and allow providers to preserve the internet as a live block -- a level playing field it will facilitate and reduce the government in network management. the transparency and will not disclose information about subscribers or compromise the security of the network and it will protect sensitive data. it is also important to recognize that our choice of technologies for accessing the internet continues to expand at a dizzying pace. new mobile and satellite networks are getting faster every day and extraordinary devices like smart phones and data cards are making it easy to stay connected on the go. the beginnings of a trend are in the marketplace. each form of internet access has unique chemical characteristics and there are different roads to the same place. -- .

. ers reach it. i will ask my fellow commissioners at the fcc to try me in confirming this. how principles apply it depends on the rule making technology. on the rule making technology. as a practic matter, they can be fairly and properly implemented. as we talk of these complex questions for internet access, we will be focused on formulating policies that maximize innovation and investment, consumer trust, greater competition. -- consumer choice, greater competition. i will circulate to my fellow fcc commissioners proposed rules prepared by commission staff embody the principles i have discussed. this notice will provide the public with a detailed explanation of what we've proposed to do and why. equally important, the notice

will ask for feedback on the proposed rules on their applications, such as how to determine and work management practices -- how determined -- how to determine if network management practices are reasonable. while my goals are clear, to ensure that the internet remain a free and open platform that promotes innovation and investment and competition and user interest, our path to implementing them is not predetermined. i will ensure that will making process be fair and transparent and fast-paced and data driven. anyone will be able to participate in this process and i hope everyone will. we will hold a number of public workshops and use tools to facilitate participation. today we of launch -- today we have launched a web site to kick off discussion of issues i've talked about. we encourage everyone to visit the site and contradicted the process.

-- and contribute to the process. the fundamental goal of what i've outlined today is preserving the openness and freedom of the internet. we have an obligation to ensure that the internet is an enduring ended for economic growth and a foundation of democracy and the 21st century. this is not about government regulation of the internet. it is about fair rules of the road for companies that control access to the end. -- access to the internet. we will do as much as we need to do and no more to make sure that the internet remains an unfettered platform for competition and ingenuity an. we are seeing the bricks and cracks and merge, and they threaten to change the internet's fundamental

architecture of openness. it would limit the full and free expression the internet promises. this is about preserving and maintaining something profoundly successful and ensure and that it is not distorted or undermine. if we wait too long to preserve a free and open internet, it will be too late. some seek to invoke innovation as a reason to c-span.org -- in to not adopt open internet rules, but it is the best way to about -- to promote innovation and investment. an open internet will benefit both consumers and businesses. the principals -- the principles of the open internet are the best way to protect innovation in the networked by ensign of rising competition and power entrepreneurs and growing

economic plan to the benefit of all. we want the internet to continue flourishing as a platform for innovation and communication, with continued investment and increasing deployment of broadband to all americans. i believe my fellow commissioners share this purpose and i look forward to working collaborative with them in this endeavor. in closing, we are here because 40 years ago a bunch of researchers in a loud change the way computers in iraq, and as a result, changed the world -- a bunch of researchers in a laboratory change the way computers interact, and as a result, it changed the world. our work now is to preserve the brilliance of what they contributed to our country and the world. in the 21st center, the brush, the basement, and the dorm room remained places -- in the 21st century, the garage, basement and the dorm room can remain

we're joined by the policy director of free press, and regularly testifies before congress. prior to that, u.s. a staff member of representative barney standards and got his communications degree at the university of illinois. next is the ceo of skype, and he is also the co-founder

and ceo of an the other company. he started his career as a staffer for bill gradison. to my right, he worked for verizon communications and deals with broadband issues. and he was responsible for developing policy on energy and technology issues. he's been year -- six years working at verizon, data net architectures. is an engineer by trade, and holds a bachelor's degree. on my part right is darrell west, director of government

studies at the brookings institution. he was also a professor of public policy at brown university. he specializes in campaigns and elections, political advertising, mass media, public opinion, technology policy, an electronic government. we will start with a question to cash silberman. open policies are something that skype pushed for. what is your reaction to the news the -- the news today, and what does it mean for a company like skype. >> thank you for asked me to participating. i actually studied with that professor many years ago. this guard mike -- i started my career with bill bradley doing

