken care of, i think at at&t we have a regood track record on elegantly working through those using attrition and placing people on other assignments. i will stand on our record in terms of what we've accomplished there. third, this deal has a lot of investment, enhancing 15 million homes with new broadband is a significant capital outlay in spite of what some of the comments were. this is significant capital. these are hard hat jobs that will be out deploying this

capital. involves fib tore sell, new antenna rayon top of cell site structures, installations in the home. there's a lot of capital investment tied to this. in our industry, capital investment is synonymous with jobs. from a jobs standpoint, i feel good about what it would do. >> do you have anything to add? >> i would echo concerns about consolidation. complimently combination taking assets of two. oftentimes in a merge are of this size, there is significant job losses. that's not the case. this is a very different transaction. in fact, with the investments randall is talking about, it's going to create job growth, significantly better broadband access for rural america and a true win-win i think from both sides. >> all right. i will say this. we're talking about two service calls on two different days

substituting, having one obviously customers benefit from that. that's not the kind of job consolidation i think any are concerned about. to obviously have new services offered and capital and outlays and new jobs created is what we're looking for, not duplication of the same job. this has been described as a merger between a broadband provider and internet provider. i think that's somewhat true. i mean, a video provider and a broadband provider. except at u-verse you do have a video offering at at&t. it's very popular in my area. i want to know whether that's going to go forward, whether that's going to slow that deployment and increase exactly the effect it will have on u-verse. >> yes, sir.

to answer the question directly, yes, u-verse will continue and we'll continue to expand our u-verse offering. one of the advantages of this transaction i referenced in my opening comments is that directv, because of their content programmer relationships, we feel very good about what it will do to our overall content costs including on the u-verse platform. and as i mentioned, we are losing money on the tv platform on u-verse. this combination will allow us to take that from a money losing proposition to a profitable operation. therefore, what that does is allows us to expand u-verse. it changes the economics. so with the changed economics, we can expand u-verse. in fact, we have an opportunity, we have committed to expanding that platform by an additional 2 million homes passed u-verse platform with full one gig broadband capability.

>> thank you. my final question is this. it came up in the comcast time-warner hearing. many of our rural members were concerned, raised issues related to rural programming and the importance to customers. really both rural and urban areas to get that rural program, because many of them have connections or farms or interest in their rural communities. i'll ask you a similar question. is rural america important to at&t? i know it is to direct. what is your commitment to carry programming that's important and directed at rural america? >> yes, sir. rural america is very important to us. we had opportunities in the past to sell off our rural assets. we have chosen not to. we have been working diligently to try to find a broadband solution for rural america. one of the things i am most enthusiastic about this transaction is now when you have

a profitable tv product that reaches rural america, it changes, again, the economics even for rural broadband deployment. what this is going to allow us to do is build out a rural broadband footprint using new wireless technology, called fixed wireless local loop. this is one of the more exciting technologies i've been a part of in quite some time. we're committing to building out 13,000 homes with this rural technology. 15 to 20 meeting services adequate for video streaming. priced like a land line service not like a traditional wireless service. we think this transaction gives us the opportunity to really do things exciting for rural america. >> thank you, for rural content. at this time i recognize the full committee chairman, mr. conyers for questioning. >> thank you, sir. i wanted to ask -- >> ranking member, former

chairman. >> well, perhaps the gentleman has good vision for the future. >> we can leave it like that. that's all right. >> i just wanted to ask mr. bergmayer comment about anything he heard during the questioning so far with our two distinguished witnesses. >> yes, thank you. i think when it comes to the investment promises that at turkey is making, i would urge subcommittee to basically put them in context. i think it's important to distinguish upgrades from new buildout. i think a lot of at&t's numbers consist of upgrades, adding a fixed wireless product to existing wireless coverage area. that might be some amount of investment. it is less than initial build out. i think it's important to put it in context in that way and also put it in the context of at&t's

existing upgrade plans. at&t already has fairly ambitious buildout plan, something called project vip, which talks about a lot of new buildout and coverage at&t plans to do. at&t has an initiative where it wants to upgrade a number of cities to gigabyte wired broadband. however, it's not exactly clear the scope of at&t's existing plans. we know that they are ambitious based on at&t's statements but it's hard to quantify them. therefore, it is difficult to compare any new commitments they may be making today to those existing plans. when it comes to broadband coverage, broadband is an evolving standard. if we expected at&t to provide a certain level of service in 2006, you would hope they would meet any commitment and continue to upgrade broadband by policymakers.

that's my concern. it's not enough to meet a certain commitment and then stay there but we expect a continuing level of investment. >> do you generally agree with those comments? >> no, sir, i do not generally agree with the commitments. >> the commitments we have made, i think they are very well documented. we've laid them out that we will build broadband to 57 million homes, that we will expand our video footprint by 8 million homes past and we will pass 1 million business locations with fiber. and that we will pass 300 million people with our broadband -- mobile broadband lte service. those are all documented. they are all in the public record. they are in our financial filings. we are fulfilling those. the commitments that we have made, the 15 million new or enhanced broadbands are all on top of that commitment that's already out in the public domain. all of that is incremental. the capital requirements to do

that, i mean, just 2 million households with fiber to the home is a significant capital investment. the 13 million fixed wireless local loops, that's a massive geography that we're talking about passing. while it may be incremental to some investment that's already there, for a company that's investing $21 billion a year, that's a significant amount we're taking out of that. >> okay. well, now, do we have a consensus here, mr. bergmayer, of his rebuttal? does that work out with you? >> i understand that at&t has a very ambitious buildout plan but, i mean, some of the numbers in question that are supposedly in at&t's public filings somewhere are redacted and confidential in the fcc filings so i haven't looked at them. so it is difficult for me to see how the numbers are simultaneously public and redacted. my overall point, however, is to put at&t's incremental promises in context of its

existing buildout plan and for the committee to really question how merger specific these promises or whether, as happened in the t-mobile merger whether at&t already has buildout plans and they're simply restating them for the purpose of getting a merger approved. >> mr. stephenson, how would allowing this transaction to go forward result in putting downward pricing pressure on cable products? >> that's interesting. you heard mike describe the process by which he sells video services and we do, it's a process to try to get to the market with a bundled broadband and satellite tv service. you put the two together. you have a lot of customer efficiencies that come as a result of that. it's cheaper. the customer experience is better. we had an economist study this,

it's in our filing with the fcc, did a very detailed econometric model. he said even before the merger synergies, the cost synergies were incorporated, this would have not only a downward price basis but a -- >> let me get a response in from mr. lieberman before we close out. >> thank you. mr. stephenson and mr. white are very polished about talking about the benefits that will come to this deal, the commitments that they're willing to make. we haven't heard them talk about the concerns that they're -- that the programming, particularly the regional sports networks that are owned by directv are not subject to any arbitration conditions and that they will have an incentive ability to increase the prices for that programming for smaller cable operators. if they're going to be making public interest commitments, it would be nice to hear them talk about a commitment to address that problem as well. >> thank you. the gentleman's distinguished ranking member time has expired. >> thank you.

>> the chair recognizes himself for his questions. i want to go back to something that's just off a little bit of my other questions. statements to mr. white. i want it to come from my friend from georgia. i want to make it clear, directv will not be forced to unionize, correct? forced to unionize? >> no, sir. we leave it up to the employees to make that decision. >> this will be a request for them to vote to join the union or will it be a required vote for them to go to? >> the union has to go in and solicit and see if they can hold a vote. >> okay. that's all right. mr. lieberman, as you may know, i have previously expressed concerns about the impact of the proposed comcast time-warner on the ability of small businesses in my district to ties on cable television. when the subcommittee held a hearing on that earlier this year. could you give me your view and especially any difference in the impact of the comcast time warner versus the at&t, directv proposed merger.

>> gladly. concerned that comcast time warner cable would be able to exclude mvpds, their agents and advertisers from regional advertising interconnects. while this would not be the case with at&t directv which do not control an advertising interconnect. >> i always like to open it up. mr. white, would you like to talk about that? >> yes. two comments. on the advertising, we're quite a bit of a different advertising model. we're less than 1%. of advertising. i don't think it effects the market at all. i think it will open up opportunities for small businesses to advertise and as it relates to the regional sports networks, we have three of them, one in denver, one in seattle, one in pittsburgh. at&t doesn't even have a footprint in those three states so it doesn't have any impact on those regional sportsnet works. we are subject to the program access requirements of the fcc. >> i believe the vigorous competition helps consumers get a good deal no matter where it may be. the competitive market is the

genuine choice for consumers in who supplies the goods and services they demand. both at&t says this merger will increase competition. competition isn't the end, it should be a mechanism by which consumers realize actual benefits. i'm going to open this up to everyone. i would like to open this question and say can you say with certainty or at least as possible in a business world that this merger will or will not directly result in more choice and lower cost to consumers both in the short-term and the long-term and to what steen? it's often portrayed this is what will happen. the reality is life changes, hearings are over, spotlights are off and this doesn't happen. i would like to hear each of you as best as you can, concise as you can, answer that question. >> i'll take the broadband -- the paid tv side, randall can talk to the broadband benefits. from a customer standpoint, we believe in choice. we have to. we sell a pure play offering. it's going to be like vanilla, chocolate, and strawberry. we'll have the pure play, the bundle together with the at&t

