[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]





                  THE UNCERTAIN FUTURE OF THE INTERNET

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

                                HEARING

                               BEFORE THE

             SUBCOMMITTEE ON COMMUNICATIONS AND TECHNOLOGY

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 25, 2015

                               __________

                           Serial No. 114-12

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


      Printed for the use of the Committee on Energy and Commerce
                        energycommerce.house.gov
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                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman
JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
  Chairman Emeritus                    Ranking Member
ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
JOSEPH R. PITTS, Pennsylvania        ELIOT L. ENGEL, New York
GREG WALDEN, Oregon                  GENE GREEN, Texas
TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
  Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
CATHY McMORRIS RODGERS, Washington   KATHY CASTOR, Florida
GREGG HARPER, Mississippi            JOHN P. SARBANES, Maryland
LEONARD LANCE, New Jersey            JERRY McNERNEY, California
BRETT GUTHRIE, Kentucky              PETER WELCH, Vermont
PETE OLSON, Texas                    BEN RAY LUJAN, New Mexico
DAVID B. McKINLEY, West Virginia     PAUL TONKO, New York
MIKE POMPEO, Kansas                  JOHN A. YARMUTH, Kentucky
ADAM KINZINGER, Illinois             YVETTE D. CLARKE, New York
H. MORGAN GRIFFITH, Virginia         DAVID LOEBSACK, Iowa
GUS M. BILIRAKIS, Florida            KURT SCHRADER, Oregon
BILL JOHNSON, Missouri               JOSEPH P. KENNEDY, III, 
BILLY LONG, Missouri                     Massachusetts
RENEE L. ELLMERS, North Carolina     TONY CARDENAS, California
LARRY BUCSHON, Indiana
BILL FLORES, Texas
SUSAN W. BROOKS, Indiana
MARKWAYNE MULLIN, Oklahoma
RICHARD HUDSON, North Carolina
CHRIS COLLINS, New York
KEVIN CRAMER, North Dakota
             Subcommittee on Communications and Technology

                          GREG WALDEN, Oregon
                                 Chairman
ROBERT E. LATTA, Ohio                ANNA G. ESHOO, California
  Vice Chairman                        Ranking Member
JOHN SHIMKUS, Illinois               MICHAEL F. DOYLE, Pennsylvania
MARSHA BLACKBURN, Tennessee          PETER WELCH, Vermont
STEVE SCALISE, Louisiana             JOHN A. YARMUTH, Kentucky
LEONARD LANCE, New Jersey            YVETTE D. CLARKE, New York
BRETT GUTHRIE, Kentucky              DAVID LOEBSACK, Iowa
PETE OLSON, Texas                    BOBBY L. RUSH, Illinois
MIKE POMPEO, Kansas                  DIANA DeGETTE, Colorado
ADAM KINZINGER, Illinois             G.K. BUTTERFIELD, North Carolina
GUS M. BILIRAKIS, Florida            DORIS O. MATSUI, California
BILL JOHNSON, Missouri               JERRY McNERNEY, California
BILLY LONG, Missouri                 BEN RAY LUJAN, New Mexico
RENEE L. ELLMERS, North Carolina     FRANK PALLONE, Jr., New Jersey (ex 
CHRIS COLLINS, New York                  officio)
KEVIN CRAMER, North Dakota
JOE BARTON, Texas
FRED UPTON, Michigan (ex officio)











  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Greg Walden, a Representative in Congress from the State of 
  Oregon, opening statement......................................     1
    Prepared statement...........................................     3
Hon. Anna G. Eshoo, a Representative in Congress from the State 
  of California, opening statement...............................     4
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     6
    Prepared statement...........................................     7
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, opening statement.........................     8

                               Witnesses

Rick Boucher, Honorary Chairman, Internet Innovation Alliance....     9
    Prepared statement...........................................    12
    Answers to submitted questions...............................    89
Gene Kimmelman, President and CEO, Public Knowledge..............    16
    Prepared statement...........................................    18
Robert Atkinson, Founder and President, The Information 
  Technology & Innovation Foundation.............................    26
    Prepared statement...........................................    28
    Answers to submitted questions...............................    92
Larry Downes, Project Director, Georgetown Center for Business 
  and Public Policy..............................................    41
    Prepared statement \1\.......................................    44
    Answers to submitted questions...............................    97

                           Submitted Material

Letters and editorials \2\, submitted by Mr. Walden..............    59
Letter of February 18, 2015, from small, independent businesses 
  and entrepreneurs to the Federal Communications Commission, 
  submitted by Ms. Eshoo.........................................    81
Statement of Etsy CEO, submitted by Ms. Eshoo....................    84
Letter of February 25, 2015, from the Internet Freedom Business 
  Alliance to the Committee, submitted by Ms. Eshoo..............    87

----------
\1\ The attachments to Mr. Downes' testimony can be found at 
  http://docs.house.gov/meetings/if/if16/20150225/103018/hhrg-
  114-if16-wstate-downesl-20150225.pdf.
\2\ The information can be found at http://docs.house.gov/
  meetings/if/if16/20150225/103018/hhrg-114-if16-20150225-
  sd009.pdf.

 
                  THE UNCERTAIN FUTURE OF THE INTERNET

                              ----------                              


                      WEDNESDAY, FEBRUARY 25, 2015

                  House of Representatives,
     Subcommittee on Communications and Technology,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:33 a.m., in 
room 2322 of the Rayburn House Office Building, Hon. Greg 
Walden (chairman of the subcommittee) presiding.
    Members present: Representatives Walden, Latta, Barton, 
Shimkus, Blackburn, Scalise, Lance, Guthrie, Olson, Kinzinger, 
Bilirakis, Johnson, Collins, Cramer, Upton (ex officio), Eshoo, 
Doyle, Yarmuth, Clarke, Loebsack, Rush, DeGette, Matsui, Lujan, 
and Pallone (ex officio).
    Staff present: Gary Andres, Staff Director; Ray Baum, 
Senior Policy Advisor for Communications and Technology; 
Leighton Brown, Press Assistant; Andy Duberstein, Deputy Press 
Secretary; Gene Fullano, Detailee, Telecom; Kelsey Guyselman, 
Counsel, Telecom; Peter Kielty, Deputy General Counsel; Grace 
Koh, Counsel, Telecom; David Redl, Counsel, Telecom; Charlotte 
Savercool, Legislative Clerk; David Goldman, Democratic Chief 
Counsel, Communications and Technology; Margaret McCarthy, 
Democratic Professional Staff Member; Ryan Skukowski, 
Democratic Legislative Assistant, Jeff Carroll, Democratic 
Staff Director; Tiffany Guarascio, Democratic Deputy Staff 
Director; and Tim Robinson, Democratic Chief Counsel.

  OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF OREGON

    Mr. Walden. If Members would take their seats and our 
guests. We appreciate everyone being here. The subcommittee 
will come to order. Before we begin, I would like to remind our 
guests in the audience the chair is obligated under the rules 
of the House and rules of the committee to maintain order and 
preserve decorum in the committee room. The chair appreciates 
the audience's cooperation in maintaining that order.
    Good morning and welcome to the subcommittee on 
Communications and Technology's hearing on ``The Uncertain 
Future of the Internet.'' Tomorrow, the Federal Communications 
Commission is expected to adopt an order that may not 
ultimately provide net neutrality protections for American 
consumers, that might lay the ground for future regulation of 
the Internet, that may raise rates for the American Internet 
users, and that could stymie Internet adoption, innovation, and 
investment. This Order may be the salvation of edge providers 
that fear speculative ISP practices or it may be the beginning 
of regulation of all platform providers wherever they sit on 
the Internet. We just don't know, and it doesn't have to be 
this way.
    Let us take a moment to point out that Chairman Upton and I 
asked for this process to be more open than is usual. We asked 
the Chairman of the FCC to release the draft Order, the rules 
and the jurisdictional arguments for the rules, before the 
Commission vote, so that people could really understand what 
they were getting themselves into. I recognize that it is not 
customary for the FCC to release its document before a vote, 
but then again, it is not customary for an FCC proceeding to 
attract the attention of an HBO comedian or scores of 
protesters and cat mascots parading in front of the FCC and 
Chairman Wheeler's Georgetown home, nor is it customary to have 
the President add his weight to steer an independent agency's 
decision. Our calls for transparency have been echoed by others 
to no avail. In short, we are still in the dark on the net 
neutrality rules, and we don't have to be.
    Uncertainty is what we hoped to stave off by introducing 
legislation that would clearly demarcate the FCC's authority 
over the Internet. Most of you know I did not see the need for 
net neutrality rules, and some of my colleagues had to be 
dragged ``kicking and screaming'' toward our draft bill. Thanks 
for that remark, John Shimkus. Despite our reservations, we 
came to the table with legislation for two reasons. The first 
is that not one of us disagrees, not one of us disagrees, with 
the four principles adopted by the FCC in 2005, the first 
principle being consumers are entitled to access the lawful 
Internet content of their choice. We all agree on that. Number 
two, consumers are entitled to run applications and services of 
their choice, subject to the need of law enforcement. Three, 
consumers are entitled to connect their choice of legal devices 
that do not harm the network. And four, consumers are entitled 
to competition among network providers, application and service 
providers, and content providers.
    The Internet has been a catalyst for our modern information 
economy and culture precisely because of these guiding 
principles. But the current draft Order, which will purportedly 
subject the Internet to monopoly-era regulation under Title II 
of the Communications Act, threatens to throw all of this out 
the window and to generate significant uncertainty that will 
impact the industry, its investors, and ultimately its 
consumers.
    Accordingly, the second reason that we have offered 
legislation is to quell that wave of uncertainty. No more trips 
to the D.C. Circuit for the FCC, at least on this issue. Our 
economy and our communities are better served by ISPs that can 
invest in services rather than in lawyers. We are all better 
served by an agency with clear jurisdiction rather than one 
that engages in policymaking by litigation. I think that this 
is something that everyone would support, but I have yet to 
find anyone willing to engage in a real negotiation over what 
this bill should look like. I am not above asking again. So 
let's talk about how we can work together to solve the problem 
and end the uncertainty. The door remains open.
    So today our hearing is intended to lay out some of the 
questions we have been asking and to explore the uncertainty 
surrounding these new proposed rules. Our panel of witnesses 
today contains several veterans of this debate. Mr. Boucher, in 
particular, welcome back. You sat right here in this very chair 
with a gavel that looked a lot like this one when the FCC began 
its first attempt to enforce net neutrality through regulation. 
It is very good of you to return to talk to us about this same 
issue today.
    I hope that all of us here in the room will continue to 
engage in a productive dialogue and use the tools at our, and 
only our, disposal to end the net neutrality debate once and 
for all.
    [The prepared statement of Mr. Walden follows:]

                 Prepared statement of Hon. Greg Walden

    Good morning and welcome to the Subcommittee on 
Communications and Technology's hearing on ``The Uncertain 
Future of the Internet.'' Tomorrow, the FCC is expected to 
adopt an Order that may not ultimately provide net neutrality 
protections for American consumers; that might lay the 
groundwork for future regulation of the Internet; that may 
raise rates for the American Internet users; and that could 
stymie Internet adoption, innovation, and investment. This 
Order may be the salvation of edge providers that fear 
speculative ISP practices or the beginning of regulation of all 
platform providers wherever they sit on the Internet. We just 
don't know and it doesn't have to be this way.
    Let's take a moment to point out that Chairman Upton and I 
have asked for this process to be more open than usual. We 
asked the Chairman to release the draft Order--the rules and 
the jurisdictional arguments for the rules--before the 
Commission vote, so people could really understand what they 
were getting themselves into. I recognize that it is not 
customary for the FCC to release its document before a vote, 
but then again, it's not customary for an FCC proceeding to 
attract the attention of an HBO comedian or scores of 
protesters and cat mascots parading in front of the FCC and 
Chairman Wheeler's Georgetown home. Nor is it customary to have 
the President add his weight to steer an independent agency's 
decision. Our calls for transparency have been echoed by others 
to no avail. In short, we are still in the dark on the net 
neutrality rules, and we don't have to be.
    Uncertainty is what we hoped to stave off by introducing 
legislation that would clearly demarcate the FCC's authority 
over the Internet. Most of you know that I did not see the need 
for net neutrality rules, and some of my colleagues had to be 
dragged ``kicking and screaming'' toward our draft bill. 
(Thanks for that remark, John.) Despite our reservations, we 
came to the table with legislation for two reasons. The first 
is that not one of us disagrees with the four principles 
adopted by the FCC in 2005.
    (1) consumers are entitled to access the lawful Internet 
content of their choice;
    (2) consumers are entitled to run applications and services 
of their choice, subject to the needs oflaw enforcement;
    (3) consumers are entitled to connect their choice of legal 
devices that do not harm the network; and
    (4) consumers are entitled to competition among network 
providers, application and service providers, and content 
providers.
    The Internet has been a catalyst for our modern information 
economy and culture precisely because of these guiding 
principles. But the current draft Order, which will purportedly 
subject the Internet to monopoly-era regulation under Title II 
of the Communications Act, threatens to throw all of this out 
the window and to generate significant uncertainty that will 
impact the industry, its investors, and ultimately its 
consumers.
    Accordingly, the second reason that we've offered 
legislation is to quell that wave of uncertainty. No more trips 
to the D.C. Circuit for the FCC--at least on this issue. Our 
economy and our communities are better served by ISPs that can 
invest in services rather than in lawyers. We are all better 
served by an agency with clear jurisdiction rather than one 
that engages in policymaking by litigation. I think that this 
is something that everyone would support, but I have yet to 
find anyone willing to engage in a real negotiation over what 
this bill should look like. I'm not above asking again--let's 
talk about how we can work together to solve the problem and 
end this uncertainty. The door is open.
    So today, our hearing is intended to lay out some of the 
questions we've been asking and to explore the uncertainty 
surrounding these new rules. Our panel of witnesses today 
contains several veterans of this debate. Mr. Boucher, in 
particular, sat in this very chair when the FCC began its first 
attempt to enforce net neutrality through regulation. It's very 
good of you to return to talk to us about this same issue 
today. I hope that all of us here in the room will continue to 
engage in a productive dialogue and use the tools at our, and 
only our, disposal to end the net neutrality debate once and 
for all.

