money to be made in hauling oil than there is in hauling either one of those products. i am interested if either one of those situations is true. this is probably a mr. brown question for the kind of things that you're hauling but is there a decision that's made based upon the most profitable return based upon the commodity being hauled and i would guess that there's a consequence now to declining oil prices such that are the circumstance that you may have been in with a shortage of rail cars is less of a problem today than it was maybe to the benefit of mr. john's customers fertilizer prices may be slightly lower. any thoughts about how the change in oil price structure affects your ability to provide services otherwise to kansas and others and agriculture and utility states that utilize

coal. >> well, in terms of the various commodities that you mentioned often they are in different types of equipment. cole is handled in coal cars and oil is handled in tank cars and agriculture are certainly in covered hoppers. so it's different types of equipment. we certainly endeavor to have the available supply of cars either through our car 1 partners or those that we provide ourselves for our customers to be able to move the amount of commodity that they wish to ship. as that grows we try to keep pace with additional equipment throughout the various market segments. so in terms of the oil business, we know that price is reduced the volume has lessened greatly so in some cases we have some of those cars in a storage status but maybe mr. lonegro deals with it on a much larger scale than i do. >> thanks. david is right they all move in different pieces of equipment. in the crude situation

specifically, the grand majority of those are privately owned by the shippers not by any of the railroad so we don't allocate those cars to any particular customer. you know, there are different prices depending on different commodities and ultimately what the market will bare based on alternative means of transportation, risk, et cetera. you know the service equation there are multiple networks within the broader freight network so we look at the coal network and grain network and things of that nature but they all utilize the same crew base the same locomotives and the same track infrastructure so it is very difficult if not impossible to give priority, you know, to any one particular commodity over another because you know if for example, you have one commodity that wants to move at 50 or 60 miles an hour and you have another commodity that might move a little bit slower it actually degrades your network capacity for everybody so we try very, very hard to

balance under our common carrier obligation to balance the way that we treat all of our customers and make sure we have the equipment and resources necessary to handle today's demand and tomorrow's demand. >> thank you very much. thank you mr. chairman. >> thank you senator. that kansas missouri feeling will end when the first basketball game comes up i'm guessing. >> senator pete ers. peters. >> thank you mr. chairman and thank you for your witnesses on your testimony about the freight system today. i appreciate it. as a new member of the committee, i have enjoyed learning more about this wonder wonderful system that we have in the country and the ways we can improve it. i have a couple of questions one for mr. lonegro and one for mr. brown related to michigan specifically. my understanding is michigan presents somewhat of a challenge to the railroad industry because we're a peninsula, basically two peninsula so in terms of cycle

time it's a little bit more problematic particularly in northern michigan. i know yours are up in central and northern michigan servicing just a few customers is your bread and butter as you take their products and try to get them into markets and then has to get into the broader stream of csx and other national rail ways go. if you could comment on cycle time and the interconnectivity with csx and other rail lines that service michigan. has that been a challenge. is it something that we need to be aware of? does it perhaps impact michigan more than other states for the fact that we're geographically a peninsula. >> yes. certainly last winter with our class one interchange partners, that's primarily csx in michigan. we saw cycle times increased as they did over the entire national network. our michigan shorelines are a

really good example of the g and w short of niche where we have height lighter density line that's are well connected to class 1 partners and they are very fluid as we talked throughout the testimony. there was a period of time when in 2014 when fluidity was challenged. it started in the winter. it was asser erxacerbated by and we shared in that growth as well. we have seen marked improvement and overall velocity and fluidity in the interchanges in michigan. so the point where we have seen additional traffic come to those railroads and we saw demand increasing and overall equipment utilization through fluidity. >> thank you. michigan has revitalized as i know you're well aware of it used to be the mainstay of our automotive business. we waited for the economy in

michigan to come back. it's nice to see that it has. so we are putting investments in the grand rapids and plymouth subdivisions which we have there. i think the overall service networks you will see as the broader network improves. certainly the cycle times will be instrumental in that. we have, i think some new business that is interchanged between some of the kancanadian railroads and csx so we look forward to having our traffic run through the crew bases there. >> right. thank you. one final question. you mentioned in your opening comments the impact of the positive train control systems and cost associated with that because of your unique customer base, very small customer base and i know i mentioned to you before the hearing some grain elevators. they have their lifeline to get to markets. just maybe a few customers.