capability particularly with the 15 million homes they're going to build out which will be a new benefit for consumers. in terms of the overall value to consumers, today those bundles are not very competitively priced. when you make one company as our modeling shows, you'll see a better value bundle offering to those customers. >> just a quick question. full disclosure for folks like me who have direct and have at&t for two different services. will that now bundle -- is that going to become a bundle opportunity for us, or are we stuck within the packages that we currently have. until they are over. >> congressman, that will be your choice. we believe in choice. i think the way we built our business, it's up to the customer to decide so we're going to give that choice. as i said, you can choose a, b, or c or you can stay where you are. >> mr. stephenson. >> there's another facet to this when you ask about consumer benefits, the over the top model is evolving very, very quickly. we also have 100 million wireless subscribers at at&t who

are demanding access to the types of content that mike has on the directv product. one thing you should expect to see is begin to integrate those offerings and begin to deliver that content seemlessly across the mobile devices. that's one benefit. accelerating the ott model. the second is in terms of consumer benefits, the 15 million broadband homes passed is a significant consumer benefit that would not happen but for this transaction. we think that is significant. obviously the pricing implications, i won't go into the econometric model, but it's compelling what happens to pricing not just with us but across the industry as a result of this trend. >> i may have made a freudian slip and said more choice and more cost. that's what i experienced in the past. i would assume the other two disagree with that. because of time, i do want to go back to this issue. the chairman brought it up. it is an issue for me. it'sen orphan county issue. it is not just me. there are other members.

mr. white, i've had conversations with your folks. i want to continue to make this. i'm going to continue to harp on this until we get this fixed, both with the broadcasters. this not an issue i'm going to let go of. when i get on something, i don't leave it until i get an answer. at this point i would encourage that. my time is expired. we'll go to the gentleman from new york. mr. jeffries. >> thank you, mr. chair. let me thank the witnesses for your testimony here today. there's been some discussion about the work force transition. i want to go over some of that ground again. mr. stephenson, at&t has the largest unionized work force in the country, correct? >> full-time union, correct. >> i commend you for that and that you've been an incredibly successful company with that workforce composition. your employees are represented by the communication workers of america, is that correct? >> that's correct.

>> mr. white, what is the percentage of unionization of your work force at directv? >> at directv we have outsourced partners. specifically as it relates to directv, in terms of owned employees, de minimus, nonunion workforce. some installers in the northeast are union. >> have there been efforts to unionize the work force in the past? >> i think we've had a vote in one geography in california, yes. >> and what was the outcome of that result? >> that result was in favor of unionizing. we've had some questions from our standpoint they're going through the commission by challenging that but, i mean, we're waiting for the ruling from the nlrb, i believe. >> thank you. mr. stephenson, in terms of legacy directv employees, i believe you said they will have

an opportunity to join cwa. is that correct? >> we have a process of open cart neutrality. >> the process of facilitating that potential will be through neutrality in terms of car check. >> yeah. we have a long track record in this regard. when we bought at&t wireless, for example, we opened up the work force to car check. the union came in and held a vote and across many of the locations they voted to join or to become part of the collective bargaining process. some places not. we leave that up to the employees to make that decision. >> now you expect the merger to create jobs, i believe both mr. white and mr. stephenson you testified in that regard, correct? that regard? >> yes, we are enthusiastic. we're investing to build out 15 million jobs in broadband. those are hard hat jobs. to go build out these capabilities. >> so both in terms of the ambitious capital buildout program and i gather as a result of the complimentary nature of

the company, there doesn't seem to be much disagreement about that. there's an expectation that you would create jobs now. mr. bergmayer, is there a reason for you to disagree with that assertion? >> i think it's usually the case that in mergers there are job redundancies. it's not the focus of my concern here today. i'm focused more on the consumer side. >> okay. now, mr. stephenson, in terms of the potential creation of jobs, is there a specific regional distribution that you would anticipate would receive any job growth more so than other parts of the country? >> the places that come to mind first are the 2 million homes that we're passing with our gigabit technology. really high speed broadband capability. that involves taking fiber all the way to the home, putting electronics in the field. that's a very significant build. that will be within what i will call our old traditional

franchise land line territory. so the 22 states where we operate today. the rural broadband build, which is the wireless deployment, will hit 48 states and so that's going to be a fairly broad based deployment, and in our company jobs align with capital. i mean, they're perfectly correlated. as you invest, you hire more people. i don't want to mislead. there will be places where there are redundancies in jobs but we do have a very good track record on how to address those situations and we use very extensively attrition and i feel good about our track record in that regard. >> now you don't currently offer video services in the new york city market, is that right? >> in what market? >> in the new york city market. >> we offer wireless services in the new york -- and large corporate businesses we offer service to. >> but not video, is that right? >> not video, not today. >> okay. now, mr. white, directv does offer video in the new york city market, is that right?

>> we do. >> and how do you expect the potentially merged entity, at&t/directv to impact the nature of the services that would be offered by a combined company? >> i think in -- in urban markets like new york there wouldn't be any change, frankly, in general in terms of a paid tv standpoint. we'll continue to compete hard for customers in those geographies. i would say we'll have a chance to bundle with the wireless side. that's something different that we haven't done before. >> so there's no current bundle -- >> no. >> -- offered in the new york city market? >> we might with verizon and with slower speed internet service. not with higher speed. fios is very competitive in new york. >> thank you. i yield back. >> thank you, mr. jeffries. at this time i recognize the gentleman from texas, mr. farenthold. five minutes.

>> thank you, mr. chairman. >> he's the vice-chairman of the subcommittee. >> thank you. i'd like to follow up with you, mr. white, on a question that mr. collins asked about local broadcasters. as satellite technology is adopted in homes, how does the local car dealer reach that market outside of the local broadcast station that you carry? car dealer or whomever can go to a cable company and buy some of the local avails. with satellite, it doesn't. i would assume u-verse had a chance to buy local ads on cable as well. if you didn't, you have you had have. >> yes, you're absolutely right. u-verse because it's a local product does have local advertising. as far as directv is concerned, the nature of the satellites in the sky is national. so our advertising business grew up as a national business

competing with the large media companies who are much larger than we are. more recently we've got a new technology that's enabling us to do some targeted advertising. we've done a joint venture with dish for political advertising. this is a new technology leveraging the internet, which is enabling us to target homes and we're hopeful to be able to grow the local advertising, but historically i think $70 million of our 600 in advertising is local advertising. it's very small. >> you may actually have a technology that's helping local broadcasters here rather than potentially hurting them. i wanted to talk now, mr. stevens, a little bit about your fiber buildout. common sense to me dictates that if you have -- the driving force behind broadband right now is video. if you've got a cheap way to deliver have io via satellite as opposed to broadband, there's a discouragement in rolling out

your fiber network. i read an article in "the dallas morning news" about how you're actually still rolling it out because you're competing with google fiber. so how are we going to see the rollout of fiber affected in markets that google isn't entering yet? when is it going to filter down to the, you know, mid-size cities and then eventually to the smaller towns? >> that's one of the i guess interesting things about this transaction. i've referenced it a couple of times now. our video service, whether it's over our fiber or fiber to the node technology, we lose money on the video service because 60 cents of every dollar goes to the programmers. combining with directv and creating the opportunity to make our programming costs look like directv's programming costs makes our fiber-based tv product profitable. once the tv product becomes profitable, it fundamentally changes the economics of a fiber build.

so when we state in the -- when we announce the deal that we're going to expand our fiber to the home footprint by 2 million homes, it's because of the economics of a more profitable video product. in fact, in your district, i think corpus christi, 16,000 homes will get fiber to the home as a result of this transaction. victoria county, out around that area, it's a fairly significant number will get fixed wireless local loop broadband coverage where they don't have anything today. it changes the economics. of a broadband build and makes a fiber deployment more compelling, not less compelling. >> all right. so you're willing to tell me under oath here that this isn't going to slow down your fiber deployment? >> this will what? i'm sorry. >> not slow down your fiber deployment. >> this will cause us to do more fiber deployment. >> all right. you talk about lowering programming costs and the buying power you get with this merger. i see how that's a competitive advantage.

