[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



 
                   PROMOTING INNOVATION, COMPETITION
                          AND ECONOMIC GROWTH:
                 PRINCIPLES FOR EFFECTIVE DOMESTIC AND
                  INTERNATIONAL STANDARDS DEVELOPMENT

=======================================================================

                                HEARING

                               BEFORE THE

               SUBCOMMITTEE ON TECHNOLOGY AND INNOVATION

              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                      WEDNESDAY, FEBRUARY 29, 2012

                               __________

                           Serial No. 112-63

                               __________

 Printed for the use of the Committee on Science, Space, and Technology


       Available via the World Wide Web: http://science.house.gov



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              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY

                    HON. RALPH M. HALL, Texas, Chair
F. JAMES SENSENBRENNER, JR.,         EDDIE BERNICE JOHNSON, Texas
    Wisconsin                        JERRY F. COSTELLO, Illinois
LAMAR S. SMITH, Texas                LYNN C. WOOLSEY, California
DANA ROHRABACHER, California         ZOE LOFGREN, California
ROSCOE G. BARTLETT, Maryland         BRAD MILLER, North Carolina
FRANK D. LUCAS, Oklahoma             DANIEL LIPINSKI, Illinois
JUDY BIGGERT, Illinois               DONNA F. EDWARDS, Maryland
W. TODD AKIN, Missouri               MARCIA L. FUDGE, Ohio
RANDY NEUGEBAUER, Texas              BEN R. LUJAN, New Mexico
MICHAEL T. McCAUL, Texas             PAUL D. TONKO, New York
PAUL C. BROUN, Georgia               JERRY McNERNEY, California
SANDY ADAMS, Florida                 JOHN P. SARBANES, Maryland
BENJAMIN QUAYLE, Arizona             TERRI A. SEWELL, Alabama
CHARLES J. ``CHUCK'' FLEISCHMANN,    FREDERICA S. WILSON, Florida
    Tennessee                        HANSEN CLARKE, Michigan
E. SCOTT RIGELL, Virginia            SUZANNE BONAMICI, Oregon
STEVEN M. PALAZZO, Mississippi       VACANCY
MO BROOKS, Alabama
ANDY HARRIS, Maryland
RANDY HULTGREN, Illinois
CHIP CRAVAACK, Minnesota
LARRY BUCSHON, Indiana
DAN BENISHEK, Michigan
VACANCY
                                 ------                                

               Subcommittee on Technology and Innovation

                  HON. BENJAMIN QUAYLE, Arizona, Chair
LAMAR S. SMITH, Texas                DONNA F. EDWARDS, Maryland
JUDY BIGGERT, Illinois               JOHN P. SARBANES, Maryland
RANDY NEUGEBAUER, Texas              FREDERICA S. WILSON, Florida
MICHAEL T. McCAUL, Texas             DANIEL LIPINSKI, Illinois
CHARLES J. ``CHUCK'' FLEISCHMANN,    BEN R. LUJAN, New Mexico
    Tennessee                        VACANCY
E. SCOTT RIGELL, Virginia            VACANCY  
RANDY HULTGREN, Illinois             EDDIE BERNICE JOHNSON, Texas
CHIP CRAVAACK, Minnesota
RALPH M. HALL, Texas


                            C O N T E N T S

                      Wednesday, February 29, 2012

                                                                   Page
Witness List.....................................................     2

Hearing Charter..................................................     3

                           Opening Statements

Statement by Representative Benjamin Quayle, Chairman, 
  Subcommittee on Technology and Innovation, Committee on 
  Science, Space, and Technology, U.S. House of Representatives..     7
    Written Statement............................................     8

Statement by Representative Donna F. Edwards, Ranking Minority 
  Member, Subcommittee on Technology and Innovation, Committee on 
  Science, Space, and Technology, U.S. House of Representatives..      
    Written Statement............................................     9

                               Witnesses:

Ms. Mary H. Saunders, Director, Standards Coordination Office, 
  National Institute of Standards and Technology
    Oral Statement...............................................    10
    Written Statement............................................    13

Mr. S. Joe Bhatia, President and CEO, American National Standards 
  Institute
    Oral Statement...............................................    24
    Written Statement............................................    26

Mr. Philip Wennblom, Director of Standards, Intel Corporation
    Oral Statement...............................................    41
    Written Statement............................................    43

Mr. Mark Grimaldi, Owner, Equinox Chemicals
    Oral Statement...............................................    47
    Written Statement............................................    49

Mr. James Seay, President, Premier Rides
    Oral Statement...............................................    53
    Written Statement............................................    55

Discussion                                                           68

             Appendix 1: Answers to Post-Hearing Questions

Mary H. Saunders, Director, Standards Coordination Office, 
  National Institute of Standards and Technology.................    86

S. Joe Bhatia, President and CEO, American National Standards 
  Institute......................................................    90

Philip Wennblom, Director of Standards, Intel Corporation........    98

Mark Grimaldi, Owner, Equinox Chemicals..........................   101

James Seay, President, Premier Rides.............................   104


                   PROMOTING INNOVATION, COMPETITION
                          AND ECONOMIC GROWTH:
                 PRINCIPLES FOR EFFECTIVE DOMESTIC AND
                  INTERNATIONAL STANDARDS DEVELOPMENT

                              ----------                              


                      WEDNESDAY, FEBRUARY 29, 2012

                  House of Representatives,
         Subcommittee on Technology and Innovation,
               Committee on Science, Space, and Technology,
                                                    Washington, DC.

    The Subcommittee met, pursuant to call, at 10:10 a.m., in 
Room 2318 of the Rayburn House Office Building, Hon. Benjamin 
Quayle [Chairman of the Subcommittee] presiding.

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    Chairman Quayle. The Subcommittee on Technology and 
Innovation will come to order.
    Good morning. We have been informed that the Ranking 
Member, Ms. Edwards, is on her way and wanted us to be started 
so we can be prompt.
    I want to welcome everybody to today's hearing, entitled 
``Promoting Innovation, Competitive and Economic Growth: 
Principles for Effective Domestic and International Standards 
Development.'' In front of you are packets containing the 
written testimony, biographies, and Truth in Testimony 
disclosures for today's witnesses. I am now going to recognize 
myself for five minutes for an opening statement.
    Today, we have the Federal Government--sorry. I would like 
to welcome everybody to today's hearing, which is being held to 
examine the principles of effective standards development, the 
process by which the Federal Government, industry, and other 
stakeholders promote those principles internationally, and the 
ways some of our trading partners use standards as technical 
barriers to trade.
    Standards play a critical role in both the domestic and 
international economies. Standards provide certainty for both 
producers and consumers, enabling technologies to emerge and 
markets to develop. While standards are pervasive throughout 
the economy, their role in the marketplace is not widely 
appreciated. Standards enable cell phones from different 
carriers to communicate with each other. They allow 
microprocessors to operate in computers made by different 
manufacturers, and standards ensure that electrical appliances 
can be used throughout the United States.
    Along with providing market certainty to producers and 
consumers, the process by which standards are developed is also 
crucial to competitiveness and innovation. In the United 
States, standards development has historically followed a 
market-driven, voluntary consensus approach. This system has 
proven to be effective because it allows relevant stakeholders, 
including small and medium-sized enterprises, to contribute in 
the development process, ensuring the final standards have 
broad market relevance. As a result, our standards development 
process has promoted innovation and competition.
    However, different industries have unique needs for 
standards. Whereas mature industries require standards to 
provide product specifications to producers, emerging 
technology industries may want to avoid standardizing at an 
early stage, as this could stifle innovation and the 
development of potentially superior technology. Timing, 
therefore, is a critical issue. It is also important that 
standards remain dynamic, allowing opportunities for 
incorporation of new technologies.
    These principles have proven to be effective in promoting 
innovation in standards development processes. However, they 
have not been universally adopted. Many countries have taken a 
top-down approach to standards development. In some instances, 
trading partners have mandated standards as a means of 
protecting their domestic industries. In other cases, countries 
have implemented standards without adequate notification 
periods. This can be especially burdensome for small- and 
medium-sized enterprises, which do not have the abundant 
resources available to comply with changing rules. Other 
countries require a local presence or partner to participate in 
their standards development processes. In each case, these 
approaches to standards development can inhibit competition and 
innovation and can hurt U.S. producers seeking to export their 
products.
    Today, we will be looking at the principles of effective 
standards development processes, and will seek to understand 
the ways in which the Federal Government and stakeholders 
promote these principles abroad. We will also analyze some of 
the ways that standards and conformance assessment can be used 
by trading partners as technical barriers to trade. Finally, we 
will seek to understand the ways in which the Federal 
Government, industry, and other stakeholders can act to address 
instances where standards are used as technical barriers to 
trade.
    We have an excellent panel of government, industry, and 
stakeholder witnesses who will share their insights on these 
topics, and I would like to extend my appreciation to each of 
our witnesses for taking the time and effort to appear before 
us today, and we look forward to your testimony.
    [The prepared statement of Mr. Quayle follows:]

            Prepared Statement of Benjamin Quayle, Chairman,
               Subcommittee on Technology and Innovation,
              Committee on Science, Space, and Technology,

    Good morning. I'd like to welcome everyone to today's hearing, 
which is being held to examine the principles of effective standards 
development; the process by which the Federal Government, industry and 
other stakeholders promote those principles internationally; and the 
ways some of our trading partners use standards as technical barriers 
to trade.
    Standards play a critical role in both the domestic and 
international economies. Standards provide certainty for both producers 
and consumers, enabling technologies to emerge and markets to develop. 
While standards are pervasive throughout the economy, their role in the 
marketplace is not widely appreciated. Standards enable cell phones 
from different carriers to communicate with each other. They allow 
microprocessors to operate in computers made by different 
manufacturers. And, standards ensure that electrical appliances can be 
used throughout the United States.
    Along with providing market certainty to producers and consumers, 
the process by which standards are developed is also crucial to 
competitiveness and innovation.
    In the United States, standards development has historically 
followed a market-driven, voluntary consensus approach. This system has 
proven to be effective because it allows relevant stakeholders, 
including small and medium-sized enterprises, to contribute in the 
development process, ensuring the final standards have broad market 
relevance. As a result, our standards development process has promoted 
innovation and competition.
    However, different industries have unique needs for standards. 
Whereas mature industries require standards to provide product 
specifications to producers, emerging technology industries may want to 
avoid standardizing at an early stage, as this could stifle innovation 
and the development of potentially superior technology. Timing, 
therefore, is a critical issue. It is also important that standards 
remain dynamic, allowing opportunities for incorporation of new 
technologies.
    These principles have proven to be effective in promoting 
innovation in standards development processes. However, they have not 
been universally adopted.
    Many countries have taken a top-down approach to standards 
development. In some instances, trading partners have mandated 
standards as a means of protecting their domestic industries. In other 
cases, countries have implemented standards without adequate 
notification periods. This can be especially burdensome for small- and 
medium-sized enterprises, which do not have abundant resources 
available to comply with changing rules. Other countries require a 
local presence or partner to participate in their standards development 
processes. In each case, these approaches to standards development can 
inhibit competition and innovation, and can hurt U.S. producers seeking 
to export their products.
    Today, we will be looking at the principles of effective standards 
development processes and will seek to understand the ways in which the 
Federal Government and stakeholders promote these principles abroad. We 
will also analyze some of the ways that standards and conformance 
assessment can be used by trading partners as technical barriers to 
trade. Finally, we will seek to understand the ways in which the 
Federal Government, industry, and other stakeholders can act to address 
instances where standards are used as technical barriers to trade.
    We have an excellent panel of government, industry, and stakeholder 
witnesses who will share their insights on these topics with us. I'd 
like to extend my appreciation to each of our witnesses for taking the 
time and effort to appear before us today. We look forward to your 
testimony.