could you kind of flush out and elaborate a little bit. you talk ed about how the requirements are really disproportionately impact your lines and the customers that you serve service particularly in northern michigan. >> yes, sir. well, most of the g and w owned railroads do not require ptc to be installed overall. there are literally, hundreds of interactions with class ones where there will be ptc installed on their lines. maybe we cross their line or it's a point where we operate across over the class 1 line for some distance. so those are the areas there's still not much clarity on exactly what we will be required to do in terms of equipping locomotives. in terms of other ininfrastructure requirement that's may fall to our short line properties. to the point that it's possible just that capital intensive requirement to a shoreline pushes it into a economic situation that's not viable.

so i mean it's that critical. in terms of michigan, it's relatively a minor issue. again, it centers around interactions with class 1 ptc installed routes. >> okay. great. thank you. appreciate that. thank you. yield back mr. chairman. >> thank you. senator johnson. >> thank you mr. chairman. certainly in the state of wisconsin, we've experienced some of these service disruptions from a number of nakt or factors, whether the increase in the freight required for transporting oil. the result of those service disruptions has been in some quarters a call for greater involvement by the service transportation board. other potential government intervention. i'd like to go down the panel. certainly personally as somebody who utilized rail service for 31 years in my plastics company i would have a great deal of certain for the federal government getting involved and starting to allocate who should get what but i kind of want to

get all of the witnesses, their opinion in terms of the pros or potentially cons of greater involvement by the federal government as opposed to the private sector taking care of it. >> the railroads produced to the order we produced measures to the stb that go to the fluidity of the rail network. those are published on a weekly basis so you have a good understanding already about the fluid of the rail network. that said, most of those are going to give you a snap shot and a retrospective on how the railroads have performed. as i mentioned earlier in the hearing, we've invested literally billions of additional dollars based on where we saw service and volumes in 2014,

months ahead of the temporary order. so in terms of spurring action by the railroads, we had already taken the action, we had already recognized that we needed to invest more in order to deliver service for our customers. >> let me interject. my concern is if the government got involved the incentive for investment might be proreduced. would you be concerned about that as well. >> i think the challenge is if the government begins to pin point where that investment should care. again it's a network of networks so it's very difficult to say that the investment should go to a specific location or to favor a specific commodity when we're trying to serve, you know, a multitude of commodities and have hundreds of thousands of cars on the system evident. >> it's hard enough for a business that's fully aware of the customer base to make those capital investment decisions efficiently much less a bureaucracy. as a customer, what are your thoughts on that? >> i'm sorry.

>> well, from my er secretaryive, having been inside government for 35 years what i have learned and being in an infra infrastructure person, i what i seen is the successes come from our partnership with private sector. having run a port which is a $30 billion economic engine to my community in order to make our port successful and to move things forward, we try to get government out of the way. one of the problems whether it's at the national level or washington or state level or local, the success comes where you're able to truly partner with your private sector partner and with all levels of government. really to understand what are the rules and try to -- one of the frustrations i find in government is that there is way too much bureaucracy. we tend to get weighed down. we lose our way. we can't find our way out of the forest for all the rules and regulations. so i think it's a problem at all

level including within my own local government. the state of florida, i think has taken a lot of advances over the last four years regardless of political affiliations, democrat or republican, one of the things florida is focused on is how can we be more business friendly and create that environment. mind you i'm stepping in as the top salesman for the state. my new role is the head of secretary of commerce for the state so my job is to sell the state. one of the things we will sell is the fact that we're a business friendly state so we are concerned about the environment. we're concerned with obviously the importance of education but we're also concerned making sure that we don't overregulate. thats a big way to sell your community and sell your state. >> okay. mr. brown. >> i would just kind of echo what mr. lonegro said as well as say, you know, for example, mr. chairman, the state where we started a new railroad operation called the rapid city eastern

railroad in 2014, we will start up operation a itthe stb did require the canadian pacific did conduct regular communications with stb about the fluidity to require how many locomotives and how many cars are interchanged at the new interchange. it was the point where we began operating. we, as a part of that process, we voluntarily eftstablished astb, regular communication ourselves. so we could make sure that we understood the level of communication that was happening between the two companies. they understood the amount of cooperation that was required and was occurring in order to successfully began that operation and that we were all talking about the same facts. so that process occurred over a period of a few months.

