>> hear what the candidates are saying from the campaign trail from the newly designed spanier website from campaign 2012. >> in my view, it's time to get serious about our challenges and i won't go through all of them. the biggest one is the budget and spending. >> if investment is not landing in your marketplace, then it's landing somewhere else. capital is a coward you can argue. it will flee to wherever it is in the marketplace. >> i'm not an modern, it's an interesting concept, the idea of having a consumption-based tax as opposed to an income-based tax.

it's an interesting theory. it makes a lot of sense. to go through that debate right now and have a debate based on that tax, we need to do something now. >> read the latest comments from candidates and political reporters and league to spanier's media partners in the early primary and caucus states at our website. >> the senate commerce committee took up two nominations for commissioners on the federal communications commission. if confirmed, they will replace former commissioner meredith at well baker who left the f.c.c. in may to join comcast and another whose term expires at the end of the year. this is about an hour and 40 minutes. >> ms. rosenworcel, i would ask you to speak first. ajit pai after that. i hope that you will both introduce family members and

relatives or anybody that you might like sitting behind you. >> good afternoon, chairman rockefeller, ranking member hutchison and the distinguished members of this committee. thank you for the opportunity to appear before you today as a nominee as commissioner of the federal communications commission. for nearly five years, i have had the privilege of serving this committee as senior communications counsel, so i am accustomed to these halls, this room, the deliberations of this body. i can assure you sitting at this table today is a different experiencing all together. sitting behind me is my terrific husband of 11 years and until very recently, sitting beside him were our children, caroline frances age 5 and emmett age 2. they are our prided and joy. i would like to note my parents who are not here today.

they are at home in hartford, connecticut. i would like to think that a commitment to public service runs in my family. my father served in the air force before going on to a career as a doctor in hartford. for three decades, he ran the city clinic for hypertension and kidney failure. my mother has helped run a soup kitchen in hartford and my grandfather before them, served in the united states custom service here in washington. my great-grandfather before that served the public in a different way. he swept the streets in new york. it is a great honor to have been nominated by president obama to serve as a commissioner on the federal communications commission. communication technologies are a source of tremendous opportunity. they support our commerce. they connect our communities and they enhance our security. they help create good jobs. and by unlocking the full potential of broadband we will alter the way we educate, create, entertain and govern ourselves. this reminds us of the great sweep of f.c.c. authority and

its impact on what every american reads, sees, and hears. communication technology is changing as a brisk pace. laws and regulations struggle to keep up. the challenge for the f.c.c. is identified how to inspire the best in communications in a world where change is a constant and innovation can invert what we think we know. in approaching this challenge, i believe that a little humility helps. at the same time, it's absolutely essential that the f.c.c. honor the values that are at the core of the communications act. that means the safety of our people is paramount. new communications technologies should facilitate our security and protect life and property. that means universal service, no matter who you are or where you live in this country, you should have access to first-rate communication service. to prosper in the 21st century, all of our communities, urban, rural, and everything in-between need this access. our communications networks and the access they provide should

be the envy of the world. this means competitive markets, they're the most effective means of facilitating innovation and insuring the public reaps its benefits. this means a fierce commitment to consumer protection, communications technology and media are growing more complex. it is vitally important to get consumers the information they need to make good choices. we should strive, too, to help parents and families navigate the bewildering world of media communications. these values derive from the law. if confirmed, they were inform my efforts going forward. if confirmed, it will be an honor to continue to work with the members of this committee. i pledge to listen to you, the congress, those with business before the fmpling c.c. and above all, the american people. if confirmed, it will be an honor to work with the talented members of the commission today, the chairman, commissioner mcdowell and commissioner apply bourne. if confirmed, it will be a

pleasure working with the individual sitting next to me, mr. pai. finally, i believe the f.c.c. is blessed to have a staff of uncommon skill. if confirmed, it will be a pleasure working with them day in and day out. in closing, chairman rockefeller and members of the committee, thank you for the opportunity to appear before you today. i look forward to answering your questions. >> thank you, ms. rosenworcel. these are huge nominations and they have vast effect on the future of our country for better or for worse. i think it's hard to overstate the importance of the federal communications commission and its reach, so i want that very clearly understood. mr. pai, i would welcome your statement. >> thank you, mr. chairman. chairman rockefeller, ranking member hutchison, members of the committee. thank you very much for giving

me the opportunity to appear before you today. i appreciate as well the many courtesies you have extended to me during this process. i have enjoyed my meetings with many of you and your staff and if confirmed, i look forward to continuing that pro ductive dialogue and serving with my distinguished counterpart ms. rosenworcel. i would like the very kind introductions. the support has been gracious and the service on behalf of the people of kansas, outstanding. i would like to thank the president for nominating me. i am deeply humbled by the honor and if confirmed by the senate, i will do my best to be worthy of the privilege of serving the american public in this capacity. with the committee's indulgence, i would like to introduce members of my family who are in attendance. this might take a while, but i stress the word indulgence. supporting me today and all days is my wonderful wife janine, my son who has absconded, he wanted to make a

contribution to the record unfortunately, alexander who just turned three months old. >> can i ask if those who you identify if they at least raise their hands. [laughter] >> thank you. >> my parents, my mother-in-law and father-in-law, my brother-in-law, bob, my cousin and his mother, my cousin and her husband. and members of my extended in-law family, janet and rod, debra who took my done alexander outside the room and ago necessary who is probably the most technical logly savvy of all of us at 87 years of age. i also wish to remember on this day my late grandparents. they never could have imagined that their sacrifices and the

