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








           OVERSIGHT OF THE FEDERAL COMMUNICATIONS COMMISSION

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

                                HEARING

                               BEFORE THE

             SUBCOMMITTEE ON COMMUNICATIONS AND TECHNOLOGY

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                           NOVEMBER 17, 2015

                               __________

                           Serial No. 114-101

[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...............................     5
    Prepared statement...........................................     6
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     7
    Prepared statement...........................................     7
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, opening statement.........................     9
Hon. Gus M. Bilirakis, a Representative in Congress from the 
  State of Florida, prepared statement...........................    94

                               Witnesses

Tom Wheeler, Chairman, Federal Communications Commission.........    11
    Prepared statement...........................................    13
    Answers to submitted questions...............................   102
Mignon Clyburn, Commissioner, Federal Communications Commission..    18
    Prepared statement...........................................    20
    Answers to submitted questions...............................   139
Jessica Rosenworcel, Commissioner, Federal Communications 
  Commission.....................................................    27
    Prepared statement...........................................    29
    Answers to submitted questions...............................   146
Ajit Pai, Commissioner, Federal Communications Commission........    33
    Prepared statement...........................................    35
    Answers to submitted questions...............................   150
Michael O'Rielly, Commissioner, Federal Communications Commission    40
    Prepared statement...........................................    42
    Answers to submitted questions...............................   153

                           Submitted Material

Statement of Bill Haslam, Governor of Tennessee, submitted by 
  Mrs. Blackburn.................................................    96
Statement of Herbert H. Slatery, III, Lieutenant Governor of 
  Tennessee, submitted by Mrs. Blackburn.........................    97
Letter of June 18, 2015, from Messrs. Latta and Green to FCC 
  Commissioner Tom Wheeler, submitted by Mr. Latta...............    98
Statement of the Illionois Chamber of Commerce, submitted by Mr. 
  Kinzinger......................................................   100
 
           OVERSIGHT OF THE FEDERAL COMMUNICATIONS COMMISSION

                              ----------                              


                       TUESDAY, NOVEMBER 17, 2015

                  House of Representatives,
     Subcommittee on Communications and Technology,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:15 a.m., in 
room 2123, Rayburn House Office Building, Hon. Greg Walden 
(chairman of the subcommittee) presiding.
    Present: Representatives Walden, Latta, Barton, Shimkus, 
Blackburn, Scalise, Lance, Guthrie, Olson, Pompeo, Kinzinger, 
Bilirakis, Johnson, Long, Ellmers, Collins, Cramer, Upton (ex 
officio), Eshoo, Doyle, Welch, Yarmuth, Clarke, Loebsack, Rush, 
DeGette, Butterfield, Matsui, McNerney, Lujan, and Pallone (ex 
officio).
    Staff Present: Ray Baum, Senior Policy Advisor, 
Communications and Technology; Rebecca Card, Assistant Press 
Secretary; 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, 
Professional Staff, Communications and Technology; Gregory 
Watson, Legislation Clerk, Communications and Technology; Jean 
Woodrow, Director, Information Technology; Christine Brennan, 
Minority Press Secretary; Jeff Carroll, Minority Staff 
Director; David Goldman, Minority Chief Counsel, Communications 
and Technology; Tiffany Guarascio, Minority Deputy Staff 
Director and Chief Health Advisor; Jerry Leverich, Minority 
Counsel; Lori Maarbjerg, Minority FCC Detailee; Tim Robinson, 
Minority Chief Counsel; and Ryan Skukowski, Minority Policy 
Analyst.