    Mr. Walden. I now recognize the gentlelady from Tennessee 
for the remainder of my time.
    Mrs. Blackburn. Thank you, Mr. Chairman. I want to welcome 
each of you here today. I am one of those that believes the 
Internet is a bright spot in today's economy. It is not broken, 
and it does not need the FCC's help in order to be effective. 
Title II of the Communications Act is the regulatory nuclear 
option. It will stifle private-sector investment in networks by 
creating regulatory uncertainty and lead to courtroom 
challenges. We know that Title II reclassification could result 
in as much as $11 billion in new fees and taxes.
    We welcome you here today. We look forward to hearing your 
viewpoints and to a lively discussion, and I yield back.
    Mr. Walden. I thank the gentlelady. I now recognize my 
friend from California, the Ranking Member of the Subcommittee, 
Ms. Eshoo, for an opening statement.

 OPENING STATEMENT OF HON. ANNA G. ESHOO, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Ms. Eshoo. Thank you, Mr. Chairman, and welcome to all of 
the witnesses, most especially our former colleague who is a 
Member, a distinguished Member, of this committee both as a 
chairman of the subcommittee and ranking member of the 
subcommittee.
    Mr. Chairman, I had a wonderful statement that I was going 
to read, but I received a letter from Engine. It is dated 
February 18 of this year. It is addressed to the Federal 
Communications Commission, and I think that what they had to 
say and the 102 entrepreneurs and start-ups that signed the 
letter is really an eloquent statement about where we are and 
where we need to go.
    And it reads, ``Dear Commissioners. We are the small 
independent businesses and entrepreneurs that Commissioner Pai 
referenced in his February 6, 2015, press release about the 
FCC's impending net neutrality rule-making, and we write to say 
unequivocally that his release does not represent our views on 
net neutrality. Quite the opposite. Entrepreneurs and start-ups 
throughout the country have consistently supported Chairman 
Wheeler's call for strong net neutrality rules enacted through 
Title II.
    ``For today's entrepreneurs and start-ups, failure to 
protect an open Internet represents and existential threat. 
Because net neutrality is such an important issue, the start-up 
community has been engaged in the Commission's open Internet 
proceeding to an unprecedented degree. The clear, resounding 
message from our community has been that Title II with 
appropriate forbearance is the only path the FCC can take to 
protect the open Internet. Any claim that a net neutrality plan 
based in Title II would somehow burden `small independent 
businesses and entrepreneurs with heavy-handed regulations that 
will push them out of the market' is simply not true. The 
threat of ISPs abusing their gatekeeper power to impose tolls 
and discriminate against competitive companies is the real 
threat to our future.
    ``Contrary to any unsupported claims otherwise, we believe 
that the outlined proposal that the Chairman circulated last 
week will encourage competition and innovation by preventing 
ISPs from using their gatekeeper power to distort the Internet 
market for their own private benefit. A vibrant Internet 
economy depends on an open playing field in which small, 
innovative entrepreneurs can compete with incumbents on the 
quality of their services, not on the size of their checkbook 
or their roster of lobbyists. In Verizon v. FCC, the DC Circuit 
stated in no uncertain terms that without reclassifying 
broadband under Title II, the FCC cannot impose the bright-line 
bands on ISP discrimination that start-ups need to compete. As 
such, any plan that does not include Title II reclassification 
cannot support strong net neutrality rules. We are pleased that 
Chairman Wheeler has recognized this simple reality.
    ``Chairman Wheeler's plan is the best proposal we have seen 
to date for protecting the open Internet. While there are 
important details yet to be finalized, the substance of the 
rules that the Chairman circulated last week are encouraging. 
Any attempt to undermine the Chairman's proposal through 
obfuscation and innuendo is not productive and certainly does 
not represent the opinion of the start-ups and entrepreneurs 
that have worked so hard to make the Internet great.''
    And again, the letter is from Engine, and it is signed by 
102 start-ups. And obviously that is now part of the record. I 
also would like to place in the record, ask for unanimous 
consent to place in the record, the editorial by Chad Dickerson 
at Etsy CEO that testified before the committee.
    Mr. Walden. Without objection.
    [The information appears at the conclusion of the hearing.]
    Ms. Eshoo. I want to yield the remainder of my time--thank 
you, Mr. Chairman--to Congresswoman Matsui.
    Ms. Matsui. I thank the ranking member for yielding me 
time, and I welcome the witnesses here today.
    The future of this Internet has sparked unprecedented 
interest. We all know that. Let us not forget that over four 
million Americans took time out of their day to share their 
voices with the FCC on the future of the Internet.
    The American people overwhelmingly rejected the idea of so-
called Internet fast lanes, and as a result, Chairman Wheeler 
rightly made a U-turn to ban prioritization agreements and as 
to a ban on paid prioritization is a right move for the future 
of the Internet.
    Tomorrow's FCC vote will not be the end of the road. In 
some ways the vote will be the beginning of the fight to 
preserve net neutrality and protect consumers and encourage 
innovation. That is why it will be critical for the FCC to 
maintain the flexibility for the Internet age.
    I look forward to the FCC's vote tomorrow, and I will 
continue to work with my colleagues on this moving forward. And 
I yield back the balance of my time.
    Mr. Walden. The gentlelady yields back. The chair now 
recognizes the Chairman of the Full Committee, Mr. Upton of 
Michigan, for an opening statement.

   OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Mr. Upton. Well, thank you, Mr. Chairman. In less than 24 
hours the FCC will begin proceedings to green light new net 
neutrality rules that rely on outdated utility-style 
regulations to govern the Internet. They are taking this path 
in part because of the limits on the FCC's statutory authority 
and in part because of political pressures to act. 
Unfortunately, whether intended or not, this approach brings 
with it a host of consequences that have the potential to 
disrupt the Internet that we have come to know and rely on.
    Title II means applying regs that were never meant for this 
technology or marketplace and relying on unstable legal ground 
to refrain from applying others. It also means an inevitable 
return to the courts for net neutrality rules, which will lead 
to more years of uncertainty for consumers and providers. Until 
it is resolved, there may be no rules of the road for either 
consumers or industry.
    To avoid this result, Chairman Walden, Thune, and I offered 
draft legislation proposing net neutrality rules guided by the 
principles for an open Internet that we all share. Our 
committee has a rich history of taking on complex and difficult 
issues and finding common ground that both sides can support.
    Given what is at stake here, I had hoped this would be 
another instance of such bipartisan cooperation. While I knew 
that not everyone would be interested in the legislative path, 
I am both surprised and deeply disappointed that we have not 
yet been able to engage in a negotiation and produce a 
bipartisan product with our colleagues. But tomorrow's 
commission vote does not signal the end of this debate, rather 
it is just the beginning. And I have to believe that as members 
review the FCC's rules and hear today about the many problems 
that will result, there will be an opportunity for a thoughtful 
solution like the one we have offered: bright-line Internet 
rules of the roads, safeguards to encourage innovation, and 
enforcement mechanisms that allow the FCC to protect consumers 
without years of court battles.
    A legislative answer to the net neutrality question will 
finally put to rest years of litigation and uncertainty. 
Today's hearing will illustrate many of the harms that could 
come from the FCC's Title II approach to net neutrality. Let us 
work to avoid those landmines and get this done here, in 
Congress, where policy decisions should belong. There is no 
question that Americans deserve the most robust and innovative 
Internet possible. This requires clear rules tailored to 
protect consumers and companies. Rules like the ones we have 
put forward in our discussion draft and the same rules the FCC 
Chair, President Obama, and Democrats in Congress have sought 
for years.
    Once again, I would urge my colleagues to work with us and 
help put net neutrality into law in a way that avoids the 
costly, harmful consequences that we will hear about today. It 
is the right thing to do, so let us get it done. I yield the 
balance of my time to the Vice Chair of the subcommittee, Mr. 
Latta.
    [The prepared statement of Mr. Upton follows:]

                 Prepared statement of Hon. Fred Upton

    In less than 24 hours the FCC will begin proceedings to 
green light new net neutrality rules that rely on outdated 
utility-style regulations to govern the Internet. They are 
taking this path in part because of the limits on the FCC's 
statutory authority, and in part because of political pressures 
to act. Unfortunately, whether intended or not, this approach 
brings with it a host of consequences that have the potential 
to disrupt the Internet we have come to know and rely on.
    Title II means applying regulations that were never meant 
for this technology or marketplace, and relying on unstable 
legal ground to refrain from applying others. It also means an 
inevitable return to the courts for net neutrality rules, which 
will lead to more years of uncertainty for consumers and 
providers. Until it's resolved, there may be no rules of the 
road for consumers or industry.
    To avoid this result, Chairman Walden, Chairman Thune, and 
I offered draft legislation proposing net neutrality rules 
guided by the principles for an open Internet that we all 
share. Our committee has a rich history of taking on complex 
and difficult issues and finding common ground that both sides 
can support. Given what is at stake here, I had hoped this 
would be another instance of such bipartisan cooperation. While 
I knew that not everyone would be interested in the legislative 
path, I am both surprised and disappointed that we haven't yet 
been able to engage in a negotiation and produce a bipartisan 
product with our colleagues. But tomorrow's commission vote 
does not signal the end of this debate; rather, it is just the 
beginning. And I have to believe that as members review the 
FCC's rules and hear today about the many problems that will 
result, there will be an opportunity for a thoughtful solution 
like the one we have offered: bright line Internet rules of the 
road, safeguards to encourage innovation, and enforcement 
mechanisms that allow the FCC to protect consumers without 
years of court battles.
    A legislative answer to the net neutrality question will 
finally put to rest years of litigation and uncertainty. 
Today's hearing will illustrate many of the harms that could 
come from the FCC's Title II approach to net neutrality. Let's 
work to avoid those landmines and get this done here, in 
Congress, where policy decisions belong. There is no question 
that Americans deserve the most robust and innovative Internet 
possible. This requires clear rules tailored to protect 
consumers and companies. Rules like the ones we have put 
forward in our discussion draft--the same rules the FCC 
Chairman, President Obama, and Democrats in Congress have 
sought for years. Once again, I ask my colleagues to work with 
us and help put net neutrality into law in a way that avoids 
the costly, harmful consequences we will hear about today. It's 
the right thing to do--and we can get it done.

    Mr. Latta. I appreciate the chairman for yielding and 
thanks very much for witnesses for being with us today. I look 
forward to your testimony.
    The FCC will vote tomorrow on a net neutrality proposal 
that reclasses broadband Internet access service under Title II 
of the Communications Act. I strongly disagree with this 
approach. Time and time again we hear from businesses large and 
small that the reclassification will disrupt our flourishing 
Internet ecosystem by stifling innovation and slowing 
investment. Subjecting a thriving, dynamic industry to navigate 
the FCC's bureaucracy and red tape will adversely alter the 
Internet as we know it today.
    Furthermore, the FCC's proposal will inevitably introduce 
legal and certainly due to its lack of statutory authority. The 
discussion draft brought forth by Chairman Upton and Walden is 
a strong indication to this issue--pardon me, a strong solution 
to this issue. A legislative fix will provide regulatory 
certainty and enact the President's network management 
prohibitions without treating broadband as a common carrier.
    I look forward to the hearing today, and Mr. Chairman, I 
appreciate you yielding, and Chairman Walden, I yield back. 
Thank you.
    Mr. Walden. The gentleman yields back the balance of the 
time. The chair now recognizes the Ranking Member of the Full 
Committee from New Jersey, Mr. Pallone.