sacrifices of their children would have culminated in this proceeding a world and a century away. adds my introducer pointed out, i'm the child of immigrants. my parents came to the united states from india 40 years ago with $10 in their pockets, willingness to work very hard and a belief in the american dream. they settled in parsons, kansas, in the late 1970's. just to give you a sense of the geographic scope of the place. parsons is a town of 10,000 people, approximately 150 miles of kansas city. my parents started serving the community as doctors at the county hospital. they work there until this day. i'm glad i grew up in rural kansas. the friends i made and the experiences i had gave me a valuable perspective on life and as i grow older, i find that i appreciate that perspective ever more. as a child in rural kansas, i remembered it was expensive to

make long distance calls using our bulky telephone, especially to relatives abroad. our conversations were efficient more than expansive. we could only choose morning three channels on the manual dial of our television. we did eventually have a satellite dish installed in the backyard. it was approximately 10 feet across. with it, we would watch nonbroadcast programming if we typed in the coordinates and waited for the satellite dish to reposition itself. from the products offered were rather limited. we're not in the kansas of my childhood anymore. today companies compete against each other to provide novel services. we've seen expansion in content

and new ways for people anywhere in the world to access the content. we see personal communication devices more powerful than computers that once filled up an entire room. believe these developments have made our lives better, richer, and even longer. for this, the private sector deserves the lion's share of the credit. private companies and entrepreneurs to risks. they raised capital. they brought new services and products to the marketplace. they employed millions of people along the way. it is also important to recognize the role that the federal communications commission has played in this technological revolution. when it prioritizes competition and innovation, the fcc allows the private sector to deliver a rapid communication services at reasonable prices, that is the charge the government gave them in 1934. speaking of 1934, the newspaper.

from the very first commissioner to be appointed to the fcc. the title refer to them as "rulers of the air." my ambition would be far more modest. i would not bring an ideological mission to the agency. i would not hold. it is for it against any company or technology. -- i would not hold any prejudice against the company or technology. i would stay within the bounds of the authority as set forth by congress. i would work with others to come up to solutions carefully calibrated to solve common problems. my decision making process would incorporate and reflect a respect for others outside the agency. i would seek to build a collaborative relationship with congress including the members of this committee.

i would consult with the private sector as appropriate, state and local governments, consumers, and others impacted by the commission agenda. i believe the commissioner must be a good listener. if i am fortunate enough to be confirmed, i will do my best to hear all stakeholders have to say. in discharging my responsibilities, i also would be mindful of the implicit goals of communication policy, to maximize the benefits of competition and innovation for all american consumers whether they live in a big city or rural kansas, to enable my son to note how far communications services have come in his lifetime. thank you for giving us this opportunity. i look forward to your questions and request my full statement be made part of the record. >> it will be made so. thank you. you have a warm way of whiltalk.

i truly believe you are a good listener. i think it is incredibly important. fcc is a very complex organization. the deals and such are cerebrum and technical matters -- supreme pool -- cerebral and technical matters. communication becomes very important. most people do not know what you do. if they do, they're probably afraid of you. those personal skills are incredibly important. i would like to start the questioning with a question to each of you. it is a question jessica has heard many times before because i ask it as the first question. we were responsible for establishing a program we are very fond of.

a lot of other people help. it has done a fantastic job in helping to close the digital divide. i thought at the time that when it passed, a high number of costumes would be covered. in fact, it was only 15%. that was in california. houston went wireless and within two days, they were 100%. there was a vast variations in west virginia. the numbers are now very high as they are across the country. the e-wave program is about the technology and keeping it current so it can continue to close the digital divide. my question is simple but profoundly important. will you both promise me that you will support that program?

>> yes. [laughter] >> if confirmed, i look forward to working with you on the program. [laughter] >> one of the reasons i say that is because there is a tendency to look at the related money that is fungible and apply it to things that have nothing to do with the program. that causes me vast heartache. i will incorporate that into your e yes answer that he will keep an eye out for that. the second question is an obvious one. senator hutchinson has given me good news today. i was shocked that we started a couple of years ago to draw a

bill to honor the 9/11 commission unfold request to have a national wireless broadband connectivity so that everyone would hold virtually the same device to instantly be in touch with each other. it would not be like when the military invaded kuwait and they could not talk to each other because they have different ways of talking to each other and could not. that was extremely embarrassing. that has been overcome. it remains very much the case in terms of our first responders in america. that would be firefighters, policeman, and people who do a variety of work and have to be connected. a firefighter has to be able to not just take a photograph of the building he is going into. it may be building-penetrating

photograph where he can locate an injured person where he can apprise the nature of the problem and shoot it right to the emergency room at the local hospital. all of these things have to work together. there was an enormous amount of support for this with every public group and nothing happened. it past this committee with a vote of 21-4. it might have been higher if we had taken it at a different time. it was right there. everyone was for it. the vice president was all over it. nothing happened. obviously with something like that, if you do not give up. you continue on. it made voluntary giving back of

spectrum to the sec. no one believes it is, but it is voluntary. there will be many billions of dollars coming back into the fcc that could be used for deploying this system across the country, everywhere. it also go to making sure the hardware was there. in the end, there would be money left over for deficit reduction. it is pretty hard to argue that this is a bad idea when it does not cost the taxpayer a single dime. i would ask each of you again if you will be supportive of the committee efforts with respect to this legislation.