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

    Mr. Walden. Good morning, everyone. And welcome to the 
subcommittee on Communications and Technology and our oversight 
hearing on the Federal Communications Commission.
    I want to welcome the Chairman and all of the 
Commissioners. We are glad to have you here again. We 
appreciate your joining us today.
    As you know, it is our job to not only initiate innovative 
legislation and work with all of you on various individual 
legislative and regulatory priorities, but it is also our job 
to conduct rigorous and appropriate oversight of the Federal 
Communications Commission. And that is the subject of the 
hearing that we have today.
    Sadly, it is clear by various actions of this and previous 
commissions that Congress has delegated too much flexibility at 
times and authority to the FCC. And it seems that, regardless 
of what our clear legislative intent is, too often that clear 
intent gets misunderstood or, worse, obfuscated or obstructed. 
So, colleagues, we have to do a better job when we write these 
bills so as to limit FCC authority, not to expand it.
    This committee has placed an emphasis on improving the 
FCC's processes when it comes to conducting the people's 
business. The full House has concurred with our work on 
multiple occasions, including as recently as last night, when 
the House passed the FCC Process Reform Act of 2015 
unanimously. This effort arises from complaints and suggestions 
from the public and from various Commissioners over the years 
under various Chairs. Better process at the FCC will result in 
more transparent decisionmaking, where all the Commissioners 
have a meaningful opportunity to participate.
    And, Chairman Wheeler, while you have made important 
improvements, and I commend you for that--you have reduced 
backlogs, you have implemented a new complaint process, among 
other items--members of your own Commission are driven to 
publicly express their frustrations with the bigger 
decisionmaking process at times, so it is distressing to hear 
of somewhat bitter divisions.
    Now, let me give you three specific issues that concern me 
and many of us on the committee.
    First, our lawyers believe the FCC has disregarded the 
clear directive in the STELA Reauthorization Act of 2014 by 
expanding the scope of the DSTAC Working Group beyond what was 
ever intended by the committee. So that is number one.
    Number two, the FCC has promulgated rules designed to 
preempt state laws regarding municipal broadband absent 
congressional authority to do so.
    And, of course, the FCC continues its 8-year-long failure 
to complete its required quadrennial review of media ownership 
rules. I wonder what penalties would befall a licensee of the 
Commission that so failed to follow the law.
    And that is just the list of things that have already 
happened. The Commission has a number of pending proceedings 
that threaten to walk the same tired path of partisan, 
predetermined outcomes.
    The Commission has announced a rulemaking to ``clarify the 
FCC's expanded privacy authority under the new Internet 
rules,'' even when some cheerleaders for Title II common 
carrier regulation of the Internet access are coming to realize 
just how wide a net this self-granted authority casts over the 
Internet. If IP addresses are equivalent to phone numbers under 
Title II, just how will commerce flow in a broadband world? 
What is the FCC's definition of ``privacy'' under a law 
designed for hand-cranked telephones?
    The Commission appears poised to move forward on an item to 
redefine multichannel video programming distributor, or MVPD, 
to include linear over-the-top video providers. This is billed 
as a way to promote online video as a competitor to traditional 
cable and satellite providers, yet many over-the-top providers 
assert that government intervention is not warranted and that 
this will chill investment and innovation in the nascent, 
growing sector.
    And the Commission appears ready to move forward to expand 
the scope of the universal service Lifeline program without 
adopting controls to prevent ballooning costs. While this 
Commission has taken some steps to reduce waste, fraud, and 
abuse--and I commend you for that--much work remains in these 
areas, and the program still lacks meaningful spending 
controls. This, despite the fact the contribution factor for 
universal service--that is the percentage of consumers' bills 
the FCC collects each month to support the Universal Service 
Fund program--will rise to 18 percent in January, and that is 
an all-time high.
    Serious concerns about the misguided management and reward 
system of the Enforcement Bureau have risen to the point that 
Chairman Upton, the vice chairman of this subcommittee, Mr. 
Latta, and I have asked the Government Accountability Office to 
conduct an independent investigation into how decisions are 
made, how fines are determined, and how employee performance is 
assessed.
    In addition to these concerns, many stakeholders have 
expressed overarching concern that the FCC is adopting and 
applying its rules in an arbitrary fashion, singling out 
certain companies or industries for asymmetric regulation. This 
concern is buttressed, in their view, by so many 3-to-2 votes.
    With the spectrum auction less than 4 months away, I would 
also like to get your assurance that the Federal Communications 
Commission will fully and faithfully implement the law that was 
passed by Congress that broadcasters will not be forced to 
participate and that the Commission will make all reasonable 
efforts to preserve broadcaster coverage, prevent interference, 
and make sure that consumers can continue to enjoy their over-
the-air viewing.
    Two final notes. First, congratulations to the FCC on your 
October 23 unanimous vote to adopt the AM radio revitalization 
order, providing needed relief to the struggling AM radio 
industry. To quote the NAB press release, ``a great day for AM 
radio and for millions of listeners across America.'' I 
especially commend Commissioner Pai for his leadership on this 
issue and for all of you for coming together and finally 
getting this done.
    And I also want to congratulate Commissioners Rosenworcel 
and O'Rielly for their bipartisan efforts on 5G wireless. Keep 
it up.
    There is no lack of leadership or ability among the five 
people sitting before us today. You are all accomplished, 
recognized leaders. Our job is to change the system so each of 
you is a full participant in these incredibly important and 
complex decisions in a rapidly changing communications world.
    With that, I will turn to my friend from California, Ms. 
Eshoo, for her opening comments.
    [The prepared statement of Mr. Walden follows:]