health care policy. we're here today to talk about what we believe is an extremely welcome development and how communication policy in america for the first time in some time, being recognized as innovation policy in america. and in particular, we think that this is incredibly important as a step forward in recognizing the balanced approach to innovation, supporting innovation both for access providers so that people can get access to the internet, but also for application providers, people who make content or software. i. skype, a software provider. we make only software. you download skype and it helps you communicate with anyone

around the world for free or very cheap. we have 300,000 new users each day. we think that we have had an impact on the world from a team that was originally six people in northern europe. the principles that chairman's anticosti -- that the chairman has laid out will cover the american in some key ways. the first is the balanced approach between access and applications. what do i mean by that? for too long the focus has been on how do we make sure that access providers can continue to lever broadband access to more and more people -- to provide broadband access to more more people? but why would somebody want broadband access? the next generation of

televisions are going to be internet connected televisions. i don't need another 100 television stations. when my flat panel television is also the videos and -- video conference center of the home, and if you take any black vinyl blackskype software, you have made conference center. without both being supported, neither moves forward. take a look at the chip industry in the 1980's. intel could as said 487 -- 486, bad as the past is that you in may. less don't develop any more software because we reach the technical limitations. that is not what they said. do a lot of great applications came out on the software side

which helped push intel to develop the next level of chips. that's all the way that we have developed a wonderful new applications like facebook and twitter, that we could not have imagined two to three years ago that caused people to want to pay for better, faster, more reliable internet. and it is only when that cycle is allowed to thrive that we all succeed. the sickening won a talk about is wireless and wired lines. we know that there is been a lot of debate from the sec as to raise -- as to whether wireless should be included, and we are encouraged to see positive movement in that direction. let me be clear about our view. there is only one internet. >> as a quick follow-up to that, we're talking about applications.

can you talk little bit about the carrier and the cost that this might impose on carriers. a lot of the carriers say that net neutrality rules would decrease investment. you partner with carriers around the world. d.c. investment in networks when you partner with them and with or without open rules of the road? >>skype is a global company, as i said. what we see is that there are other places in the world who have much more open policies. we have a partnership with a operator called 3 in the u.k. that is been very successful. they have created an entire product line built around skype , with a phone call the skype

phone. other carriers said that that was crazy. you're going to cannibalize your own model. in fact, in a few months, what they're finding is that lots of people are switching to the 3 network in order to get this application. they are actually using the internet more, data services more as a result. 3 is actually earning higher revenue per customer with this skype products than with its non-skype products. that is what we expect happen as we get more open into the united states as well. i want to talk about this for a second. a potential distinction between wireless and wired lines. in the future and today, the internet is the internet. for many people, their first

experience is going to be the mobile internet. from the communications industry, there may be a tendency to see an evolution where you started with a hard- line fun and moved to a wireless phone around a house, and then this all funds that were big and bulky, and knows shrunk, and any added a camera to it. -- ending you had a camera to it. we do not see the world that way at all. we see a world where the terminal computer became a pc they got what i connected. -- that got wifi connected. in the exact same expectation, with pcs, you are going have a mobile phone. that is what the darrell west research is showing. we think that is where the world

is. go, where it is. i'm encouraged to see movement and the direction from the chairmen as well. >> what is verizon's reaction to the announcement today? verizon has experience at trial basis -- not on a trial basis, but you have a case study for dealing with spectrum -- the 700-mhz auction. can you talk about what lessons you learn from developing that spectrum? and if that has been difficult in terms of the best thing -- of the vesting? and it generally your reaction to the principles? >> thank you, and it is a pleasure to be here today and share thoughts on these issues. we absolutely sure the

chairman's goal of preserving the open internet. -- share the chairmen's goal of preserving the open internet 3 b.c. the value of the creativity that has been unleashed by the open internet -- the open internet. we'd see the value of the creativity that has been unleashed by the open internet and we want that to continue. we want broadband platforms for consumers that are also platforms for innovation, not only by ourselves, but other companies on this panel with me. we are clearly putting our money where our mouth is in building these networks and opening them up for innovation. as many of you know, we did bid on and acquire the sea block, which at the open this requirement. our business interests converged with the requirements that were placed there in a way that we were able to live with.