>> yes. [laughter] >> yes. >> i am happy. my time is up. >> i think you pretty much answered in your opening statement, but i want it on the record and clear that you have recently joined a law firm that does have business before the fcc including one of the potential mergers between at&t and t-mobile. it has been abandoned, but not necessarily permanently. do you have any possible conflicts of interest? would you recuse yourself if there were a conflict between your previous law firm and the business that comes before the

fcc? i would like to know exactly how you plan to handle that. >> thank you for the question. i do not believe my short employment would preclude me from being an effective commissioner and robustly participating in proceedings. i was aware of all on my first day of the firm that i was under consideration for this position. during my time there, i have not represented clients before the fcc. my name has not appeared on comments or pleadings' submitted. the firm has precluded me from discussing, handling, or knowing about particular matters. >> you would not feel any prejudice in favor of a client of your former firm? >> not at all. >> last year, the fcc opened a proceeding to consider regulating broadband internet services as a common carrier under title two of the

communications act to impose neutrality restrictions. the fcc did abandon not approach when there was a bi-partisan outcry from congress. it did go forward on that neutrality under title 1. chairman genachowski has said he will keep the title two classification dockets open. do you think there's any value in keeping this proceeding open when a bipartisan group in congress has clearly opposed it? >> for nearly a decade, the fcc has chosen to look at the broadband services as title 1 services. i recognize the supreme court has upheld the decision. the agency has tried to use its ancillary authority to provide consumer protection under title 1.

the scope of that is under consideration and review in the d.c. circuit. i would clearly abide by any decision the court reaches. >> on the same question to you? >> this is an issue that divided the commission and this body. it has been healthy to have the debate. it has identified for the public the various positions on either side. proponents argue it is important to preserve a free and open internet for consumers. opponents have argued it is important for service providers to be able to control the network to promote an open and vibrant experience for everybody. this decision is under review. depending on what the court says about the scope of the authority, as a commissioner i would abide by that decision as

well. >> this is a question for both of you as well. in recent years, the sec has imposed merger conditions -- sec has imposed merger conditions on companies that seem extraneous to the transaction and could be seen as attempting to achieve policy goals that it would not be able to have otherwise through rulings. how do you feel about the role of the fcc in these merger applications and putting extraneous diversions or requirements for jettisoning parts of portfolios? how do you feel about that approach to merger approval or disapproval? >> the fcc authority for merger

review is under title two and three of the statute. it has the authority to assess transactions and transfers of licenses are in the public interest and necessity. it is my opinion that any conditions that apply to the standard should be rationally related to the transaction. >> are you saying you limit it to that nexus? >> if there rationally related to harm in the transactions, remedy the harm, an increase consumer benefit, it is justifiable under the statute and i will clearly add here to it. >> my approach to merger review under the public interest standard would be simply to evaluate whether the merger would benefit competition and consumers. in the course of reviewing a merger, if the commission found

competitive harm would arise, and would be open to considering -- i would be open to considering conditions that were specific, directly related to the competitive harm identified by the agency. part of the difficulty that arises when extremists -- extraneous conditions are considered is that it becomes a bore tax for a variety of concerns that do not have to do with the merit of the transaction even if they might be good ideas or policies to pursue in generalized rule making. i would limit conditions to merger-specific types. >> thank you. >> senator kerry is chairman of the subcommittee responsible for all of this. he was detained at the white house. that is probably a pretty good place to be detained at. he arrived late. we are calling on him to speak.

he has not have that chance. i told him he could take a couple of extra minutes to use but however he wished to make some points or whatever. >> thank you very much. i was not detained in the way i originally intended. nevertheless, i was detained. [laughter] i note it is gratifying to see a member of one's stock receive this kind of recognition. i noticed difficult to read a talented member of your team go. -- i know is difficult to let a talented member of your team go. we're all familiar with jessica , talent,el's work commitment to the commission,

and encyclopedic knowledge. she has served us all on this committee with great distinction. we thank you for that. i am less familiar with mr. pai's work in a direct way, but i know of his reputation for professionals who serve us. i look forward to supporting both of your nominations. senator rockefeller said this is a big nomination. these are big nominations. i want to second that. in a very real way, you are the protectors of our democracy. you are the protectors of the viability of thought and communication and ideas being able to freely move in and

around our entire social fabric. if it gets conglomeratized and narrow in the ownership, our freedom is challenged. our democracy is lesser. both of you are widely recognized for your temperament and intellectual capacities. given the nature of the marketplace you will be regulating and overseeing, you are going to need those skills enormously. big money interests are going to lobby you to gain tactical advantage. public interest groups will push you to appear to their sense of what is moral. your every word is going to receive attention in the trade crash repress and investors -- in the trade press and among

investors trying to read the tea leaves. i know you understand your responsibilities to the public and the broader interest. i also know as staffers you have felt some of this pressure before. i am confident as commissioners you will feel it on a new scale. you have to listen to your conscience and do what is most consistent with the law and the public interest. this is an extraordinary time. it is an exciting time in communications we're in the early stages of an exciting mobil-device driven communications revolution. satellite companies compete to deliver tv services broadcasters are delivering critical services in all communities in different ways.

the descendants of monopoly telephone companies are competing to provide service at home and at work. all that is great but even as these opportunities are presenting themselves, the markets in each of the sector's continued to concentrate power in the hands of fewer and larger conglomerate. the concentration threatens the competition that we contemplated when we wrote in act. ou diversity of ownership in communications is what democracy needs. it has reached a point that when the agency acts to protect

consumers or competition, companies push members of congress to attack the commission and members. i think you are aware of that. the challenges you will face at the fcc are significant. i want to make sure you come to this with a clarity about the value of open networks and how licensed and unlicensed spectrum can complement each other and how to best insure the market is open to new innovation. i would open by asking you to generally comment on the divergence from where we were in the 1996 act and what you see happening in the marketplace today. >> as i meant to be in my

opening statement, technology is changing at a fast clip. it is challenging for legislators and regulators to keep up. it is important to approach the task with some humility but also with recognition that there are core values fostering the public interest, privacy, public safety. those are the things that should animate the deliberations of the commission going forward. >> do you both agree we need to free up some of our spectrum for broadband to be competitive to create jobs and maintain our economic capacity? answer both and she can come back. >> with the first question, i find it difficult to improve

upon my colleague's answer. i would point out that whatever congress decides to do on reforms to update current realities is something i would faithfully implement if i were fortunate to serve on the commission. with respect to the second question, i can do think it is important to open up networks to free up the spectrum for competition, innovation, and investment. that is the key to a healthy economy and democracy. when the commission and congress focus on competition, consumers and policy benefit. >> yes, we do need more spectrum available for the services we all make use of. the problem is we have less in

the pipeline than many of our international counterparts. i think it would be foolhardy to only focus on spectrum. i think we will have to work at improving the efficiency of existing spectrum with technologies to help us do that. >> i would ask an additional questions be made part of the record. >> i now turn to senator demint. after him, it is in the order of arrival. what will i be allowed to ask questions? -- >> will i be allowed to ask questions? >> yes. i have to eat some crow here.