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF NEW JERSEY

    Mr. Pallone. Thank you, Mr. Chairman. As I have said 
before, net neutrality is critical because access to the 
Internet is critical. We go online to apply for jobs, to help 
our kids with their homework, and to grow our businesses. These 
are just a few of the reasons why four million Americans 
reached out to the FCC demanding strong network neutrality 
protections. Due to this overwhelming civic engagement, we are 
on the eve of a historic event at the FCC. Tomorrow the 
Commission is set to put into place what may be the strongest 
Internet protections consumers have ever had. And for all of 
you who called in, who wrote in, who came in to support net 
neutrality, you will see that the FCC and the rest of 
Washington knows how to listen, even if it doesn't always 
appear that way.
    So I welcome the Republicans' change of heart on their 
effort to legislate. I remain open to looking for ways to 
enshrine the FCC's network neutrality protections into law, but 
our effort can only work if it is truly bipartisan which is why 
I am baffled about why we are holding this hearing today, Mr. 
Chairman. Just a few weeks ago this subcommittee met on these 
same issues. We all heard a number of major concerns with the 
Republicans' discussion draft. We all heard that these are 
complicated issues that take more than a few weeks to sort 
through. This subcommittee and our Full Committee have too much 
other important work to do to have the same hearings over and 
over again.
    For instance, the FCC just completed the most successful 
auction in history for our Nation's airwaves. We could be 
spending this time building on that auction and establishing a 
spectrum pipeline for the future. We are nearly 2 months into 
the new Congress with very little to show for it. I think this 
subcommittee has enough talent to do more than just obsess over 
one topic at a time. Our constituents expect more of us.
    Now once we have all had time to review and evaluate the 
FCC rules and their effects, we can hopefully look for ways to 
find and reach consensus on a bipartisan legislative draft, but 
now is not that time. Now is the time for the FCC to do its 
work. I know that Chairman Wheeler will do everything in his 
power to release the FCC Order as soon as he can after the 
vote. To deliver on that promise, however, the Chairman needs 
the cooperation of his fellow Commissioners. So I ask all the 
Commissioners at the FCC, even those who may disagree with the 
final decision, to work with Chairman Wheeler to make this 
Order public as soon as possible.
    And I now yield the remainder of my time to the gentlewoman 
from New York, Ms. Clarke.
    Ms. Clarke. I thank our Ranking Member, Mr. Pallone, as 
well as our Ranking Member, Ms. Eshoo, for yielding me time 
today. I would also like to thank our witnesses for lending 
their expertise to today's hearing.
    Mr. Chairman, protecting the free and open Internet is 
truly and essentially an issue of access to economic 
opportunity. More than 80 percent of Fortune 500 companies 
require online job applications. Our constituents simply cannot 
compete without access to all that the Internet has to offer.
    In my district and across our country, people are 
increasingly moving to their smartphones and tablets as their 
primary access point to the Internet. That is especially true 
for the most economically vulnerable Americans. Seventy-seven 
percent of our low-income families rely on their mobile phones 
to get on line. So I support making sure that all Americans 
have open access to the Internet. People should be able to find 
the content and applications they want, no matter who they are 
or where they live. They should not be constrained by Internet 
gatekeepers, and the time has finally come to establish 
certainty in this regard.
    Therefore, I urge the Federal Communications Commission to 
finish its work. Four million Americans have called in on the 
FCC to adopt strong network neutrality protections. That eye-
popping number demonstrates how important this is. The country 
has waited long enough.
    I thank you, and I yield back.
    Mr. Walden. The gentlelady yields back the balance of the 
time. And now we will move forward to hear from our witnesses.
    We again thank you all for being here today to share your 
expertise on this issue as we move forward. I want to start 
with former chairman of this subcommittee, Mr. Boucher of 
Virginia, who is with the Internet Innovation Alliance now as 
the Honorary Chairman. Mr. Boucher, we are delighted to have 
you back as we have all said, and we look forward to your 
commentary this morning.

 STATEMENTS OF THE HONORABLE RICK BOUCHER, HONORARY CHAIRMAN, 
  INTERNET INNOVATION ALLIANCE; GENE KIMMELMAN, PRESIDENT AND 
CEO, PUBLIC KNOWLEDGE; ROBERT ATKINSON, FOUNDER AND PRESIDENT, 
 THE INFORMATION TECHNOLOGY & INNOVATION FOUNDATION; AND LARRY 
 DOWNES, PROJECT DIRECTOR, GEORGETOWN CENTER FOR BUSINESS AND 
                         PUBLIC POLICY

                   STATEMENT OF RICK BOUCHER

    Mr. Boucher. Well, thank you very much, Chairman Walden and 
Ranking Member Eshoo and other members of the subcommittee. It 
is a privilege to accept the committee's invitation to return 
to this very familiar surroundings and to share with you this 
morning my views on the best way to assure protection for 
network neutrality.
    As the Chairman said in the introduction, I am the Honorary 
Chairman of the Internet Innovation Alliance. It is a 
membership organization. We have 175 members including some 
technology companies. I am also a partner at Sidley Austin. We 
also there have clients who are telecommunications companies. 
But here today, I am expressing my own views, not the views of 
our law firm's clients or of the Internet Innovation Alliance.
    From the very time that the debate began about a decade ago 
on the network neutrality issue, I have been a strong proponent 
network neutrality and of imbedding a central network 
neutrality guarantees into our federal law. In those days I 
joined with now Senator Markey and Congresswoman Eshoo and 
others on this committee in a legislative effort that at that 
time was not successful to assure network neutrality 
guarantees. I remain a strong supporter today of network 
neutrality as I was then.
    I believed then as I believe today that assuring an open 
Internet is essential to maintaining the Web as a vibrant 
medium for free expression, for commerce, for education, for 
healthcare delivery. It is clearly the most capable and 
versatile communications medium that has been derived to date.
    To keep it that way, I am here today to urge that the 
committee develop a narrow bipartisan bill that gives statutory 
permanence and an assured legal foundation to network 
neutrality. I am concerned that if Congress does not act, all 
protection for network neutrality is at risk of being lost.
    FCC Chairman Wheeler has said that his reclassification 
Order that will be approved tomorrow rests on a stronger legal 
foundation than the FCC's 2010 Open Internet Order which 
ultimately was overturned in court. And that may be true. But 
it certainly is going to be subject to legal challenge. And we 
can't know today what the outcome that that litigation is going 
to be. We can predict that the court decision will be years 
into the future and coming, and that will be at a time that is 
well into the next presidential administration. We can just 
look at the timeline for the Verizon decision that declared the 
Open Internet Order be invalid. That didn't come until more 
than 3 years after the suit was filed. Three years from now we 
are into the next administration.
    If the Republicans win the presidency in 2016, the next FCC 
will have a Republican majority, 3 to 2, the mirror image of 
what it is today. And it would be very unlikely to appeal and 
adverse court decision or to institute a new proceeding that 
would establish network neutrality guarantees. In fact, it is 
very likely that a Republican FCC would move very quickly to 
reverse tomorrow's classification decision, even if that 
decision survives court determination.
    Tomorrow's reclassification order and the network 
neutrality principles it embodies truly rests on a tenuous 
foundation. Without statutory protection, the network 
neutrality guarantees can be swept away in the next 
presidential election, and judging from the polling we are 
seeing today, that is going to be a very close race.
    Therefore, my sole purpose in appearing today is to say 
that legislation is the superior solution. That is true for 
those of us who strongly support network neutrality guarantees. 
It is virtually impenetrable to judicial challenge and would 
resolve the debate with statutory permanence that is simply not 
available through the regulatory and administrative process.
    I know the Democratic members of this committee have raised 
concerns about the draft that has been circulated by the 
Republicans, but I would make a couple of points in closing. 
First of all, as Chairman Walden and Chairman Upton both have 
indicated, the Republicans have made a major move toward the 
historic Democratic position in offering to place strong 
network neutrality guarantees into federal law. In essence, 
they are offering to Democrats the very network neutrality 
principals that, for a decade, Democrats have sought to 
achieve.
    By the same token, Democrats have concerns, and I think it 
is important for the Republicans to acknowledge those concerns 
and address them in a bipartisan negotiation. Surely those 
concerns are subject to resolution. Candidly, I have some 
concerns about the draft legislation, and if I were on the 
Democratic side of the dais today, I would be expressing some 
concerns as well.
    In the end, what really matters is two key principles, 
first, establishing strong network neutrality guarantees 
perhaps using the FCC's 2010 Open Internet Order as a model and 
secondly providing a continuation of the light touch 
information service Title I treatment of the Internet that has 
welcomed investment and made it a dynamic platform that has 
become the envy of the world. Everything else should be open to 
discussion, negotiation, and resolution.
    At the moment, both sides have leverage. Both sides have 
the opportunity to obtain their key priorities, and I very much 
hope that a conversation will ensue and that you will adopt 
legislation that does a service for the country and keeps the 
Internet open and maintains the light touch regulatory 
treatment that it enjoys today.
    Thank you very much for having me here, and I will be 
pleased to take your questions.
    [The prepared statement of Mr. Boucher follows:]
   
  [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
    
    Mr. Walden. Mr. Boucher, thank you very much for your 
testimony and your comments.
    We now go to the President and CEO of Public Knowledge, 
Gene Kimmelman, not a stranger to our committee. We welcome 
your comments as well, sir.

                  STATEMENT OF GENE KIMMELMAN

    Mr. Kimmelman. Thank you so much, Mr. Chairman, Ranking 
Member Eshoo, members of the subcommittee. On behalf of Public 
Knowledge, which is a non-profit that promotes creativity, 
freedom of expression on open communications platforms, I am 
pleased to appear before you this morning, and I am most 
honored to join with millions of consumers, citizens, civil 
rights activities, start-up companies, small businesses, to 
praise the direction that Chairman Wheeler at the FCC is going 
in his proposed rules for open Internet because it is those 
rules that will do more for our society to promote freedom of 
expression and opportunity on what has become the most 
important platform for economic opportunity, social mobility, 
as Mr. Boucher said, education, healthcare. That is the 
Internet. These rules are critical.
    The proposed rules as we understand them actually follow a 
long tradition of the FCC flexibly applying the mandate that 
this Congress has directed it to follow in preventing 
discriminatory practices that are unjust and unreasonable on 
communications platforms. They are perfectly aligned with what 
this Congress has asked in the past and update in conjunction 
with all the innovation and technology that we have seen 
exploding in this space, the fundamental principles that are 
necessary to promote freedom of expression.
    It is the Title II principles that have been undergirding 
through all of our communications infrastructure the exposure 
and investment, the tremendous innovation in telecommunications 
that we have experienced in the last few decades, and the 
enormous growth in the Internet economy. It is those same 
principles the FCC is applying as we understand it in 
tomorrow's ruling.
    We think this just continues through light touch regulation 
as again Mr. Boucher referred to, the approach that this 
Congress has always been asking the FCC to be sensitive to with 
clarity in its policing tools that are necessary to guide an 
open Internet and prevent unreasonable discrimination on that 
platform. We believe that is all they are doing.
    Now, I understand from the comments made already this 
morning and more that we will hear that there are questions 
about regulation. There are questions about how to apply them. 
There are questions about how far they go. It is not 
unreasonable. It is not the first time. This is my third decade 
of going through debates about common carriage and 
discrimination going back to the breakup of AT&T through the 
computer inquiry, through the 1996 Act, and now into the 
Internet era. These are the very same important principles to 
discuss.
    But here is one thing I would like to highlight. I don't 
know Chairman Wheeler that well. I have come to know him better 
in the last few years, given where he sits and what he has 
said, and here is what I have seen. This is a chairman of the 
FCC who is very sensitive to the need for investment in 
infrastructure and expansion of broadband opportunities for 
Americans. This is a chairman who my perception is wants to 
regulate as little as possible to accomplish the goals that 
Congress has directed him to accomplish. And I therefore feel 
very confident that he is attuned to all the concerns that you 
are raising, he has listened to the public's input, and that 
these proposed rules as we know them are likely to be 
consistent with that.
    So while I fully understand the interest in legislating, I 
would urge you today to sit back and see what is put forward 
tomorrow. See what will work and what you think won't work and 
then consider what Congress rightfully needs to do to step in 
and address those concerns. But I will also suggest please 
consider if you are legislating addressing all the other 
concerns that have been legitimately raised about potential 
shortcomings in the Communications Act.
    In that endeavor, we look forward to working with you as 
you move forward. Thank you so much, Mr. Chairman.
    [The prepared statement of Mr. Kimmelman follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Walden. Mr. Kimmelman, thank you for your testimony as 
always. I would just point out that we are not doing a mark-up 
today on legislation. We actually have said we are not going to 
do a mark-up until we see what the FCC does, but we wanted to 
hear from people like you about what you know about the Act at 
this point or the Order at this point.
    We will go now to Mr. Atkinson, the Founder and President, 
Information Technology & Innovation Foundation. Mr. Atkinson, 
we are delighted to have you here this morning to get your 
perspective. Please go ahead.