    [The prepared statement of Ms. Edwards follows:]

  Prepared Statement of Ms. Donna F. Edwards, Ranking Minority Member,
               Subcommittee on Technology and Innovation

    Thank you, Chairman Quayle. And thank you for calling this 
important hearing on standards development and the role of standards in 
global competition.
    Although issues surrounding standards do not often get attention in 
Congress, they have an incredibly significant impact on the ability of 
U.S. companies to innovate and compete in the global market and have a 
much greater bearing on future economic growth than most would imagine. 
I'm pleased that we're taking the time to focus on these issues and 
thank the witnesses for their willingness to join us today.
    As the global marketplace has grown over the last 30 years, we have 
learned how important it is that the playing field is level and that 
all of the players on that field are playing by the same rules. 
Standards can open up new or expanding markets to a U.S. company. 
However, standards can also serve as a barrier to trade, keeping U.S. 
companies out and sending profits elsewhere. When things go awry in the 
international standards realm--when someone tries to manipulate the 
standards system or rig it to their own ends--it really matters for 
U.S. companies and the U.S. economy.
    As we continue to look for opportunities to spur economic growth in 
this country and keep the U.S. competitive in the global marketplace, 
it is critical that we preserve the ability of our companies--big and 
small alike--to export their products to markets throughout the world. 
To make that happen, we need to do what we can to ensure that the 
standards that are being put in place worldwide do not unfairly 
disadvantage our home-grown businesses.
    We have a very successful standards development system in this 
country. It has been, and continues to be, the envy of the world. Our 
system is characterized by unparalleled transparency, openness, and 
engagement. As a result, we produce incredibly high quality standards.
    Unfortunately, not everyone does it our way. And the task of 
promoting our standards internationally or harmonizing our standards 
with those developed elsewhere, while also weeding out those that leave 
something to be desired or disadvantage our companies, is certainly not 
an easy one.
    Last Congress, this Committee recognized the importance of 
international standardization to our economy and sought to determine if 
there were ways that the Federal Government could more effectively help 
the private sector in its standards harmonization efforts. We explored 
ways for the Federal Government to get its own house in order, so that 
our agencies are coordinating and not unintentionally getting in each 
others' way. We wondered if there was value to the Federal Government 
stepping up and helping industry and the standards community by serving 
as a watchdog, looking out for situations where the international 
standards development process might be taking a turn for the worse. And 
we wanted to ensure that the Federal Government was prepared to offer 
assistance to our private sector standards community, if such 
assistance was needed and would prove helpful.
    As you may know, these efforts culminated in a provision in the 
House version of the America COMPETES Reauthorization Act of 2010. 
Although this language did not make it into the final version, these 
are issues that I remain interested in. I look forward to hearing from 
the witnesses today about what, if anything, can be done to make the 
Federal Government a better partner to industry and the standards 
development community.
    I am also interested in hearing from the witnesses about the 
importance of the U.S. remaining on the leading edge of standardization 
in new or emerging areas of technology. I am pleased that the Federal 
Government is working closely with the private sector and the standards 
development community to ensure that the U.S. is leading the world on 
standards development for smart grid, nanotechnology, health 
information technology, cloud computing, and public safety 
communications. We should continue to join efforts to identify new 
areas of technology with significant transformative potential and come 
together as quickly as possible to develop the needed standards and 
promote those standards internationally.
    Mr. Chairman, thank you again for holding this hearing on this 
important topic. I yield back the balance of my time.

    Chairman Quayle. We will wait for the gentlelady, but 
before we do it, we are going to introduce our witnesses and 
then we will proceed to hear from each of them in order.
    Our first witness is Ms. Mary Saunders, Director of the 
Standards Coordination Office at the National Institute of 
Standards and Technology. Ms. Saunders serves as the 
representative of NIST within the standards community and leads 
the agency's interactions with foreign governments.
    Next, we will hear from Mr. Joe Bhatia, President and CEO 
of the American National Standards Institute. Mr. Bhatia 
represents American interests in international standards 
through his involvement with a variety of international 
standard organizations.
    Our third witness is Mr. Philip Wennblom, Director of 
Standards at Intel Corporation. Mr. Wennblom leads Intel's 
worldwide strategic standards policy.
    Our fourth witness is Mr. Mark Grimaldi, owner of Equinox 
Chemicals. As the owner of a business with significant export 
growth, Mr. Grimaldi is experienced in how international 
standards affect American companies in the global marketplace.
    Our final witness is Mr. James Seay, President of Premier 
Rides. In addition to his standards experience with Premier 
Rides, Mr. Seay chairs the ASTM F24 Global Committee on Ride 
Safety Standards.
    Thanks again to our witnesses for being here this morning. 
As our witnesses should know, spoken testimony is limited to 
five minutes each. After all witnesses have spoken, Members of 
the Committee will have five minutes each to ask questions.
    I now recognize our first witness, Ms. Mary Saunders, for 
her five minutes.

          STATEMENT OF MS. MARY H. SAUNDERS, DIRECTOR,

                 STANDARDS COORDINATION OFFICE,

         NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY

    Ms. Saunders. Chairman Quayle and Members of the 
Subcommittee, thank you for this opportunity to discuss how 
standards can promote innovation, competition, and economic 
growth. I will highlight recent standards policy developments 
in the federal space as well as outlining how NIST promotes 
voluntary consensus standards internationally. More detailed 
information is available in my written testimony submitted as 
part of the hearing record.
    NIST has a unique role with respect to standards in the 
federal enterprise. This role is defined by statute, and its 
effectiveness is borne out by a track record of technical 
excellence. Our strong ties to industry and the standards 
community have enabled us to tackle various standards-related 
challenges and deliver timely solutions. Companies both large 
and small engage with NIST directly through workshops and 
outreach activities as well as indirectly in technical 
committees in more than 100 standards organizations in which we 
participate.
    Last year, NIST Director Patrick Gallagher testified before 
this committee about the need for more effective federal 
engagement in standards development, use, and promotion. This 
is now being facilitated by a Subcommittee on Standards chaired 
by Dr. Gallagher established within the National Science and 
Technology Council's Committee on Technology. Last October, 
following extensive public consultations, the Subcommittee 
issued a report with recommendations on how the effectiveness 
of Federal Government engagement in standards to address 
national priorities can be enhanced. These recommendations have 
been incorporated into a recent White House memorandum for 
agencies.
    There are many types of standards organizations. One size 
certainly does not fit all, and identifying underlying 
principles that characterize effective standardization 
processes is important for agency decision making. A limited 
set of foundational attributes for standardization activities 
is called out in OMB Circular A-119 focusing on voluntary 
consensus standards activities. The Subcommittee on Standards 
also identified the following as being important to maximize 
the impact of the full range of standardization activities on 
enabling innovation and fostering competition, and these are 
transparency, open participation, flexibility, effectiveness 
and relevance, coherence international acceptance, and net 
benefit.
    NIST has embraced these principles in our work coordinating 
standards development for the realization of interoperable 
smart grid, for cloud computing, and other areas. In each of 
these cases, it was determined either by legislative or policy 
directive that there was a need to ensure that relevant 
standards are available on a timely basis to support a rapid, 
coherent response to a national priority. NIST leadership in 
facilitating private-sector-led standards development efforts 
engaging a broad range of stakeholders is contributing to 
ensuring that key public policy goals are met in a timely 
manner with solutions that are accepted globally.
    The U.S. Government and NIST in its international 
interactions has long advocated that companies should adopt and 
use international standards where available and that the 
opportunity to participate in standardization activities should 
be made available to all interested stakeholders. NIST has also 
demonstrated by example through our own participation in a 
range of international standardization activities. We have 
worked effectively to move technical content from NIST special 
publications in the cybersecurity and cloud arenas into 
international standards venues to facilitate global acceptance.
    With a reduction in tariffs globally, the use of standards 
and conformity assessment procedures as technical barriers of 
trade has become an issue of increasing concern. NIST supports 
U.S. industry and government agencies in addressing technical 
barriers to trade by providing various reference tools to 
inform U.S. stakeholders of potential TBT-related issues and to 
assist them in addressing them. We engage in regular 
information exchanges related to technical standards and 
conformity assessment issues with important trading partners 
such as the European Union, Japan, China and Brazil. These 
exchanges enable us to gather firsthand information about 
standards and related developments that can impact U.S. 
companies exporting to those countries. In instances where we 
have better approaches, we have been able to share our 
experiences about those approaches, why these have worked and 
lessons learned.
    In closing, Chairman Quayle, Ranking Member Edwards and 
members of the Subcommittee, NIST is actively working with both 
private sector partners and other agencies to leverage new 
opportunities to help our industry maintain their leadership 
role in the standards arena. We look forward to working with 
you closely, and I will be glad to answer any questions that 
you may have.
    [The prepared statement of Ms. Saunders follows:]

               Prepared Statement of Ms. Mary H. Saunders

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    Chairman Quayle. Thank you, Ms. Saunders.
    I now recognize Mr. Bhatia for five minutes.