what about making space available for new coming, new television networks. you see a huge growing market in spanish language networks. you see a growing market in sports and news for these sort of things. what's going to happen with respect to, god for bid don't get re-elected next year and decide to start blake tv? >> well, as you can imagine, congressman, we get requests for new channels all the time. i think right now we're considering 50. i don't have satellite capacity for 50 but we do have two new satellites going up over the next year. we have a process internally where a couple of times a year i sit down, what are all the requests? we already have 152 independent channels. we welcome that as an important part of our diversity of offerings. i would expect with our new satellite capacity and with things like the gigabit to the home where you can do affordably -- you can do video

that we would have more diversity of independent channels. >> thank you very much. i see my time has expired. >> thank you. at this time mr. cicilline is recognized for five minutes. >> thank you, mr. chairman. thank you to the witnesses for being here. i'd like to started with mr. stephenson. mr. bergmayer has said at&t failed to see any public interest benefits and he argues that the buildup that you're speaking about of 15 million customers, is in fact enhancements rather than buildouts and may have actually been something part of your capital investment anyway and something not reflected in your public filings and aren't really specific to this merger. can you speak of that? can you tell us of that 15 million, how many are enhancements that have existing

service, how many are buildout for new customers. is it, in fact, something you plan to do anyway and is not specific to this merge. not to say it's not a good thing in evaluating that. could you respond to that? >> yeah, i'll be glad to. i went through earlier specifically what commitments we have made and they're in our public financial filings where we've committed fiber, where we've committed i.p. broadband for 57 million homes. a million businesses pass with fiber, 350 million covered with lte. all of that is just kind of baseline. we make those commitments and we're finishing that. the 15 million broadband enhancements or additions are all incremental with that. the 15 million are split. 13 million is a technology that we're very enthusiastic about. it's called fixed wireless local loop. very interesting name for the technology. what it is, it's taking advantage of areas where we have significant spectrum, and it tends to be rural america. in fact, it's almost rural america.

we have 20 megahertz, deploying technology and using wireless to deliver 15 to 20 megabit service to those homes. to mr.berg -- mr. bergmayer's point, we have to put up a lot of equipment. a lot of installation required, 13 million. there are 2 million homes where it's called enhanced but what we're doing is deploying fiber to the home. literally going out and digging up the streets and putting fiber in the home. that's a significant incremental commitment to what we've already made. >> thank you. several witnesses both in their testimony and written testimony have raised issues with respect to net neutrality and should -- should part of the remedy to address some of the issues that have been raised with the transaction include extension of net neutrality to wireless? should we do that as part of this process or should it be done, i should say? >> we've been very, i believe, constructive in the net neutrality debate. rules that went in in 2010, we

worked extensively with the fcc to design those rules and make sure it accomplished what the tech industry needed, the content people and all. and we think those rules landed at the right place. those rules were very cautious to tread into the wireless area because wireless networks are not like fixed line networks. we have limited spectrum that this congress is working aggressively to deal with. when you have limited spectrum and limited capacity doing things where it constrains what you can do to deliver traffic can be very hazardous, if you will, to service quality in general so we felt we ought to walk very cautiously and be very, very delicate in how we deal with the wireless situation. >> mr. white, could you talk to me a little bit about what directv is either committed to doing or what will be part of the terms of this merger agreement to ensure that smaller independent channels will be paid a fair rate given that directv already is the second largest video distributor and

will presumably only have its market position enhanced as a result of this merger? what commitments have you made or what terms will be part of this merger agreement that would protect that? >> so i don't think we've yet put in anything specific to the merger agreement. clearly every distributor of video right now is struggling with rising content costs which are 60% of our costs, and they're growing at far in excess of consumer incomes, high single digits, 8 to 10% a year, which has put tremendous pressure on the business and our need to raise consumer's prices. i would say certainly that colors how we look at all negotiations with -- big and small. by the way, we've taken on the big guys. i think we've probably been a leader in the industry in battling to keep costs lower. it's a tough battle. but as it relates to independent channels, we have both our

public interest obligations that we continue to live with. 4% of our channels would be pios. we have i think 26 of those. we have 152 independent channels and in today's world with over the top as an option as well with broadband, we can put things up as an application just like we've done with pandora and youtube so we can expand even beyond that and would certainly look to it if consumers want it. >> if i could ask the final two witnesses if they would submit written answers to this question. if there are things you suggest we could do that would allay some of the concerns you both have raised short of an outright opposition to the merger but actions we could take as a congress that will respond to some of the very important issues you raise, if you could answer that in writing i would be grateful. i yield back, mr. chairman. >> thank you, mr. cicilline. at this time i recognize mr. issa. >> thank you, mr. chairman.

gentlemen, as a chairman next door i get to go first and all the material is mine. when you get down this far usually most of the good questions have about asked and this is no exception but i just want to run a concept by you because i serve on this committee and commerce committee that looks at the other side of your issue with the fcc. when i say, for example, comcast, time-warner, at&t, at&ts, verizon fox, dish wet work cbs, sprint, t-mobile, abc and google and everyone else, are we looking at a future which, in order to be competitive, companies have to find these partnerships, these allies, these mergers in order to be able to create real, viable competitors, in this case at&t directv to some of those

other hypothetical and not so hypothetical names that i mentioned? mr. stephenson, mr. white? >> certainly for anyone distributing the paid television piece, i'll let randall speak to the broadband aspect, but i think there's a story there as well, when 60% of your costs are the content that you distribute. we're just a distributor and seven companies control 75% of our content costs. we're already in the world of dealing with big scale providers of content, like they're tough negotiations, big and small. in our case we've had our battles with big ones on behalf of our customers. so i think as a reality to do the kind of investments that we're talking about in broadband, i think mr. bergmayer referred to it, to me the exciting thing is not just the commitments that we're making today, but the fact of at&t having a profitable video business will support them to continue to invest in increasing speeds in broadband which we know that's where the future is going for the long term. >> randall?

>> yeah. i don't know where future industry moves go and what consolidation transpires. this one, mike and i, we view this as very different. this is not comcast/time warner. this is not two cable companies getting together. it's not sprint t-mobile. >> you don't have a major content element? we have some of the other names and hypothetical names i mentioned do have, and that's why i asked the question that way. >> so you're exactly right because this one is just -- we're putting his tv product with our broadband and wireless product and creating a unique value proposition in the marketplace but there is not a content play per se in this transaction. >> i'm going to go to the other. >> mr. bergmayer, in your opening statement you were very concerned, but i would presume you would have been equally or more concerned when major cable companies and content providers joined, right? >> yes, sir.

>> okay. mr. lieberman, same thing? >> yes, there's definitely concern. i just want to say it's not only content providers merging with distributors, it's also just distributors getting larger. when they get larger, they get more influence over programmers. that drives programmers to want to get larger as well. as a small provider who doesn't have the financial resources to get larger themselves, they suffer. if they want to have a market that's dominated by larger players where consumers in rural areas don't have options, then that may be the market that we're going to look at. >> well, this is the reason that i started this way. on this side of raburn office building, we deal in the antitrust question, but antitrust since the dawn of antitrust since teddy roosevelt has been about recognizing that companies naturally compete if not for a trust situation that gives them an unfair advantage. do you all agree to that, that that's really what antitrust is about, is maintaining the

opportunity for real competition? so now i go back to my basic question which is not just for your merger but in my mind for how this committee deals with, if you will, the promoting of competition, in fact, do we not have a problem that if we do not create certain large entities that can deliver product and compete to my household to make sure that i have multiple choices to my household wherever i live that, in fact, we will not have competition either for delivery of content or quite frankly we have a problem with delivery of content being at a good value. isn't that true? >> one thing is certainly true, and i think this merger creates a greater opportunity for us to combine with at&t's broadband capability. i mean, for us, every satellite costs $400 million on its wireless business randall is spending 10, 15 billion, $20 billion a year in capital

spending. it's expensive to rewire america, and that's kind of what we're about collectively, and that's how we compete. >> thank you. mr. chairman, fortunately viasat is in my congressional district. the launches tend to cost a similar amount. >> they do. >> although space x is reducing the cost of the launch. but those satellites are transmitting so many more channels and so much more band width that i'm confident that competition from space becomes one of the competitions that hopefully this committee will realize needs to be viable to maintain an antitrust environment. i thank you and yield back. >> would the gentleman yield? >> i yield such time as -- >> i'll yield 15 seconds. >> yeah. i just want to make a statement about government investment in infrastructure. the space program, hundreds of millions of dollars that the federal government, through

taxpayer money, spent to prepare to turn that industry over to the private sector of which mr. issa is so proud and justifiably, i think, is a tribute to government spending. and with that i will yield back. >> thank you. mr. holding? gentleman from north carolina is recognized. >> thank you. the folks i represent in north carolina want to know in real terms what it means to them, the merger. we've had lots of good conversation in this hearing and so i'd like for you all to succinctly boil it down and answer this question. three years from now what are the top two things that you think that my constituents, who are your customers, will appreciate or dislike about this merger? and i'll ask mr. stevenson, mr. white and then i'll ask mr. bergmayer, mr. lieberman.