beginning even before we acquired the spectrum, we did what was going to do an open a wireless platform selected book could create new devices and applications -- so that people could create new devices and applications and bring them to our network. even within our platform, we have found that support a wide variety of applications developed by third parties, and we recently increase our efforts to reach out to the developer community to bring even more capabilities to these funds. -- to these telephones. we have a wide variety of small funds that allow people to don load whatever connections they want on their -- of cell phones that allow people to download whatever connection they want on their applications. set top boxes have the capability called widgets.

these are small applications available on your television. the first one for applications we have developed. we have added twitter and facebook as applications and we have more coming along the way. our goal is to create a widget bazaar that would allow third- party applications to be accessible to the platform with openness and innovation are keys to the success and what we believe consumers want. we heard about the internet and the genius behind the invention of the internet as an open platform. but the internet of the 40 years ago is not the same internet as today. it is not even the same internet as five years ago. the internet as a platform has also been involved in consistently -- has also been involved in consistently. the internet is a work in progress and we do not know what it is going to look like five years from now. but we do know it will need more capacity, need more security capabilities built into the network itself, and immune

system, and we believe that new capabilities will be created by innovation in the networke and those new capabilities and innovation should not be precluded by regulation. in talking about the proceeding at hand, i was very pleased to hear that the outcome was not predetermined. i think that the goal of making this fact- and data-driven is going to be critical, because we need to look at facts and see what are the problems that need to be fixed. what are the examples that require a dramatic change in the regulatory policy of dealing with the internet? a hands-off policy that has been in place since the internet was first commercialized in 1994. the chairmen only intends to do as much as needed and no more -- i am encouraged to hear that

the chairman intends to do as much as needed and nothing more. >> as far as the discrimination principals go -- principles go, can you talk about how nondiscrimination should or should not apply to wireless, in your mind? and what is reasonable management? is there anything else you think falls under the pocket of reasonable that work management? could you describe that a love it? -- could you describe that a little bit? >> sure. while this is very different from wireline broadband. there are spectrum constraints that obviously exists. but there are other issues as well. the mility factor is huge, the fact that the man can appear out of nowhere as users convert -- that demand can appear out of nowhere as users converge.

all this is going to be worked out through the process. i do not know if we can work out profound insights here. >> i'm going to turn over to baben. what does npr to for the future of broadband baristas to go far enough? -- for the future of broadband? does it go far enough? >> it remains to be seen. what we have heard today is a very common-sense approach to a reasonable framework for preserving the open internet. somebody asks me as i was coming in this morning, do you think the chairman is going to give up old speech? i said yes, of course he will. -- going to give a bold speech?

i said yes, of course you will but he will give a common sense of speed -- of course he will. he will give a common-sense speech. but in this town, common sense is bold. [laughter] he is boldly applying common sense to policy, which we have seen across the political spectrum is a risky business. however, i am obviously delighted to see this proceeding and going forward. it is a logical extension of policy decisions that have been made by republican and democratic chairmen alike. it is in keeping with the leadership and the views of the u.s. congress on this question. obviously, as a consumer representative, it is the elixir of consumer choice and of addition that we have long been waiting to see. -- consumer price and competition that we have long been waiting to see. i often about complicated policy issues -- often think about

complicated policy issues and at the end of the day i need to be able to explain this to my 19- year-old niece, a sophomore in college, because it is your generation that will be enjoying are suffering from the fruits of our policy here. the take away after giving joshe's comments is that i can tell you that my 19-year-old niece with like to have a skype from, and the policy laid out is the way to go with the marketplace. -- would like to have a skype phone, and the policy laid out is the way to go with the marketplace. it is encouraging to see all the cameras in the back of the room, how important this issue is, what a turning point we are at. and how we are going to go forward and settle this question once and for all and deliver an open internet for the future of the u.s. >> you have push for open

internet policies for some time. if you look of the wireless space, there are examples of a flourishing innovation. many believe there is proof positive that the market is competitive and there is a lot of innovation going on. >> to me, the iphone is a good example of investment at the edge. it has been wildly popular. the-has gotten in trouble when it has begun for closing -- the iphone has gotten in trouble when this began foreclosing certain applications. this is one of the cracks and fissures that the chairman pointed out in his speech. we want to fix it before things go in the wrong direction. to me, the idea that network neutrality rules bart anti- investment is totally backwards. net neutrality is a pro competitive, pro investment policy.