                STATEMENT OF MR. S. JOE BHATIA,

                       PRESIDENT AND CEO,

             AMERICAN NATIONAL STANDARDS INSTITUTE

    Mr. Bhatia. Thank you, Chairman Quayle, Ranking Member 
Edwards. Good morning, ladies and gentlemen. My name is Mr. 
Bhatia. Thank you for the opportunity to testify.
    I want to start out by saying that standards and conformity 
assessment activities are inseparably linked really to all 
aspects and all facets of our national economy. They influence 
it, and 80 percent of all global merchandise traded is impacted 
by them. That amounts to about $13 trillion every year. Of 
course, it will go up later.
    The United States has the most flexible and democratic 
standardization system in the world. Our system thrives on 
active engagement of all stakeholders, giving us a competitive 
advantage over those countries that follow a top-down approach. 
It is the market itself, that through open, transparent, and 
consensus-based processes determines when a standard should be 
first developed.
    The public-private partnership that we have talked about is 
a key part of what makes our system successful, and ANSI is 
committed to our role as a neutral convener and as a forum 
where we get all the constituencies together--industry, 
government agencies, consumers, academia, and all the other 
people that are affected by the documents. We work to leverage 
the power of standardization and by making targeted activities 
successful in first developing the standards and then deploying 
them in the future.
    I have heard from many industry leaders over many years 
that they have come together in the standardization process to 
achieve three key goals: one, to shape the specifications that 
drive their products' acceptance; two, they capitalize on the 
efficiency and cost-saving measures that collaborative 
ingenuity provides; and they finally are able to influence 
international requirements and standards that allow our 
products to be accepted across borders and take advantage of 
the growing global economy.
    As the U.S. member body to ISO and IEC, ANSI works very 
hard to ensure that the U.S. interests are considered from all 
facets of life. It is crucial that we approach ISO and IEC with 
a clear and strong national position both from the technical 
point of view and also from a policy point of view, and we then 
leverage our international relationships, be it from the 
Germans or with the French as the traditional partners, or with 
the new ones like Brazilians or the Indians. We leverage that 
to achieve support for our positions. We have several examples 
of success. The most critical ones that come to mind are 
biotechnology and the standardization efforts in the financial 
services area.
    Now, a big problem we face in the global market is that too 
often standards, and compliance to standards, are used as 
barriers by other nations. Emerging markets such as China and 
India are countries that are developing thousands of standards 
and specifications every year. A lot of them are developed with 
the personal preferences of those markets and those 
technologies in mind. You can imagine that these are favoring 
those solutions that perhaps are foreign to us, and you can 
imagine the difficulty that creates for the U.S. businesses 
looking to get into these markets; one of our key priorities is 
to help U.S. companies, large and small, negotiate this complex 
landscape and remove any barriers in the way of unobstructed 
trade.
    One key example I want to mention is a U.S. SME, undergoing 
an $8.5 million contract, was stopped at the border because of 
a certification requirement, a technical requirement, and we 
worked then with the China certification and accreditation 
administration, which eventually agreed to speak on behalf of 
the company; then we worked with the U.S. Government to raise 
the issue with the Chinese officials as a matter of WTO 
obligations of the Chinese, and after a short time, the SME was 
successful in gaining acceptance to that market.
    Mostly, though, when it comes to global trade, transparent 
and consensus-based international standards are really not an 
obstacle. They are actually a part of the solution. If they are 
used effectively, if they are developed properly, they have the 
capacity to remove all barriers to trade and fuel business 
growth for large and small companies.
    Now, large companies have the capacity and resources to 
develop global strategies to overcome barriers to trade. The 
SMEs often lack such in-house capabilities. ANSI has worked 
very closely with NIST and with others to develop things like 
standards portals, which provide valuable free information to 
small and large companies, both to be able to access markets 
like China, like Japan, like Korea, like India, and work on 
others at the same time. The standards portals are a 
beneficial, free resource to all comers, especially to the 
SMEs.
    And finally, in conclusion, I want to thank you, Mr. 
Chairman, for calling this hearing. We hear a lot about 
problems that our exports have in breaking into emerging 
markets, and we simply cannot afford to let them miss out on 
these good opportunities, and I think in a partnership that 
spans the public sector and the private sector, standards and 
conformance can really be the strategic tools to help fuel the 
U.S. innovation, our competitiveness, and our economic growth, 
and we stand ready to help anyone. Thank you.
    [The prepared statement of Mr. Bhatia follows:]

                Prepared Statement of Mr. S. Joe Bhatia

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    Chairman Quayle. Thank you, Mr. Bhatia.
    We now recognize Mr. Wennblom for five minutes.

               STATEMENT OF MR. PHILIP WENNBLOM,

            DIRECTOR OF STANDARDS, INTEL CORPORATION

    Mr. Wennblom. Thank you, Mr. Chairman, Ranking Member 
Edwards and Members of the Subcommittee. I appreciate the 
opportunity to speak today on the important topic of standards. 
My name is Philip Wennblom. I am Director of Standards at Intel 
Corporation. Intel is a semiconductor company headquartered in 
the United States doing business in 120 countries around the 
world. We had about $50 billion in revenue last year and about 
100,000 employees. As Director of Standards, I look at the 
standards across all lines of business worldwide with a special 
focus on standards policy issues.
    Standards are very important to Intel's business and they 
are vital to the ICT industry. Intel makes complex 
semiconductor products and intricate pieces of software, and 
standards help our customers build useful systems out of those, 
and once those systems are created, standards help them be more 
useful to consumers who buy and use those systems.
    Standards are needed when a consistent approach is required 
across multiple vendors. That might be, for example, in data 
networking, where the IEEE 802.3 standard called Ethernet 
enables multiple computers to plug into any network and just 
work, or they are also useful when setting performance, 
efficiency or quality criteria across multiple products, 
allowing them to be compared or evaluated. Enabling global 
supply chains is another example where a modern laptop computer 
has over 250 standards just for interoperability, and a lot of 
those allow companies to specialize in making different types 
of products and then have them all come together and just work.
    I would like to share some views on how standards are best 
developed, speaking from the perspective of the ICT sector, 
information and communication technology. First, we have a very 
diverse system of standards making in the United States. There 
is a variety of types of organizations. Some have been around 
for over 100 years with well-established programs, and others 
have just been created in the last few years. There is a 
variety of working methods, and companies have a choice often 
about where to take their work in standards making. That 
diversity is a key strength of the U.S. system.
    Second, most ICT standards are global. That means they are 
developed with the worldwide marketplace in mind and they tend 
to be adopted globally, and that is important to suppliers, 
recalling the point about global supply chains, and also very 
beneficial to consumers because products work no matter where 
you go around the world.
    Third, standards should be voluntary, not mandated or 
regulated. Voluntary is really a friend of innovation. 
Technology changes very quickly. Moore's law says that the 
number of transistors on a piece of silicone will double every 
24 months, and that means that is the force that means that the 
smartphone in your pocket probably has more computing power 
than the fastest desktop computer of 15 years ago. Regulations 
and mandates can't keep pace with that rate of change.
    And finally, the process that we use to develop standards 
is transparent, consensus based and industry led. One example 
to illustrate this is the universal serial bus. It is an 
example of diversity because it was a unique organization to 
develop that specific standard. It was defined for the global 
market and developed by companies and experts from all over the 
world, and it has now been very widely adopted. There have been 
billions shipped. It is innovative, well beyond what was 
imagined when it was created. Almost all of us interact with 
USB in our laptops or smartphones or cameras, or printers. It 
is implemented on a huge variety of projects, and it has 
created opportunities for both large and small companies. Even 
recently there are some new startup companies building USB 
products and competing very effectively because that standard 
tends to level the playing field.
    Finally, a few comments on trade barriers. The WTO 
Technical Barriers to Trade Agreement is very useful, has very 
useful provisions, but there are some ambiguities. For example, 
not every country views international standard in the same way, 
which can make it harder for U.S. industry. Monitoring and 
enforcement are key. We appreciate the NIST programs that keep 
us informed about regulations, and when our industry identifies 
concerns, we bring those to the attention of USTR, who is a 
great partner.
    It is also important for the United States to set a good 
example using the practices we would like other countries to 
adopt, meaning minimizing technical regulation and basing 
requirements on international standards.
    Thank you again for the opportunity and I would be happy to 
take any questions.
    [The prepared statement of Mr. Wennblom follows:]

               Prepared Statement of Mr. Philip Wennblom

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    Chairman Quayle. Thank you, Mr. Wennblom.
    I now recognize Mr. Grimaldi for five minutes.