senator snow. [laughter] >> it is too late. >> do you remember when you came in? >> [inaudible] are we ok to go? thank you for being here today. let me ask about mobile broadband. the competition report does not include mobil broadband when it shows bill out. that would suggest we have problems in areas we might not if you count mobile broadband. a few years ago, there was not a lot of capacity in the mobile market for broadband. now we are at 4g.

i suspect at some point we will have a stronger -- 3 mobile region through mobile we will be able to get anything we need through broad band. do you consider it to be part of our broadband system? should it be included in the broad band competition report? >> i think we're seeing increasing convergence along all sectors. i think it will grow to be more robust substitute. it will be the perfect substitute for traditional service. the agency has a lot of reporting duties. the reports often reflect remarks that are dated. it is worth trying to identify how to update them to better reflect technology and the way consumers use them. >> this is a really important point. we will look at the statistic

like 80% build up in rural areas and suggest a new subsidy when we have companies are competing for mobile broadband in an area. the failure to recognize different technologies as viable alternatives -- mobile broadband is better than dsl in some capacities and growing. we need to recognize all existing technologies as well as try to imagine potential technologies. when we start subsidizing one technology and eliminating another -- i hear it in south carolina. your people collecting funds for building out. -- you have people collecting funds for building out. others have the subsidy to compete with another technology.

your answer is pretty important. we should push as congress and fcc that the reports we look at are accurate. >> it should reflect the way consumers are using their service. >> i also think that it is seen as an acceptable substitute and that the sec would do well to take note of that. -- fcc would do well to take note of that. >> do you think the fcc has the authority to expand the contribution base to internet service providers? >> under the communications act, the commission has the authority to assess telecommunications services. it has discretionary is negativauthority on other servit

could be described as broadband. i would commit to a review of the statute. >> you think internet services fall under telecommunications? >> a portion could. i think the challenge going forward is making sure the revenue base is strong enough to support the type of universal reforms the agency adopted last month. >> you think fcc has the authority to assess fees to internet service providers to find the universal fund? >> it has the authority but not undertow of treaties and statutes. >> can you really divide in

internet service provider that provides both? you are talking about assessing fees to part of their services and not to others? >> i apologize. i am getting fairly legal. let me put it more simply. the current system is supported by tele-communications, long distance services. the challenge going forward is making sure we have a system that will support universal service in rural areas. the agency will need to look at new systems like those proposed in the last administration that involved connections and not necessarily internet or brown them services. broadband services but connections. >> i can scarcely improved on my colleague's response. i would say the commission indicated it intends to look at the contribution mechanism next year. i think the commission should take a close look at the nature

of the statutory authorities before assessing fees in the manner you suggest. >> the cable act is nearly 20 years old. it reflects the monopoly status of media services in most areas. that has totally changed. do you believe the laws we currently have regarding video services should be reassessed and updated? >> that is a broad question. as a general manner, there is a lot in the act that is old and can be benefited by taking a fresh look. >> i agree. fcc recently released rulemaking where it identified a number of ways to clarify where the

commission authority was given that the marketplace has changed. that is something i would definitely take a look at if i were fortunate to serve at the commission. i have a statement for the record. i do have a couple of questions. i will preface those by saying we had a chance to visit when you visited the office. thank you for your service and understanding of the issues. your time in the senate included a substantial amount of time with my chief of staff. i am glad you are both willing to be here today and willing to make yourselves available for these important jobs. one of the challenges the fcc

will continue to face with the congress is that this is an area that changes so quickly. i have believed the odds you will solve a problem while it is still the problem are pretty slim. the odds you will create a problem by trying to solve a problem that has passed you by our greater than not. i remember when we did the telecommunications act when i was on the commerce committee in the house in the late 1990's. we came back to it five years later. nothing we thought was important was still important. i remember all of the things we divided over, all the debates, all the friction. none of it mattered five years later. i remember the many times i have asked my staff about the

definition of neutrality this month -- net neutrality this month because it was a constantly moving target. the net neutrality the commission has taken. my view is if you regulate too much, you will slow down the development of the services rather than speed them up. as you slow them down, you will make them more difficult and expensive. those are issues i hope you will think about. my belief is you both will become commissioners. the commission has never been able to fully defined and underserved and underserved --

unserved. there is a big difference. someone comes in and creates a network with their own money. someone in the government decides it is not quick enough so we will subsidize someone to come in and compete. i think we need to be extraordinarily careful with that. assuming you are both on the commission, one of the first questions i will ask when we meet again is the difference between underserved and unserved and what you will do about it. i have different ideas about those. i want you to comment on the proposed merger between at&t and t-mobile. i was concerned when the

commission staff released their view of the merger even though the merger request had been withdrawn. does the commission speak through the commission or the staff? how do you view the actions of the staff as a commissioner? you may or may not say anything about the idea that staffers will be directed to or decide on their own that they will announce their view on issues that may or may not be before the commission. >> the chairman is the manager of the full agency. that is usually in consultation with other commissioners. if i were to be consulted about a question like this, my recommendation would be to abide by the commission rules to make sure whatever the commission was proposing to do was consistent with those rules

and practices. >> what if there is no commission action pending, should the commission gratuitously put information out? >> i have had an opportunity to read the news article about it. i view the commission's discretion as one that should be exercised a carefully. the release of the staff report along those lines in the context of the proceeding that does not currently exist, to the extent that our rates people in the industry, that is something i would take into account. >> does the commission act through its actions or through the staff? >> i would have a hard time improving on the answer from my colleague. what occurred yesterday was the chairman who directs the agency