i'll ask you. two things you think my constituents will appreciate about this merger in three years' time. >> 15 million more rural americans will have internet service that don't have high speed internet today and i think up to 70 million homes in america out of 115 million will have a much better bundle offer to compete with the cable companies. >> mr. stephenson. >> as that plays out. what the econometric model will show, we believe, there will be downward pricing pressure in this industry as we become a viable competitor, as our programming costs begin to climb at a lower rate, we think is beneficial to consumers from a pricing standpoint. we think also more broadband is very, very good for the over the top content distribution models so more broadband will help accelerate the over the top models and bring more choice for

customers on content. >> mr. lieberman, maybe the top two things they will not appreciate in three years? >> yes. i think that the rising prices that they will see, that their service providers who are not directv have to pay for directv programming, and i think number two, concern that they would have is just the increasing pressures, the decreasing competition that smaller providers can provide as a result of the increasing consolidation that's happening in the marketplace, not only due to at&t/directv but also comcast time warner cable. >> mr. bergmayer. >> as a resident i would be concerned if i could only get wireless or some future prospect of fiber and broadband options that other people can have in densely populated areas. i agree over the top video is a great benefit to consumers. i think what people benefit from is a choice of over the top video providers. i would hope in the future customers aren't driven to using

one or another over the top video provider. for example, if at&t operates its own over the top video service that it does not discriminate in favor of that service and discourage people from using competing services. for example, exempting only its own services from data caps but not those of its competitors. >> thank you. mr. chairman, i yield back. >> thank you, mr. holding. at this time we'll recognize the gentleman from missouri, mr. smith, five minutes. >> thank you, mr. chairman. thank you for holding this committee. my first question is for mr. white. mr. white, the american cable association states that reductions in programming costs that at&t and directv may receive as a result of the proposed merger which may lead to higher programming costs for their members. how do you respond to that? >> first of all, the reduction in programming costs that we referred to is a reduction in the costs that currently at&t pays.

we didn't make any assumptions that directv's costs would go down necessarily, but it's all related to the cost of content that at&t pays today. our belief is as we look at that frankly all of us battle in these negotiations everyday. the cable operators do as we do as distributors and there's a significant amount of leverage, but i -- it's hard for me to see in a world where there's over $40 billion of affiliate fees that our billion dollars in savings out of the 40 would make that much difference over time to what they would charge the small operators. >> so do you think this merger will increase the cost of your competitors by any means? >> that's got nothing to do with our thinking on it. this is all about getting capability to service 75% of customers that leave directv because they can't get a bundle right now. nothing to do with that.

i don't accept that at all. furthermore, i think our -- some of our smaller operators, you've got to remember in a local market they are very, very powerful in terms of their coverage and they negotiate very tough and i don't expect them to want to see their prices at&t has made significant investments to reach my constituents, many of whom struggle to get dialup. can you explain how this transaction will result in increased broadband services for rural communities like mine? >> in fact, i'm looking at a list here. missouri. they fixed wireless local loop that this transaction will accommodate and, again, we have a profitable tv product that we now pair with a broadband technology and it makes the

economics for deploying broadband look really attractive. we're going to use a wireless technology which will give 15 to 20 megabits,ing in missouri, that's 340,000 households with this technology. and this is one of the areas we're most enthusiastic about. we've been looking at this technology a long time, trying to get the economics to work and it works once you put a profitable video product which directv brings to bear with this technology. so that's what missouri should see. >> thank you. you know, representing a very rural congressional district with your statements there i want to point out that the only way that i can get internet service at my house -- which is 13 miles from a community of 25,000 people -- is through wireless. or satellite. so that's extremely important for rural america. mr. lieberman, larger-sized

competitors typically have an advantage relative to their smaller rivals as a result of economies of scale. smaller-sized competitors can outperform their large rivals on service and product quality. what other competitive advantages aside from size will the combined entity of at&t and directv have? >> thank you. and as you know, consumers do benefit from having independent distributors in the market, companies like new wave are just important in their communities and these are often in areas where larger players do not want to invest and do not want to serve. with regards to your question, first and foremost i can't discount the importance of just being large when you're negotiating for programming costs. even at&t, directv have said that 60% of their costs are -- go to programming.

that's to deliver their video service. that's the same for smaller operators as well. i think being large have other advantages of just having more financial resources, whether or not it's marketing to your customers, for instance. these things are -- give great advantages to directv in a lot of their competition with smaller operators. >> will the aca members like -- that are present throughout my district, will they be able to compete with the combined entity of at&t and directv on the basis of better service and higher product quality? >> they will compete. they will do what they can to overcome the significant disadvantage that they face in paying programming fees that are significantly higher than directv. but that competitive ability is getting more and more difficult over time and if your customers enjoy having a competitive choice between two two satellite

providers and a local cable operator then i think we need to look at the underlying rules that are driving these consolidation to ensure that consumers can continue to benefit from from that in the fucher. >> thank you, mr. chairman. >> thank you. we're going to have a second round for members who are here if they desire so, mr. smith, if you want a second round you can take it. mr. johnson, do you have follow-up questions? i'll go and then you if you have any. let me start with -- mr.berg meyer, mr. stevenson mentioned net neutrality and they're committed to the fcc and some of their guidance. but, general, i'm not sure what the fcc's position on net neutrality is. it seems to me they're backing away from what was originally conceived as net neutrality. >> as i understand it, at&t is

committed to follow the 2010 open internet order. those rules are partly vacated by the d.c. circuit but it was part of a merger condition, certainly at&t might promise to abide by those rules even if they're no longer in force for some of the industry. i think there's a question about the extent of the protection they offer to wireless users. for example, while they provide less protection for wireless users than for wireline broadband users, they don't provide no protection and one of the areas where they offer protection for wireless users is for services that the providers itself offers. there's some cases where it can't discriminate against competing services. now, if at&t does offer a new over-the-top video service, those provisions of those rules might kick in where previously at&t did not offer such a video service so they might not. that is sort of an interesting point with the 2010 rules. >> you know, i think most americans -- and most members of congress are very concerned. you know, we -- the internet has

been a gateway, not a gatekeeper to broadband providers and i know as a telephone company you have -- you are subject as a common carrier. and we've seen reports of fast lane, slow lane which i think are -- if there's a reason not to have that it's just concerning. >> well, i mean, we're working, public knowledge is working at the fcc now for strong net neutrality rules that would apply to the entire industry, not just one company. i mean, i question whether it makes a lot of sense to have rules that apply to just one company and not others. i'd prefer them to be industry wide. i would presume if we succeed in our effort to get rules that are even better than the 2010 rules in place if they go beyond the 2002 rules level of protection than presumably at&t would be

subject to them. but if they go not as far as the 2010 rules we would still hold at&t to the 2010 rules. >> i know there's some discussion about what is a common carrier, but, you know -- because -- i won't get into all that but i think it's something the committee ought to look at. mr. lieberman, discriminatory pricing, obviously, is a concern. we want to preserve the competition we have and you've talked about a differential of 30% in your testimony. you said the proposed transactional increase directv affiliate programmers incentive to charge higher prices to at&t directv rivals and then you say regulators should adopt a remedy to eliminate the ability of directv affiliated programmers to charge higher prices to

at&t/directv rivals. i think the same thing would apply to comcast, nbc, and, you know, obviously others. it wouldn't be just directv. but would you -- and i know there was some arbitration that expired and directv had to submit to arbitration. i think comcast still does. i think you said in your statement that you didn't feel like that was sufficient. do you want to comment further on that? or on discriminatory pricing? >> yeah. let me start with the issue that's most directly tied to the at&t/directv deal which is their -- which is directv's incentive to charge its rivals higher prices for its programmi programming, which will get greater as a result of this deal. current there isn't enough protections to avoid that problem. i think mr. white has explained that program access rules were subject to them currently. hour, those rules themselves are

not enough. even directv has suggested in cases, mergers where program access rules already exist that there should be heightened protections. fcc has asked for that same condition so directv is part of a 2008 merger, had arbitration conditions opposed to that. baseball-style arbitrations, that was based on coming up with a rate that was based on fair market value for the programming. that has expired. and we believe that a similar condition should be adopted to address that, however the one that was previously adopted had some flaws. it remained too expensive for smaller operators to use so if you have a remedy that's too expensive for a cable operator with a thousand subscribers to use, you pretty much have no remedy. so we need to relook at this type of remedy, put some modifications to make sure it works for all providers that need it.

>> just to eliminate the ability all together? >> excuse me. >> just to eliminate the ability all together? >> what we should do is eliminate their incentive to increase the prices for their rivals more than the price that they would charge to non-rivals. >> all right. and i think yawl support category of dby? >> yes. >> let me close by saying what most -- some members of congress, i guess, this is the most frequent question i was asked and i don't think anyone's asked this. one of the principle components of the proposed at&t/directv emergencier is directv's continuing relationship with the nfl. what can you share with us regarding that relation shship your customers' ability to continue to get the package which they very much value? >> well, thank you for the

question, congressman. as you can imagine, nfl content, all of our customers are very excited about each year when we kick off the is season. we've had a long standing -- actually, a 20-year relationship this year with the nfl. we very much value that relationship. our relationship is excellent. our current deal was a multi-year deal, expires at the end of this coming season so we are in active discussions with the nfl about renewing our nfl sunday ticket product. and we're very hopeful and opt mistic th mi mistic that that will happen. >> mr. johnson, will close the hearing with this question. >> thank you. as part of its merge we are nbc universal, come cast pledge to partner with schools to teach digital literacy and encourage adoption among low-income families. comca comcast, like wise, committed to

offering certain low-income families broadband internet access at affordable rates. and as a result of this program, nearly 1.2 million americans have joined the program. 86% of whom now use the internet daily. 21,000 of which are in my home state of georgia and with just over 17,000 families in the city of atlanta alone. will at&t commit to a similar program to advance the public interest through affordable broadband access and digital learning -- excuse me, digital literacy training? >> i'm not intimately familiar with it, congressman, but we will look at it. i think it's probably not only in our -- the communities we serve interests, something like that, but probably in our own self-interest. we are doing a lot in terms of nano degrees, trying to help with low-cost education for

people to get degrees that would equip them to do things in the digital world and we're very, very excited about it. we also have made a number of investments to ensure that we can address that end of the market and ensure that these -- the customers at that end of the market are getting rally robust broadband capabilities. our experience in terms of getting good penetration of broadband into lower income communities is not the access to broadband, it's the access to computers. and what is happening and is happening at a very quick pace are these devices. these are very low-cost computers that are wirelessly connected and giving really low cost for people in lower-income communities to gain access to the internet and the digital economy. so we are focused in this but i'd be glad to look at the areas you address eed and i value wai >> it as part of its rollout in kansas city, google inkpluds a

free monthly service with basic internet service if consumers pay a one-time construction fee to connect their home to the network. does at&t offer a similar service for its fiber networks? >> what we have done -- google did some very creative things in kansas city and i take my hat off to them. they then modified their approach and took it to austin and the -- what they received in terms of permits to build out a fiber network in usaustin from e municipalities was very interesting. in fact, as soon as they announced it we told the austin community if you will make the same concessions to us we will build a fiber network as well. we launched our fiber network back in november. google has yet to launch theirs in austin. but it's a good indication of competition and the robustness of fiber deployment in these communities, a different business models that are emerging, like the one you mentioned in kansas city, a different one in austin.