                STATEMENT OF MR. MARK GRIMALDI,

                    OWNER, EQUINOX CHEMICALS

    Mr. Grimaldi. My name is Mark Grimaldi and I am the 
President and CEO of Equinox Chemicals and Adco Products 
located in Albany, Georgia. Thank you for having me here today. 
It is an honor to be here to represent my company and our part 
of the industry.
    We are an industry leader in chemical innovation, R&D, 
specialty manufacturing, and product commercialization around 
the world. The industries we serve include aerospace, 
specialized industrial products, pharmaceuticals, lubricants, 
flavors, cleaning, and cutting-edge research products for a 
diverse group of markets globally.
    When I started Equinox Chemicals eight years ago as a 
single-person operation, I had a vision of building a high-tech 
product development company and a manufacturing company that 
could vertically integrate all the way from innovation through 
R&D, manufacturing and commercialization and be able to compete 
in a global marketplace. I knew this would be the key if we 
were really, really going to be able to compete in a really 
diverse market, and because of this approach, we have grown 
more than 300 percent in sales and over 389 percent in employee 
growth in the last three years. We have invested millions of 
dollars in infrastructure and manufacturing here in the United 
States and facilities during a period of time when the rest of 
the industry was pulling back and not investing capital, and it 
is our ability to compete both domestically and globally in 
this very short amount of time that has allowed us to excel in 
both innovation and manufacturing. So establishing solid 
standards and being involved in the development of new 
standards, or updating existing standards both domestically and 
globally, is one of the most crucial factors in our success.
    The United States leads the way globally by setting the bar 
for existing standards as well as in the development of new 
standards as world markets, products and technologies evolve. 
The key to the United States remaining in this pinnacle 
position and continuing to improve the process is to ensure 
that the following four basic principles which have been 
essential to our success are maintained and further developed.
    One is that the standards process is private-sector led 
with representation from government, industry, both small and 
large industry representatives, and consumers, and we need to 
ensure that there is flexibility and applicability with minimal 
impact on innovation, competition, and economic growth. It has 
got to be consensus based. It has got to be a transparent 
decision-making process where participation is available to all 
the stakeholders and you get input from a diverse group of 
folks regardless of the size or the location of the 
representative giving input. And I would also like to emphasize 
that guaranteeing a balance in the process inputs from all the 
stakeholders is key to favoring one group or industry over 
another when you are setting standards, which would create 
unfair competitive advantages and creating an environment where 
the end user, the consumer, may not be getting the best 
possible product. It has to be voluntary. Mandating standards 
hampers competition and the innovation process by limiting the 
company's ability to work outside the box and on the cutting 
edge of new technologies. There is a time and place in the 
development cycle for standards, and you can't--there is no set 
time for a standard to be developed. You really have to rely on 
the folks that are the experts and the consumers and the part 
of the advisory board to decide when it is appropriate to start 
a standard process, because if you do it too soon you can stunt 
growth and stunt innovation.
    And then promoting the U.S. standard-setting system and 
standards set under that system domestically and abroad would 
lead the way around the globe, and having to comply 
unnecessarily with multiple standards both domestically and 
globally adds a huge amount of unneeded redundancy and 
complication to many of the companies, especially the small and 
medium business companies. It would be great and ideal if we 
could just choose what standard we wanted to comply with, but 
it doesn't work that way. We are in dozens of countries, we 
have thousands of products, and our customers choose what 
standards they expect our products to comply with, and so when 
we have all those redundant standards that we have to comply 
with around the world, it makes it very, very complicated for 
us to do that.
    So the United States has consistently led the way in 
developing these globally accepted standards, but as the E.U. 
and other developing countries start to develop those 
standards, we need to ensure that we continue to lead the way, 
work closely with these trade partners, and we have to ensure 
that other countries do not create unnecessary trade barriers 
and otherwise use standards to create unfair competition in 
places, especially in Europe where one of our biggest markets 
is, and REACH would be a great example there.
    So in closing, I would like to ask that you continue to 
weigh this topic with your colleagues, staffs, and advisors, 
and that you remember the critical standards--that it is 
critical that standards are set to create equal opportunity 
among domestic and international businesses of all sizes, 
involve no excessive fees that limit SME participation and 
competitiveness, and minimize delays in development and 
approval of new products, and include some intellectual 
property protections to encourage investment in these endeavors 
worldwide.
    Thanks for the opportunity, and I am available to help in 
any way possible going forward.
    [The prepared statement of Mr. Grimaldi follows:]

                Prepared Statement of Mr. Mark Grimaldi

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    Chairman Quayle. Thank you, Mr. Grimaldi.
    I now recognize our final witness, Mr. Seay, for five 
minutes.

                  STATEMENT OF MR. JAMES SEAY,

                    PRESIDENT, PREMIER RIDES

    Mr. Seay. Good morning, Mr. Chairman, Members of the 
Technology and Innovation Subcommittee. My name is Jim Seay and 
I am the President and Owner of Premier Rides, a small company 
in Maryland recognized globally as an industry leader in the 
supply of innovative amusement rides and attractions. I would 
like to personally thank Ranking Member Edwards for the kind 
invitation to discuss the position of small business with 
respect to the standards development process.
    Premier Rides focuses on the construction of high-tech 
rides that incorporate elements such as non-contact magnetic 
drive systems that both dramatically accelerate multi-ton 
vehicles to high velocities in seconds and stop them just as 
quickly. As an exporter, we ship millions of pounds of 
millimeter-accurate fabricated steel all over the world, 
including sophisticated electronic control systems to areas 
like Singapore, Indonesia and China. On a voluntary basis, I 
serve as the chairman of the ASTM International Committee F24 
on Amusement Rides and Devices. Along with 500 members from 24 
countries, we provide thousands of voluntary hours annually 
towards the development of amusement-ride safety standards. 
Safety is the paramount principle of my industry, and I believe 
strong safety standards are an appropriate method for 
establishing a very high bar for participation.
    Premier Rides is a growing company of approximately 20 
technical and marketing employees plus a fabrication base of 
over 200 craftsmen. The expansion of global business is 
allowing us to add more staff, and last month, Premier has 
added five new engineers, both entry level and also senior 
level. We are hiring more engineers now. The more engineers we 
hire, the more work for our manufacturing facilities. I can 
honestly say that without fair global standards that ensure a 
high level of quality and safety, Premier would not be 
delivering as much equipment internationally. Simply put, the 
standards level the playing field for us.
    ASTM International is a 100-year-old nonprofit organization 
devoted to the development of voluntary consensus standards. It 
is accredited by ANSI and meets WTO principles for the 
development of international standards. ASTM also has a long 
and vibrant relationship with the National Institute of 
Standards and Technology.
    For a small company like Premier, the key principle to 
effective standards participation is fair treatment for all. At 
ASTM, Premier does get, as a small business, fair treatment. 
The ASTM committee structure ensures balanced participation 
from stakeholders. While I am from a small company, my 
technical input and votes regarding safety issues are equal to 
that of companies such as Walt Disney and Universal. That is 
very powerful for a small company.
    Another principle for the success of small company 
engagement is the use of technology to lower barriers to 
participation. ASTM has committed significant resources to 
provide integrated electronic processes from the inception of 
an idea for a standard until that standard is published. This 
is an especially important tool for small companies like 
Premier that do not have unlimited manpower and unlimited 
financial resources.
    So does Premier have a positive experience with standards? 
Yes. In locations like Singapore and Indonesia, the experience 
due to standards adoption has established a level playing 
field, eliminated subpar, substandard suppliers and put Premier 
in a position where there was a fair basis to compete with 
other quality-focused suppliers.
    Are all experiences positive? No, they are not. In one 
example. despite the fact that our industry relies upon ASTM 
standards worldwide, the ISO has recently formed a new 
technology committee for attraction safety under the 
chairmanship of the Federation of Russia. That makes no sense. 
As another example, in a rush to provide new entertainment 
experiences to the public, developers in China incorporated 
subpar equipment with virtually no safety standards oversight. 
Serious accidents occurred and China reacted not by adopting 
the ASTM standards but by writing their own. To our technical 
experts of the industry again, this makes no sense. I see a 
major opportunity for organizations like NIST to assist in 
promoting existing standards, and without such an effort, the 
independent efforts might result in trade barriers, less 
safety, and affect the growth of companies like Premier.
    In summary, small- and medium-sized companies like Premier 
have, and need to continue to have, an effective voice in the 
standards process in order to advance the global 
competitiveness of U.S. companies of all sizes. The U.S. 
Government should promote global harmonization and the adoption 
of the best standards, and avoid the unnecessary and costly 
obstacles that are created when our trade partners create 
policies and preferences for less-robust standards.
    I appreciate the opportunity to appear before you and look 
forward to working with you.
    [The prepared statement of Mr. Seay follows:]