chose to release the report. i believe it is within his statutory authority to do that. i will acknowledge it is probably unprecedented. >> 30 years ago when there was much less media, there was the fairness doctrine. i would be opposed to seeing that put back in place. what is your view on that? >> i share your view. i believe chairman genachowski does as well. he took action to remove the regulation from the books given that it had stayed on the books for some time. but i do not support returning to the fairness doctrine. >> now we will have senator to momy. >> thank you both for joining us

today. welcome to the committee. congratulations on your nomination. thank you for your willingness to serve. this is a tough job you are heading towards. i commend you for that. as we all know, december a year ago the commission adopted the open internet order. it was the subject of litigation. i think it is before the d.c. circuit court of appeals. in the event the commission loses the case, would you comment on whether you would support the idea of reclassifying broadband as a telecommunications service under title two of that act? >> as i noted earlier, the commission has had a practice in the last decade of treating

those as information services. the supreme court upheld the approach. i think there has been a fair amount of reliance on it. i think the decision will depend on the findings from the circuit. if commissioner, i would agree to abide by that. >> if i were to be confirmed, i would have concerns about because vacation to the extent that the imposition of those common carrier regulations might dampen economic investment, the willingness to take risks. that might harm consumers. i would be hesitant especially became in the wake of two court of appeals decisions that the commission lacks authority to pursue them. >> if the court decision does not provide guidance and is silent on the question of whether title two is an

appropriate way to reclassify broadband, do you have a personal opinion about whether that is an appropriate regulatory framework? >> these are new areas of the law. we would have to follow the decision of the court. >> thank you. >> could you repeat that? also, pull the microphone closer. >> i would say that these are new areas in the law. we would be duty bound at the commission to follow the decision of the court. >> thank you for bringing your incredibly vast experience at a

fairly tender time in life and agreeing to serve in the capacity your being reviewed for. broadcasters have to fulfil the public interest obligations in exchange for using the public airwaves. does a broadcaster need to provide local news coverage of the community is licensed to serve in order to satisfy the public interest obligations? >> broadcasters are trustees of the airwaves. they receive licenses in communities. they have a duty to serve the local community. part of that should include things like providing locally relevant programming like news and information. >> do you share that view? >> i do.

>> i will ask each of you to respond to this question. in 2007, the fcc held a hearing in new jersey on a license renewal. new jerseyans testified about their failure to cover new jersey news and events. four years later, the station was still operating under an expired license. there is evidence its service to new jersey has gotten even more limited. if you are confirmed, would you review the record in this case thoroughly? can i count on you to review this loups -- lapse in getting a decision on whether the slices ought to be renewed? >> you have my commitment to doing that. >> yes, absolutely.

>> new jersey is a contributor close to $200 million a year to the universal service fund. the birdiburden on new jersey ad other states is getting bigger. can i count on you to bring some fairness and balance into the distribution of the funds that come in? new jersey contributes $5 for every $1 tickets in services. can i ask you each to respond to the question? will you insist on a look at the equity here? >> as i mentioned earlier, the commission did keep up the

contribution side for next year. i would dig into the record carefully and make sure the proper forms are taken for the universal service fund on the contribution side. >> i agree with my colleague that the universal service system needs to be a fair one. >> very few media outlets are focused first and foremost on new jersey. the state-owned television station recently went through a dramatic change and is now operated by a company from new york. can i get your commitment to watch the new njn situation closely to make sure it lives up to the obligations of the people in our state? >> yes, senator. >> yes.

>> i will ask you one more question. some have criticized giving additional spectrum to the public safety community on the basis that the commercial sector may need in the future to address customer and network demand. what do you see by way of network demands and new technology? >> as the chairman pointed and out, a decade after 9/11, we are still wrestling with the question of whether and when public safety personnel arrive at the scene of an accident, whether they will be able to communicate. the question of how to resolve that question is entrusted to congress. if i were fortunate to be confirmed, i will faithfully decision. congress'

>> i have heard discussed in this room that the average 16- year-old has more functionality in their telephones and our policeman do today. providing them with better spectrum can lead to all of our safety being improved as well as theirs. i would be supportive. >> new jersey lost 700 people on 9/11. the toll that 911 to was over 3000 people. it took was over three dozen people in was larger than the landing at d-day of pearl harbor. the situation was worsened by the fact that there was little or no communication between those who rushed into the building to save people's lives

and paid for by giving their own. the one thing we have to do is make sure we have the operability required for us to be responsible in a way that is efficient. >> thank you. regulations to both of you on your nominations. you are both impressive. -- congratulations to both of you on your nominations. you are impressive. your children are coloring. they were shocked you are on tv. i do not think we need to tell them it was not network. mr pai, your family is so engaged in these questions that i am afraid they're going to answer them.

my first question is on competition. one of the main goals in passing the telecom act of 1996 was to open up the communications market to competition. the national broadband plant found that the vast majority of americans can only choose between two broadband providers. there are still challenges. what role should the fcc plan to ensure adequate competition? >> i think we will see more intermodal competition. wireless is a good place to start. >> i would build upon the answer by saying that to the commission -- extent the commission can do so, they should make sure the rules of the road do not differentiate between different technologies. the commission is dealing with regulations that apply to telecommunications providers but

not cable or wireless providers. to the extent they're competing in the same space, it is important to have technological neutrality with respect to the rules to ensure everyone is competing on a level playing field. >> you mentioned wireless. i have been very involved in some of the consumer protection issues, particularly focused on early termination fees. we have seen some improvements, but i still hear about it and roll. what role can the fcc play in the consumer protection area? >> consumers should continue to monitor the early termination fees situation you described and look at other issues where there has been recent progress. >> the incentive auctions for

the network, one thing i want to bring to your attention is that minnesota is on the canadian border. some broadcasters and our state have raised this issue that in minnesota, they have to coordinate with the sec and the canadian government. -- with the fcc and the canadian government. they've been working to get new channels but have had delays in getting applications approved. will you work with us and them to make sure we can address these issues if they arise as part of any voluntary uction process? >> yes. >> that will require you to go there in january. [laughter]