we've announced one in north carolina as well. >> okay. what other outreach programs does at&t offer to unconnected homes? specifically those in low-income neighborhoods and in rural areas? >> you said what programs? >> yes, what outreach programs does at&t offer to unconnected homes, specifically those in low-income neighborhoods or rural areas? >> apologies, i don't know off the top of my head but we can get that to you. >> okay, that's a -- >> you know, they do have at&t aspire which i think is a very valuable program. it may not get the broad amendment to keep students from dropping out of school and that's a very large program and when they don't drop out of school they get a good job and they have the ability to use -- >> it's a multiple hundred million dollar commitment to the high school dropout crisis

focused particularly on hispanic, african-americans and native americans. the dropout crisis was epidem psychowe've made a major economicment of money to address this, moved the needle in a lot of areas and that has continued. >> and wasn't that $300 million? >> the first was $200 million and the second was $250 million, i think. >> that's commendable. but in terms of outreach to enable families, low income and also rural folks of what the opportunities are in terms of your -- what you offer and how it can benefit the people. so in terms of just outreach, not so much the programming itself but what do you do in order to make people aware of the benefits of internet

connection and the other services that you provide? >> it's a good challenge and, like i said, i can't give you specifics of what we're doing there. if nothing, i'll let you know and we'll take it under consideration what we can do and do better. >> thank you, that is -- >> of course, inspire is an outreach program. >> big time. >> to our biggest problem in education, our dropout rate. >> you're certainly to be commended for that. >> i would tell you that regard one of our biggest issues as is a company is -- >> well, i know y'all are -- it is a tremendous program. [ laughter ] >> you all agree? [ laughter ] >> i'm just going say one of our biggest issues as a company over the next six years is access to what i would call computer and digital literal employees. we're going need a significant number of them and we are doing a lot of creative things, not the least of which is we are

fully funding for any employees that can qualify a master's at computer science at georgia tech university, purely online, it's been certified by the governor and the board of regents as a fully accredited degree and at&t is committing to pay anybody who can qualify and make it into that program. those who who can't qualify to get into it we're bringing in the house and we'll do at&t certifications to build these skill sets for people. >> okay, well that's great digital literacy training. do you have any programs that enable those without that skill to learn about it and take advantage of it? any programs that you might have? >> so we have a number of digital literacy programs and, in fact, the aspire program that the chairman referenced, we've

actually done some things with the aspire program where we've invested in companies who do digital literacy training and do things in schools to develop digital curriculum and so forth so we've made some investments. in these areas that continues to be a focus of ours. i would be glad to give you a full detailed listing of the efforts we have going on in that area. >> that would be great. and i just look forward to you all thinking outside of the box and coming up with some new, attractive ways of making your services available to those who cannot afford it or who just simply do not know about it. and those you've already covered, the fact that those without access you're going to take care of that. there's that other softer component of it also. >> noted. >> thank you. i yield back.

>> i thank the gentleman. this concludes today's hearing. i thank all of our witnesses for attending and answering our questions. i thought you were all -- you all gave excellent testimony. without objection, all members will have five legislative days to submit additional questions or witnesses or additional materials for the report. this hearing is adjourned and now you can go over to the senate and answer their questions. >> president obama is traveling today. he's in minneapolis hosting a town hall meeting at the mini ha ha state park. we'll have live coverage of that for you starting at 3:10 p.m. eastern on c-span. the rapidly growing e-cigarette industry has caught the attention of federal regulators in congress. next monday, c-span will air portions from two recent senate hearings where democratic

lawmakers accuse the industry of intentionally marketing their products to kids. at those same hearings, republicans said regulators should be mindful of the e-cigarettes' potential as a smoking cessation tool. here's a brief look. >> i think this whole thing is nothing more than it's all about the money. i think it's uncreative. i think it's nasty. it's like pornography, in my mind. let's depict between the one and the other. in fact, maybe what you're doing is much more dangerous. i'm aswhhamed of you, i don't kw how you go to sleep at night. i don't know what gets you to work in the morning except the color green of dollars. i've never said anything like that before, but i've never in

my 30 years on this committee have i ever heard testimony such as given by you and by you, sir, who -- what i want to do is send you to the middle east because you say we can just get good people together and we can settle everything. you should go to the middle east and settle that then come back and you can talk to us more realistically. but for you two, you're what's wrong with this country. and the profit motive is good. but only if it's aimed at something which is for the general benefit of the public and this can be stretched a little bit because the public likes to be entertained. i can't say professional basketball is necessary for the existence of democracy in america but people like it so let's go ahead. but i think in your case, you don't that leeway.

it's simply a matter of the dollars. the money that you rake in. the 256% increase in two years in advertising and then you say it's only for the adults, not for the children when everything else that's come out of this hearing says otherwise. i think it's dreadful. >> that's a portion of recent hearings looking into e-cigarettes. join us monday, 7:00 p.m. eastern, for more when we'll explore proposed fda regulations with a.p. reporter michael felderbalm. we'll take your phone calls, tweets and posts on facebook. that's monday, 7:00 p.m. eastern on our companion network c-span. >> what i have right here 1 a partially processed plant that i've cut down into sections that are the right length for hanging and then i take off all the big fan leaves and those are sent to the kitchens to make edibles. they have a small amount of thc so they get that for a really

good fries us. then these little leaves here are the tight trim, and this can be dried and made into joints or it can be sent to the places that make extractions and made into hash and that sort of thing. and then right here we have finished bud and this is sent over to cure and hang to dry and then cured in buckets for a couple of weeks before they sell in the the dispensory. >> washington journal looks at the recreational use and legal sale of marijuana in colorado with guests from denver and your phone calls live friday morning, 7:00 to 10:00 eastern on c-span. >> earlier today, the senate health, education, labor, and pensions committee looked into campus sexual assaults. this comes on the heels of three discussions on the topic hosted by missouri democratic senator claire mccaskill who's championed the issue. you can watch those meetings on our web site, c-span.org and our video library.

next, a portion of this morning's hearing. this runs about a half hour. >> about title 9 and enforcement mechanisms for title 9. that basically terminating all federal funding for an institution. i believe if i remember right in reading your statement you said that's never been used? >> never in an institution of higher education. it has been used with school districts. >> but not for an institution? for this kind of an incident in. >> we have not had to actually withhold federal funds are a college or university. if i may, just last april we have, i think, the best example of how well that tool is working for us. tufts university after they entered into a resolution agreement with us purported to revoke that agreement and i sent them a letter telling them that they were in breach of the agreement and telling them that they had 60 days to cure or that we would begin the process to revoke federal funds. within two weeks tufts university came back into

compliance and is part of -- not in compliance with title 9 but in compliance with the resolution agreement itself. so the threat of withholding federal funds is a very significant enforcement tool for us. it's one of the reasons that we've been able to see our institutions -- >> you're given me evidence but your statement says it's never been used. >> it's never been used that we've had to withhold the funds. it has been used as an incentive for the institutions to comply with the law. >> what we call the nuclear option around here. >> and it's a pretty good nuclear option. my concern would be not having the nuclear option. >> i'm not certain that it is a very good option. you know, it may be something that you have in the background but if you don't have other options that you can use by diverting funds, for example. in other words, saying, okay, part of your title 4 money because of this violation now some of those funds have to be diverted to a campus-based program for prevention and information and support activities for students.