                  STATEMENT OF ROBERT ATKINSON

    Mr. Atkinson. Thank you, Chairman Walden and Ranking Member 
Eshoo and members of the subcommittee. ITIF is a think tank 
that focuses on advancing innovation and smart innovation 
policy.
    Let me start by arguing that I think it is time we should 
consign the term net neutrality to the dustbin of history. It 
is a misleading term. It is a bias term that has driven the 
debate to the false conclusion that there is a one-size-fits-
all Internet and that absent Title II, Internet Armageddon is 
one decision away.
    Neither of these claims are true. Instead, what we need to 
be talking about is the need for effective network policy for 
the 21st century. Ten years from now our goal should be to have 
a better, smarter Internet than we have today, and to be sure, 
it should be a network that effectively polices abuses. We have 
been and have continued to be long supporters of the view that 
Internet providers should not be able to capriciously block or 
degrade or create pay-to-play, forced pay-to-play. That has 
been our position for 8 years now in the debate. And when we 
see other nations that are doing things like shifting to a 
carrier-pay model or allowing blocking competing applications, 
for example, of VoIP, we strongly oppose those and rules should 
do that.
    But we also need a network that supports a rich diversity 
of applications with the optimal levels of performance. This is 
not the telephone era where you have one application riding on 
one wire. What you have are multiple different applications 
with multiple different needs all riding on one wire.
    So the idea that we should have a rigid regulatory scheme 
that requires all traffic to be delivered the same way is a 
little bit like saying that we should force bicycles and mopeds 
to drive on the interstate with sports cars and tractor 
trailers. Or it is a little bit like the Postal Regulatory 
Commission telling the U.S. Postal Service that they can no 
longer have Priority or Express Mail. You can only deliver mail 
at one speed, and that is really what we are talking about 
here.
    So in other words, there are two threats to the Internet 
today, or potential threats. One is unreasonable discrimination 
which we have seen frankly very, very little of, and the other 
is the risk of a dumb static network that doesn't evolve as the 
Internet economy evolves. Title II in our view is a bad idea 
because it embodies the second of those two visions instead of 
the first.
    But Title II is a bad idea not just because of its rigidity 
but because of the uncertainty it puts industry, both network 
providers and edge providers under. As the Honorable Rick 
Boucher said, the notion that Title II is going to put 
regulations on a sure footing is simply wrong. To think that 
Title II will provide certainty for anyone but the FCC is a 
pipe dream. As Dr. Boucher referred to, there will be 
significant legal challenges, significant legal uncertainty, 
and certainly political uncertainty. Whoever the next president 
is, could go in either direction, could go towards banning, 
going back to Title I or could go and say we are going to 
reverse any kind of forbearance actions that this current FCC 
Chairman is committed to. So we just simply have no idea what 
is going to happen.
    Significantly, if Title II goes forward, there is also 
going to be uncertainty over its implementation. Chairman 
Wheeler has tried to mollify critics saying that he will 
forbear and forbear from this and from that and from this. But 
the fact that he has to give assurances is proof that Title II 
is a kludge of a solution. It is not a solution when you have 
to take whole components of it and move it off the table. It is 
a little bit trying to fit the square peg of a smart network 
policy into the round hole of Title II Telephone Regulation.
    The other problem or challenge with the Chairman's actions 
is that many groups are going to file petitions in terms of 
forbearance. We already have some groups already, and I will 
refer to my colleague, Gene Kimmelman's organization. Public 
Knowledge has asserted just last week that they intend to push 
to use Title II to require broadband providers, including new 
entrants into the marketplace with innovative business models 
deploying fiber, to serve all areas of a community at once. 
This may or may not be a valid view. In our view, it is not. 
But it has nothing to do with net neutrality.
    We have seen Free Press state, ``with Title II, we have the 
legal authority to win the battles that are coming around the 
bend.'' So this is not really an argument about net neutrality. 
This is an argument about broad-based regulation of network 
providers.
    So going forward, the only way in our view to achieve 
certainty, for edge providers and network providers, is 
congressional legislation, and to achieve that certainty, we 
would argue that balance needs to be the watch word as you go 
forward, and we need to have balance between the edge and the 
core. We need balance between requiring a one-size-fits-all 
dump pipe and allowing capricious discrimination, neither of 
those solutions is the right way. And frankly, we need balance 
between the over governance of Title II and the under 
governance of doing nothing.
    We believe that it is possible and desirable to get that 
kind of solution that serves everybody's interest in the 
debate. There is a real moment of opportunity. What we have 
heard today is a broad consensus on the principles, and we 
believe that Congress should work together to draft the kind of 
framework we need for network policy for the 21st century.
    Thank you for the opportunity to appear before you.
    [The prepared statement of Mr. Atkinson follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Walden. Mr. Atkinson, we appreciate your comments, and 
thank you for being here today. We will now go to our final 
witness this morning from the Internet Industry. He is an 
analyst and an author, Larry Downes. Mr. Downes, we are 
delighted to have you here as well. Please go ahead.