it is about encouraging investment at the edge to expand the number of applications and services that consumers want. we see in the weiland -- we see it in the wireless market and the wireless market. this is the cycle that has defined the entire history of the internet. it has been working beautifully. i think we will continue to see it work well and we will continue to see policies that promote more investment, and ever-revolving circle of the virtual cycle. >> you published a report on what consumers want. can you talk about how today's events may or may not move the needle of all on changing things for consumers? >> yesterday i discover that

this was going to be a bigot and when i was watching the nfl football game -- this was going to be a big event when i was watching the nfl football game and there was a news flash and one of the top stories highlighted was the fcc. when you hit the football audience, that is a big thing for america. consumers bought more applications at a cheaper cost -- want more applications at a cheaper cost in a way that is accessible to everyone. in a survey of cellular phone users, 80% said they wanted to choose their own applications. consumers like the flexibility and openness and freedom of that situation. they appreciate all the innovation that is taking place. we have almost 65 alpa -- we have almost 65,000 wireless applications that are available the day. -- available today. speaking as somebody who did his

to his attention on a manual typewriter, i can -- who did his dissertation on a manual typewriter, i can personally appreciate all this new technology grid in the survey, only 26% said they down loaded applications to their cell phones. when asked why, 37% said they were not interested, 16% cited the cost, others said that the application was not available on their device, and only 1% blamed the service provider restrictions. when i listen to the chairman's address this morning, i think there were two aspects that were interesting from the consumer standpoint. what is the problem of digital traffic jams -- one is the problem of digital traffic jams that he was alluding to. we will have rising lovell of downloaded music and video and games that will have an impact on network traffic.

in may and a decrease in traffic jams for some users. what i thought was interesting about the chairman's comments is that his proposal seems to allow network operators to employ "reasonable number to management techniques" -- "reasonable network management" techniques, as long as they go about exposing how to manage the traffic. i want more details on that, because it all comes down to implementation. you could understand from the consumer standpoint how that could be good or not so good. the other thing that i think is limning is this issue of premium services -- that i think is looming is this issue of premium services. one of the most complicated issues facing the sec involves pricing structures. under the new -- facing the f c c in false pricing structures but under the new rules, --

facing the f c c involves pricing structures. @@@@@@ again, i think that implementation is the $64,000 question from the consumer's standpoint. from a process standpoint, one of the things i like about the chairman's proposal, and i am talking about the study and how the digital sector is trying to use more technology to improve the system, the sec unveiled a new web site -- the sec unveiled a new web site, and i went to it to see what was there. what i like about the process that is going to went bald is that they are going to give have new opportunities for consumers,

businesses, applicants, people one side -- all sides of the issues to really give their input over the next couple of months on this issue. of months on this issue. openinternet.gov is already active. if you love the chairmean's proposals or hit the proposals, you can enter your comments. -- or hate the proposals, you can enter your comments. his speech was probably the inaugural webcast on that side. you can register to receive fcc updates. in a lot of respects, the process is as important as whatever and up coming out of the in process. -- ends up coming out of the end process. the chairman emphasized at data- driven approach. i think that is absolutely crucial. there are a lot of claims and counter-claims made in this area

across the political spectrum. we actually need to be making decisions that are informed by data. i think that if we do that, we will end up with the result that is beneficial to consumers and businesses. >> you called the $64,000 question on premium services. i would love to hear your reaction to what verizon's take is on a premium services, but that falls under the category of reasonable management -- whether that falls under the category of reasonable management services. >> it is unclear how the network is going to default and one new capabilities are going to be enabled. -- how the network is going to eat, and what's new capabilities are going to be enabled. -- how the network is going to evolve and what new capabilities are going to be enabled.

it is an important issue, and one that is going to require a lot of attention in this process. >> i think at this point we will open it up to questions in the audience. i am sure there is a lot out there. i think we have some people, two people with microphones will wander around and take questions. as we are waiting for the microphone -- here we go. >> my question is for david young. you were asked about how wireless was different, and the two examples you came up with was that wireless had shared capacity and the ability -- >> can you introduce yourself? >> i am the chief technologist at the new america foundation's open technology initiative.