>> it is always an issue in challenge for all of us. we know there are a number of issues with e-911. were households are cutting the cord and relying on wireless. that is raising opportunities and challenges. 1/3 of all americans only have wireless devices. it can present challenges in determining the location of a citizen. i understand the fcc is working to close the accuracy gap between landline and wireless calls. do you consider that an important priority as you look at implementing e-911? but i do believe is a priority. i look forward to working with you and the committee to ensure

that goal is met. >> senator warner and i will be introducing our bill. we look forward to working with you. some states have short have reconstruction time periods. i hope you will look at that. it was incorporated in the national broadband plan. we're hoping we can work for word on that going forward. the second thing is the importance of universal service reform. we have run out of time. that is clearly the way to go as we move forward with broadband. thank you to both of you. >> i have a couple of quick questions.

thank you both for visiting my office and your willingness to serve. when you have gone too bony minnesota, i would expect to come to alaska -- when you have gone to balmy minnesota, i would expect you to come to alaska. [laughter] i want to invite both of you. and like to invite you back as commissioners. you get credit if you come in january. >> 42 below, i am hearty. >> i will do everything i can to clear my calendar in july and august. [laughter] >> let me thank you again for being here. let me ask you a philosophical question.

you have heard me say this. when i hear the words "fair usually it means that alaska gets left out. there is no other state like it. our highways are in the air, literally. broadband and wireless is a critical component to our long- term economic health, our ability to educate folks in the rural communities, as well as deliver health care and medicine. give me your sense -- let me preface it -- let me ask it this way. how do you see the resources of the universal service fund being used? what are those priorities? the idea of universal means some

pay more to benefit the whole system with that premise, give me your thoughts on how you would prioritize utilization of the universal service funds. >> when i said fair, i meant smart. we have data that tell us where broadband is and is not. it is incumbent on the agency to use that information to determine where the funds flow. where there is no service, it should be our first call to address those problems, alaska included. >> i would associate myself with those remarks. i would add that having gone to alaska, i would take a personal appreciation of the uniqueness that the problem has in alaska. it is hard to imagine when you

look at a map. i saw a small part of the state. i saw an appreciation for how important is for the fund to take into account how unique your state is. >> would you agree there is uniqueness in what alaska has to deal with? >> absolutely. i spent time in alaska communities that are not on the road systems. i am familiar with the uniqueness. >> as we build out, we have to use a variety of systems to create communication networks. in the process of reforming the universal service fund, you also have smaller companies that

invested, built out hardware. now they're trying to transition, but that transition time may not be as short as the fcc would like to make the transition. they put this capital investment in to build out. the filled a need. they are shifting more towards wireless and broadband systems. how do we address that? at the end of the day, all of these resources funneled through the federal government. >> let me provide you with two answers. different arms of the government should be talking to each other about this. i think they could do more. the second point i would make is that there should be no flash cuts. we should recognize many of

those companies had an honest reliance on the government commitment. we should find a way for them to fully navigate to whatever new network the commission adopts. >> unrecognized important value they provide. that is something fcctake into . >> thank you. i look forward to seeing you in alaska, maybe in july or august, not january. [laughter] >> we should understand that history has been made here today. this is the first time the senator has never referred to alaska as being maybe more needful of attention than perhaps other states. it is very small and far away.

he has overcome his shyness today. we should be very proud. >> we welcome you. you represent such impressive array of talent, expertise and experience. we would be fortunate to have you on the commission. one of the first issues i wanted to raise is the concept regarding comprehensive spectrum inventory. i happen to think that in order to have a true analysis of what exists in the spectrum, who is using it, by whom, how much is available, that we should have an inventory of the spectrum, and that is legislation senator kerry and i have introduced a rebel last couple of years because we think it is absolutely essentials. there is no way to discern exactly what is available.

what is your response to that in terms of what you think would be necessary to establish a complete analysis of what exists as far as spectrum? secondly, the chairman, in response to a letter that was submitted concerning this issue, indicated that they have conducted a baseline inventory, but as i could understand it, it is essentially did not examine the breath of what existed. whether or not they followed up with licensees in terms of who was using spectrum and to what degree they were using it. do you think a baseline inventory is sufficient? >> as you know, a spectrum is a scarce but valuable resources. i think it is incumbent on the federal government to constantly be assessing how it is

allocated, how is assigned, and how is used. i wholeheartedly agrees with the desire to have a robust spectrum inventory. i am understand the fcc has done some work on that goal. i think over time, the goal should be to make that a more robust inventory. >> do you think we should have an analysis done now at the forefront of this process? >> yes, although i do not think we will have the luxury of time to make this sequential. i think our international counterparts have more spectrum in the pipeline than we do. i think we're going to have to operate on multiple fronts all at the same time. >> as much as i hate piggybacking shamelessly on my colleague's answer, i would find it hard to improve on it. it is difficult for the commissioner or any other agency

to use spectrum more efficiently or allocated more effectively if we do not know who is using it. >> with respect to how you improve upon the technological innovations, one of the issues, of course, is incentive options. there has been a disproportionate reliance on incentive options. the fcc believes it will yield up to 24% or 500 mhz. that is a very small amount of what is going to be required by 2020 in terms of the demand and the explosive growth in wireless broadband. how best to develop these technological innovations? what should be done all in order no -- what should be done in

order to establish that, other than incentive options? >> we would be foolish if all we did was rely on incentive options. we have to use our intelligence and resources for developing better technologies that use spectrum more efficiently and also study the policy of network so that we can be more efficient with the networks we do have today. >> in what timeframe should that happen? >> it should happen immediately. >> can it happen immediately? >> if confirmed, i can tell you that i would certainly make it a point to try my best to do so. >> if i were confirmed, i would urge the commission to create whatever sort of regulatory framework incentivizes that development as quickly as possible. >> i think it is critical.

