by cable, it is washington your way. >> this week "the communicators ,"a discussion about issues related to broadcasting with gordon smith. >> we're pleased to welcome back gordon smith, president and ceo of the national association of broadcasters, former senator of oregon. senator smith, the nab is meeting in washington this week. what is your message to capitol hill when you meet with legislators? >> there are three major issues we are facing. those are spectrum allocation, re- transmission consent, and the performance royalty issue on the radio side and how weak reconcile mutual dependence of

radio and performers. they need us. we need them. their market was broken by the internet. people do not buy music anymore. that is unfortunate. we do not want to break radio in trying to resolve this. >> has three television been broken by the internet? -- has free television been broken by the internet? >> no. the have argued for payment of produced content. we asked for the same consideration. when they take our content and put it through their pipes or bounces off the satellite, we feel we are owed something. of all the programming that the majorityttch, are broadcast content. people like to watch things like. they like super bowl, baseball, "office.

of these things are expensive to produce. we believe we deserve to be paid for them to keep broadcasting in the best of content. >> the republican commissioner of the fcc and the republican chairman of the energy and commerce committee have both said that the government should not be regulating between broadcasters and cable television on retransmission. do you agree? >> i do. while there is the rare interruption, the truth of the matter is that 99% of the negotiations are settled without interruption and on the market basis. that works better than the government getting involved trying to urge a particular outcome or particular price. the government does not usually do that well. we think the proof is in the pudding. it is working. it works for cable. they get paid for their content.

it works for broadcasting as well. what is not broken should not be fixed. >> it is that helpful to your organization that the republicans took a house back in 2010? >> our issues are not republican and democrat. our issues are about the american people. news, the weather, sports, information that they want to watch. i find friends on both sides of the aisle. the fact of the divided government gives you more procedural hurdles to utilize if you need to and to stop bad things. when i served in the u.s. senate, i think there was viewed as a constructive conservative. i have many friends on the democratic side of the aisle. now that my ban on lobbying has been removed, i have found that

regardless of party the reception back on the hill has been warm and wonderful. it does not matter if it is republican or democrat. >> also joining us is jonathan the assistant managing editor of "communications daily." >> are you concerned about the procedural hurdles with the commission and then the republican congress? neutrality is the big concern right now. rbc in that go into broadcast issues -- are we seeing that going to broadcast issues? >> if i wanted to be a partisan, i would like everything my way. the truth is our history shows that some of our worst decisions are when you have one- party domination.

those in the costing us a great deal of money and usually produce unintended consequences. divided government gives you an opportunity to fully that ideas. it does slow down the process. the founders of the american government with malice aforethought made it hard to make law. i think that is a good thing. as frustrating as it is to watch on c-span sometimes, republicans and democrats do not seem to be able to agree on the time of day. it still produces a better result. when it comes to broadcast issues, it is helpful to have an extra check and balance between the chambers to make sure that our concerns the very important to the american people are fully considered before big decisions are made that could have lasting and damaging consequences.

>> other agencies do not have as many hurdles enacting legislation. do you get concerned with them examining the system that you and your members feel should not be examined? are you concerned about the threat of overregulation of the industry in general? >> of course we are concerned. the truth of the matter is that net neutrality is something where of the d.c. circuit court of appeals has said unanimously that they do not have the authority or statutory authorization to oppose that. they went ahead anyway. they're trying round two on that. i am nervous that there may be a

tendency to go beyond what is allowed under study. that is why we have the judiciary and article 3 of the constitution. my hope is the the fcc will act in accordance with what they have said publicly in that they do not have the statutory authority to impose binding arbitration or some new system that puts the government's, on the negotiations and tries to force a particular outcome. they are rightly concerned, as we are, about making sure there is notice, a good faith, that the parties are earnestly engaged in resolving what the market price ought to be. i hope they abide by their comments of the past and stick to the wall and produce regulations consistent with the law. >> in a recent letter to the chairman of the committees in

charge of the issues that you face, the energy and commerce committee, and the commerce committee in the senate, you talked about spectrum quarters -- hoarders. who are they and what should be done about that? >> people should remember that i was on the senate commerce committee when we did the analog to digital transmission. broadcasters gave up nearly 1/3 of the spectrum in the analog age for wifi purposes. the ink was barely dry and the demand was that we need more. we find in pronouncements to shareholders -- time warner, clear wire, they are admitting to having tremendous amounts of on purpose -- unpurposed

spectrum. they call it a good economic value. you can call reporting. in this spectrum that has not been deployed. it is spectrum we have given up. we think is reasonable before you take more to lease deploy what you have. >> are the broadcasters sitting on unused spectrum? >> the broadcasters. given what we have left. what is being proposed is to take an additional 40% of our spectrum. if that is done, we are very concerned. the viewers need to understand the difference between the broadcast spectrum the way we utilize it in the wake wireless utilizes it. when we use it, power transmission is going to