. you know where your customer is, if you know whether there is a

certain capacity, and you manage that capacity said that as usage increases, if you ensure that there is enough capacity to handle peak demands. on the wireless site, you can have a crowd converged on a website that only supports asat number -- a certain number of users which suddenly has 100 times that number of users of competing for the same resources. that is what i mean by alternate environment. >> next question. >> again, a question for verizon. i recently watched a web cast in which you're chairman was present. one of the discussions was about the risks wireless

carriers face, ubiquitous openness would limit innovation and essentially reduce them to a downpipe that we have now in the long-distance sector. do you have concerns about being reduced to a dumb pipe and what can you do to avoid that outcome? >> that is the point i was trying to make when i talked about our platform is being -- our networks being a platform for innovation. there are things we can do to add value for the content and application providers by providing a storefront for them like the apple itunes store. we have applications store and we're trying to grow that store and make a more robust. we provide billing, collection,

payment back to the application provider that is a ball you added on top of distribution over the network. -- that is a value added on top of the distribution network. we're doing things to make sure we work with the developers to make their applications work well with our network and support capabilities we can provide that if they choose to take advantage of our a value. that does not prevent them from putting up their own applications on their own servers and making them available to smart phones or other connected devices. there is an opportunity for us to participate in the application value space and help drive network investment to the revenue that generates. >> what you think of his thoughts on wireless and a central management? >> if i could just respond to the dump site -- i hate that phrase.

access is one of the most important things we have. it is highly differentiated. verizon has invested a lot into having a high quality internet experience both over a wire lines and wireless. i think people recognize the value of that and they achieve a premium price for it. it is access to applications that are compelling that require better, more high-quality access. i think we will continue to see the ability to differentiate quality of access. we're usually supportive of that and our interests are aligned around that. where we get nervous is where would you go to these telecom conferences and the break up session is how we avoid being a dumb pipe and it's more how you leverage market power to use our applications so that we can capture more value.

we think access is not dumb at all. it's incredibly hard to do. i applaud the effort verizon has been making to deliver great access to people all across america. on the wireless side, all of us are aligned that there's a football game and there's a massive crowd, we need to make sure that somehow it is managed. the principles that sharon -- the principal german laid out brown how that happens are designed to make sure that happens in an effective way. >> i'm from search compliance .com. this is a question about mobile habitation and goes to apple and google and skype. google voice was not approved.

how should that work when most users are turning to broadband as a principal use. how should the applications be regulated to the opener not? -- to be open or not. >> the wireless market, i did not mention this, but one of the things that differentiates the wireless market is the highly competitive nature that we've got. we have four to seven competitors in the u.s. trying to maintain existing customers and win over new ones. when the iphone came out, for example, it sparked a lot of focus on the smart phone market and weighs four competitors like at&t to create compelling

product services and packages to compete as that. so there is the blackberry storm and other devices and smart phones put on the market and to the extent their applications that our support on these other smart phones not on the iphone, that's a reason to go with verizon and get the storm. i think the competitive market allows for the innovation occurs by one party to enter responses by others in a way that is very healthy and good for competition and consumers and good for the whole ecosystem. >> is that reflected in what you have found consumers want as far as switching carriers and going with [unintelligible] >> consumers want choice, competition, and low cost. that is a short summary.

the tricky thing in both the broadband and wireless areas is that there are contradictions across the goals. it's like public opinion on health care. we want a lot of things and some of them are hard to get simultaneously. the same thing is through -- the same thing is true here. they're interesting complexities in terms of how this stuff is going to play out. these changes lead to greater choice, greater competition, and lower prices. consumers are obviously going to love that, but the question is on the cost side of the equation. that's the reason the fcc has to be careful on how it and implement these principles so they can manage consumer goals in a variety of different ways. >> there is the debate over whether the wireless market is competitive or not will be a big topic going forward as this process goes through.