>> so with respect, senator harken, i think we do have that opportunity. as part of the resolution agreements, we do enter into agreements with institutions that they change their practices which have costs associated with them. the institutions have to have council who -- >> but you have to have the authority to divert funds? >> not to divert but we have the authority to direct them to take steps that have to use funds and that are costly. >> but you don't have the authority to tell them, no, you've got to direct funds for that? >> i think that's a semantic difference. the schools, when they have to take steps that cost money, to divert funds toward that -- those practices. and those practices include, for example, paying damages to complainants who have come forward. they include retaining additional staff who have to focus on a particular project and report to us about it. they include creating climate surveys and conducting them on their campus. they include taking steps to train students that cost money and to train staff that cost money. that is a diversion of funds and that's very significant for the campuses. in my 17 years as a civil rights litigator before i came to this administration what i did was to

use what is a nuclear option which is to say there would be a very significant consequence -- >> are you telling me you don't need any more authority or anything else from this committee or from the congress to carry out your oversight and your ability to sanction, to redirect funds, to -- at any of these institutions? you don't need anything else from us? >> well -- >> you have all the authority you need? >> i am saying i think i have all the authority i need. it's not my view that we look tools that is meaningful for us. >> that's amazing to me. >> and it's very satisfactory for me. >> if you have all the tools you need. >> i think that we have the enforcement tools we need. >> because obviously something isn't working out there. i'm sorry, some things aren't working. >> some things are not working. >> even you in your testimony said that you've got -- through your investigation wes know colleges and universities are retaliating against students for filing complaints, discouraging other survivors from filing complaints, delaying investigations for months or longer.

delaying service and support to survivors when their investigations are pending or providing inadequate interim relief, and on and on and on. addressing sexual violence solely as a criminal matter and not under title 9. you're saying this is what's happening out there. >> those are very, very significant concerns and we want to see them changed on campus all over the country, anywhere that they happen. and i think we've been able to enter into roy bust agreements that are taking those steps. build delighted to work with you and your staff on this as we go forward. it's critically important to make sure our students stay safe and i think we're moving in that direction. >> maybe i'm not hearing this right but i guess what you're saying is nothing more needs to be done on our end. you've got all the authority you need to take care of this. >> i apologize if i even suggested that that were true. i would love to identify ways that we could work together. my view is that the importance of the threat of withholding federal funds is something that should not be undermined and that's something that has been a very effective tool for us. i think we should be clear that

that is so and there may well be more things we could do and i would welcome them. to add to the arsenal, because i think it's critically important we deliver for all kids. >> let me ask you, my time is running out, i have one second left. but in terms of information on the cleary act, the schools are required to provide this information to the students, the general public at large. how good a job do they do of informing incoming students and their families as to what the incidences are of sexual violence on the campus? in other words, when students look at colleges before they go, are they able to look at this? is this presented in a format that they can see and compare from one college to another what's happening? >> all institutions are supposed to notify them about this

material, the annual security report and make it available upon request. most schools have put it on their web sites and it's right there when you go on to apply to a school for a job or for enrollment. >> so are you saying, again, that the schools are basically doing a good job of this? that they're being a senate they're being honest about reporting this to perspective students and their families? >> they're doing a relatively good job of producing the reports. now, we do find significant violations at some institutions with the statistics. so there are violations out there, we know that. we find those in our cases and where we find them we take actions. we're hoping that these new requirements, they will give us some additional tools and require additional disclosures that will allow students to have better information about the environment that they're going into with regard to sexual assault. >> got it. thank you very much.

>> thanks, mr. chairman. >> you're both in the department of education, is that right? >> that's correct. >> and mr. moore has talked about regulations that you are proposing under the violence against women act amendments to the clery act. so you're about to go through a comment period on these at which institutions will have a chance to say what they think about it, anyone else will as well, is that correct? >> that's correct, senator. >> ms. lhaman. you talk about something called guidance and i've got here about 66 pages 60 guidance under title 9. now, are -- do you expect institutions to comply with your title 89 guidance documents? >> we do. >> you do? then what authority do you have to do that?

>> well, it is our -- >> and why do you not then go through the same process of public comment and rule and regulation that the same department over here is going through under the clery act. >> well, we would if they were regulatory changes. >> why are they not regulatory changes? do you require 6,000 institutions to comply with this, correct? >> we do. >> you do. even though you're just making an edict without any chance for public comment, without any regulatory approval? how can you do that? >> i would not describe it that way. >> i would. how can you do that? why would you not go out and ask institutions and people who might have been assaulted what they think about your guidance before you apply your guidance to 22 million students on 7,200 campuses? >> first, we do. we have quite a long list of conversations that we've had in person and through letters and -- >> but you here in the same department of the united states

department of education. under the clery act, he's going through a regulatory process which publishes what he's doing after stakeholder meetings, after discussions, he's asking for comment, then there's a regulation then the congress has a chance to weigh in. but you're just over there issuing your own opinions as far as i can tell. correct? >> no, that's not correct. we have gone through the regulatory process -- >> well, who's responsible for, you? >> i am, but that's not just my opinion. that is what the law is and it's guidance about the way that -- >> is this the law? >> it is. >> i thought we made the law. do you make the law? >> i do not. >> so why do you say that's what the law is? it's an explanation of what title ix is. >> who told you you could do that. >> with gratitude, you did when i was confirmed? >> we told you you could make the law in title ix? why does he go through a public notice and comment under the clery act if you don't have to? >> i do when we regulate this is not regulatory guidance. >> well i greatly disagree with

that. i think what you're doing is writing out detailed guidance for 22 million students on 7,200 campuses and it's just -- it could be your whim, your idea. we make the law, you don't make the law. where does such a guidance authority come from? is it just grown up over time? and why would the same department have -- how often do the two of you meet with in your department? how many times in the last year have you senate. >> i couldn't count them because it's so many. jim and i work together very, very closely. >> and did you have input in s his -- rules that are proposed for -- to be ruled? >> yes. a member of my team has been part of the notice and comment process. >> well, i'm very concerned about -- that -- the arbitrariness of an individual in the department saying what the law is when i thought we were supposed to do that.

i understand that your two offices have signed a formalized agreement to better handle title ix and clery act complaints and to share information. is that correct? >> that's correct. >> is that because in the past you've really failed to coordinate and created a good deal of confusion on college campuses about how to coordinate the responsibilities for dealing with sexual assault as they look up at title ix and look up at the clery act? >> i think there was room for growth for us and i'm pleased with the collaboration that my office and the federal student aid office have been able to enter into for students in the ten months that i've been here and it's been working extremely well. >> what kind of formal procedures did you have to discuss your guidance with institutional officers who have to comply with your guidance? how many meetings did you have with institutional officers

around the country? >> well, i don't have the number off the top of my head but it took about three years to prepare that question-and-answer document that followed the 2011 guidance and in those three years we had many, many meetings with college and university officials, with associations of college and university officials, with student activists, with survivor organizations, with title ix coordinators. we had just a tremendous number of actual in-person meetings, telephone conversations, letters that came to us, asking questions, telling us what more we need. so it was a long it aive the process that involved many stakeholders with many different opinions so that we could give them greater guidance and clarity about the ways we enforce. >> my time is up but i would say to my colleagues who are here, i think we should carefully consider not just in this case but in other cases, whether it's fda or anything else, what the difference is between a law and through a regulation, which is proposed by the department of

education and this growing business of issuing guidance where there's no opportunity for the kind of public comment and approval that the regulatory procedure has. thank you, mr. chairman. >> thank you senator alexander. in order i have senator murray, senator warren, hagan, casey, baldwin, murphy and white house. >> thank you very much, mr. chairman, i appreciate your holding this important hearing. the department of education investigates allegations of title ix and clery act violations and earlier this spring listed 55 colleges, including washington state university under investigation for title ix violations. what are some of the best practices in the field that universities can take to proactively prevent sexual assault? >> thank you, senator murray. among the best practices that we hope to see is the conduct of a climate survey as a way of identifying how students feel, how faculty feel about safety at

campus. as a way of identifying whether the campus message has been received by the students in the community at that campus about where to go, what -- what is tolerated, what is not tolerated, whom to complain to if necessary and whether there is a feeling of safety on the campus so that schools can respond. so we think that a climate survey is a really important first step. in addition, it's critically important to community disapprobation about sexual violence on the campus and sexually hostile violence so the entire school community is clear about what is and is not acceptable on the campus. it's also critically important to let students know who a title ix coordinator is, where to go if the students need help. how the complain and who are resources on the campus so students can access those resources if they need them. then finally it's extremely important to have a transparent and fully functional investigative process where students need to complain so that interim relief 1 available to students when they need it so that students can be clear that effective and appropriate steps are take on the address sexual

violence when it occurs. >> very good. i really appreciate that response. i've sponsored, along with senator baldwin and many other members of this committee, the legislation called the tyler clemente higher education anti-harassment act that requires colleges and universities to prohibit harassment and establishes within the department of education a grant program to support campus anti-harassment programs. wouldn't such a grant program help be helpful in addressing campus sexual assault? >> it would be enormously helpful. i can't tell you how much that tool would mean to us to be able to deliver for students around the country. as part of my role in the -- representing secretary duncan in the white house task force to protect students from sexual assault, i've visited campuses around the country as part of the violence -- the office of violence against women in the department of justice grant program to see what kinds of success is variable to see from the grants they're able to deliver. i have to confess i have that real jealousy that they're able to give those grants and to ask

for changes that they know need to be made and for research about best practices that can come from the delivery of those grants. it would be incredibly meaningful for us. >> wonderful, mr. moore? >> yes, senator thank you very much for your work on that initiative. what we find with the clery act is -- and it's one of the reasons why we are very excited about the work of the task force and the work that acr is doing with regard to climate surveys. you have to understand what the campus climate and culture is before you can address it effectively. one of the other tools that is in the new vawa requirements is that we are going to require schools to have primary prevention programs. primary prevaenention only workn a proactive way. if you have problems in an rotc program, in the athletic departments, fraternities, sororities, you have to make sure that training is designed to address all of those issues. to get to these issues of culture and claimant and tradition that are problematic on campuses, we have to get an

understanding of harassment, hazing, several other factors if we're going to be effective. so thank you very much. >> perfect. thank you very much to both of you. thank you very much, mr. chairman. >> senator warren? >> thank you very much, mr. chairman. the topics of this hearing couldn't be more important. our young people go to college to learn about the world, to start their careers while they're working hard to build their futures. they should at the least feel safe on campus. and they should feel confident that if they are victims of crimes the people around them will respond quickly and with respect and compassion. i know now that for 20 years the federal government has been collecting and disclosing data on alleged campus crimes under the clery act and mr. moore you noted last week the department of education released draft rules on expanded data collection.