otherwise, in terms of incentive options, there is a drive in that respect. on the other hand, i think it is clearly important to do everything we can to maximize the availability of spectrum. as you say, you can only reallocate or redistribute it. you cannot manufacture it. we need to enhance our opportunities to know what is available and how best to utilize it. one other issue -- a couple other issues, if i might. one is on the question of the management of the spectrum in terms of who has the ultimate decision making authority. there's been several reports of the last decade suggesting that there are two different

authorities that oversee spectrum policy between government and non-government uses, and that ultimately, to have less confusion, it would be best to have one altman's decision maker or authority over the spectrum. do you -- one ultimate decision maker or authority over the spectrum. do you agree or disagree? >> i think that is a fair point. historically, they have not coordinated as much as they could. a spectrum grows more and more valuable, i think it is important for them to coordinate and work more closely together. >> i think it is important for them to coordinate as well. the question of how to do that lies within the province of congress, and that is something i would look to this committee for guidance on. >> i want to commend these

nominees and observe that by this point in the hearing you are probably feeling pretty good about your chances for confirmation. [laughter] let me just say, my brief statement mentions that i am from a state that has quite a bit of rural area to it. a great concern of mine is that our nation's rural areas have the same access to broadband as the more populated areas of real -- populated areas. with regard to the recent usf order dealing with competitive wireless, a number of people feel that wireless was unfairly and illogically targeted in this order. what do you say to that and what affect do you think the order

will have on broadband competition, particularly in rural areas such as alaska, west virginia and so on? >> i think the recent order is an attempt to ascertain where service is and is not. i think if is an effort to take scarce resources and direct them to places where service is not today. i think the agency will need to continually evaluate how the funds are spent to make sure that we do reach underserved areas in mississippi, alaska, west virginia, and any other state across the country. >> i would add kansas to that tally. having grown up in rural kansas, i am keenly concerned about rural areas. i have not had the opportunity

to dig into all of the particulars, but i do know that the commission is going to be actively considering these issues in the next year and if confirmed, i certainly would take these issues to heart. >> i appreciate that and i do hope so. let me move to device in opera ability. -- inoperability, which remains a top priority of mine. as we continue to transition to a broadband world, a device opera ability -- inoperability becomes even more important. are you familiar with the report

we sent requiring inter- operability as a matter of public safety? >> yes. >> what do you think the fcc can do to support these principles? >> is a complex question. it is also a very important question because it is so essentials to communication. small, rural areas that have spectrum in the 700 megahertz band may find that their customers are unable to use their devices when they leave home, and need to rome on other networks. that is a real problem. there are real technological and challenges and costs associated

with addressing this. i think the fcc should follow-up on this work. >> you do not have any question that the technological challenges can be addressed and overcome? >> i am an optimist that they can be worked on. >> i agree that it is important to balance this. i think it is an issue that has captured this committee's attention, and for good reason. it is critical for consumers, public safety personnel, and other constituencies. it is an issue that obviously the commission is going to have to grapple with? -- grapple with.

>> i appreciate that. >> i want to congratulate the nominees on being with us today. your nominations to the fcc. we will look forward to working with you. there are lots of issues that will fall under your jurisdiction and just from the advances we have seen in technology, people today conduct business, communicate with friends, pay bills. there are so many things we do with technology today, and it is important that in a knowledge based economy and society that broadband service is available to everyone. it has become an absolute necessity in terms of getting anything done. i am enthusiastic about the growth we have seen in the telecommunications sector of our

society, but i'm also concerned that there are areas of the country that are underserved when it comes to the deployment of broadband. i believe it is important in our reforms that we give -- in universal access reform that we give broadbent access to all tribal and rural areas. i hope he will continue to monitor the reform -- you will continue to monitor the reform efforts to make sure that universal service is not only sustainable but effective over the long run. i know you are from kansas and connecticut, so you probably have some experience with some of the more rural areas. i certainly would welcome you to travel to south dakota as well to get a perspective on how

these issues play in rural areas of the country. i would like to extend that to you today. another issue is telecom mergers. i am concerned about the effect divestitures on rural states like south dakota. i would ask you to look into that issue to make sure that those packages are truly preserving competition and not negatively impacting certain regions of the country. to that point, we have in my state of south dakota, when verizon acquired a telecom company in my state, the justice department allow the merger to go forward under the condition that divestitures take place. customers suddenly found themselves with dead spots where there had not been any before. now at&t is of course reportedly floating a package of

divestitures in an attempt to obtain approval of its merger with t-mobile. i have concerns about how those proposed divestitures might impact my state. i wonder if you could comment on that issue, your perspective on it, and how you intend to deal with those issues as they come before you. >> i can take this one. thank you for the question. as a general matter, i would take it case by case, look at every transaction to determine whether or not a divestiture were in the public interest. to the extent that i believe it would harm consumers rather than benefit them, that is not something i would before. the very purpose of the divestiture is to prevent a competitive harm that would be created by the merger. it seems counterintuitive then that the fcc or the department of justice would insist on a

divestiture that would ultimately not be to the consumer's benefit. the fcc should be very careful about imposing conditions of that type. >> divestitures the traditional tools of antitrust in order to make sure that the transaction maintains competitive markets, but i think it is fair to first ask if that divestitures will harm consumers. i am familiar with the article you're talking about from "the wall street journal," and i think it makes some interesting points. >> i hope you'll continue to think about that as you deal with the issues on the commission. as i travel around my state, one of the reasons employers say they are not hiring people is because of economic uncertainty caused in some cases by federal regulatory actions. whether that is health care reform, regulations coming out of the epa, dog-frank, you can