it got to the point where there really wasn't much to talk about. so it was a 15 minute how is it going this week call. we ended that process. so that can be helpful. i think it more informed stb so that as shippers come to them about a specific operation whether it be congestion or start up operation as in our case, they have the information that they need to respond and hopefully, we are successful in how we do that and it's a positive story and in this case, it turned out to be extremely positive. so that's a good involvement. >> thank you. thank you mr. chairman. >> thank you senator johnson. i would just say too, i would agree with the senator from wisconsin when it comes to having the government mandate investment. i do think what we saw last year with some of the bottlenecks is a need for greater transparency about where those were car supply, power, those sorts of things which was very helpful because we have literally

millions and millions of dollars at stake in our economy when you can't get rail transportation in a timely way. so we've introduced a bill which we passed out -- we will introduce a bill which we passed out of this committee last year which would basically focus on process reforms at the stb and allow more members to discuss pending business and address serve hesices on the front end rather than when it becomes a crisis. i look forward to working with members of the committee on something that makes sense. senator. >> thank you mr. chairman. thank you for holding this hearing on a really critical issue that's unappreciated by a lot of the public who focus on passengers and commuters but we know how critical freight is and how important safety and reliability of freight transportation is so i want to thank all of you for being here today and focus for a moment on

the safety issue as it concerns folks who work on the tracks, our workers who are out there and whose safety can be at issue and even at risk. so often. late last fall the national transportation safety poured ishboard issued an in depth report on the tragic loss of 15 workers in 2013 alone. 11 on railroads and four on transit systems. the ntsb made recommendations as you know across the industry to the federal railroad administration as well as other actions like oshca. these recommendations urge the agencies and the industry to do more to protect employees on the railroads, insureing that they are given proper briefings and sufficient information and devices that will protect them in the course of their work. the death of robert luden a little more than a year ago in

west haven connecticut tragic death, fully preventible unnecessary, leaving his family and his colleagues without him, just shows how this issue can be a matter of littererally life and death. so i'd like to ask each of you what can be done to make sure that regulators like the fra, it's an agency of government, act on recommendations from the ntsb especially for workers who are often the most in danger? and my view is that there should be consequences for the failure of the fra to act in protecting workers. this issue is national in scope. so i'd like to ask even of you beginning with mr. lonegro, what can be done to compel the fra to

follow recommendations of the ntsb and other common sense measures that should be taken. >> thank you senator. we opened up a dialogue with ntsb as part of the positive train control mandate. i have met with them several times, both in terms of the departing chair person as well as the new chairman. and as part of that, i think it has been a healthy dialogue around what training requirements are necessary to protect railroad workers both in the cab and locomotive and on what we call the waste side or track side. one of the four mine pillars of positive train control is to protect the track workers when they have an established authority along the line line. that area will be where the head worker in charge there the foreman or employee in charge we call them will have the authority to allow a train to pass through or not and at what specific speed.

so i do think positive train control will significantly address that certainly on the process side, the training side, the safety briefing piece and the communication in additional technologies like, you know, the cameras which are both inward facing and outward facing will help us understand the true root cause of many of these accidents. in terms of the interwork rz between the ntsb and fra, i will have to leave that one to which commit committee committee. i will tell you that we look at the ntsb's most wanted list that they published for many years and determine whether or not those make sense for us to deploy. this inward facing camera which has been a part of the number of investigations that the ntsb has put forward makes a lot of sense to us. >> thank you. you know i have been an advocate of positive train control as well as a number of the other measures that you just mentioned such as cameras, alerters, redundant signal protection, i

think they are vital but positive train control, certainly is kritingiccritical to the safety strategy. many of the really tragic incidents could have been prevented with positive train control, wouldn't you agree? >> i would. >> and let me ask all the witnesses, isn't it unfair to the railroads that have made advances and are on a path to meet the deadline to potentially postpone the positive train control mandate? >> with all due respect i would be very surprised if any railroad makes the 2015 deadline. you may remember that the california delegation had proposed a 2012 deadline as part of the deliberations and clearly that was a reaction to the