                   STATEMENT OF LARRY DOWNES

    Mr. Downes. Thank you. Thank you, Mr. Chairman, Ranking 
Member Eshoo, and members of the subcommittee. I appreciate the 
opportunity to testify before you today. I am based in Silicon 
Valley, have been for over 20 years, and have been actively 
engaged in what really is the remarkable development of the 
broadband Internet ecosystem in several capacities including as 
an entrepreneur and advisor to start-ups and investors.
    Since March 2014 I have also served as a Project Director 
at the Georgetown Center for Business and Public Policy 
studying the increasingly uncomfortable tension between the 
accelerating pace of disruptive innovation and the necessarily 
deliberative processes of government.
    My written testimony focuses on four major concerns with 
the FCC's pending proceeding which I would like to summarize 
now. Number one, Chairman Wheeler has flip-flopped from 
pursuing open Internet rules to what now appears a full-force 
effort to transform broadband into a public utility, threatens 
to end nearly 20 years of bipartisan policy favoring light 
touch regulation of the Internet, perhaps the most successful 
approach to regulating an emerging technology in history.
    Under the visionary approach of Congress, the Clinton 
administration and FCC Chairman of both parties at the time and 
since the 1996 Act wisely left Internet governance to the 
engineering-driven, multi-stakeholder process, a process that 
continues to rapidly evolve and improve the Internet's 
architecture protocols and network management technologies.
    Number two: The May 2014 NPRM which promised to follow the, 
quote, roadmap laid out by the Verizon court to reenact the 
open Internet rules under the authority of Section 706 now 
appears to have been jettisoned in favor of an all-inclusive 
plan to regulate every node of the Internet infrastructure 
including peering, transit, and other essential but non-neutral 
network management principles the 2010 report and Order wisely 
and explicitly excluded. Though we have yet to see the final 
report and Order, it is reported to be over 300 pages long. Its 
length will challenge even its strongest proponents to say with 
a straight face that it is any way a simple or light touch 
resolution to a decade of debate over the appropriate and 
legally permitted role of the FCC in policing the Internet. And 
as we know from its 2010 counterpart, most of its most 
contentious and legally challenged aspects will be 
intentionally buried deep in the text and in hundreds of 
footnotes.
    The jurisdictional gymnastics were bad enough in 2010. Now, 
given the acknowledged misfit, both from a legal and policy 
standpoint of Title II written decades ago to closely regulate 
the former public switch telephone network monopoly, the 
process is already confounded by the need to first transform 
the Internet into a public utility and then immediately begin 
the process of unraveling that decision. Having selected the 
blunt instrument of Title II, the FCC in its discretion must 
continually decide on its least-appropriate provisions in an 
attempt to undo them through clumsy and legally uncertain 
forbearance proceedings. At the very least, extensive 
forbearance invites the worst kind of rent-seeking behavior by 
self-interested parties throughout the Internet ecosystem.
    Number three: Recent developments in this long-running 
debate over who and how to regulate the Internet have now made 
clear that for many advocates that open Internet rules were 
always the populist tail wagging the shaggy Title II dog. 
Though the rhetoric of net neutrality remains the substance of 
the FCC's pending rule-making instead advances a long-running 
campaign to abandon the light touch model and replace it with a 
public utility regime, the goal all along for many supposed 
open Internet advocates. Though the FCC may today attempt or 
not to forbear from the most damaging provisions of Title II, 
the campaign is already preparing to drive the Title II wedge 
as far as possible which, for the most vocal advocates have 
always included mandatory unbundling, required build-outs, pre- 
or post-hoc rate regulation, universal service fees and other 
taxes, and shared jurisdiction with state public utility 
commissions. Perhaps the light touch model was wrong all along. 
Perhaps the transformation of the Internet into a public 
utility would do a better job of encouraging investment, 
adoption in innovation. I don't think so, but if that is what 
we are debating, we should at least acknowledge it and move the 
debate to Congress where it obviously belongs.
    Number four: Abandoning the Verizon court's Section 706 
roadmap in favor of public utility regime as the Chairman has 
not hesitated to acknowledge introduces considerable legal 
uncertainty that at best will mean another 2 years or more 
without resolution to the open Internet debate. It is not 
simply my personal belief that Congress never intended for 
broadband Internet to be regulated as a public utility like the 
old telephone network. That of course has long been the 
interpretation of the 1996 Act of the FCC itself, an 
interpretation ratified in 2005 by the United States Supreme 
Court in the Brand X case. Overcoming a decade of FCC policy 
and Supreme Court precedent will require considerable 
innovation and outright creativity by government lawyers that 
will certainly take years to resolve one way or the other.
    There is a better way, one that removes all legal 
uncertainty in an instant and avoids many of the intended and 
unintended consequences of the public utility gambit. The 
legislation introduced last month in both the House and the 
Senate would quickly and cleanly resolve the FCC's persistent 
jurisdictional problems and enact precisely the rules called 
for in even the most aggressive articulation of open Internet 
principles. Though I continue to believe the engineering-driven 
multi-stakeholder governance of the Internet is the optimal 
solution, one that has worked with remarkable efficiency since 
its inception, I have from the beginning supported the proposed 
legislation if only as a way to end the largely academic debate 
about the need for what the FCC itself calls, quote, 
prophylactic rules.
    I thank you again for the invitation and look forward to 
your questions.
    [The prepared statement of Mr. Downes follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    [The attachments to Mr. Downes' testimony have been 
retained in committee files and can be found at http://
docs.house.gov/meetings/if/if16/20150225/103018/hhrg-114-if16-
wstate-downesl-20150225.pdf.]
    Mr. Walden. Mr. Downes, thank you, and thanks to all of our 
witnesses for testifying today. We appreciate your comments, 
your suggestions, and your concerns. I would like to ask 
unanimous consent to submit into the record an opinion piece 
written by Robert McDowell, former FCC Commissioner, and Gordon 
Goldstein that was in the Wall Street Journal entitled, 
Dictators Love the FCC's Plan to Regulate the Internet; the 
Obama Administration's Efforts to Treat the Web Like a Utility 
has Fans from Saudi Arabia to the Putin's Kremlin. Without 
objection.
    [The information has been retained in committee files and 
can be found at http://docs.house.gov/meetings/if/if16/
20150225/103018/hhrg-114-if16-20150225-sd009.pdf.]
    Ms. Eshoo. Oh, my God. Come on.
    Mr. Walden. Well, I don't generally comment on the 
submissions you have. So Mr. Downes, the United States recently 
returned from a treaty conference in South Korea where our 
delegation fought to keep the Internet from coming under the 
purview of the UN's International Telecommunications Union. The 
ITU has an extensive set of regulations that apply to 
telecommunications including economic relations on 
interconnection. Would the FCC redefine a broadband Internet as 
a public utility telecommunications service within the ITU 
constitutional remand? And with the FCC stating that its 
regulatory powers would include Internet interconnection 
agreements, have the implications for international termination 
agreements been considered by the Commission and what effect do 
you think this will have?
    Mr. Downes. Thank you, Mr. Chairman. So of course, again, 
we have to qualify that we have not seen the full report. We 
don't know exactly how they are going to do this, but certainly 
if we are talking about a telecommunications service, that is 
within the purview of the ITU and the treaties that the United 
States is subject to in conjunction with its membership in the 
ITU.
    Whether or not this is going to stand up legally, I think 
there is no question that these forces within the ITU that are 
eager to introduce things like sending network pays, models 
that we have had on telephone service and introduce that for 
Internet service is a way of subsidizing their own local 
broadband connections. They will certainly make the argument, 
whether they are successful or not, that our move undermines 
our longstanding commitment to keeping the Internet away from 
those kinds of telecommunications and settlement regimes, and 
really, it certainly undermines our moral high ground in saying 
so whether or not they get away with it or not.
    Mr. Walden. Under GATS, countries that declare services to 
be basic services like telephony could limit U.S. investment 
opportunities abroad. Up until now the USTR has argued that 
Internet broadband is a value-added service, and importantly in 
many country trade commitments, there are more liberal market 
access opportunities for value-added services as compared to 
basic services.
    For example, China has more restrictive rules for who can 
obtain a basic service license, and China has defined services 
connected to the Internet to be basic services, a definition 
that the U.S. trade representative has challenged in the past.
    Taking this as an example, could the FCC reclassification 
to a telecommunications utility as they are doing allegedly 
under their rule change USTR negotiating positions abroad and 
result in closing market access and competition opportunities 
for U.S. companies?
    Mr. Downes. So I don't feel comfortable sort of answering 
the question in terms of what it would force the USTR to do, 
but certainly as I say, from a rhetorical standpoint, it makes 
our negotiating position, our leverage, much more subject to 
those kinds of arguments coming from the countries we have been 
urging so strongly over the years to try to keep Internet as a 
light touch regulatory model the way we have historically done.
    Mr. Walden. All right. Mr. Atkinson, you raised some issues 
involving Mr. Kimmelman's organization. I would like to hear 
you pursue that a bit and then get Mr. Kimmelman's reaction as 
well. What else do you see out there in terms of what the FCC 
is proposing in their Open Internet Order?
    Mr. Atkinson. Well, again, we haven't seen it, but I would 
agree with Mr. Downes that the net neutrality argument for some 
groups, not all groups, and I don't really believe this is true 
for most of the industry advocates, for example, in Silicon 
Valley, but the net neutrality argument in my view has been a 
stocking horse for going back to a network that is highly 
regulated and ultimately going to a network that is publically 
owned. I think that is the end goal for many, many of these 
organizations. They want cities or governments to be running 
these networks, and they equate them to roads which most roads 
are publically operated and publically funded, not all. And so 
I think what we will see--and I didn't mean to just point out 
Public Knowledge alone because there are other groups that do 
that, but I noticed it last week when I was on their Web site. 
It was pretty stark. It was essentially saying that they would 
use the Title II power to require broadband providers to roll 
out broadband in a certain way. Now, if you do that, I think 
what the end rules of that will be will be much less 
competition because it is harder for new entrants to come into 
a market and put a little bit of broadband here. They may not 
have the capital. They may not have the markets right away. But 
if you are requiring them to serve an entire area from the day 
one, you will simply get fewer competitors coming into the 
wireline marketplace, and I think that is going to end up 
hurting.
    So I think we will see more and more of that as--my 
prediction is if Title II decision is made tomorrow, you will 
see sort of a period of quiet for maybe 3 or 4 months, and then 
you will start seeing this next sort of wave. Well, we have 
done that for net neutrality but what about this? What about 
prices? What about discrimination?
    So I think it is just really the first step that we are 
going to be seeing here.
    Mr. Walden. I appreciate that. Mr. Kimmelman?
    Mr. Kimmelman. Thank you. I think Mr. Atkinson has 
fundamentally misunderstood what was a Q&A session that was 
reported on our Web site. It was a response to the question 
about is there a concern for red-lining as broadband is built 
out, denying service to low-income marginalized communities? 
And our staff indicated that there was a concern. We didn't 
call for regulating everyone.
    Mr. Walden. All right.
    Mr. Kimmelman. And I think as Mr. Atkinson knows, we have 
supported differing treatment of dominant and non-dominant 
carriers for years and years and years. Everyone knows as 
competition grows, you need to let start-ups get into a market 
and challenge the dominant players.
    So I think that is just a misunderstanding.
    Mr. Walden. All right. Mr. Atkinson, anything else? Five 
seconds.
    Mr. Atkinson. Well, I would be happy to submit to the 
committee the actual statement that a Public Knowledge employee 
researcher----
    Mr. Walden. All right.
    Mr. Atkinson [continuing]. Puts on there, and it is very 
clear that they intend to use Title II for this purpose.
    Mr. Walden. All right. My time is expired. I recognize my 
friend from California, Ms. Eshoo.
    Ms. Eshoo. Thank you, Mr. Chairman, and thank you to all 
the witnesses.
    First on the issue of equating the open Internet rules with 
repressive government attempts at online censorship I really 
think is misinformed and irresponsible. Several of the 
governments seeking to expand the UN and ITU role in Internet 
governance are actively engaged in blocking their citizens' 
access to information online. And that is very important to 
have down in the record. This is the opposite of U.S. policy. 
This is not U.S. policy. It is the stark opposite of it.
    We adopted the open Internet rules to protect consumers' 
access to the content of their choosing. That is one of the 
basic tenants of an open Internet. So I think it is important 
to get that down for the record.
    I have several questions. I doubt that I am going to be 
able to ask all of them. I ask that you keep your answers 
brief. Mr. Downes, you are really lathered up about this. Last 
week T-Mobile--this is on the issue of investment and this 
whole notion, wild accusations that the market is going to be 
chilled, there isn't going to be any investment. Last week T-
Mobile became the second major wireless carrier to downplay the 
implications of Title II on their ability to continue 
investing. So how do you reconcile T-Mobile's statements and 
similar comments by Sprint with your belief that the FCC action 
will threaten the long-term health and continued investment in 
broadband?
    Mr. Downes. OK. Thank you, Ms. Eshoo. I can't obviously 
comment on what T-Mobile and Sprint are thinking and their 
reasoning, but what I can say is, you know, under this light 
touch bipartisan policy we have had the last 20 years, we have 
had over a trillion dollars of investment in broadband----
    Ms. Eshoo. No, but I am asking you, the charge is, and it 
has been made by those that oppose essentially my position and 
those like-minded individuals and organizations, it is a very 
serious charge that has been made. So can you reconcile it? Do 
you have proof? Is there lack of investment? Is there already a 
chill? Do you have information from the New York Stock Exchange 
or others? I think it is one thing to say we are concerned 
about something. It is another thing to make a charge that, A, 
is definitely going to happen and is going to produce B.
    So let me move on to Rob Atkinson. Thank you. Good friends. 
I am an Honorary Co-Chair of ITIF and proud to be. In the 
absence of robust broadband competition, I think there is an 
even greater need for strong enforceable open Internet rules. 
Now, your testimony doesn't raise this issue, but the facts I 
think point to rather dismal picture. At speeds of 25 MB per 
second, nearly half of Americans have just one choice. At 
slower broadband of 10 MB per second, 30 percent of all 
Americans still have only one choice.
    So what would you propose be done to enhance broadband 
competition? And just be as brief as possible. If you have like 
maybe three bullet points?
    Mr. Atkinson. Well, first of all, as we have written on 
that, no country in the world has a majority of its connections 
over 25 MB, even North Korea certainly doesn't. Even South 
Korea.
    Ms. Eshoo. Yes, but we are talking about the United States 
of America. So I am asking----
    Mr. Atkinson. Right, but my point is that----
    Ms. Eshoo [continuing]. You a very direct question.
    Mr. Atkinson. Congresswoman, my point on that is simply 25 
MB I think is a standard that is just too high. No country 
meets it. So we do have robust competition, more around the 10 
to 15 MB range where we have a lot of providers competing.
    But I would agree with you. I don't think competition--you 
could have more competition or less competition. I would fully 
agree. It doesn't mean that we shouldn't have rules because 
even with competition, you can have abuse. So I agree with you 
we need rules.
    Ms. Eshoo. OK. I am going to ask you to stop so I can get 
to our friend, Rick Boucher. And it is wonderful to see you, 
and thank you for being here today.
    Eight years ago you introduced the Community Broadband Act 
of 2007, yourself and then-Representative Upton, as a way to 
overturn state bans on municipality-built broadband networks to 
spur deployment. Would you still stand with that today?
    Mr. Boucher. My views have not changed, Congresswoman 
Eshoo.
    Ms. Eshoo. Good.
    Mr. Boucher. I believed then and believe today that where 