                 Prepared statement of Hon. Greg Walden

    As you know, it's our job on this subcommittee to not only 
initiate innovative legislation and work with each of you on 
various legislative and policy proposals, but also to conduct 
rigorous and appropriate oversight of the FCC, as we will do 
today.
    Sadly, it's clear by various actions of this and previous 
commissions, Congress has delegated too much flexibility and 
authority to the FCC. And it seems that regardless of what our 
clear legislative intent is, too often that clear intent is 
misunderstood, or worse, obfuscated or obstructed. So 
colleagues, we have to do a better job when we write these 
bills so as to limit FCC authority, not expand it.
    This committee has placed an emphasis on improving the 
FCC's processes when it comes to conducting the people's 
business. The full House has concurred with our work multiple 
times, including as recently as last night when the House 
passed the FCC Process Reform Act of 2015 by voice vote. This 
effort arises from complaints and suggestions from the public 
and from various commissioners over the years under various 
chairs. Better process at the FCC will result in more 
transparent decision-making where all the commissioners have a 
meaningful opportunity to participate.
    And Chairman Wheeler, while you have made important 
improvements--you've reduced backlogs, implemented a new 
complaint process among other items--members of your own 
commission are driven to publicly express their frustrations 
with the bigger, decision-making process. It's distressing to 
hear of the bitter divisions.
    Now, let me give you three, specific issues that concern 
us:
     Our lawyers believe the FCC has disregarded the 
clear directive in the STELA Reauthorization Act of 2014 and 
expanded the scope of the DSTAC working group beyond what was 
ever intended;
     The FCC has promulgated rules designed to preempt 
state laws regarding municipal broadband absent congressional 
authority to do so;
     and, of course, the FCC continues its eight-year-
long failure to complete its required quadrennial review of 
media ownership rules. (I wonder what penalties would befall a 
licensee of the commission that so failed to follow the law?)
    And that's just the list of things that have already 
happened. The commission has a number of pending proceedings 
that threaten to walk the same tired path of partisan, 
predetermined outcomes:
     The commission has announced a rulemaking to 
``clarify the FCC's expanded privacy authority under the new 
Internet rules.'' Even some cheerleaders for Title II, common 
carrier regulation of Internet access are coming to realize 
just how wide a net this self-granted authority casts over the 
Internet. If IP addresses are equivalent to phone numbers under 
Title II, just how will commerce flow in a broadband world? 
What's the FCC's definition of ``privacy'' under a law designed 
for hand-cranked telephones?
     The commission appears poised to move forward on 
an item to redefine ``multichannel video programming 
distributor'' or ``MVPD'' to include linear over the top video 
providers. This is billed as a way to promote online video as a 
competitor to traditional cable and satellite providers--yet, 
many over-the-top providers assert that government intervention 
is not warranted and that will chill investment and innovation 
in the nascent and growing sector.
     The commission appears ready to move forward to 
expand the scope of the Universal Service Lifeline program 
without adopting controls to prevent ballooning costs. While 
the commission has taken some steps to reduce waste, fraud and 
abuse, much work remains in these areas, and the program still 
lacks meaningful spending controls. This despite the fact that 
the contribution factor for universal service--the percentage 
of consumers' bills that the FCC collects each month to support 
USF programs--will rise to 18 percent in January, an all-time 
high.
     Serious concerns about the misguided management 
and reward system of the Enforcement Bureau have risen to the 
point that Chairman Upton, Vice Chairman Latta and I have asked 
the Government Accountability Office to conduct an independent 
investigation into how decisions are made, how fines are 
determined and how employee performance is assessed.
    In addition to these concerns, many stakeholders have 
expressed overarching concern that the FCC is adopting and 
applying its rules in an arbitrary fashion, singling out 
certain companies or industries for asymmetric regulation. This 
concern is buttressed by so many 3-2 votes.
    With the spectrum auction less than four months away, I 
would also like to get your assurance that the FCC will fully 
and faithfully implement the law, that broadcasters will not be 
forced to participate, and that the commission will make all 
reasonable efforts to preserve broadcasters coverage areas so 
that consumers can continue to enjoy over-the-air viewing.
    Two final notes. First, congratulations to the FCC for your 
October 23rd, unanimous vote to adopt the AM Radio 
Revitalization Order providing needed relief to the struggling 
AM radio industry--to quote the NAB press release ``a great day 
for AM radio and for millions of listeners across America.'' I 
commend Commissioner Pai for his leadership on this issue and 
all of you for coming together and finally getting that done. 
And I want to also congratulate Commissioners Rosenworcel and 
O'Rielly for their bipartisan efforts on 5G wireless--keep it 
up.
    There is no lack of leadership or ability among the five 
people sitting before us today. You are all accomplished, 
recognized leaders. Our job is to change the system so that 
each of you is a full participant in these incredibly important 
and complex decisions in the rapidly changing communications 
world.