tragic accident in chatsworth, california. at the same time that agency metro link had committed at that time which was 2008 to be finished with positive train control by 2012. they have just recent ri announced that they will only be in testing in 2016. so we are all working as diligently as possible and, you know companies can show their will and their commitment by the number of dollars that they spend and the number of people that they allocate to positive train control in the thousands of people that are working on it everyday at csx and in the industry and the billions of dollars that we're spending in order to deliver it just as quickly and safely and efficiently as possible i think is testament to that. >> my time has expired. i don't know whether any of the other witnesses have answers to that question but i thank you mr. chairman.

>> i thank the senator from connecticut connecticut. i want to thank all of the panelists for all of your great responses today. we will keep the record open for a couple of weeks but i appreciate everybody being here today and participating in this. we will il inform our discussions and decisions with regard to how we deal with and manage the rail issues under this committee's jurisdiction. so thank you again and with that, this hearing is adjourned. thursday on cspan, day two

of the confirmation hearing for attorney general nominee. live coverage from the senate judiciary committee begins at 10:00 a.m. eastern time and the senate banking committee considers a bill that would impose new sanctions against iran for its nuclear program. live coverage at 10:00 a.m. eastern here on cspan 3. >> keep track of the republican led congress and follow its new members through the first session. new congress, best access on cspan. cspan 2, cspan radio and cspan radio.org. >> on tuesday, the internet education foundation head its annual internet policy conference in washington d.c. in this part of the conference, we'll hear from the head of the federal trade commission and the u.s. chief technology officer about federal technology initiatives. and congresswoman rogers talks

about how members of congress use social media. this is an hour and 45 minutes. hello folks. we're just going to get going. and i can't believe we're getting going at 9:00. so i'm really excited. thank you everybody who braved the weather and made it out today. i know a lot of folks have some trouble because a lot of school closings in montgomery county and fair fax. so a lot of folks have to deal with child care issues. so we are live streaming thanks to the internet society and cspan is here today so we will be televising this. there's a lot of ways to gt out and of course on our byoutube

channel we'vell be showing the video and audio at a later date. thank you for everyone showing up. i'm really excited that you made it here and that we're ready to go. on your agenda which you have in your packet, you should see that the person speaking should be jerry burman. i am not jerry burman. i am tim lorden. terry is the founder of the internet education foundation which organizes and produces the state of the net along with other projects like the congressional internet caucus advisory events and congressional app challenge and several other projects over the years. jerry lives in a cabin in west virginia during this time of year and he never got out of that cabin. so he sends his regrets and i wish he could be here because jerry reates the internet education foundation 18 years ago with a lot of folks in this

room to be a neutral platform where every internet stakeholder could come together in good faith and with civility debate these really important internet issues. and jerry believed that everybody was an internet stakeholder even if they didn't realize it. and i think that has born out over the years to be truer and truer and truer. there are more people coming to state of the net. there are more people coming to the debates in discussion about internet policy that never would have considered themselves internet stakeholders several years ago. that vision from jerry has proven to be more and more true as the years go by. in your pocket just a little house keeping. you have an agenda. you have a list of our board members to whom we are really grateful that keeps us balanced so we don't take any positions on legislation but we're fair brokers in these debates. the board members will be introducing people throughout the day and you'll get to meet a

new of them. we also have the wifi information which is superimportant and the #for twitter if you're tweeting please do. the #sotn15. so please tweet early and often. i want to thank our sponsors. our sponsors are google, comcast, nbc and verizon. we really are appreciative to them and we have several other sponsors in the packet. there's more information on them. without them we could not find a venue of this size to host all of the conversations that we really need to do. so let's see if i missed anything. people were asking me if we should have -- what's the theme for state of the net this year? >> i kind of thought it was prettyself skplan ittoor.