the incumbent providers are not offering an adequate service 
and in many places their service is either quite slow or in 
some very rural communities and reaches of the community is 
non-existent. If a community wants to step up and provide a 
broadband service that enhances economic development, then it 
ought to be free to do so.
    I would just note that in one community in my formal 
congressional district, the City of Bristol, the public utility 
there that is city owned overbuilt the incumbent provider and 
offers a gigabit-level network that has been tied directly to 
the creation of more than 1,000 jobs in that community.
    So yes, I think it makes a lot of sense. I indicated that 
my testimony here today is entirely my own views, and you have 
asked for my view and I can assure you that my view has not 
changed.
    Ms. Eshoo. Well, that is wonderful, and I hope that the FCC 
Chairman's proposal includes what you began many years ago. 
Thank you. I think my time has more than expired.
    Mr. Walden. The gentlelady yields back. The chair now 
recognizes the gentlelady from Tennessee, the Vice Chair of the 
Full Committee, Ms. Blackburn, for 5 minutes.
    Mrs. Blackburn. Thank you, Mr. Chairman, and thank you to 
each of you for your time to be here. Our constituents are 
really concerned about this issue. As I said in my opening 
remarks, they don't think the Internet is broken and they don't 
understand why the FCC would be trying to step in. So we 
appreciate hearing from you.
    Another thing that I hear and I want to take my questions 
this direction is the issue of new fees and taxes. I know 
Progressive Policy Institute had a study, and they said maybe 
$11 billion in new fees and taxes. And then January 16 the 
Washington Post ran a story attacking that figure, but then 
they noted that through interviews with tax and regulation 
experts that Title II reclassification would likely, and I am 
quoting, ``cost some consumers something.'' And we know that 
Chairman Wheeler is, as Mr. Atkinson, you pointed out, there 
has been discussion about forbearance from applying universal 
service fees on broadband and other components. So we do have 
concern about this in the reclassification, that it will lead 
to some amount of increased fees and taxes. And February 2 the 
New York Times ran a piece titled In Net Neutrality Push, the 
FCC is Expected to Propose Regulating Internet Service as a 
Utility. And in that piece, David Farber, Professor Farber from 
Carnegie Mellon, and I think all of you probably are familiar 
with him. He helped to design parts of the backbone of the 
Internet. And as we say in Tennessee, it was not done by Al 
Gore. It was done by others. But the article states Professor 
Farber commented, ``Regulating the Internet like a telecom 
service potentially opens up a Pandora's Box.''
    And he advised that information services are typically free 
of taxes while telecommunications services are not especially 
at the state level.
    So what I want to ask you all, looking at these components, 
from Progressive Policy Institute, the review of that by the 
Post, the comments as in the New York Times by Professor 
Farber, does anyone on the panel dispute the conclusions of Dr. 
Farber, the Progressive Policy Institute, and the Washington 
Post? Mr. Kimmelman? Go ahead.
    Mr. Kimmelman. Ms. Blackburn, I certainly dispute the 
implications of that is being said. What is being said is if 
there will be new taxes and fees. My understanding is the 
chairman's proposal will have no new federal taxes and fees. He 
is forbearing from a portion of Section 254 as I understand it 
from his own description of what he will propose tomorrow. So 
there will be no federal taxes and fees.
    As to state and local government, which I believe is what 
Dave Farber was also referring to, it is today the case that 
every state can decide on its own what it wants to tax, what it 
wants to impose fees on, subject to limitations that this 
Congress is and has imposed on the Internet tax moratorium 
legislation which you can adjust as need be to make sure that 
state and local governments do not go beyond what you think is 
reasonable.
    Mrs. Blackburn. OK. So Mr. Kimmelman, you are disagreeing 
with the conclusions of Dr. Farber? You disagree with him as 
one of the architects of the Internet?
    Mr. Kimmelman. I don't believe he is the architect of tax 
systems. I believe that is your job here and what state 
governments do, and he presented----
    Mrs. Blackburn. OK. So you are----
    Mr. Kimmelman [continuing]. A point of view of what he 
thinks might happen somewhere and----
    Mrs. Blackburn. OK. I am going to interrupt you again----
    Mr. Kimmelman [continuing]. That is plausible but it is not 
a statement of fact.
    Mrs. Blackburn [continuing]. So we can continue on this. So 
let me ask you this. How much do you anticipate it is going to 
cost consumers and private industry, especially if USF funds 
are eventually applied to Internet access? And most people 
agree, even Free Press, that reclassification would lead to 
some net increase in taxes and fees of about $4 billion. So 
what do you really think?
    Mr. Kimmelman. I am hopeful, Ms. Blackburn, that the FCC 
will review its universal service rules, will do something 
about the approximately 10 percent, way-too-inflated fee that 
all of us are paying----
    Mrs. Blackburn. OK.
    Mr. Kimmelman [continuing]. On our telephone bills and 
figure out a better system where we actually all pay less. I 
believe----
    Mrs. Blackburn. Mr. Kimmelman----
    Mr. Kimmelman [continuing]. That is certainly plausible.
    Mrs. Blackburn [continuing]. Let me ask you this in my few 
seconds that remain. Were you or your organization, Public 
Knowledge, privy to any of the closed-door sessions at the 
White House where there was a discussion on what the net 
neutrality order would look like coming from the FCC?
    Mr. Kimmelman. No. No, Ms. Blackburn. We were not privy to 
any----
    Mrs. Blackburn. Have you seen draft language?
    Mr. Kimmelman. No, I have not.
    Mrs. Blackburn. Yield back.
    Mr. Walden. The gentlelady yields back, and I now recognize 
Mr. Pallone.
    Mr. Pallone. Thank you, Mr. Chairman. As I said just a few 
weeks ago at the subcommittee's other open Internet hearing, 
one of the important aspects of net neutrality is ensuring that 
the FCC stands ready to protect consumer privacy, whether with 
regard to consumers needing telephone access or consumers 
needing broadband Internet access. Yet yesterday Administrator 
Strickland confirmed to me that the White House intends to 
release as early as this week its Consumer Privacy Bill of 
Rights proposal which could effectively strip the FCC of its 
ability to regulate consumer privacy. The administration has 
not shared the proposal with members of this committee but has 
shown it to industry. As confirmed yesterday under the current 
draft which I am hopeful can be modified before release, 
telephone, Internet or cable companies can get out of FCC 
privacy oversight by creating a self-regulatory privacy code of 
conduct through a multi-stakeholder process. Specifically, 
these companies would no longer be covered by Section 222, the 
privacy section of Title II or other similar provisions.
    So Mr. Kimmelman, I wanted to ask you. There are several 
concerns with the current draft privacy bill from the White 
House from basing it on a tried and failed multi-stakeholder 
process to potentially weakening FTC's current authorities. 
However, can you please comment on the concept of allowing 
telephone, Internet, and other providers being relieved of 
their obligations under Section 222?
    Mr. Kimmelman. Thank you, Mr. Pallone, and I appreciate 
your strong concerns about this. I certainly hope what you have 
heard is not accurate. I think this could be an enormous 
problem for consumers who have relied on the ability to protect 
their own personal privacy on telephone calls and their own 
viewing habits over cable television. That has been what 
Section 222 of the Communications Act has been applied to most 
generally. I certainly hope the administration is not 
considering rolling that back.
    Mr. Pallone. Can I ask you, I don't know if you wanted to 
respond to anything else that members have brought up so far if 
you haven't had the opportunity and wanted to comment further?
    Mr. Kimmelman. I would like to say something about the ITU 
having spent a bit of time at the WCIT Conference where Rob 
McDowell was as well. I think there is a little bit of a 
misunderstanding or sleight of hand here of raising telecom 
utility as a definition which I do not believe is what, based 
on what I have seen of the statements of the Chairman of the 
FCC, he is proposing to do with his Open Internet Order and 
drawing things into some broader regulatory framework at the 
ITU. I just don't believe that is on the table.
    On the contrary, I believe from the description that has 
been provided of the proposed plan, it is the actual 
effectuation of the U.S. Government's position against Russia 
and China and Iran and other repressive regimes that we not 
only ask other governments to prevent censorship and 
interference with their citizens' communications but we 
ourselves practice that and do not censor citizens' 
communications on the open Internet and do not allow corporate 
gatekeepers to do the same.
    So I view it as quite consistent with our past policies.
    Mr. Pallone. I thank you. Mr. Chairman, I just wanted to 
say I know--and Ms. Eshoo and I were talking about this 
earlier. The Republicans keep talking about court challenges, 
and the fact of the matter is that anything can be tied up in a 
court challenge. And you know, there was a time when the 
Republicans tried to avoid litigation. I specifically remember, 
they have and continue to talk about tort reform in the 
healthcare sector. But now it looks like the GOP wants to sue 
on everything, you know? They sue on the ACA. They sue on 
immigration reform. I am just commenting on the fact that I 
really don't quite understand why, we as a subcommittee or as a 
committee have to be constantly worried about who is going to 
sue who because we never know who is going to sue no matter 
what the action is by FCC or any other agency.
    So I just, a comment on the fact that I really don't think 
that we should be deciding what to do here, based on who we 
think is going to sue who. And certainly I see that if 
anything, it is the Republicans that appear to be more 
litigious these days than our side of the aisle.
    I yield back.
    Mr. Walden. The gentleman yields back the balance of his 
time. Chair now recognizes the former chairman of the 
committee, Mr. Barton, for 5 minutes.
    Mr. Barton. Thank you, Mr. Chairman. And we are delighted 
to have the Honorable Boucher here. It is a level of the 
respect and the amount of intimidation factor that you have not 
yet been asked a question. We are afraid of you, Mr. Boucher. 
But I remember well the debates you and I have had, some on the 
same side, some on opposite sides. And we are delighted that 
you are here again. We love Morgan Griffith. He is a great 
member of this committee, but we miss you and we wish you well.
    Mr. Boucher. Thank you very much, Mr. Barton.
    Mr. Barton. We have talked about this issue of net 
neutrality, and Mr. Atkinson quite rightly pointed out that 
that is a misnomer. Net neutrality as espoused by the most 
aggressive proponents, there is nothing neutral about it. It is 
net regulation. What the FCC is probably going to vote on 
tomorrow is net nonsense. It is not going to work. It is going 
to be tested in court. It is going to fail in court. The 
chairman of this subcommittee and the Full Committee have put 
out a draft that would give some certainty but would maintain 
the premise of true neutrality.
    Now, Mr. Boucher, you are a smart guy, you know? You are a 
lot smarter than me. But you understand, and I want to commend 
you for your--you were the only one that really made any 
political comments, you know? You put it on the table. You have 
great candor, and I appreciate that.
    But 1934, when we passed whatever we call that Act, the 
Communications Act, there was one phone company basically. Now, 
there were some small rural telephone companies, but if you 
wanted a phone company in your particular area, you went to one 
company. You went to one company. Today in Ennis, Texas, if I 
don't like my Internet provider, which is Charter Cable, AT&T 
will come in and do it for me. Verizon will come in and do it 
for me. There are any number of providers that all I have to do 
is pick up a solicitation letter in my mailbox or next time the 
phone answers say yes to somebody who wants to provide me 
different Internet services. There are all kinds of 
competition.
    Title II was passed when you had one provider. Do you agree 
with that?
    Mr. Boucher. Mr. Barton, I don't disagree with anything 
that you just said. The phone----
    Mr. Barton. Including--and everybody else.
    Mr. Boucher. The tone that I would express that sentiment 
in is the following, that there is a better way. Title II is 
kind of a blunt instrument. It is a relic from another era that 
doesn't fit very well in today's highly competitive 
communications market where you have got the world's most 
capable platform for delivering information of all kinds and 
multiple parties delivering access to that platform, depending 
on whose service you want. Title II was never conceived for an 
environment like that. There is a better way, and the better 
way--I will come back to my original remarks--is for this 
committee----
    Mr. Barton. I am not going to let you filibuster too long.
    Mr. Boucher. Well, I am only going to take about 10 seconds 
here, but you come together on terms that are for today's 
modern era that offer network neutrality assurances and 
maintain broadband as a lightly regulated Title I information 
service. That honestly is what is called for in today's 
environment.
    Mr. Barton. In the Chairman's draft as he has put out, you 
would generally support it?
    Mr. Boucher. I think it moves in the right direction, and I 
think it is important to note how far the Republicans have now 
moved toward the historic Democratic position.
    Mr. Barton. See, and that bothers me.
    Mr. Boucher. Well, I know you, and I am not surprised. But 
I hope you will see the light this time. And let me just stay 
that I think it is a major development that now everyone is 
talking about the best way to preserve network neutrality, and 
the best way to do that is a narrowly crafted statute that 
gives permanence to these principles.
    You know, we have been debating this issue now for a 
decade, and everyone has more important work to do. Mr. Wheeler 
at the FCC has more important work to do, but he is going to 
spend a lot of time responding to requests here and litigation 
in court unless this issue is put to rest.
    So a decade into it now, it is time to settle it. This 
committee has within its ability the power to do that----
    Mr. Barton. OK. I want to----
    Mr. Boucher [continuing]. And both of you have an 
incentive. Both sides have an incentive to get it done. So I 
hope you will.
    Mr. Barton. I want to go to Mr. Atkinson very quickly. Do 
you and the people you represent generally support what 
Chairman Walden and Chairman Upton have put out in draft form?
    Mr. Atkinson. I would associate myself with Congressman 
Boucher's remarks. I think it is in the right direction. I 
think there is room for compromise in it. I think the 
Democratic side has raised some points that have validity. 
Though it is not a perfect bill in my view, but it is a very, 
very important first step and it lays the groundwork for a 
legislative solution.
    Mr. Barton. Thank you. And thank you, Mr. Chairman. I yield 
back.
    Mr. Walden. The gentleman's time is expired. Now we go to 
the gentleman from Pennsylvania, Mr. Doyle, for 5 minutes.
    Mr. Doyle. Thank you, Mr. Chairman, for holding this 
hearing, and thank you to all the witnesses, particularly my 
good friend and colleague, Rick Boucher. It is good to see you 
back here, Rick.
    I am excited to see the FCC take this next step tomorrow in 
protecting an open Internet. I think the Chairman has 
recognized the passion and interest that people around the 
country have for this issue, and he has seen broad support from 
an array of stakeholders, from investors to venture capitalists 
to edge providers and ISP. Most recognize that the sky isn't 
falling, and many applaud the certainty that these rules will 
bring to the marketplace.
    You know, this morning I was checking the stock prices for 
many of the major telecom companies, and most companies' values 
were up. So clearly investors don't think the sky is falling, 
either. Statements by executives by many of the Nation's 
largest telecom companies reflect their expectation that these 
rules won't change their investment or deployment strategies 
and that they believe properly crafted rules will not affect 
their businesses.
    I also want to point out that the FCC is also moving 
forward to grant a number of petitions by communities to lift 
restrictions on municipal broadband deployments. I think that 
is a great step in the right direction, and I think the 
communities can bring some much-needed competition to the 
broadband market.
    And finally, let me say with regards to some of the 
concerns expressed by Ms. Blackburn, the Washington Post fact 
checker looked at this study that she cites and completely 
debunked the study. The fact checker said the more complex the 
issue, the easier it is for politicians to obfuscate the 
reality of the dramatic numbers, and our constituents deserve 
better than scare tactics that deliberately mislead the public 
and gave it three Pinocchios. So I think that speaks to that 
issue.
    Mr. Kimmelman, I want to follow up on a question that Mr. 
Pallone asked you. This proposal by the White House sounds like 
it would severely undercut the FCC's authority to prevent ISPs 
from using their position in the marketplace to do things like 
charging subscribers not to have their browsing history data-
mined or setting super-cookies that allow users to be 
identified and tracked across the Internet.
    What benefit do you see in the FCC's ability to enforce 
privacy protections on ISPs and what do you think would be lost 