everyone in a demographic area. it is very efficiently used. when you look at the way wifi does it, if i send you a video on mike iphone, it is from me to you. it is 121. it takes a tremendous amount of bandwidth. -- it is one to one. we are in the video business. they want to be in the video business. no one does it more efficiently than we do. if you to call the broadcast spectrum, there's probably not in of spectrum in the universe to manage one to one video on every mobile device in the world. we think our transmission is efficient and is essential. we do it for free. they will charge you a fee. free is better than a fee, especially when you consider that the people who rely on the

old fashioned way of receiving television over the air we did some say it is 10%. some say it is 17%. let's say this 14%. that is roughly 42 million americans who rely exclusively on over the air. there is a cord cutting phenomenon. people are rediscovering digital tv over the air has tremendous variety and the best quality. people are saying what else i need i can get over the internet. the number of people relying on over the air is going up and not down. the way we do video is more efficiently than anyone else. >> you have had your numbers in town. these are local tv and radio stations lobbying their members of congress about the issues important to them. with the feedback that you got,

did that have anything to do with concern from legislators about what the fcc is lining up to do, to make the tv channels closer to each other and make the band smaller. that is something the commission can do on its own. it does have the authority from congress to do that. what was their feedback about those plans? >> the viewers should know the fcc does not have the authority to just take our spectrum and put up and auction. that requires an act of congress. they do have the ability to place your within an allocation called meatpacking -- repacking. they say that the sale or auction will be voluntary. our hope is to keep voluntary voluntary if you do not volunteer to go out of

business, you are not placed in an inferior band. ing of not lose multicast i foreign language stations, minority stations, religious stations. those are things that add value to the 6 mhz channels. we do not want to lose the future of mobile television. in washington, d.c., you can get it with an antenna on your ipad. you can watch live, local tv on your ipad or other mobile devices. these are tremendous innovations. these are innovations that broadcasting promised the commerce committee they could do. they spent billions of dollars doing it. now they're saying they're going to repackage. if you are repackaged into an

inferior band, you lose mobile and what was promised. broadcasters detrimentally allied -- relied on the word of congress when they gave back 1 of the spectrum. >> what do your members feel about the proposition? >> without respect to republican or democratic registration, they are interested in keeping voluntary voluntary. in exchange for an auction, let's be very careful of any repackaging plan that could take away what broadcasters are providing to the american people. >> in a recent hearing, the longtime chairman dingell ask julius genachowski about the

auction process. >> you are going to have a voluntary spectrum auction. how is it going to be voluntary if there is pressure placed on the holders of the spectrum by the commission? >> the options would rely on market incentives. it would allow the market to set a price for existing owners of licenses to make the choice between continuing what they are doing or transferring the license in exchange for the offer from the auction. >> it sounds like a bank holdup to me. you hold a gun to the tellers head and say you know that they're going to voluntarily give you the money or you will shoot them. >> only if the free market is

the bank holding. >> i have some dark suspicions on this matter. >> senator smith? >> i agree with congressman dingell. we support voluntary. we are very concerned about the details. the devil is in the details. it really is in the details of repackaging. that is really just forced relocation into a lower power band that would degrade the broadcast signal. we do not want that. i would point out one more thing. we produce content. we send it out. we do not control the receivers made by the consumer electronics people. some of these are such poor quality. they need to improve the quality of receivers so that there is not the interruption. there is digital efficiency. that will resolve a good deal of the problem.

>> would you agree that the spectrum auction is inevitable? would you give a percentage of how much the broadcasters would be willing to give up? >> i do not know where they came up with needing another 120 mhz. we nearly gave that much up to of years ago. i do not know why that number comes out of broadcasting. somewhere between there and zero, there will be some broadcasters under water economically the will gladly agree to go out of business for a market sefee. there are a lot of people in broadcasting for profitable and employ lots of people, and produce the best content. the content we all rely on locally is what they produce. there's no substitute for the broadcast signal when it comes to those things. i do not want to presume a

percentage. what you really have when you are talking about this is a regional broadband problem. it is primarily los angeles, chicago, and new york. you have a national broadband solution. why should people in kentucky have to have their stations potentially degraded so that you download inster app new york city? let's be fair. that is what it is really coming down to. >> on the spectrum proceeds, whenever the split may be, there is also some tension between the house republicans, especially the freshmen who are focused on debt reduction and cutting the budget. broadcasters need to maximize their share of the proceeds. does that concern you?