                  Prepared Statement of Mr. James Seay

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    Chairman Quayle. Thank you, Mr. Seay, and I would like to 
thank all of the witnesses for their testimony, reminding 
Members that the Committee rules limit questioning to five 
minutes. The Chair will at this point open the round of 
questions, and I will recognize myself for five minutes.
    Ms. Saunders, I wanted to ask you, one of the concerns that 
I have, you said that there are about 10,000 consensus 
standards that were in federal regulations, and one of my big 
concerns is how some federal regulations are just allowed to go 
on in perpetuity without any reevaluation. I actually 
introduced a bill that actually has all major rules after 10 
years go through another reevaluation so they can do a cost-
benefit analysis. What are federal agencies doing with the 
standards that are within the federal regulations to make sure 
that they are still the type of standards that we need so that 
we are not going to stifle innovation going forward?
    Ms. Saunders. Well, to your point, you are right. We do 
track in the Code of Federal Regulations close to 10,000 
references to standards in various agencies' regulations, and 
there is a provision, a general provision that agencies should 
review major rules every five years with a view to revising 
them or eliminate them, etc., and many agencies do an excellent 
job of undertaking that revision. To be practical, it is easier 
for the smaller agencies that have a smaller number of 
regulations for which they are responsible to undertake that 
review on a frequent basis but I know that all the agency 
standards executives do encourage the folks who write the 
regulations to undertake those reviews to determine whether the 
regulations themselves should be revised or updated or 
eliminated, and also that the standards referenced in those 
regulations might need to be updated in the sense that a more 
recent edition might need to be referenced.
    There are clearly health and safety issues that have to be 
carefully considered by the agencies when they undertake those 
determinations, and I will also say, recently, over the past 
two years, the Office of Management and Budget Information and 
Regulatory Affairs has explicitly reached out to agencies 
seeking them to submit plans for review of the regulations, and 
that has had some positive impact as well.
    Chairman Quayle. Okay. Thank you.
    Mr. Grimaldi, in your testimony you were talking about when 
the right time to have the consensus standards be made with new 
companies, especially startups in the startup sectors that if 
you put standards in place too early, that might stifle growth 
and innovation, but is there no magic point of when you should 
put standards down? What is your take on when we should be 
looking to provide consensus standards from the various sectors 
because it has to come from the private sector so that we can 
all work together. But when do you see that as the time to do 
it?
    Mr. Grimaldi. That is a very difficult and complex question 
to answer because it is such a broad area. For instance, in the 
chemical industry, we are so diverse. I mean, chemicals go into 
so many--just about everything in the world and affect so many 
different markets and can affect Intel and the furniture 
business and the paint business and the carpet business. It 
goes into everything. And so when you do you start setting the 
standards? It has to be looked at on an individual basis. You 
can't just have a magic line in the sand that says when you 
cross this line, you have got to start developing a standard.
    And so it makes it a very, very difficult process because 
the other thing you want to be careful of is that in some cases 
when we are developing new technologies that revolutionize a 
particular market or an industry such as dry cleaning or 
something like that, when you can develop a new product that 
replaces a product that has got safety issues or environmental 
issues, you want to be able to bring that product to market 
very, very quickly. Well, the standards are so old and so 
established that sometimes you want to be able to start that 
process much, much sooner than you would for something that has 
to be out on the market for a while. It is so new, it is such a 
new technology or a new market that you want to have time to 
understand what the impacts that the standards are going to 
have before you go into that process.
    Chairman Quayle. Okay. Thank you.
    Mr. Wennblom, you mentioned that monitoring and enforcing 
the WTO Agreement on the Technical Barriers to Trade is the 
best way that we can actually get the full benefits of that 
agreement. How do you think the monitoring--has it been 
effective so far? Do you have any suggestions on how to improve 
that?
    Mr. Wennblom. That is an important question. I think the 
monitoring we have is largely effective but it does require the 
engagement of industry, which is often the first to see an 
issue and in partnership with NIST and USTR and other parts of 
the government. So I think everyone has to be diligent, but the 
tools we have in place are good ones. Of course, I also 
mentioned there are ambiguities in some of the trade 
agreements, and as we see an opportunity to improve those 
agreements or develop new ones that would be more clear and 
support U.S. interests, that is always helpful to pursue.
    Chairman Quayle. Okay. Thank you very much.
    I now recognize the Ranking Member, Ms. Edwards, for five 
minutes.
    Ms. Edwards. Thank you very much, Mr. Chairman, and thank 
you all for your testimony.
    I am really curious here, it feels like the elephant in the 
room is China, and so I want to have a little bit of a 
discussion and particularly in the area of, say, intellectual 
property rights. I am a little curious about the relationship 
between intellectual property rights and standards with respect 
to China, and my understanding is that in recent years there 
has been a push by Chinese regulators to invoke compulsory 
licensing of intellectual property rights for mandatory 
standards, and so I wonder if any of you can discuss these 
efforts and what they mean for U.S. companies attempting to do 
business in a really huge market. Mr. Bhatia?
    Mr. Bhatia. I will take a shot at it. ANSI has an 
intellectual property rights committee, which basically looks 
at these issues from a broader perspective, and just recently 
we had the privilege of having ITC, FTC, and--what was the 
third agency? So we have all the key agencies of Federal 
Government are also participating--PTO also joined. In addition 
to that, we have about 90 different organizations that are 
participating and not always the opinions are common, but we 
worked very hard to develop what we think are rightful measures 
to not only handle the application of IPR issues and 
standardization, for example, the issue of embedded technology 
that is preferred by a company as a critical issue but also 
working to take action at the international level such as with 
countries like China or others where there may be violations of 
intellectual rights off others, and we are working not only 
with China but we are also working with international 
organizations like ISO and IEC to develop global policies that 
will support the needs of industry, not just in the United 
States but also in other developed markets, which are usually 
creating the intellectual capital.
    So I think there is a lot to be done. We do need the 
assistance and engagement of industry on an active basis. We 
have a forum in which to debate these issues and advance. We 
also have bilateral agreements with SAC, for example, the 
standards organization of China. We work very closely with 
them, and we can go to them directly about these issues and 
these problems, and quite often they try to work with us. China 
is maturing slowly. I think they are becoming more aware of 
their responsibilities. As they become more advanced in 
technology development, they are going to be creators of 
intellectual capital, not just the user of it. So I think they 
are becoming more and more responsive to requests, from the 
Western countries usually, to address these issues in a fair 
manner.
    Ms. Edwards. I am also just curious, from a business 
perspective, and our three witnesses who actually deal with 
this probably on a more regular basis can help me understand 
what happens when your company encounters an international 
standards-related issue and you might need the U.S. government 
to offer some kind of assistance in resolving that. Given the 
number of agencies that might have responsibility, you as 
business owners, who do you call and how do you know who to 
call?
    Mr. Seay. I will speak from the standpoint of our company. 
First of all, China is a very important trading partner to 
someone like Premier but the IP issues in my industry are 
significant. It was not uncommon that you go to trade shows 
recently and you see photographs of your equipment, our own 
equipment, Premier's equipment, in other people's booths, which 
are startup organizations in China. The way that that has been 
remediated is, number one, we have a trade association, the 
International Association of Amusement Parks and Attractions. 
They have adopted an IP approach to preventing that from 
happening.
    The biggest challenge is, if China does not adopt the 
global accepted standards, what happens in our industry is--and 
there have been significant issues where they will essentially 
use the IP on a visual basis of an attraction--they will build 
an attraction, but because it doesn't have the embedded safety 
of what the standards like the ASTM F24 give, you end up with a 
very devastating result, and there have been some serious 
accidents because of that, as I mentioned.
    Ms. Edwards. Are there times when that equipment then 
somehow or another makes its way into the U.S. market?
    Mr. Seay. It has been marketed into the U.S. market and 
there are instances where some of it has come in. The results 
have not been good. There hasn't been a safety issue here in 
the United States, but the results on a quality level has now 
put--there has been pushback on that. But it is important to 
have someone like NIST that we can turn to because as an 
example, NIST had a workshop with Chinese people, businesses 
who came here and they identified our industry as being one 
where we have got to work together closer. So we do need 
someone like a NIST that we can turn to for that.
    Ms. Edwards. And Mr. Chairman, we can explore this, but the 
question that I have is, is it NIST, is it PTO, is it, you 
know--I mean, I am just completely confused as to if I am a 
businessperson who owns a small business, trying to figure out 
and navigate who has the responsibility to be my advocate in an 
international arena I think is very complex, and I hope, Mr. 
Chairman, we are going to be able to get to some of those 
questions. Thank you.
    Chairman Quayle. Thank you, Ms. Edwards.
    And I now recognize the gentleman from Tennessee, Mr. 
Fleischmann, for five minutes.
    Mr. Fleischmann. Thank you, Mr. Chairman.
    I know we have touched on this in some of the testimony and 
some of the questions, but I would like to hear from all of you 
all about this issue, please. What in your experience has been 
effective responses for either industry or government when a 
company encounters the use of standards as technical barriers 
to trade in countries to which they export? I would like to 
hear from all of you on that.
    Ms. Saunders. Okay. We have several examples of effective 
responses. I think the most effective responses were--building 
on my fellow panelists' comments--the affected industry and the 
relevant government agencies come together, and in the trade 
space when you have a technical barrier to trade, the lead on 
that issue is the U.S. Trade Representative's Office. We work 
with the Department of Commerce in particular because we have a 
trade agency component as well as a scientific component. We 
work very closely with the U.S. Trade Representative's Office 
to provide technical expertise that underpins their negotiating 
arguments or their arguments against countries that are 
applying technical barriers to trade. It is very important to 
have the support of the industry as well. I can speak from a 
practical perspective in terms of how that barrier is actually 
affecting business. But I do think we have several cases. Joe 
mentioned one particular in China where he worked with the 
private sector and also with the government. We have several 
cases where we have been successful in rolling back technical 
barriers to trade. There are many cases where it hasn't worked 
quite as well. But I think when the trade agency, particularly 
the U.S. Trade Representative's Office, Department of Commerce 
including NIST for technical expertise, and the industry work 
together, we have a pretty good chance of being successful.
    Mr. Bhatia. If I may add to that, we have quite a few 
structures through which we can execute our concerns. We have 
technical advisory committees, which are jointly sponsored by 
USTR and Department of Commerce, which are all populated by 
private sector people. I chair one of those, which deals with 
technical barriers to trade. I am a Vice Chair now. I chaired 
it for 10 years. And through that forum, we can address all 
technical issues that are faced by either industry association 
as a collective activity or by individual company that channels 
it through the trade association like Mr. Seay gave the example 
of.
    We also have opportunities to work directly with countries 
because we have bilateral agreements with them. We also have 
opportunities to engage the responsible federal agency for that 
particular product type. For example, the example of playground 
equipment, we would go to CPSC, Consumer Product Safety 
Commission, because they have the oversight of managing the 
safety of consumer products in this country and they have 