if that authority was removed and vested in the FTC that may 
lack the authority to establish bright line rules the way the 
FCC could under Title II?
    Mr. Kimmelman. Mr. Doyle, I think it is a very serious 
concern if what you describe is accurate. I think that 
consumers across the country rely upon the infrastructure of 
communications in this country to protect their privacy. It has 
historically done so. Section 222 has been used for that, and I 
think we need to look at that in the broadband environment. It 
would be extremely unfortunate if that were thrown out the 
window at this moment.
    I have a concern just based on the characterization that 
you provided and Mr. Pallone that the administration which had 
been working on privacy legislation 4 years ago and had brought 
together many stakeholders has pulled something out of the 
drawer and hasn't maybe fully looked at changes in the 
environment, including the regulatory environment, since those 
ideas were first floated. And I certainly hope that they are 
updating that and are listening to the concerns raised.
    This would be a very significant concern for consumers if 
all of a sudden they thought their privacy was in jeopardy.
    Mr. Doyle. Mr. Kimmelman, some have argued that paid 
prioritization and unencumbered zero rating of apps and 
services can be beneficial to consumers. Others say that these 
policies could lead to greater barriers to entry in the 
marketplace and in fact hurt consumers by limiting the array of 
new businesses and start-ups that can climb the pay walls that 
these policies erect. Where do you stand on that?
    Mr. Kimmelman. Mr. Doyle, I think paid prioritization can 
be extremely dangerous to the Internet ecosystem that we have 
today. I constantly think back to what Tim Berners-Lee has 
talked about as permissionless innovation. He didn't have to 
ask anyone to develop the World Wide Web. I think that is an 
important concept to keep in mind here.
    Now having said that, that does not mean everything is--it 
is one size fits all as Rob has said. It means there needs to 
be important regulatory oversight functions applied as to what 
a particular service does, whether it is beneficial to the 
competitive process, whether it opens opportunities for 
innovators, whether it creates a new competitive option in the 
marketplace.
    So I wouldn't classify every service one way or the other, 
but in general, I think there should be a big alarm bell goes 
off when you see something that looks like paid prioritization 
as a starting point.
    Mr. Doyle. Thank you. Mr. Chairman, I will yield back.
    Mr. Walden. The gentleman yields back his time. I would 
like to ask unanimous consent to submit in the record a letter 
from Mr. Mark Cuban who says the market is aware of the 
uncertainty the FCC is creating--and will respond accordingly 
by creating volatility, and a story in News Bay Media. Moffet 
Downgrades Cable Sector on Title II Woes. Without objection, 
those two items will be inserted in the record.
    I now turn to Mr. Olson. Are you sure it is not Mr. 
Shimkus, I believe was here?
    Voice. Sorry, sir.
    Mr. Walden. Yes, Mr. Shimkus overriding my own counsel here 
for the next 5 minutes.
    Mr. Shimkus. Thank you. Well, it is great to be here, a 
great panel, great discussion, and again, it is good to see 
Rick here, although his real name is Frederick Carlisle, goes 
by Rick. So I did my due diligence.
    Mr. Atkinson, given the Title II explicitly allows for 
discrimination, how can the FCC place an outright ban on paid 
prioritization?
    Mr. Atkinson. Well, I disagree with this notion on paid 
prioritization. If we really want to ban paid prioritization, 
then we should ban CDNs, content delivery networks, that major 
companies like Netflix use. They are paying to get their 
traffic as close to the customer as possible. And a little 
Silicon Valley start-up, maybe they can't pay for a CDN.
    So I think this notion that somehow some kind of paid 
prioritization is OK and some kind is not. Now my position is 
we should let the market determine that. I actually think this 
could be really good for start-ups. There may be start-ups that 
can't afford to use CDN services. They may want to say, I have 
an application that has what engineers call low latency needs. 
The best efforts Internet isn't going to do that. As long as 
the rule says that if you don't pay you always get best efforts 
Internet, we can never have a system where a carrier says you 
have to pay to get best efforts. So that is what any 
congressional rule has to say.
    But if you want to go beyond it, it is like I can get a 40-
cent stamp or whatever it costs for the mail today, but if I 
want to go beyond it as a businessperson, I have the right to 
get it. And I think that is very much pro-consumer and pro-
business.
    Mr. Shimkus. But to have the certainty, that would require 
legislation. That would require language other than FCC going 
to the current Communications Act and then trying to wiggle in 
one section over the other.
    Mr. Atkinson. Right. Absolutely. And that is why we 
supported so strongly Chairman Wheeler's initial proposal 
because he allowed paid prioritization, but he said it has to 
be reasonable and has to be pro-consumer and there are some 
safeguards around it. But he backed off from that position. I 
am not sure why. But I think that was the right position. And 
guaranteed, if the FTC goes forward tomorrow with Title II, you 
won't be able to have that level of customization.
    Mr. Shimkus. I have been told to make sure I answered the 
same way. I am not sure why, but I think I know why. Rick, you 
have looked at the European use of broadband, and it is 
obviously a different way of handling that. Obviously the 
concern and part of this debate is that by moving into Title 
II, we may be falling into the same trap as the European 
community. Can you address that?
    Mr. Boucher. The Internet Innovation Alliance with which I 
am affiliated, did a study which we published about 3 weeks 
ago. The results of that are on the Alliance's Web site. And in 
that study, we took a close look at the broadband performance 
of Europe versus the United States. We did that in parallel to 
the regulatory structures that prevail in Europe and also in 
the United States.
    In the United States we have historic light touch 
regulation going back about a decade now for broadband, and 
that light touch regulatory environment has been very welcoming 
to investment.
    In the European Union for about the same period of time, 
going back to about 2002, they have had a more intrusive 
regulatory regime characteristic of their regime and most of 
the member states of the EU is something called unbundling and 
least access over the last mile. And that basically means that 
competitors are welcomed on to the incumbent's network at a set 
price, at a regulated rate.
    The history is pretty clear that in the European Union that 
least access requirement has impeded investment, and on 
virtually every measure of Internet capability, the European 
Union is behind the United states, behind in access to 
broadband capabilities on the part of the public, behind in 
terms of speed, behind in investment on both the wired and 
wireless side and even the European Commission has now 
concluded that the reason their performance is lagging is 
because of the intrusive regulatory structure that they have 
and has recommended to the member states that for next 
generation networks, the fiber optic deployments, the gigabit 
level networks that are only now beginning to come to Europe, 
even though we have them more commonly in the United States, 
that the member states should not apply the least access 
regime, saying that to do so would impede investment.
    So the simple conclusion we reach in our study is that at 
the very time when we appear to be moving now toward Europe in 
terms of a regulatory posture with Title II reclassification. 
Europe is now moving our way and lightening up its regulatory 
structure. Now, the FCC is proposing to forbear from imposing 
least access, but I will be very surprised if Title II is 
adopted, if you don't see some competitive carriers suing, 
saying that the FCC did not have an adequate record to 
undertake that level of forbearance and saying that now that 
Title II applies, there has to be least access. Rob Atkinson 
earlier said that Title II is going to create a lot of 
uncertainty. This is yet another example of where I think it 
will.
    Mr. Shimkus. Thank you.
    Mr. Walden. The gentleman's time expired. We now go to Mr. 
Yarmuth for 5 minutes.
    Mr. Yarmuth. Thank you, Mr. Chairman. Rick, it is good to 
see you. Thanks to all the panelists. Now we have heard 
arguments that the FCC's net neutrality rules will make 
Internet speeds offered to American consumers as slow as those 
in Europe. But according to Akamai's most recent State of the 
Internet Report, average U.S. Internet speeds ranked behind 
what consumers can get in Moldova and 20 other countries.
    I will address this to Mr. Kimmelman. Do you think that 
American broadband consumers are getting a good deal as 
compared to their European counterparts?
    Mr. Kimmelman. Thank you, Mr. Yarmuth. I think it is really 
hard to do apples-to-apples comparison of the U.S. and Europe. 
Some of their rules are European Union-wide. Some of them are 
nation-specific. So it is a bit tricky.
    But in general, there are some policies they are imposing 
that are much more government driven, that much more come out 
of a single provider monopoly environment, and they can keep 
prices low and they can open up their platforms. And then they 
have other problems.
    And I think the better way to think about it is can we do 
better here with our speeds and with our deployment, and I 
think the answer is clearly yes. I don't think it is to follow 
a European model as such, and I don't think Title II is 
anywhere near the same as what most of the Europeans have done. 
But I think the goal of actually pushing up speeds of reaching 
higher for what has now become this essential platform for 
economic and social growth in our society, absolutely, yes. We 
should be pushing as hard as possible.
    Mr. Yarmuth. Some of your fellow panelists seem to take a 
different view of the current state of consumer choice in the 
American broadband market. I know in my district, there is one 
provider that dominates the market. Essentially that is the 
only game in town. What is your view on the level of broadband 
competition our constituency currently enjoy?
    Mr. Kimmelman. I think there are a number of different 
measurements that are being used. The FCC is now pushing the 
envelope to really push for greater deployment. But by anything 
other than a snail's pace, we lack robust competition in our 
broadband market, particularly for the delivery of video 
quality services. And so often one provider, sometimes two. Mr. 
Barton I guess is lucky to have, fortunate to have more. Some 
people can use wireless for a variety of services but usually 
not the most robust video delivery system.
    So we suffer from a very significant problem and lack of 
competition.
    Mr. Yarmuth. And what about the issue of cost versus 
quality and service? How do we rate in terms of what consumers 
pay for quality video?
    Mr. Kimmelman. Well, again I hate to say anything too 
definitive because different countries have different rules, 
different frameworks. But there is no doubt there are some 
countries that have faster speeds and better quality. And I 
would just urge the committee to look at what are the policies 
that go with those that actually deliver that. Sometimes it is 
with greater government involvement, and that is something to 
actually consider as a matter of tradeoff.
    Mr. Yarmuth. Just as a matter of principle, if you have one 
provider with very little regulation, then the odds of getting 
good service at a reasonable cost are lower than if you had 
either multiple providers in a vibrant competition or some kind 
of heavy-handed regulation.
    Mr. Kimmelman. Absolutely. And I will just point out that 
going way back in history, we did have more of the open market 
that Mr. Atkinson was talking about, and it was bedlam. There 
was a refusal to interconnect in the early 1900s which led to 
the development of the AT&T monopoly with a set of public 
obligations that came with it.
    So obviously a different timeframe, but I just raise the 
admonition. The economics of that could still be problematic, 
that interconnection is not something that has traditionally 
worked well in a totally free-market environment.
    Mr. Yarmuth. Great. Thank you, Mr. Chairman. I yield back.
    Mr. Walden. The gentleman yields back the balance of his 
time. The chair now recognizes the gentleman from New Jersey, 
Mr. Lance, for 5 minutes.
    Mr. Lance. Thank you, Mr. Chairman. Mr. Atkinson, in your 
testimony you eschew the term net neutrality in favor of a more 
generic term, network policy. You say, and I quote, any network 
policy for the 21st century recognizes that the Internet is not 
inherently neutral and that while some forms of traffic 
differentiation can be anti-consumer or stifle innovation, 
other forms may enable innovative new services. And I would 
like you to elaborate. Perhaps that might be in healthcare or 
educational fields, but I ask for your expertise into how this 
could further innovation.
    Mr. Atkinson. So I think one of the things that has been 
striking about this debate is the absence of the voice of 
network engineers. The Internet has never been neutral, and it 
is not neutral now. In the Internet engineering space, there 
are different priorities that network traffic receives because 
frankly, if your email goes and you get it 50 milliseconds 
late, you don't notice and you don't care. But if your two-way 
video with your doctor is 50 milliseconds late, you basically 
cannot have that conversation with your doctor. Fifty 
milliseconds is way too long.
    So the idea that we would treat all traffic the same is 
essentially an anti-consumer. It is going to stifle these kinds 
of innovations. If I can just make one quick point about the 
question on competition, we released a report last year called 
The Whole Picture where we looked at competition. Using the 
OECD data, we have the third most-competitive intermodal 
broadband market in the world. We are almost tied with Korea 
and Canada. We have more intermodal competition, in other 
words, two providers serving each home, than any other country. 
The reason there are a few countries ahead of us like Japan, 
like Korea, is really two factors. They have very high 
population density. They are serving apartment buildings 
largely. Super-easy to do. And secondly, they have put in 
massive government subsidies. Now, we can have an argument 
about whether that is a good policy or a bad policy, but many 
of these countries have used public monies from tax incentives 
and grants.
    So this notion that somehow we are lagging behind because 
of the light touch regulation I think is mistaken.
    Mr. Lance. Thank you and I appreciate that point. You said 
in your testimony the almost certain legal challenges to the 
FCC's Order and the uncertainty that would in turn create as 
evidence that a legislative route would be better than the 
FCC's reclassifying broadband under Title II. How long do you 
think the legal challenge would last if this were to occur?
    Mr. Atkinson. I imagine it would begin quite soon, and I 
would agree with Congressman Boucher, I think you are talking 
3, maybe 4 years before we would end up with any sign of real 
decision and certainty, whether this we can do a go or no-go.
    Mr. Lance. Thank you, and others on the panel are certainly 
willing to----
    Mr. Boucher. Let me just----
    Mr. Lance. Yes, thank you, Congressman. Yes.
    Mr. Boucher. Just to look at the most recent decision in 
this space. It was the Verizon decision of the D.C. Circuit.
    Mr. Lance. Yes, sir.
    Mr. Boucher. It invalidated the FCC's 2010 Open Internet 
Order.
    Mr. Lance. Yes.
    Mr. Boucher. More than 3 years from the time the suit was 
filed until the decision was handed down. You know, my point is 
that puts us into the next presidential administration. If 
there is a Republican FCC at that point, the network neutrality 
for all practical purposes is gone. There will no longer be 
network neutrality assurances. Those who strongly support 
network neutrality should be looking for greater permanence. A 
statutory alternative offers that.
    Mr. Lance. And regarding the former case, did that go, sir, 
to the Circuit Court here at the DC----
    Mr. Boucher. Yes.
    Mr. Lance. And of course, in this situation, there is the 
potential that it could be appealed further and the Supreme 
Court might grant, sir, and that would even be a longer period 
of time.
    Mr. Boucher. Yes.
    Mr. Lance. Yes. Thank you. Mr. Downes, you have cited in 
your testimony how network management technologies could exist 
regarding oversight of the FCC. Do you believe that this will 
lead to reduced investment and innovation on the part of ISPs 
in broadband networks?
    Mr. Downes. Well, it depends I think on how far the FCC 
goes now or in the future in terms of this public utility 
regime. Obviously we have investment in our public utilities 
including the wireline telephone network, but it is clearly not 
at the same pace and at the same froth level as what we have 
seen in the last 20 years under the light touch regime.
    Mr. Lance. Thank you, and Mr. Chairman, I yield back 16 
seconds.
    Mr. Walden. The gentleman yields back the balance of his 
time. The chair now recognizes Ms. DeGette next up.
    Ms. DeGette. Thank you, Mr. Chairman. You know, as a 
supporter of net neutrality, I have been glad to see that the 
latest debate has led to a consensus around principles of 
access to lawful content, no harmful discrimination, and 
transparency. These are really the core principles that have 
been laid out, both in the Republican draft and also in 
Democratic proposals, and also the White House is in favor of 
this and most importantly maybe is what our constituents expect 
when they use the Internet. But of course, the constituents 
expect much more than just an open Internet. They expect faster 
speeds, affordable prices, and access to new and innovative 
content.