now, data can be a powerful tool in helping us understand the problems we face and possible solutions. i want to ask about how the data are used. mr. moore, can you tell me about what kind of analyses the department of education conducts with clery act data and taken as a whole what these analyses have shown? >> thank you, senator, for the question. what we do to validate this information is we go out to schools and conduct compliance assessments and when we do that we will look at substantial samples of incident reports to see if they were classified the right way. >> okay. so just to be sure i'm following here. what you're saying is you go out and validate that you're getting good data that come in. >> correct. >> so you make an independent on-the-ground evaluation. you look through what kinds of records? >> police incident reports, security documents, student conduct records, sometimes the

hr records. sometimes you have to go into athletic departments or fraternity offices where anybody who can adjudicate, discipline, or investigate issues of discipline we have to look at records from those offices. >> okay, so you look at the records, you look at what was reported and you see how good the match is and then you know about the quality of your data. and i presume if the match is not good then you have an ongoing relationship then with the school about how it is they need to improve their data reporting. >> there are several things we do. there's a technical assistance and corrective action component and if what we find constitutes a substantial misrepresentation, the school could be subject to administrative action, usually that would mean a fine. >> okay. so you try to get everyone in compliance in terms of reporting the information. now my question is we have this information, we've been collecting information for 20 years now. presumably the quality of the information has gotten better

over time and more complete over time. what do you do with the information? >> we do collect that information from all of our institutions and we do analyses of it to try to track trends in campus crimes. >> so you look for trend lines on a school-by-school basis? >> sometimes a school-by-school basis, but also across sectors of education. we'll often look at community colleges and look for trends there. obviously crime environment is very different at a community college, it doesn't have dormitories versus, let's say, for-profit educational institutions that don't have the big sports programs, big fraternity programs, those kinds of things. and then we'll look at our traditional institutions that are likely to have more times of crime occurring. >> and do you make those -- all of those reports public when you do these analyses? are you putting them out there, making them public? >> the statistics are publicly available. >> i understand the statistics are publicly available. >> the analysis is not.

>> so you do the analysis -- what happens with it when you discover a problem? >> basically, we use it to form late our compliance program. we use in the the conduct of our cases and it also gets used in terms of possible proposals for changes to the rules. >> actually, then, let me switch it over. do you use these data as part of your enforcement strategies and designing your enforcement strategies? >> we do. and we use in the two ways, someone that jim and i work together when we collectively have concerned based on the analysis that jim and his staff have done. he may refer something to us so we can investigate. we look at the data itself to decide whether we should do a proactive investigation of our own and it may be a little bit counterintuitive but sometimes very low day from a school is a reason for us to go and investigate because it will seem like they may not be reporting appropriately. so we use the data very often in our own assessments for where we should look at a school and when

we have a complaint that comes to us what we should do as we're evaluating that complaint. >> i'm just about out of time here, too, but let me ask one more question that tie this is together. are there other data that you should be collecting or that you would find helpful in making your decisions about where you've got compliance and where you don't that you feel like ought to be there? >> sure. there's one that i think is coming that we will access and another that i would like to have that we don't have now. so the one that's coming -- i'll get to the one we don't have. i have a civil right days a collection that i conduct for the k-12 schools around the country that gives me a picture of equity health for those schools that i find enormously helpful for the enforcement work we do. i don't have that same access at the higher education level and i think it would be terrifically use informal this area among others for civil rights compliance in higher education and i think it would be very, very helpful to have. >> well, as i said, i've run out of time. i very much appreciate this. i think we have to be very careful about the quality of our data. i'm very glad to hear about this part of it.

how we use this data to analyze and identify problems and collect more and better data if we need it. because i think the focus on prevention needs to be far more intense than it has been. thank you, mr. chairman. >> thank you, senator warren. senator casey? >> mr. chairman, thank you very much. i appreciate you having this hearing. i want to thank our witnesses for your testimony and for your work on this. i have to commend, even though we've got a long way to go on this issue, the work that you've done, the white house, vice president biden, so many others working on this problem. this problem has z persisted now for generations and we're finally getting to the point where we're reacting appropriately to it. we should react with a sense of outrage. this is the ultimate betrayal of a woman who attends college. we all say we want people to get higher education, we all say

it's important and then we send them institutions where many institutions -- not every, but many, don't seem to take this issue very seriously. it should be under the category of a zero-tolerance effort, and the perpetrators should be labelled as such, or labelled with words like "coward" and "monster" and whatever else we can come up with. and i know that upsets some people but it's the way i see it. so there should be zero tolerance. and that means the institutions should be doing a lot of things already without any laws, without any regulations. but some of them haven't gotten the message so you have to send the message more directly. and have some rules. i'm glad that we made great progress when we reauthorized the violence against women act. one of the component parts of that was my campus save law which you're now working on implementing. we're grateful for that. and i'm grateful for senator

lahey in his work to get that done. so we've made progress with campus save, got to get it implemented but i'm sure there will be gaps and other matters that weren't addressed. so we've made progress, we have a long way to go. in light of the campus save elements, which you've spoken to a little bit, mr. moore, i think your testimony on page four, talking about clarifying definitions, keeping data, having better prevention strategies, getting bystanders involved. too many students who don't want to do what they should being down to help when they're bystanders. so a whole range of changes which will take place. but the one thing i wanted to ask you in particular was now that you're in the process of making sure these provisions get implemented, how long will schools have to come into compliance? >> thank you, senator, for the

question, and thank you for your work on the campus save act. as a fellow fell sipencil vaini make me very proud, sir. what we are going to be very clear and we are going to issue guidance in the coming days to reiterate that institutions have to make their best good-faith effort in this first year. their best good-faith effort to comply with the statutory language since we don't have final regulations. so when institutions issue their annual security reports in october of this year, what we're going to be looking to see is indications that schools are looking for ways to implement these requirements and then we will have a full year to recalibrate that properly with the schools. issue additional guidance to clarify where there are problems. with all the work we've done on this you can guarantee that there's a piece here or there that we didn't consider. and we will have to go back and

address that in our guidance. we are also going to have a complete rewrite of our handbook for clery act compliance. and that will be available to the schools. we're also working on some other training materials that will be available free of charge to all of our schools so that by the time we get to october 1, 2015, everybody should be on the same page. >> that's great. i wanted to ask you as well in the remaining time i have, on the question about the education of institutions. and, look, i realize that institutions tend to feel that they're overwhelmed with rules. but this is one they've got to comply with. can't really call yourself a university or college if you're allowing this problem to persist. so how -- tell me a little bit about how currently or how upon implementation the department will be helping to educate institutions going forward?

>> one of the things we've done is we've increased our presence at training conferences and we have increased both the number of guidance documents that we've put out and the quality of those documents. we've brought them down to a level of that will be -- that should be easy for all institutions to implement. that's one of the issues with the clery act is that you have 6,000 school, some of them with 25 students and maybe three or four employees in a strip mall running a cosmetology school up to omega state university. it's actually a very flexible program. a lot of what niece the clery act is not terribly prescriptive. it requires schools to take that law and implement it at their schools. they need an implementation plan. we in this knew guidance that we're putting out, we want to give them best practice information that will allow them to develop that implementation plan in an appropriate way at the very little school and the

large school. well i appreciate that. i'm over time but thanks for your work. >> thank you, senator casey. senator baldwin? >> thank you, mr. chairman. earlier in this session of congress we took some incredibly important and i would argue very long-overdue steps towards combatting the epidemic of sexual assault in the military. and in examining the problem of sexual assault in the military and the steps that were taken i discovered that there was no specific focus on looking into and collecting data on sexual violence in our reserve officer training corps programs on our nation's college campuses. i view rotc programs as -- they're sort of standing at the intersection between this issue and crisis of sexual assault in the military and sexual assault

on campus. nearly 40% of all new officers commissioned into the army and navy combined since 2012 have come out of rotc programs at our nation's campuses and i really think it's kr ee's critical tha understand how the issue of sexual assault is being commissioned with so many of our military's future leaders. that's why i earlier this session asked the department of defense and the white house to ensure that data from rotc programs contributes to the full understanding of the problem of sexual violence at our colleges and universities. and so i was disappointed that the report by the white house task force to protect students from sexual assault that was released in april didn't address these issues, nor does, as i