relationships with their counterparts in other countries as 
well. Similarly, we can go to OSHA for workplace safety issues. 
So we have opportunities and mechanisms that we work with, and 
ANSI has structured a lot of our liaisons with both federal 
agencies and also in other countries to address some of these 
issues both at the governmental level and also at the private-
sector level because we also work with industry groups in many 
other countries.
    Of course, we have better success with mature partners that 
we have been working with over the years like Canada or Germany 
or U.K., and we are beginning to learn how to work more 
effectively with countries like China or India. But I think it 
is not a lost cause. We can do a lot of good.
    Mr. Wennblom. Thank you for the question. I think one of 
the most important things we do is try to identify concerns at 
an early stage by monitoring the standards activity in the 
countries of key trading partners using tools like the 
standards portal that ANSI provides and others, just having 
people on the ground. We also then, if we identify a concern, 
work in trade associations to determine if there is an industry 
view on that concern, and using the comment opportunities that 
the Technical Barriers to Trade Agreement provides, we can 
identify those concerns to key trading partners. If the 
concerns aren't addressed, then USTR is a great partner in 
further addressing those issues. So that is kind of our general 
recipe.
    Mr. Grimaldi. I would also agree with that in that a key 
way that as a small business we navigate that and help ensure 
that we get an effective response from government is using our 
trade associations and using them as a resource to help us 
navigate through the systems to get that response that we need, 
and the Transatlantic Economic Council, Department of Commerce, 
and USTR are examples in the ways we address these NGBs 
currently. But it is very difficult in more mature markets 
where we have a lot of these trade barriers that have been 
around for a while that are well established. It is very 
difficult to reverse some of that, and especially when you have 
got new technologies and innovation that you want to launch 
globally. And a lot of times with the speed of technology 
development and change, it is difficult to get that new 
technology out there quick enough and respond quick enough when 
you have these standards that are in the way.
    Mr. Seay. I will be quick. I mentioned before the ISO issue 
that our industry is dealing with. We have not found an 
appropriate mechanism to deal with that one where you have 
almost like a rogue standards effort being established that 
doesn't have the experts that should be there that exists in 
other efforts. I will give an example of a trade barrier 
situation, which is even closer than China, where up until 
recently Europe and the United States in my industry, you would 
have to build equipment for the United States and you would 
have to build different equipment for Europe. There has been a 
concerted effort set up by the trade association I mentioned 
before, IAAPA, working with ASTM where the CEN people and the 
ASTM people got together to harmonize their standards so that 
there would be some ability to cross-promote products between 
the two areas, and that is not only good for the manufacturers, 
it is good for the end user because it ends up making the cost 
of the product lower.
    Mr. Fleischmann. Thank you very much. I yield back.
    Chairman Quayle. Thank you, Mr. Fleischmann.
    I now recognize the gentleman from Maryland, Mr. Sarbanes, 
for five minutes.
    Mr. Sarbanes. Thank you, Mr. Chairman, and thank you for 
having this hearing, and I also want to thank the Ranking 
Member for bringing Jim Seay to the panel today. His business 
is located in my district and we are very proud to have it 
there. Premier is a good name for his business because it 
really is the premier deliverer of ride products across the 
world from my understanding, so we are glad to have all of you 
here today.
    I wanted to pick back up with you, Jim, about this ISO 
issue and help me understand a little bit more what it means 
that the Federation of Russia now has the chairmanship and why 
you are describing this activity as kind of a rogue activity. I 
am sort of drowning in the alphabet soup of acronyms that are 
involved here in this thing, but maybe you can on that issue 
give us a little more detail.
    Mr. Seay. Yeah, the alphabet soup is kind of like the 
Ambien of the technical world, you know.
    But the ISO situation is a perfect example of the 
challenge, and with ASTM, you have got a voluntary consensus 
organization, and as I mentioned before, anybody can 
participate in ASTM. We have, you know, operators, 
manufacturers, consumer advocates, the CPSC. I mean, you have 
this wide array. Anybody can participate. With the ISO 
situation, an individual who is smart enough to recognize that 
they can take what is called the tag for ISO by writing a 
check, and they now control this new committee and it is a 
committee that is not open. It doesn't have the consensus 
approach. If you want to write checks, you can participate.
    One of the biggest challenges is that the United States 
only gets one vote in ISO, and so you now have a scenario 
where--and with the Europeans, we actually have this good 
relationship I talked about before, but the Europeans have a 
vote for every country in Europe so the United States becomes--
has a minor role, and here we are in an industry where you look 
at the global business for my industry, the majority of that 
global business is controlled through U.S.-based entities and 
the expertise lies in large part in the United States and also 
in Europe. So you have this situation where suddenly, you know, 
the entire body of experts becomes a very small factor in the 
development of these regulations, and, you know, nothing 
against the Federation of Russia, because I never want them 
upset at me, but you know, they have not been a large 
participant in the entertainment business, we are, and the 
attractions we build are incredibly sophisticated. We have 
attractions that run 13 trains at the same time with seconds of 
separation so that requires extreme safety.
    Mr. Sarbanes. So when the ISO, the jurisdiction of the--I 
mean, because the way you described it, one response might be 
to say well, there are all these other ways of exchanging 
standards and bringing consensus and so forth. So, you know, 
ignore ISO if it is off on some rogue expedition. So describe 
the kind of jurisdiction it has in terms of the reach of these 
regulations that it issues and how that creates a problem for 
you and other companies.
    Mr. Seay. Well, I think the comment before, the elephant in 
the room comment, is a good one because the challenge with 
ASTM, and I will be honest, it has got an A there; it is 
American. The issue is with ISO, it has got an I. It is 
international. It is simple as that. When the vote went out 
globally, should this ISO standards development group be 
established, you know, the Germans were great. The Germans have 
some fantastic standards. They wrote a very blatantly negative 
vote for it. However, there were votes all over the world from 
people who don't even have attractions in their country who 
said sure, ISO, that has got to be better than anything else, 
and that is the situation that you honestly end up in.
    Mr. Sarbanes. And when did this happen? How long has the 
ISO sort have been a force to be reckoned with?
    Mr. Seay. Well, the ISO has always been a force to be 
reckoned with, and there is a lot of good product out of the 
ISO, but for our particular situation, this is about 12 to 18 
months.
    Mr. Sarbanes. And can you quickly give a specific example 
of a barrier? You talked about, you had to build equipment to 
meet U.S. standards and then you were building a different form 
of the equipment in terms of Europe at one point, and you saw 
that as a problem. Without giving away any trade secret, is it 
like a specific product where you could describe where this 
problem occurs in terms of a technical barrier, just again, to 
give me more understanding of it?
    Mr. Seay. Just one example. When China did react and write 
their own standards, and we talked about that before, people 
writing their own standards to kind of protect their own world, 
they wrote standards that have to do with g-forces, and our 
world is all about the g-forces applied to people, and they 
wrote standards that don't correlate to all the studies that 
have been done between Europe and the United States, and there 
is extensive information that went into establishing g-force 
standards that are in ASTM and the CEN that are good standards. 
The Chinese changed those and they don't make sense to the 
experts in our industry. So now you can't supply a product that 
has been incredibly reliable at a Disney park that millions and 
millions and millions of people have ridden and ridden safely, 
as that product potentially might not be able to be put into 
China now because of that new standard.
    Mr. Sarbanes. Great. Thank you.
    Chairman Quayle. Thank you, Mr. Sarbanes.
    And then I recognize the gentleman from New Mexico, Mr. 
Lujan, for five minutes.
    Mr. Lujan. Mr. Chairman, thank you very much.
    And to pick up a little bit where this conversation has 
been going, Mr. Grimaldi, you say that with respect to emerging 
technologies, it is important to work with industries and 
across countries to develop industry standards that allow for 
maximum market access and that it would be highly beneficial to 
the United States and the E.U. to work to establish standards 
that they can then push into developing markets. Can you talk a 
little bit more about the United States-E.U. cooperation and 
why it is important and how this sort of cooperation can 
benefit U.S. companies?
    Mr. Grimaldi. Yes, I can. And I guess I can give an example 
that really hits home where that didn't work well and why I 
think it is important. So in 2007, the Europeans put together 
the REACH standards and regulations, and a lot of folks here 
know a lot about that. It is very messy, and the objectives 
were: to improve the protection and health and the environment 
from the risks that can be posed by chemicals; enhance the 
competitiveness of the E.U. chemical industry, a key sector for 
the E.U. economy, so right there, it becomes a trade barrier; 
promote alternative methods for assessment of hazards of 
substances; and ensure the free circulation of substances on 
the internal market within the European Union. And I think that 
when they started to develop this standard, which happened 
very, very quickly and blindsided a lot of U.S. companies, the 
intent was good, but by the time it actually made it to 
implementation, the restrictions were tremendous. You know, 
companies based outside the E.U. can't register directly. The 
law requires importers to register the substances they import. 
A non-E.U. supplier has to fully disclose all of his 
formulations and IP and share that with his competitors in 
Europe. And you actually have to have European representation 
there to comply with the standards.
    And so the burden for a small company like ours or a 
medium-sized company to comply with these standards is hundreds 
of thousands of dollars just to get product into Europe and/or 
pull products out that we did have there, and what it does is, 
it starts to stymie the best products that could go to market 
or to be able to even effectively launch a product there and 
front those costs. And so one of the ways that we really need 
to cooperate in that situation is to be sure that we don't come 
up with a ``me, too'' standard, just not in retaliation but to 
make sure that--you know, because what we saw was a bunch of 
European companies now doing business here. Some of our biggest 
competitors came to the United States because it was easier to 
do business here. They were having trouble with their own 
standards.
    And so there was a lot of discussion about well, we can do 
the same thing here and level the playing field, and I think 
that is the wrong answer. We don't want to go and do a ``me, 
too'' standard just because we want to level the playing field. 
I think we need to take the high road and lead that effort and 
push back and say this--you are creating a standard that makes 
unfair competition and doesn't work logically for the markets 
that the industries are trying to standardize.
    Mr. Lujan. I appreciate that.
    Mr. Wennblom, jumping to a technology I think that most of 
us depend on daily, and I appreciate in your testimony talking 
about in 1995 the contributed technology associated with USB, 
and so my question to you and to Mr. Bhatia is, as we talk 
about this notion that mobile phones are going to begin to 
adopt additional standards associated with these charging 
technologies, I appreciate that I can use a USB charger and I 
can move from computer to computer whoever it is manufactured 
by, but the frustration that I have is, when you are buying new 
mobile phones, the USB still works in the computer but the 
aspect that goes into the mobile device to charge it, I don't 
know how many car chargers I have gone through and how many 
plugs I have gone through. The one thing I appreciate about 
these two devices that I carry daily, one that belongs to me, 
one that I use for Congressional responsibilities, is the same 
charger on my iPod that I bought many years ago I can use to 
charge this phone but the chargers that I have for BlackBerries 
from previous years don't necessarily charge this.
    So when we talk about USB, micro USB and whatnot--and I 
know I ate up a lot of time there, Mr. Chairman, but this is 
something that I certainly hope that we can get direction to 
solving, and the rationale being, Mr. Chairman, as we talk 
about the notion again pointed out in the testimony that it is 
important for the United States to set a good example, 
demonstrating the approaches we would like to see for the 