    So for the last decades, the virtuous cycle of investment 
and innovation have given consumers these advantages as well. I 
know there is disagreement among the panel about the best way 
to implement net neutrality, but I want to step back to the 
core net neutrality principles, and I want to ask each member 
of this panel the same question. And this can be answered yes 
or no. Are the net neutrality principles of access to lawful 
content, no harmful discrimination, and transparency if 
properly implemented compatible with the continued investment 
necessary to give consumers the broadband experience they 
expect? Mr. Boucher?
    Mr. Boucher. Yes.
    Ms. DeGette. Mr. Kimmelman?
    Mr. Kimmelman. Absolutely, yes.
    Ms. DeGette. Mr. Atkinson?
    Mr. Atkinson. Yes.
    Ms. DeGette. And Mr. Downes?
    Mr. Downes. Yes, especially the way you phrased it, yes.
    Ms. DeGette. Thank you. So I am glad that we all agree that 
strong net neutrality can be an unambiguous win for consumers. 
I want to--do you want me to ask this?
    Mr. Lujan. If----
    Ms. DeGette. OK.
    Mr. Lujan [continuing]. You want to yield.
    Ms. DeGette. I will yield--let me ask one more question. 
Then I will yield to you if that is OK. Mr. Lujan has an 
excellent question that he wants to ask. Mr. Kimmelman, some 
have suggested that the power of the free market is sufficient 
to protect the open Internet, but in your testimony you pointed 
out that some of the biggest ISPs have admitted there is a 
business advantage to violating open Internet principles. Is 
this merely a theoretical concern or have we seen cases of 
business actually trying to gain an advantage on their 
competitors by violating net neutrality principles?
    Mr. Kimmelman. We have seen examples, Ms. DeGette. 
Fortunately we have had rules in place or we have had rules 
proposed for a long period of time that have very effectively 
disciplined most market behavior. And so we haven't seen a lot, 
but we have seen this and it is very simple. It can be 
advantageous to the bottom line to favor one's own content, to 
favor one's own preferential relationships in content providers 
to make more money. And so there is nothing nefarious about it. 
It is a natural economic incentive----
    Ms. DeGette. Right.
    Mr. Kimmelman [continuing]. For these ISPs to pursue 
suction actions.
    Ms. DeGette. Thanks. Of course, Congressman Boucher, we all 
agreed up here after your testimony that we should just hire 
you as a mediator to work out this legislation. So I want to 
ask you. You said we need to have narrow bipartisan 
legislation, but you single out the network neutrality 
principles as a key non-negotiable element. So why do you think 
the debate has moved past negotiations over network neutrality 
principles?
    Mr. Boucher. I think very simply because both sides now 
have quite a bit of leverage, and when both sides have leverage 
roughly equal, and I think that is the situation today, it is 
the optimal circumstance for legislating.
    There are two key principles that really matter here, and 
the first of these is that the Republican offer for imbedding 
strong network neutrality principles in the statute be accepted 
by Democrats. In return for that, we ought to be continuing to 
treat broadband by the proven method and that is an information 
service subject to Title I with light regulation. We have had 
that for a decade, and we have developed the most capable 
Internet by virtually every measure that exists anywhere in the 
world. If you add all of our ecosystem of the Internet 
together, it is the envy of the world. Let us not upset that 
very workable formula. Keep Title I in place. Those are the two 
key principles of legislation.
    Ms. DeGette. Thanks.
    Mr. Boucher. And I think the fact that Republicans have 
moved as far toward the Democratic position as they have is 
really a major development. It is noteworthy, and it is because 
of the leverage the Democrats now have as a consequence of the 
reclassification decision.
    Ms. DeGette. Thanks. And I yield the balance of my time for 
follow-up to Mr. Lujan.
    Mr. Lujan. Thank you very much. I thank the lady from 
Colorado. Mr. Atkinson, something that you said earlier caught 
my attention. You said in regards to Mr. Boucher that that Mr. 
Boucher had valid issues regarding the Republican discussion 
draft. Can you expound on that?
    Mr. Atkinson. Well, I am not in a position to go into a 
significant amount of detail, but I think there are 2 key 
points there. One is there are valid issues because there are 
no Democrats who supported that. And so you cannot get this 
bill passed with the President signing it unless there is some 
compromise. So I think that is point number one. Point number 
two is the FCC--I think the bill could go slightly further 
giving the FCC some authority. Now what I think the bill 
rightly does, under 706 for example, there us unlimited 
authority. 706, you can use that to justify pretty much 
anything, and that is clearly too broad and was clearly too 
broad when it was passed in '96.
    So there needs to be some constraints on the FCC in our 
view, but also at the same time they need some abilities to be 
able to go out and effectively police issues.
    Mr. Boucher. If I may, Mr. Lujan, since you were asking 
about my thoughts and if the Chair will just indulge me for a 
moment, I am going to take issue a little bit with what Mr. 
Atkinson just said about 706. I did note at the outset that I 
had some issues with the Republican draft. I am going to be 
very candid to say that I think when the draft suggests that 
Section 706 not be deemed an affirmative grant of authority to 
the FCC, that does go too far. And that is not a necessary 
provision in order either to assure that we have strong network 
neutrality principles in the statute or to continue the light 
touch regulatory treatment that broadband enjoys today.
    So as a starting point while Democrats sit down with 
Republicans to negotiate an agreeable statutory formulation, I 
would hope Republicans would say, you know, that does go fairly 
far. We acknowledge your concerns. We are willing to take that 
provision out. To me that would be a sensible step to take.
    Mr. Walden. The gentleman's time, gentlelady's time, has 
expired, and we appreciate the comments from former member, 
former chairman. At least we are having those discussions with 
you. Mr. Collins for 5 minutes.
    Mr. Collins. I want to thank the witnesses today. It seems 
as though the discussion now has moved from net neutrality to 
Title II because we have all coalesced around the concept of 
net neutrality. So Mr. Atkinson, you brought up the point that 
you are fairly certain litigation is the next step absent 
congressional legislation. I think I heard Mr. Downes say that 
could be 2-plus years. So I am a private-sector guy, an 
entrepreneur. You make investments based on as much certainty 
as you can get. That is kind of a rhetorical statement. And as 
you introduce uncertainty, doesn't mean it is all or nothing. 
Some would say, well, isn't there going to be investment? Well, 
sure there is. But the more investment I think the better to 
certainly grow broadband and the others. We want more 
investment, not less. It is my belief as a private-sector guy, 
uncertainty brings less investment than certainty. And as I now 
look at where we are with the upcoming rule as we understand it 
from the FCC, it is disappointing to say the least that the FCC 
in what they are going to do, relative to Title II, the 
consequences of what I call that overreach will be uncertainty. 
And with that, less investment than otherwise. It doesn't mean 
no investment but less investment, and that is not a good thing 
which is why I think I am very happy to hear a lot of 
consensus. It is the role of Congress to push forth a bill. If 
we do so, we do it in a bipartisan way that should trump what 
the FCC is going to do.
    And so Mr. Atkinson, I would like to talk a little more 
about the litigation piece, where you see it coming, how 
quickly you see it coming, and if you agree with me that in the 
arena of litigation absent something else, there will be less 
investment than more.
    Mr. Atkinson. I do agree with you. It won't be catastrophic 
but at the margin there will be likely less investment if we go 
down this path.
    I also would like to point out the uncertainty, really, I 
think is for both sides on this debate. I mean, there is a 
legitimate argument I think that the advocates of net 
neutrality make that Silicon Valley entrepreneurs or other 
offers, they need some level of certainty. You know, are they 
going give me 5 years to know? Carriers do this. Totally agree 
with this. Carriers need certainty. My concern with Title II 
and what the Commission is doing is it really is not providing 
certainty. It is providing certainty in a way for maybe a year 
or 2 or 3, but don't forget. We have an election coming up, and 
just say for the hypothetical, 50/50 chance. That means you 
have a 50/50 chance that you are not going to have any rules
    I agree with you on the legal challenge. I think what we 
will see, as Mr. Downes said, rent-seeking from particular 
carriers with particular interests or other groups who will go 
in and say, you know what? We can gain a slight advantage over 
our competitors if we challenge the FCC on this particular 
component. And that is perfectly reasonable for them to do. It 
just will gum up the entire process.
    Mr. Collins. Now, as I understand it, there is something 
around 1,000 provisions in Title II, and we have heard rumors 
anyway that they are going to forbear on this one, this one, 
and another one? Maybe forbear on the ROI as we limit returns 
on electric utilities, true monopolies that they would forbear 
on that piece which would be the death of the Internet if they 
decided the rate of return could be 6 percent or something like 
that. But with a thousand provisions, and we don't know which 
ones they will forbear on or not. Isn't it also in the 
uncertainty realm once they have Title II, they forbear now, a 
year from now, 2 years from now a different president. They 
decide not to forebear. So I will go back again. I am 
encouraged to hear I think almost a coalescing. We need 
congressional legislation on net neutrality. Title II is just a 
wet blanket on it, and perhaps that is part of the incentive 
that has brought us together. Well, let us not question that. 
We are I think more together than not. But especially, would 
you agree that those thousand provisions and forbearing or not 
is really what is going to have this gummed up?
    Mr. Atkinson. I would definitely agree with that, that this 
is going to provide anything but certainty.
    Mr. Collins. Mr. Downes, any comments in our last 30 
seconds?
    Mr. Downes. Yes, while I agree with Mr. Atkinson, and as I 
say, I am just baffled by the Chairman's decision here because 
as he himself said, when the DC circuit ruled in the Verizon 
case, it provided him a roadmap and an invitation to reenact 
the 2010 rules under Section 706. It was, you know, certainly 
not without legal risk but certainly nothing compared to the 
legal risk now of Title II and all the forbearance proceedings 
that will go with it.
    Mr. Collins. All right. I want to thank all the panel 
today. I yield back, Mr. Chairman, my last 10 seconds.
    Mr. Walden. The gentleman yields back the balance of his 
time. And now we turn to the gentleman from Illinois, Mr. Rush, 
for 5 minutes.
    Mr. Rush. I want to thank you, Mr. Chairman. Mr. Chairman, 
I had been involved in another hearing, a Joint Subcommittee 
hearing downstairs. And so I have not been able to participate 
as fully as I would like. But the time that I have been here, 
this has been quite interesting to me. I certainly want to take 
a moment to join in with the chorus of welcoming our esteemed 
colleague, Chairman Boucher back again. Your time on this 
subcommittee where I served with you was really an era of 
enlightenment for me. So I really want to thank you so much for 
your contributions, and I wish that we were spending as much 
time on reforming program carriage rules as we are on these 
issues that we are discussing, net neutrality and associated 
issues.
    Reforming carriage rules especially as it relates to 
independent networks. I think that is something that we need to 
get to. That said, a free and open Internet with unfiltered 
access is what I believe we all want. You believe the Title II 
reclassification is not a viable solution in addressing net 
neutrality. In your years as chairman of this subcommittee, do 
you really believe that the FCC will be able to forbear all of 
the onerous provisions from Title II?
    Mr. Boucher. Thank you very much, Mr. Rush, and thank you 
for your kind words and your words of welcome as I return to 
the committee to offer some views.
    I think it is challenging for the FCC to undertake 
forbearance without the development of a complete record that 
justifies each of the forbearance steps. And the FCC's record 
in developing its forbearance decisions is really pretty thin. 
My guess, and I am just guessing, is that a lot of the basis of 
the litigation that is going to be upcoming is going to be 
challenging the absence of an adequate record for the FCC to 
take its various actions in association with this 
reclassification, forbearance among those actions.
    So the short answer to your question is I think Chairman 
Wheeler is trying to forbear from the most onerous provisions 
of Title II such as tariffing requirements, rate regulation, 
least access and unbundling. He is making a serious effort to 
do that. I think his decision to do that is going to be 
significantly challenged in court, and we don't know what the 
outcome can be.
    Coming back to my core point today, that is yet another 
reason that it is in the interest of everyone to use this 
moment to provide permanent protection for network neutrality, 
to do so in a statute, and also in that statute continue the 
light touch Title I treatment that has been so successful here 
for the last decade.
    Mr. Rush. You point out that the Republican discussion 
draft would codify transparency requirements and prohibit 
blocking, throttling, and paid prioritization. What is your 
position on including a ban on zero rating practices?
    Mr. Boucher. I am going to forgo dissecting the legislative 
draft in any detail because I think that is uniquely the 
responsibility of the subcommittee, and there are clearly 
provisions in the legislative draft that ought to be open to 
discussion and negotiation as long as in the end what is 
achieved is the embedding of network neutrality principles and 
light touch regulation. This subcommittee will perform a great 
service.
    So I would leave to the bipartisan conversation a 
discussion of the specific elements that are in the draft 
legislation.
    Mr. Rush. Mr. Chairman, I yield back.
    Ms. Eshoo. I appreciate the gentleman yielding the 
remainder of his time. I think it is very important to raise 
the issue when it comes to legislation that there not be an 
automatic assumption that because there is the recognition that 
these three items are mentioned in the bill that they are 
automatically banned. There are problems in the legislation 
because there is no follow-up by the agency that has 
jurisdiction. In fact, the agency is prohibited on behalf of 
the American people to implement these so-called prohibitions.
    So there is a distance to go, and this really needs to be 
addressed if there is ever any hope--and no one has raised this 
from the panel, and it is a very important item I think for all 
of us to know. There was something raised earlier about 
thousands of things in Title II. There are actually, what, 47 
sections in Title II with only a handful that in my view need 
to be used relative to the regulations.
    Mr. Chairman, I would like to ask for unanimous consent to 
submit a letter for the record from the Internet Freedom 
Business Alliance that supports the action the FCC is taking 
tomorrow on net neutrality.
    Mr. Walden. Of course. Without any objection.
    Ms. Eshoo. Thank you very much.
    [The information appears at the conclusion of the hearing.]
    Mr. Walden. Yes. And I must just respond to my colleague. 
There are actually a thousand, exactly a thousand provisions 
within the CFRs. That is where the rules are. That is the 
reference I believe Mr. Collins was making. And as for our 
draft legislation, the FCC would have complete and total 
enforcement capability to enforce the law. And so I would 
disagree with the characterization by my colleague.
    And I would ask unanimous consent to submit for the record 
a number of items including a story quoting the Chief Operating 
Officer, Mike Sievert of T-Mobile where he says while there is 
nothing in there that gives us deep concern about our ability 
to continue executing our strategy, he said the 
reclassification is not the most desirable approach. Without 
objection.
    We have a series of documents concerned with the partisan 
Title II approach including editorial from the Washington Post, 
a letter signed by Mark Cuban and others to the Commission. 
Some other publications I think have been shared with the 
minority, and without objection those will be in. We have some 
documents regarding people's views affecting small business 
from Barbara Espen, Counsel for the American Cable Association 
and ex parte that we would submit for the record.
    Consumer Impact I believe is the next one from the 
Progressive Policy Institute that as much as $11 billion per 
year might be put on consumers' backs as a result of Title II 
reclassification, and we have information for the record 
regarding successful U.S. approach with European history with 
approach the FCC plans to take, a number of articles and 
statements. And I think that is the bulk of our submissions for 
the record. Without objection they will be submitted as well.
    We thank our witnesses for your clarity to this issue and 
for your sharing your comments. We look forward to see what the 
Commission does and eventually actually having the opportunity 
to read the 332 alleged pages of whatever it is they are going 
to vote on tomorrow. So with that, the committee stands 
adjourned.
    [Whereupon, at 12:26 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]
    
    
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