explanatory explanatory. we have bit coin coming up this afternoon which we think is a very fascinating environment. but trying to put together a theme really is kind of difficult. i mean when we had state of the net last year, i looked around and hbo and espn were cable programmars and amazon and net flicks flix were internet companies. a year later i'm not sure if those classifications hold. amazon just won a couple of golden globes and espn astreaming online as well as hbo. things change very quickly. that's why we don't go with themes because things happen to quickly around here. i think we really need to hurry-up because the other day in switzerland eric schmitt said the internet is going to disappear. we'll have a series of keynotes. starting off, we will go right

to the afternoon till lunch and then we will go into the break out sessions. a lot of the folks in the later sessions are coming in from out of town got stuck in new york and boston. we have a few fill in folks. every keynote we have this morning is female which i think is really, really awesome. and we have a panel on diversity and tech leader in the day that will punctuate that happenstance. so right now, i'd like to introduce alvero who will have a keynote conversation with the federal trade commission chair woman. this is the first time we've ever had an ftc chairman at the event. i'm super excited. so welcome, please. [ applause ] >> good morning. chair woman, i'll thrilled to be here with you this morning. >> good morning.

i'm delighted to be here. i want to thank everyone for being here this morning. and i want to thank tim for the invitation to join you. >> for braving the snow? d.c. so chairwoman, you are affectively the nation's leading consumer privacy officer. you have to do a lot of big picture thinking around privacy. this morning, i want to focus around your big picture thinking on the it netnterfletnet of things but first you have an announcement to make. >> yes, i'm pleased to be able to share with all of you that the ftc is issuing its internet of things report this morning so i'm pleased to be able to have a chance to discuss the report and i hope you will all have a chance to take a look at it. >> wonderful. so there seems to be a tension at the core of internet things and wearable technology. a tension between convenience

and privacy on the other. you had doggy fitness trackers connected toothbrushes and my personal favorite was the smart sock that tracked the rhythm and cadence of your run whether you're going to injure yourself. none of these things have screens screens. so there are a lot of people in this industry who think we need to fundamentally rethink of the way we do things like privacy because it's really hard to give consent to a sock. >> on the other hand this technology produces extraordinarily sensitive information. at ces, you had ear buds that tracked the oxygen level in your blood. you had a wearable bracelet that didn't just track the calories you were burning, it also tracked the calories you were intaking by measuring your blood

glucose level. how do you think about privacy for a technology that seems to collect all of your most sensitive data all of the time but doesn't have a screen to ask you about it? >> let me answer that question by backing ape little bit and really getting to the first part of where you started which is this -- you called it a tension. from my perspective, i think all of the benefits that the internet of things world or big data world can provide really i think, can only flourish when you take privacy and security in to account. i think it's important to understand how an internet things -- internet of things world changes the landscape and with the privacy and data security implications, you've already alluded to this but i think it's really worth delving into it in a little more depth. the first thing is, you're

right. we're now in a world where data is being collected all the time. and not only that but we are bringing these devices in to our homes. into what used to be private spheres into our homes, into our cars and work places. we're wearing them. and the data that's being generated is increasingly much more sensitive. so that's important to keep in mind. not only that but just the volume of data that's being generated, is exponentially greater now. what that means is there are now the potential for these very large data sets from which even very neutral or seemingly benign information from which you can make sensitive inferences. so that changes the landscape considerably. that's one piece of it. another dimension is what happens to that information? if i'm wearing a witness bandfitness

band that's tracking how many calories i can consume and i wouldn't want to share that with my insurance company. what is happening to that information. do they understand that it could be possible to a data broker that it could end up in an insurance company's hands. so that's another question that we need to think about very closely. i think the third of this that in my mind stands out is the security aspect. few nengsdimensions here too. not only is personal information deeply personal information at stake but as you have more and more devices, it also means that there's more potential for exposure. as of this year, experts estimated there are 25 billion connected devices in the world. in the next five years that

number is going to double. and a lot of the companies that are getting into this space may not necessarily have expertise in security. also, a lot of the devices are small. many of them are low cost making making security much more challenging and some of these devices that we're using could also implicate our physical safety so it's not only personal information that's at stake but also personal safety. >> so let's talk about a couple of those. sharing and security. so first on sharing. this is, i think one of the aspects that troubled a lot of the consumer privacy folks that a lot of that information does not necessarily stay private. the ftc released a report that found that the 12 apps connected to health including a diabetes app, pregnancy app they shared

the data with 76 third parties. what is wrong with that picture and what is the ftc doing to fix it. >> that's another issue that's a problem in this area. that is the lack of transparency.