countries to adopt but that we need to be careful when we are 
looking for voluntary as opposed to mandates. It seems to me 
that when you come out with a new technology, we are talking 
about electricity flowing into a device to be able to charge a 
battery or another form of power to be able to charge these 
devices, that the same connectivity that Intel and others led 
the charge with the USB on the reverse side should reflect what 
is happening. And I am not suggesting that Apple adopt what is 
happening with BlackBerry. I am just suggesting that one 
company, when it finds a device or a way to plug into their 
phone that they like, that they keep it, so that way I don't 
have to keep buying plugs and devices.
    So with that, Mr. Chairman, I hope we can explore that a 
little bit more, and maybe there is a way for the mobile-phone 
industry to truly when we say that they are going to do it, 
that we see them do it or that we find another way to encourage 
them to do it, Mr. Chairman. Thank you.
    Chairman Quayle. Thank you, Mr. Lujan. We are going to have 
a second round of questioning just for that. Actually, for 
those who want to have a second round, we are going to go 
through, because I have some additional questions, and Mr. 
Lujan actually brought up a very important point that was going 
off of what Mr. Grimaldi was talking about with the REACH 
agreement in Europe, and how do we really push for the 
consensus-driven standards that are developed in the United 
States to make that to be the process globally? Because I think 
that that would be the best route to take. Mr. Seay talked 
about various things that were happening in China and Russia 
but how do you--how do we take that--and I guess I will ask Mr. 
Bhatia and Ms. Saunders to answer this one--how do we take that 
and be able to promote that consensus-driven where all the 
stakeholders are getting involved and get those standards that 
way rather than the top down because like Mr. Grimaldi said, 
when you have the consensus-driven standards, you have people 
coming from Europe to the United States because it is better. 
So how do we promote that?
    Mr. Bhatia. It is a complex issue, and as you can 
appreciate, every country--now, let us be honest, every country 
has the right to select for itself the levels of safety, 
health, or welfare that it chooses to work up to, a set of 
criteria, and this is recognized by WTO principles. We are a 
signatory to that. So every country has a right to decide how 
they are going to address critical safety issues or health 
issues or environmental issues. And in fact, our agreement 
under WTO allows countries to have deviations in criteria based 
on cultural differences, based on economic development, 
industrial development, based on climate conditions, and it is 
all legit.
    Also, let us not forget that the infrastructure of the 
globe is built. Electrical systems are built. It is going to 
cost trillions of dollars to change the electrical system from 
United States to other countries to go from 110 volts to 220 
volts, from 50 hertz to 60 hertz. It is not going to happen. So 
what is the solution? The solution is to find a way to 
harmonize our standards as best as we can, and for that, we 
need international forums to facilitate engaging of the 
countries in a logical fashion using the best solution that 
exists so far and bring that to the international table.
    One of the biggest challenges I have as the President of 
ANSI is to find a way for our U.S. SDOs, large ones--ASTM, SAE, 
IEEE, ASME--use their intellectual capital that has been 
developed with participation from many people and many 
industries, and we heard about the participation levels. It is 
a valid document but it is not often received and accepted as 
an international document. How do we cross that bridge? We can 
cross that by creating agreements, and we are trying to work on 
dialog with ISO and IAC and ITU to develop, we call them PSDO 
agreements or joint development agreements or taking a base 
standard from United States and building on that as an 
international standard. Oftentimes we succeed. I would say 90 
percent of times we succeed. The example on the playground 
equipment that was ASTM standard, we didn't succeed. We 
objected to that initiative by ISO going forward. We voted no 
to that. So did the Germans. But guess what? There are more 
countries than just two. The majority went out. So the 
development of that standard now requires us to watch what goes 
on and get as much of that intellectual capital that exists in 
the ASTM standard with their permission hopefully into the new 
criteria. So that is what needs to happen and we are working on 
that.
    I think we also have to learn as a country to play in this 
global environment a little bit differently. The days of us 
dominating totally the infrastructure of electrical development 
or innovation are gone, I think because of the Internet, 
because of the diversity of manufacturing and creativity. I 
think we are going to have to deal with new powers that are 
emerging, you know, the BRIC countries, you know, the 
Brazilians, the Indians, the Chinese. We are going to have to 
find a way to work with them along with the previous players 
along with the previous players like the Germans and the French 
and the Brits and the Japanese.
    So I think we are doing that, but we are going to have 
occasional problems, and that is why the collaboration with the 
industry is so important, and that is why the support from 
agencies like USTR, like NIST, like Commerce is so important so 
we can take the U.S. position and make that into a success for 
us, and I think we have tons of examples of where it works. 
Unfortunately, sometimes you only hear about the problems. Good 
stuff also goes on a lot, and if you look at these two guys, 
they are working in the ITC--I am sorry, one guy at least. He 
is working in the ITC sector. We dominate that area. We control 
that industry. We develop innovation. We get acceptance more 
than anywhere else. I think we have the technology that we are 
able to commercialize very effectively because we have a 
private sector-led process which allows innovations to be 
commercialized successfully, not just in the United States but 
all over the world, and that is a success story and so are 
many, many others, and I think the chemical industry is the 
same thing. We are looking at biotechnology, we are looking at 
nanotechnology. We will do the right things but we will have 
occasional problems. We have to find a way to work together and 
get these done, and we are not going to work by butting heads 
with the Chinese or the Russians or the ISO central 
secretariat. We need their help in achieving the overall 
success.
    Chairman Quayle. Right, and I think that Mr. Grimaldi made 
the good point of, let us not try to go the same route that 
they are taking in terms of trying to shut off and put up trade 
barriers because then you are just going to get the back and 
forth that we can't have. So thank you very much.
    I now recognize Ms. Edwards for five minutes.
    Ms. Edwards. Thank you, Mr. Chairman, and thanks for 
allowing us to continue to explore here.
    Mr. Wennblom, I want to turn to you because you mention in 
your testimony that more needs to be done to improve acceptance 
and understanding of diverse systems of standards development 
that is embodied in the United States to foreign stakeholders. 
But I wonder how you propose that that be done, and no one 
chose to answer my question of who do you call, so I suppose, 
Mr. Grimaldi, you are going to be content with making those 
five phone calls that you described earlier in your testimony, 
so I won't go beyond there.
    But Mr. Wennblom, if you could address that question, I 
would appreciate it.
    Mr. Wennblom. Sure, and I think the ambiguity I would point 
out is around the definition of what is an international 
standard. The World Trade Organization in its Technical 
Barriers to Trade Agreement creates some preferences for 
international standards, encouraging governments to base 
regulation on international standards as opposed to domestic 
standards. It is a very helpful section of the document. But 
the definition of international standards is open to some 
interpretation. So for example, to Mr. Seay's situation, in the 
United States, we would agree that ASTM develops international 
standards. But in other countries, Russia, for example, they 
would take a much more narrow view and say that international 
standards are only developed by ISO and IEC and ITU, and ASTM, 
just an interesting foreign standard to them. So that 
disagreement over what is an international standard creates an 
ambiguity that leads to problems like the one we have heard 
about today, in my view, so that the situation I was referring 
to.
    Ms. Edwards. Are there sectors--and this was raised to me 
at least in all of your testimony but are there sectors that 
are more appropriate to the development of international 
standards versus domestic standards that then are, you know, by 
practice and by technology and manufacturing incorporated by 
those in the international arena?
    Mr. Wennblom. Well, I can speak from the perspective of the 
information technology, information and communication 
technology sector where nearly all the standards we are 
interested in are global standards, international standards. 
Country-specific standards just don't make sense in our 
business, and it is naive to think that we can develop a U.S. 
standard and just expect the rest of the world to pick that up 
and adopt it, as Mr. Bhatia said. So we have to, from the 
start, plan on developing global standards, and that is really 
what we are interested in in our sector.
    Ms. Edwards. And then what happens in terms of our 
competitiveness when, say, the alliance is the Europeans and 
China on the development of a set of standards that may not 
quite be where our domestic market is? It feels like there are 
some instances where we then--you know, if we want to compete, 
we become followers, if you will, because it is really tough to 
lead when you are in an international arena in which that 
alliance, which is, you know, so much more substantial than--I 
mean, I guess it is one--you know, there is one point of which 
I suppose the United States and Europeans could be allied in 
terms of development of standards and then we begin to, you 
know, set the pace. But if that alliance is something 
different, it makes for a different competitive environment for 
U.S. companies.
    Mr. Wennblom. Well, standards should be about the best 
technology and innovation and growth for everybody, so if we 
can bring to the table as industry good technology and good 
ideas, I hope we--and my experience, we can build alliances for 
people to see it that way. It is not perfect, and we need to be 
diligent at that, but I think at the end of the day, alliances 
based on what is the best technical approach are pretty 
powerful.
    Ms. Edwards. And Mr. Bhatia, could you also describe where 
there are instances where principles that we undertake in our 
standards development, and Ms. Saunders, you may have a comment 
about this too, that have become commonly accepted principles 
in the international arena?
    Mr. Bhatia. Thank you. Yes. Let me just clarify one thing 
for the benefit of those who may not know the facts. The United 
States is the most dominant player in the ISO and IEC arena 
because of our size of our economy and because of who we are. 
We occupy permanent seats in both of those organizations' 
boards, five of them, six now. China has been included. We have 
that ability to direct, if you will, most of the strategies and 
implementation. We don't control everything but we have a lot 
to say, and oftentimes we are heard.
    In terms of--I am sorry, you were asking about?
    Ms. Edwards. I was asking about----
    Mr. Bhatia. Oh, the principles?
    Ms. Edwards. Yes.
    Mr. Bhatia. Yeah, we have what we call essential 
requirements in the United States which are carried out by 
ANSI. Over 260 standards developing organizations in this 
country are accredited by ANSI and they are judged against 
these essential requirements. These are criteria which focus on 
things like proper balance, participation, right to object, 
right to question, due process, consensus, resolving disputes. 
All of these are also mentioned in the OMB A-119, the circular, 
which makes it a national process, if you will, officially. WTO 
principles also follow similar lines, and most of the major 
developing countries have adopted these processes and their 
national bodies follow those principles as well. I think for 
the benefit of those who may not know the details, there are 
only about 15 to 20 major countries, developed economies, that 
are producing the documents. The rest of the world are users. 
So most of the development today in the technical arena 
internationally comes from these handful of countries, and the 
rest of the world becomes the user of that final solution. So I 
think we have an opportunity to work very closely with our 
partners, and quite frankly, the industry concerns in the 
United States often are aligned with the industry concerns in 
Germany, and the industry concerns in Japan, and the industry 
concerns in China--perhaps once they get mature. Right now they 
are not there. So I think that is going to become a big 
harmonizer of the future, so to speak.
    And to reflect on your question, are the strategies 
different for different sectors, the answer is absolutely yes. 
In the areas where we have significant international trade, I 
think it is almost essential that we have an internationally 
recognized standard, which is something that is domestically 
focused, it is a unique sector, it is a limited application. A 
country-specific document or a regional document like a NAFTA-
type document or document for the Americas may suffice for a 
while, but the key is to create standardization and then move 
towards the harmonization process towards a global standard 
eventually.
    Chairman Quayle. Thank you, Ms. Edwards. I now recognize 