>> deeply. i hear the fcc's say this will be a market and congress will allocate to broadcasters money to go out of business to be repackaged. my concern as a former legislator is that when you stack up these issues where you are pushing $33 billion on the table or more, i remember in a pay-go environment which is the budget environment across the street, spectrum auctions paid for everything. when you put billions on the table, there are a lot of claimants. where will the broadcasters fair? i said to those in broadcasting who may want to volunteer, make sure that the check clears before you let go of your

spectrum. but is there any reason to think this might be different than some of the other options, some of which raised $20 million. >> we're talking about two potential different ones. one relates to public safety. we support that. dedicated or however the will of the congress, whether you sell it commercially and use those assets to build up the public safety network. that is one way to do it. the other way is to give it to public safety and then go to the other option where we get it. we then become the paid for on building of the public safety network. we support whatever congress will do to make sure that there is interoperability when it comes to public safety issues. that said, we are concerned that

there is a rasush without a current -- thorough inventory of what is out there. we seek a world of broadband and broadcast. some see a world where broadcast goes away. we think that is a huge mistake. i am not sure i know how the internet and wifi would do all for the american people that broadcasting does for the american people. it does many wonderful things, but it does not do broadcasting. >> is there too much focus on wireless in the country today? >> it is the cool thing right now. it is hip. i love the internet and my mobile devices. i want to be able to watch live television on my mobile devices, too. when my wife says we have to meet someone at a restaurant and i am watching the game, she can

drive and i can watch it on the way. that is a personal example. i think the world has to include broadcasting in a healthy manner to serve the telecommunications needs of the american people. >> a couple of your former colleagues in the senate have introduced a spectrum in the tory -- inventory build. >> if you proceed with an option -- auction without a credible inventory, i am not sure this will be done any careful enough way where unintended consequences and damage is done that is hard to reverse. we just did this two years ago. now they're saying, never mind, let's do it again. we understand there is a problem. we volunteer to be part of the solution. we think our four principles of not taxing us force, letting us

innovate, keeping multicast ing -- these are very important in not diminishing our region our demographic areas. we volunteer to help. we do not volunteer to be rolled. >> you mentioned the gao accountability office. are you concerned that if the agency in the commerce department that handles spectrum issues were to do it there could be conflict of interest? gao should do the it? >> it is and accounting office without pre-conceived conclusions. i think that is important. we support universal wifi. that is fine. they talked about it as rule can activity -- connectivity.

there is not a spectrum shortage in rural oregon and never will be. the problem is an. -- the problem is an urban problem. as you fix the urban problem, do not damage the broadcast signal for rural places. in some congressional districts, about 40% of the people depend on over the air television and do not have satellite or cable. when you hear people say it is only 10%, they tend to be the economically disadvantaged. one in three spanish households depends exclusively on over the air. when you start throwing the numbers, it is the elderly, rural, economically disadvantaged. we think they count, too, and should not be rolled just because there are nice, new

devices that urbanites need faster downloads 4. >> we only have a few minutes left with gordon smith from the national association of broadcasters. let's look at a couple of different issues. indecency. when you were in the senate, you voted for a tenfold increase in the fines that broadcasters should pay for indecency. >> i am so glad that did not come upon they hired me. >> what is your position? >> broadcasters are not in the indecency business. atilt broadcasters -- i told broadcasters said is something the appeal to me in taking this job, that broadcasters have the higher standards. most consumers and yours do not know whether they're watching cable or broadcast content.

notwithstanding an occasional fleeting expletive or wardrobe malfunction, as a general rule, broadcasters are trying to comply with the indecency rules. sometimes we get confused with cable. >> the other night was oscar night. there was an expletive that got bleeped out for lisa leo. if that had not happened, would they have had to pay a fine? >> when you have a show like the oscars that is broadcast content with young people watching it, it is the judgment of the american people's elected representatives that we have got to be careful with the public airwaves. i am thankful that in resolving the tension between the freedom of speech and the decency standards that apply differently

in every community, there are technological fixes like time delays so that you can bleep this stuff out. it is a tension i have to live with representing broadcasters. we also have lawmakers. we will comply. >> a new chairman was named after about a yearlong search. they announced they are absorbing the longtime spectrum association. what would your advice be for your former colleague, chris dodd? he had some of the same corporate parents as your group. pal is putting that under your umbrella going to help. spectrum message?

>> mighchris dodd does not need advice from me. he is an able man. he is one of my favorite colleagues in the senate. we did not vote the same very often. i think the world of him. he is going to do great. he has the natural skills. it will be a pleasure to work with him on many issues that we share in common. as for mstv, we are responding to the wishes of our board and their board. many are the same individuals looking for some economies of scale and an increase in the focus on technology. we think with a unified voice, a budget that is a visionary to help our members develop their space with new offerings in the digital age within our spectrum,

we expect that. it will also have a radio focus to make sure radio has a place in the digital platforms of the future. we're very excited about it. i think it will be successful. >> we did not talk about the radio issue, the performance rights issue. is that going to move forward? given everything going on up on capitol hill with the budget, the war, it issues, do you see a chance of major telecom legislation happening in this congress? >> there is always a chance. i tell the members when you look at the broad firmament of issues out there and as important as these issues are to the american people, when you stack them up against the national debt