any thoughts on the competition in the wireless market and would you agree that it is a very competitive market? >> if your definition of composed of -- complete -- if your definition of competition is based on [inaudible] if your definition of competition is based on market power, there are both in the wireless market. you have to look at wireless comprehensively which the commission is doing and evaluate the competition not by counting the number of available providers, but analyzing the market structure and looking with the outcomes are and what consumers are getting in terms of price reduction and choices and impediments to competition and innovation. in all of these cases, to get back to the original question, it is a mistake to evaluate policy against every new

hypothetical example that appears in the market. step back and evaluate the entire market and start from the position of what do you want? what is the goal? our goal is to produce maximum consumer choice and investment. then we will evaluate if we have a market failure and it's caused by the application of market power? if so, what is the proper tool to alleviate the pressure and to alleviate the pressure and i think that will apply equally well based on principles that are applied to the entire ecosystem. >> i think the question was originally to you. >> we love competition and we have been facing competition since the day that we launched. google voice has some aspects that are competitive to us and some innovations that are

different. we specifically welcome that. the principle that anyone can get any application that they want from many capable devises an important one that we would encourage all the players in the market to allow for. there many positive -- enjoyed as a -- android as many positive advantages, but we want to make sure that it does not advantage -- give advantage to google applications over others. >> next question? we have one right here. >> i guess i will ask a question for people over 50. i am from here. i am interested in product in terms of, studying demographics. we get so many applications that

are not being used by people over a certain age. there are people that do not want to take a picture with my thumb, i do not want to use gaming on my internet. is there some type of move toward products that are used by people on a more frequent basis and under a certain age level? and cost, because you're being forced to pay for all of the applications that you are not -- that you are not using. >> i don't know if i'm the only person over 50 on this panel, but i will address your question. [laughter] i hate to admit that. in our study of consumer attitudes, we looked different demographic breakdowns, and come, ethnicity, and age -- not surprisingly there are huge differences across the demographic categories in what people want. just to give you one example -- the question of how you actually downloaded applications to your cell phone, very few people over the age of 65, only 7% said they

had. compared to 40% of young people who did that. when you look at the rising generation of young people, they are using the internet and wireless applications in all sorts of new and interesting ways. the love games, for example. -- they love games, for example. when the fcc thinks about its policies, they have to think about how policy decisions may play out differently across different demographic groups. we asked for, in terms of ethnicity for example, if you add application to your cellphone, what is the top application that you want? we found african-americans say they wanted to add music. hispanics valued social networking. asian-americans' a value of local directories for restaurants and businesses. when you disaggregate the consumer market, there's a lot of disparity between age, and

come, and ethnicity. the policy decisions have to reflect some of that variety out there. >> if i could echo that, a lot of the policy debate has been driven by people who are more technically sophisticated and want complete control over everything. they want to choose the operating system and write their own applications. they want to do everything themselves and that is great for the technically elite. those options are available for them. there's a wide variety of consumers out there that want simplicity and one things just to work, who are happy to let somebody else in the great experience for them and deliver it reliably. both of these models have to be allowed to flourish. you cannot have one that becomes the extreme and forces every consumer into a model that may not be what they want or what they're capable of handling. >> i would just add that

openness spurs animation and innovation helps everyone. we will see application great for the use and applications that are great for their populations. the average skype user is in their late thirties and our demographics are very much reflective of the population as a whole. grandparents are huge because of the opportunity to make phone calls on video with their grandkids. it is another first things to see something useful on the internet. [unintelligible] >> i would like at a little bit to that -- there's nothing mutually exclusive about an open network that delivers different things to different people. i would say they go hand in hand. what's the most interesting thing is how unpredictable the internet has been. the applications we take for granted as the most popular did not exist a few years ago. two or three years before that and before that and before that.

there is no way to predict what is going to be next and if anything we should expect the unexpected. in my mind, it's critical to have an open network because if he began to try to predict and optimize your network by changing the architecture or changing the way in which data flows to the network, optimized for a particular application because you want to target a particular demographic or market, that's a dangerous path because you can quickly find your path has ended and you have created a market designed to serve as something that is happening today when we know the beauty of the internet is it breaks and then something else emerges and that becomes the most popular thing. we do not want to create incentives to slow that process of creative destruction and innovation. >> kenya -- you said you're