Mr. Sarbanes for five minutes.
    Mr. Sarbanes. Thank you.
    Anybody can answer this question. It is sort of a freestyle 
question. But, you know, a lot of talking, more and more, the 
President is talking more and more about how we restore 
American manufacturing, how we bring back some of these jobs 
from overseas and the manufacturing processes that we have lost 
overseas over the last few decades, and I am just wondering, I 
don't--help me make the connection if there is one, but can you 
relate what we have been talking about here today in terms of 
the standards and how that affects businesses of all sizes to 
this other conversation that we are having about trying to 
restart the American manufacturing sector in a vibrant way and 
bringing some of these jobs back and so forth. Maybe they don't 
relate, but I would love your perspective on that, anybody who 
wants to----
    Mr. Seay. I will just put some comments in. From the 
standpoint of having standards, I mentioned before that I 
personally believe standards are a good thing because they set 
a bar and they set a bar for participation, and we talked about 
before, is the timing of standards an issue. From our 
standpoint, it is only an issue that you have got to get above 
this bar so that the product you produce is a safe product.
    The issue we get where there is the potential of 
manufacturing loss is because countries that are not respecting 
appropriate standards, they do have the ability to produce 
equipment that is far more economical, economical in 
appearance, seeming to be the same level of equipment but not 
performing either as reliably as it should or not performing as 
safely as it should. And I think that the challenge gets to be 
that there is a temptation that is out there when you can go to 
a country that doesn't have these regulations but their price 
points will be 50, 60 percent less, and a lot of that is 
because the standards, at least in our industry, are not being 
adhered to. The ASTM standards are not being adhered to. We are 
a good example of that because of the level of quality that is 
required for a safe industry, and the performance in the United 
States as an example which lives up to ASTM, we are keeping the 
manufacturing jobs here. There is a reason that we are shipping 
millions of pounds to Indonesia of steel, fabricated steel. It 
is because the company in this case that we work with in 
Indonesia, Trans Studio, a very high-level conglomerate media 
company, they have a respect for standards. They have respect 
for electrical standards as well as standards in our industry, 
so they establish those as a minimum guideline so, if you want 
to participate in their projects, you have to meet those 
guidelines. So that helped us keep those jobs here and we will 
continue to do that.
    Mr. Sarbanes. So, I mean, put simply, if you are a country 
that believes you deliver a high-quality, high-standard 
product, you are going to want to develop these standards 
internationally that are at that level because that is going to 
obviously help you compete. Any other thoughts on that before 
my time runs out?
    Mr. Grimaldi. Yeah, I have got some thoughts on that, and 
that is really the basis for our company. In a down economy, we 
built a manufacturing company from the ground up and have grown 
it consistently year after year, and we have actually been able 
to bring business back, manufacturing business, from India and 
China and places like that, and it is looking at where we can 
be competitive. The global marketplace is going to change for 
U.S. companies and we can't--you have to look at where that 
niche is, what we can focus on and what we do well and what 
your customers are after. If it is price and it is a commodity 
item, it is difficult to compete here, but if you are looking 
at somebody that is looking for something that meets standards 
consistently that they can have control over, that they want IP 
protection and a timing issue and they want to have--they want 
to be able to see their products being manufactured, so it ends 
up being more of a high-tech, high-end process, and you create 
a specialty niche there, and I think that is where companies in 
the United States, when they want to grow and increase 
manufacturing, they have to look for those opportunities. They 
have to be agile. They have to be willing to change. You have 
to look at when your product becomes more of a commodity item 
and you can't be competitive anymore, you have to be willing to 
shift and look for new opportunities and new products to 
manufacture here, so I think it is alive and well here and 
growing if you look at the right opportunities.
    Mr. Bhatia. I think there is a lot more that goes into 
retaining manufacturing than just standards. I think there is a 
strategy that needs to be looked at. There is going to be an 
$8,000 car and a $100,000 car. There is going to be a $10 
product and a $100 product. Customers and consumers are willing 
to come in at different levels. So we have two 
responsibilities, one, to create a commercial advantage, a 
manufacturing advantage, second, to guard against going below 
the bare acceptable minimum levels of safety performance. So I 
think good companies will work at that, and standards can help 
in that area.
    I think we also have some obligations that we need to think 
about that need to come from the public side also. One of the 
reasons Germany is very successful in exporting its technology 
and is perhaps now--well, not perhaps, they are the second 
largest exporter in the world because they work hand in hand 
with their government, their government programs, their 
facilitations, their efforts to outreach, their effort to get 
involved with the buying community in the future and the 
country of reception, if you will, where the market is going to 
be of them, and they nurture and develop these markets with a 
lot of support and help from their Federal Government and from 
their funding resources, which come beyond just within the 
company's ways and means.
    We also have to think about the financial aspects of 
sponsoring, if you will, initiatives and knowledge 
dissemination in the SMEs. We talked about that a little bit 
but I hope one day we talk about that a little bit more because 
SMEs are a big source of developing new businesses and new 
opportunities both in manufacturing and also in exports of 
other types of products and services.
    So I think there is a lot we can do. I see opportunities 
all over the place, but we need to find ways of funding that, 
resourcing that, and you guys are empowered to create 
incentives for this to be done more effectively, and I think we 
should talk about how we can achieve that.
    Mr. Sarbanes. Thanks.
    Chairman Quayle. Thank you, Mr. Sarbanes.
    I now recognize Mr. Lujan.
    Mr. Lujan. Thank you, Mr. Chairman.
    I want to talk a little bit about that empowerment, and we 
have five minutes to find consensus and get direction on how to 
solve this problem, and, you know, as we talk about the 
seriousness associated with this, in the 111th Congress, we 
actually had a piece of legislation that moved out of this 
Committee talking about electronic waste, the components of 
the--right now the impact on the consumer, I would hope a 
revenue stream that is not built for the mobile industry, 
mobile-phone industry built on chargers as we talk about the 
reality associated with the industry. But what can be done as 
we talk about voluntary standards where, again, appreciating 
what happened with USB but also the frustration associated with 
the other end of that cord. When we talk about electricity that 
is flowing through that copper, the interchangeability 
associated with what goes into the socket, whatever country you 
are, it seems to me that we should at least find some common 
ground there and eliminate what is happening on the waste side 
as well as with consumers, with some seriousness associated 
with direction on what could be done there to either encourage 
that voluntary component or see what could be done on our end.
    Mr. Wennblom. Thanks for your question. Two main points. 
The first is that one of the reasons why you have seen change 
in the connector that is based on USB in various phones is 
because technology has changed and requirements have changed. 
The connector in phones today is much thinner than the 
connector that was originally created for USB, and that has 
been driven by the needs of phone manufacturers who know that 
consumers prefer thinner and thinner phones. The thinnest 
connectors today would have been too expensive when USB was 
created. So in terms of cost and form factor tradeoffs, it has 
been necessary to make changes over time. And the other thing 
that is changing in phones that is very important is battery 
technology. The chemistry is changing and the form factors are 
changing, and that has driven some changes in interfaces.
    So if we tried to standardize on a connector too soon and 
required phone manufacturers to use that, that would have 
interfered with lots of the innovation that consumers 
appreciate today. So sometimes there are some changes 
necessary. However, there is also----
    Mr. Lujan. If I may, then why is it that my iPod charger 
from four years ago can still power my iPhone and I can get the 
charge out of it? I mean, I couldn't find one of my chargers, I 
don't know where I left it, and so I went into my box of 
chargers, and lo and behold, I had an old iPod charger, plugged 
it in, plugged in my phone. The old one is kind of neat because 
it has two little clips on it which they made a little bit 
smaller, so with the exception of having to pinch those clips 
now and pull it out, it still charges the phone. This is 
second-generation iPod to iPhone 4.
    Mr. Wennblom. The basic voltage for USBs remained the same 
since it was created. What has changed is the form factor of 
the connector. I think the connector on your iPhone is actually 
a proprietary interface based on USB, and because the 
manufacturer, Apple, has chosen to keep that the same over time 
for reasons that you would appreciate, your iPod connector 
still works. So continuity is useful, but there are times for 
breaks. I was going to say that the USB group has now 
contributed its technology to IEC for incorporation in an 
international standard for cell phone charging, and some of the 
changes we talked about are slowing down a little bit, so I am 
hopeful in the future you are going to need to change your cell 
phone charger much less frequently no matter which company you 
purchase it from.
    Mr. Lujan. That is encouraging, but nonetheless, as we talk 
about how technology has evolved and appreciating very much the 
fact as we talk about the connectivity on the charging 
component, I think therein lies one of the frustrations 
associated with standards across the country as we talk about 
devices that we depend on daily to the complexities associated 
with rail and roller coasters and everything in between, if you 
will, when we talk about the magnitude of size as we take into 
consideration the safety component. But I would also suggest 
the convenience and commonsense component.
    Again, I would hope that a revenue stream has not been 
developed associated with the charger, if you will, on the 
device and that we truly look to see what can be done there 
which I would suggest would offer ease to the consumer as well 
as more consumer preference when it comes to me making 
decisions on what devices that I want to go shopping for. If I 
know that I have a device that I have all the chargers that I 
need in the world, hopefully I will stick with that same device 
unless there is a compelling reason not to go with it. But when 
I have to make a decision to completely retrofit all of the 
components for my vehicle, for my home, for whatever mobile 
components we carry with us, I think it impacts us a bit.
    So I appreciate the humor associated with the conversation 
but also would ask that we take into consideration the 
seriousness when we talk about something as small as a mobile 
device.
    Thank you for the indulgence, Mr. Chairman.
    Chairman Quayle. Thank you, Mr. Lujan. You never know where 
a hearing is going to go, but I appreciate your comments, and 
we actually, with Mr. Wennblom, got a lot of information on how 
the chargers are developing and the innovation behind it. So I 
want to thank----
    Mr. Lujan. Mr. Chairman, if you would yield?
    Chairman Quayle. Yes.
    Mr. Lujan. One of the reasons I am so passionate about this 
is----
    Chairman Quayle. Because of your box of chargers.
    Mr. Lujan. It is my box of chargers, but actually this is a 
conversation I had with my mother years ago about the 
frustration that she had as well, so it is sensitivity to our 
moms, but recognizing that this is something that she said 
can't you do something about that. And so with the empowerment 
that was talked about, Mr. Chairman, I appreciate that. I yield 
back.
    Chairman Quayle. Well, to all moms out there, we will come 
to a conclusion. But I want to thank Mr. Lujan, and I want to 
thank all of the witnesses for their valuable testimony and the 
Members for their questions. The Members of the Subcommittee 
may have additional questions for the witnesses, and we will 
ask you to respond to those in writing. The record will remain 
open for two weeks for additional comments and statements from 
Members. The witnesses are excused. Thank you all for coming. 
This hearing is now adjourned.
    [Whereupon, at 11:36 a.m., the Subcommittee was adjourned.]

                   Answers to Post-Hearing Questions


Responses by Ms. Mary H. Saunders 

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Responses by Mr. S. Joe Bhatia

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Responses by Mr. Philip Wennblom, Director of Standards, Intel 
        Corporation

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Responses by Mr. James Seay, President, Premier Rides

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