go down the list. i am interested in knowing your thoughts on whether you think regulation is a contributing factor to high unemployment and how you would use your positions to promote the kind of economic certainty that i think businesses are looking for out there today. i think dealing with the world of uncertainty makes it very difficult for people to make investments and for our economy to create the kind of jobs necessary to get people back to work. >it is a fairly broad question, so feel free to approach it however you would like. i am interested in your overall perspective. >> the clear rules of the road are to inspire investment. investment creates economic growth. i would certainly make sure that i contributed clarity to any

regulatory policy. >> i agree with that completely. i think uncertainty deserves the parties in transaction, in the rulemaking proceedings, and ultimately consumers. if companies feel reluctant to invest, ultimately economic growth suffers and consumers suffer. i would also suggest in response to your second question that if i were to be confirmed, i would urge the commission to really review whatever proposed action if it was taking through the prism of job creation and economic growth. this is obviously very difficult time for many americans. the unemployment has been much higher than we would like to be for longer than it has ever been. tele-communications represents one sixth of the american economy. it is a dynamic area for the economy to the extent -- for the

economy. to the extent that the commission can create a regulatory framework that allows telecommuting patients -- tele-communications to be vibrant and continue to create jobs, that is something i would be for as a commissioner. >> i have an announcement to make, a couple of announcements to make, and actually, i have one more question. prerogative use my as chairman to go ahead and ask it. i know everyone wants to get out, and i think in some ways because of the largeness of this decision, and you have both been superb witnesses, that this has been inspiring. recordoing to keep the open until december 6th.

on the other hand, as for questions, i would like to be able to have all questions provided as quickly as possible, hopefully by tomorrow, questions that members and their staff may have wanted to ask. some came and left because they were too far down the list. we did it by order of appearance. some left, but they probably had questions, and we want you to have a chance to see those questions and i want them to have a chance to get those to us by tomorrow. i have always been -- this is a commerce committee, but it has taken on, in the last several

years, very much a consumer orientation. we spend a lot of time worrying about insurance companies and health care scanning and cramming, and all kinds of things we simply had not done before. i honestly, the media landscape is changing enormously -- obviously, the media landscape is changing enormously. this is especially true for children, which is what i want to ask you about. our children have been watching programming primarily over television. it is often interactive. there is television, social networking, multiple player games, and many parents have absolutely no idea how to even work a remote control. there is always the possibility that things can be controlled,

things can be cut off, but there is a greater probability that they will not be because parents will not be there or they will not understand. i have had many of these meetings around west virginia, and parents are deeply concerned about content. i think the diversity of media is very exciting, but it is very hard for parents. i personally believe there has been a substantial coarsening in the media that children watch. it has been dumbed down. i think that is true in news -- kids do not watch that as much -- but in programming in general. it is more obscene, more violent, more promiscuous, more whenever you want that is not good than it was before. i think that is bad. everybody else first amendment

so you cannot really get much done about it. on the other hand, you do have recourse of the federal communications commission, not to do all things, but to do some things. so i put before you this question. the legal landscape is very difficult, and i'm understand that, but so is the province that children watch and get depressed by coming get bullied by. i am not a big fan of facebook because i think it leaves children to expose themselves, thinking they're just making a comment to a friend, but then it is available to all of indonesia, all of china, all of the world, and then you get bullying. and you get picking on.

you get cyber suicide thoughts, and there are examples of this, children mortified by a system that their parents have no idea how to penetrate, and then they cannot do anything about it because they're caught up in their humiliation and they can do harm to themselves and to others. some, of course, practice to make sure they have a chance to do that. to do this to children makes me very angry. i think it should make all of america angry. first amendment or not. so my question to you is simply that i do recognize the legal constraints, that i cannot believe the two nominees of your distinction, one of them has two

children here -- >> they are back there watching tv. [laughter] can beinterested in what done to protect children and parents. >> senator, having recently joined the ranks of parents, i have firsthand concern about the images that my son sees, the words that he hears over any type of media, whether it is television, radio, frankly even video on smart foreign -- smartphone. i think it is important for the federal communications commission to do what it can to give parents the information about the technologies that are out there and the tools at their disposal to prevent children from viewing inappropriate content or hearing inappropriate words. as you pointed out, the legal landscape is a little uncertain.

the supreme court is going to consider a constitutional challenge to the entire framework in this area. depending on how the court rules, i will be legally bound to the statutes we can enforce. i would do that mindful of the concerns you have expressed. >> i remember extensive conversations -- and i apologize for the time here -- with chairman martin over saving private ryan. obviously, that was a wartime situation and there was a question of, if somebody said an obscenity, who could say it and who could not say it. his role was that if the soldier said if it was ok, but if a commentator on the situation said it it was not ok.

to that level, he at least was willing to be immersed himself. this is not the time or the cultural desire to face these issues, except that it is. that is exactly what a parent wants and that is exactly what children need. the courts will rule. i do not think you want to tell me that the fcc is so constrained you cannot think of anything that might possibly happen to alleviate this problem. >> i should start by saying that i appreciate that members have come in to update me about what my children are doing and what they are watching back there. keeping that aside, video programming is powerful stuff. at its best it can entertain and even educate. some of it is not so and

lightning and not so healthy. traditionally, the fcc has had authority to limit in decent and profane language and content, but the legal landscape, as my colleague mentioned, is changing. what is not changing is that this is very important. i think it is incumbent upon the fcc, and frankly all of us, to make sure that we both provide quality content, foster it, stimulated, the good stuff for kids, and that we also help parents be good parents by providing them with the tools to protect their children. >> that is a good answer. we will leave it at that. i am very serious about this and i worry about it greatly. i think that there are a lot of wonderful things to be