hopeful the fcc would work with you, but if they go ahead with the exact proposal that was suggested which would come as i understand it, require you to offer other phone services, other cell phones, other services on global line services, what would your reaction be? do you think the fcc can do it? what happens if we go ahead and try to do it? >> the way i would respond to that is the way i started. we believe our customers want an open experience and our customers want choices. that is why we give them the choices they want and why we

allow third-party developers to make applications developed -- to make applications available and give customers a complete access to the internet and allow them to do what they want. i do not think there is any issue there. the real issue is what the chairman announced today is the beginning of a process. the process is a rule making process. the outcome will be known by year from now or eight months from now, whatever the length of time for the process to run its course. it is hard to see exactly where that's going to end, but the concern is these are regulations that would apply to the internet for the very first time. the fcc has studiously avoided regulating isp's in any way since the inception of the internet and this would be the first exception to apply to the internet. i think there is a concern there could be unintended consequences of doing that.

>> what would be the concern, going further of that question, of having, for example, a skype application on your 4g not work request for >> i have -- on your 4g network? >> i have no problems with that. the fact is this is going to be eight dated driven process is very important to me because i don't understand what problem is we're trying to solve. i don't understand what the barriers to innovation are on the internet sites that need to be fixed by regulating isp's for the first time. that's what i want to see -- what is the problem we're trying to solve? what is the data that supports the need for addressing it in a way that could be damaging? >> you seem to think there is definitely a way -- definitely a

problem to solve. >> i would like to give credit where credit is due to verizon. they won the auction that the open as principals on that. they allow voip over their network and they started the odi innovation. that's not universally true. i'm telling you right now that skype is blocked on a lot of that works in the united states and other markets abroad. why should you care? it means that your isp has decided that some of the zeros and ones you are sending and others are not. -- some of the zeros and ones you're sending are fine and some are not. do they like the business model or the political content?

we see it as a dangerous prospect to have your isp decide which pieces of data you are and are not allowed to sen. that is the fundamental principle being discussed today. >> the fcc has already taken action to stop blocking convoys over ip -- stop blocking voice over ip service. >> we have been working closely with the sec and we have been seeing action. skype and other applications, we saw what happened with google voice. plenty of applications are being brought today and we see the attention of the fcc now to come and look into this and see why that should be and what the rationale is for that. >> i would like to do something

bold and put some facts on the table. first it is true the fcc did enforce an issue where a voice application was blocked, but that was using authority that was immediately repealed in 2005. second, this notion that the event -- that the endeavor that has no in it -- has no regulation -- spam is regulated, interconnection rules are regulated, prices are regulated, there is a proposal to put universal service under broadband and that's a massive regulatory system. the internet is becoming and the structure and will inevitably have a regulatory structure around it. we're not deciding whether it will have a regulus -- whether it will have a regulatory structure are not, the question is how will look and whose interest will serve? >this is about establishing on

the front and a marketplace with a set of principles upon which we expect the market to develop and produce outcomes which our openness, and the nation, and consumer choice. -- openness, innovation, and consumer choice. to establish policy goals like what happened in radio and television. now it is happening on the internet. this is not something we should be frightened of, it is something we should expect an embrace and do it right. what we heard today from the chairman is the beginning of the process. it is music to my ears. >> what is a concern of regulating the internet? >> the concern is that it will stifle innovation, an investment, and growth. those with concerns that led the clinton administration to take a very deliberate, proactive policy of non-regulation of the internet when the internet was first commercialized.

basically to not subject to internet service providers and the internet to common carrier regulation. if i had been designed for a monopoly telecom environment -- that was the policy of the united states that was adopted within the u.s. and it is a policy that was proactively promoted by the united states outside the country to basically not regulate the internet. i think it has been wildly successful. with all due respect, i do think the internet has been very successful. i have heard we need to take this step to encourage investment at the edge, and i have not yet seen a demonstrated problem in generating investment at the edge. at the edge. perhaps that is something that will come out of this process as well.

but to change the policy of the united states to not regulate the internet is a big change. >> this is regulated in order to create more openness, that is really important. that is what we're talking about today. we do not have a perfect market in terms of access. people do not have billions of dollars to create a new network. the first question that venture- capital as well as, how will the carriers feel about this? the carrier's control the handsets than that controls what applications you can load. if you have an application to a carias' -- a carrier models, you will have a lot of questions in your funding process. that iat