understand it, any department of education title ix guidance speak specifically to how rotc codes of conduct should address this issue. and so to both of our panelists, while i understand that instances of sexual assaults against students who are in rotc programs should be investigated and reported in the same manner as other campus sexual assaults, i guess i -- i guess my questions are have you undertaken any formal or informal collaboration with the department on the issue of sexual violence in rotc programs on college campuses and, you know, can you tell me why the department of education has not apparently spoken specifically to this is a expect? and i would ask both of you to respond. >> thank you, i, one, want to

say that i'm sorry to have disappointed you in the task force so far and i hope we can redeem ourselves going forward. >> it's a focused criticism. >> fair point. thank you. two, i want to be sure that i say that our goal, especially the most recent frequently asked questions document was to make very, very clear that there is no student on a college campus whom the college title ix obligations do not extend to. so it was our goal not to take away from that overarching message that title ix obligations extend to every student of every type on every campus so the schools will make them all safe. i had some worry if we disagated that, we would undermine the message. i would be pleased to work on ways that-to-make sure we are sending a clear message about the rotc students. i want to assure you that we have been in our investigative space working specifically with rotc students and one complaint that comes to mind in the k-12

space is that a young woman came to with us a complaint that she had not been able to be promoted to a commander in her army rotc and we investigated, we found some really harrowing facts about the way she was treated and the way that the rotc lead talked to her in sexually discriminatory ways in that school and her mom thanked us at the end of the resolution to let us know she was the first young woman ever to be promoted on that rotc campus. so we are working in this space in our enforcement work, trying to send a clear message and specifically to your question about the ways that we work together with the department of defense, we're working arm in arm with them in the white house task force and our work is ongoing. we put out our first 90-day report but the president has directed us, reminded us repeatedly that he expects an annual report each time and so there will be further steps. >> thank you. mr. moore? >> senator baldwin, i want to thank you for your work on the defense aspect of this and i think one of my takeaways from the fine work that you all did was that you have to have

meaningful punishments for sexual assaults if you're going to change the culture. one thing i can assure you of is that in our work we look at institutions across the board. we're looking at crimes that occur on campus regardless of where they occur. but one of the important changes under the amendments, again, is that we're going start to look more closely at issues of culture, climate, damaging traditions. there's lots of that in the military that we see, especially along the lines of hazing but where you create that culture where these things occur the next thing you get is sexual assault happening in high number without any proper law enforcement response or disciplinary response. so this is something that we would definitely like to work with you on going forward and to also look beyond rotc to the very enduring problems that we see in athletic programs, fraternities, and sororities and other kinds of organizations on

campus. >> president obama is out traveling today, he's in minneapolis hosting a town hall meeting. we'll coverage of that for you starting at 3:10 p.m. eastern on c-span. earlier this week, the u.s. supreme court ruled that internet streaming company ario is violating copyright laws. on this week's "the communicators" program we had a chance to ask the head of the national broadcasters association about the ruling. and it's affect on broadcasters. here's a bit of what he had to say. >> the ario decision came down by the supreme court. what's your reaction? >> well, i'm smiling, peter. i'm gratified that the supreme

court stood by a principle which is as old as the constitution, which is that copyright material has a value and those who own a copyright should be free to negotiate for its value. and i think they came down on the right side of the law and history. >> in justice breyer's opinion, he compared areo quite a bit to a cable company. is that a fair comparison in your view? >> of course it is because you had broadcasting and then cable came along and then satellite. but what is satellite. if they said we're different from cable. we have a slightly different technology so we're going to take that and not consider ourselves to be what is in law called an mvpd. so we don't have to negotiate. but satellite didn't do that and so why should areo be able to come up with a different technology and say we don't have

to negotiate for copyrighted material. we've said from the beginning, this isn't about being opposed to technology. there's still a technology there in areo. maybe there's a business model for it, but that doesn't mean you can evade the law to run a business. >> so what's the business model that you could foresee? >> they could do what cable and satellite does. they can deal with us on copyrighted material. so it's a technology that may have a place in the market, but they now have to obey the rules of the road that everyone else out there on the highway has to obey. >> so you could see the mab or broadcasters dealing with areo as they do with cable companies, retransmission costs, et cetera? >> look, these are business decisions. my job as the nab president is to advocate for laws and regulations that allow my members to stay in business.

areo was the existential threat to that if not a direct threat to that. and i would imagine that this does not go away and that there will be discussions with areo and broadcasters. but that's beyond my responsibility. and i will leave that to the judgment of my members. >> joining our conversation is monty taylo of communications daily. mr. smith? >> this was pretty popular because its suggest suggests broadcasters should be doing something differently to try to capture that market or to take those customers? >> if i -- i mean, this is the thing about broadcasting. they were just doing what we were doing with antennas, but they were charging people for stuff going free over the airwaves and that's what triggers copyright law. i mean, my own sense is we're interested in every viewer having access to our content as long as it's done lawfully.

>> it's been suggested to me today by a few people that areo could try to respond to this by going to congress, lobbying. i know the house judiciary chair said that the decision highlights how they should look at the copyright laws again. how would nab react to that? you have a plan for a congressional battle over these rules? >> look, we -- i'm not suggesting the copyright laws shouldn't be visited, but copyrye law from my experience as a u.s. senator is difficult to do because it's essentially about picking winners and losers. and it's hard for congress to make those judgments. but that said, i believe we will be very cooperative and highly engaged in the development of an update of copyright law. and already are. >> senator smith, i want to read from justice scalia's dissnts. scalia, breyer, thomas dissent.

on remand, justice scalia writes, one of the first questions the lower courts will face is whether areo's record function, which allows subscribers to save a program while it is airing and watch it later, infringes the network's public performance right. >> yeah, i mean, that's -- it's certainly something for the courts to decide. and it will be remanded. but what was upheld today was the fundamental constitutional principle that you can't take someone else's copyrighted intellectual property and resell it without dealing with the owner of that copyright. >> however, future cases of that principle was decisively established and settled by the supreme court today. >> that was a portion of this week's "communicators" program with gordon smith, head of the nab. you can see the complete show on saturday at 6:30 p.m. on c-span.

what i have right here is a partially processed plant that i've cut down into sections that are the right length for hanging. and then i take off all the big fan leaves and those are sent to the kitchens to make edibles. they have a small amount thc so they get that for a really good price from us. and then these little leaves here are the tight trim and that can be dried and made into joints or it can be sent to the places that make extractions and made into hash and that sort of thing. and then right here, we have the finished bud and this is sent over to cure and hang to dry and then cured in buckets for a couple of weeks before they sell it in a dispensary. >> "washington journal" looks at the recreational use of marijuana in colorado with guests from denver and your phone calls. live friday morning, 7:00 to 10:00 a.m. eastern on c-span. during question time this week, british prime minister

david cameron talked about hiring former news of the world editor andy coulson as his communications director back in 2010. on tuesday, mr. coulson was charged with intercepting voice mails. also known as phone hacking. the prime minister apologized to members for hiring mr. coulson. opposition leader ed miliband said the prime minister ignored all warnings against hiring coulson. this is about 35 minutes. >> order. before i call mr. damian collins at the start of questions to the prime minister, i wish to inform the house how i will be applying the house's rules to any exchanges on mr. coulson's case. i ask the house for some forbearance as it is important for members outside the house that the position is clear.

the house will known that mr. coulson has now been convicted of a charge of conspiracy to intercept communications. the court has not yet sentenced mr. coulson for that offense. there has as yet been no verdict with two charges against him on conspiracy to commit criminal cases which are active. they cease to be active when and i quote they are concluded by verdict and sentence. so they apply in this case. at the same time, the house's resolution gives the chair discretion in applying the rules. i have taken appropriate advice as the house would expect and indeed been in receipt of unsolicited advice for which i

am, of course, grateful. in the light of all of the circumstances, i have decided, one, to allow reference to mr. coulson's conviction, two, not to allow reference to his sentencing by the court, such as speculation on the nature of that sentence and, three, not to allow reference to those charges on which the verdict is awaited. i rely upon honorable members to exercise restraint. but if that proves unavailing, i will, of course, intervene. i hope that is helpful to the house. questions to the prime minister? mr. damian collard? >> thank you mr. speaker. thank you mr. speaker. this morning, i had meetings with ministerial colleagues and others. in addition to my duties in this house, i shall have further

meetings today. >> andy coulson's conviction shows the parliamentary inquiry was consistently misled by him and others with phone hacking and others. does the prime minister agree with me that the first concern should be to see redress of the victims of phone hacking and to uphold the democratic process of free press. >> i think my honorable friend is absolutely right. the first thing is that we should remember the victims. people who had their privacy wrecked and we should ensure that cannot happen again. as we do so, we must as he says cherish a free and vibrant press in our country. i said yesterday and i say again today, i take full responsibility for employing andy coulson. i did say that i received but also the select committee received. but i always said if those assurances turned out to be wrong, i would apologize fully and frankly to this house of commons and i