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

    Ms. Eshoo. Thank you, Mr. Chairman.
    And good morning, Mr. Chairman and members of the 
Commission. It is always great to see you here, the full 
Commission.
    I want to start out by commending the Chairman and, 
certainly, the Commissioners. The Chairman began his job as the 
Chairman of the Commission 2 years ago this month. I don't know 
what the exact date was, Mr. Chairman, but I know it was 2 
years ago. And it may seem to you like 100 years, some days 
anyway.
    But in the staff memorandum, if members have read it, I 
just want to go through what I think is an honor roll of 
addressing issues. This is taking on a great deal, and I think 
they are all worthy of mention. Some of my colleagues are not 
going to agree, but, obviously, I think it is very important: 
net neutrality, spectrum legislation, public safety, AWS-3 
auction, incentive auctions, the pending merger transactions, 
universal service, the E-rate, Lifeline, Rural Health Care 
Program, tech transition, consumer protection, public safety, 
enforcement, and I think there is--well, obviously, there has 
been work on process reform.
    And when I name off all of these areas, imagine the work 
that is underneath one or two words. So, whether Commissioners 
have agreed or disagreed on parts of policies that come under 
those umbrellas, you have taken on a huge workload, and I 
salute you. I have served with either five or six chairmen and 
commissions, and I think that this is the most proactive 
commission and chairman that we have worked with. So thank you. 
I salute you.
    More than a decade ago, the Columbia Business School 
professor Eli Noam examined the relationship between 
entrepreneurship and government and telecommunications. He 
concluded that entrepreneurial firms exist in the telecom 
sector--and this is so interesting to me--not despite of 
government but, rather, because of it.
    So let's assess how. Competition has been foundational in 
the Communications Act for more than 80 years, eight decades. 
So we do get some things right around here. Actions such as the 
Carterfone decision, the breakup of AT&T, and the 1996 Telecom 
Act demonstrated that when incumbents fail to innovate that the 
public sector has to step up to protect consumers and promote 
competition.
    But what should communications policy look like in the 
second decade of the 21st century? In the Internet age, it 
begins with open, interconnected networks that empower 
consumers and businesses to use the devices and the services of 
their choosing. Robust, enforceable open Internet rules prevent 
broadband providers from blocking or throttling lawful online 
content or engaging in paid prioritization.
    It means reforming legacy video laws that hinder innovation 
and consumer choice while protecting incumbent interests. And 
it means ensuring that consumers can buy a set-top box from 
someone other than their pay-TV provider. The lack of 
competition in the set-top box space has left consumers paying, 
on average, what some people think is whopping: $231 a year on 
rental fees alone. Why we allow this to continue I don't know, 
but it really does need to be addressed.
    So, to promote competition, we also need commonsense 
policies that make it easier for new companies to enter the 
broadband market. And I want to thank Commissioner Rosenworcel 
for highlighting in her testimony today the ``dig once'' policy 
that the chairman of our subcommittee and myself launched and 
on a bipartisan basis have promoted to promote broadband and do 
it in a very smart way.
    Finally, competition should be embedded in the decisions we 
make on spectrum. A balanced spectrum policy that recognizes 
the importance of both licensed and unlicensed spectrum is 
going to enhance competition, it will drive down prices, and it 
will unlock new innovation. It is an innovation platform in our 
country, and we can't lose sight of that.
    So my special thanks to you, Mr. Chairman, for your superb 
leadership; to each Commissioner for your leadership, for your 
working together. Even when you disagree, it is not personal, 
it is about the policy. And we all benefit from a variety of 
views.
    And more than anything else, I will be gone from this 
world, but what I want written about the 21st century is that 
it was an American century.
    I have gone over my time. I apologize to Congresswoman 
Matsui. I was going to yield time to her, but perhaps somebody 
else will.
    Thank you, Mr. Chairman.
    And thank you----
    [The prepared statement of Ms. Eshoo follows:]

                Prepared statement of Hon. Anna G. Eshoo

    More than a decade ago, Columbia Business School Professor 
Eli Noam examined the relationship between entrepreneurship and 
government in telecommunications. He concluded that 
entrepreneurial firms exist in the telecom sector not despite 
of government but rather because of it. Let's assess how.
    Competition has been foundational in the Communications Act 
for more than 80 years. Actions such as the Carterfone 
decision, the breakup of AT&T and the 1996 Telecom Act 
demonstrated that when incumbents fail to innovate, the 
government has stepped in to protect consumers and promote 
competition. But what should competition policy look like in 
the second decade of the 21st century?
    In the Internet age, it begins with open, interconnected 
networks that empower consumers and businesses to use the 
devices and services of their choosing. Robust, enforceable 
open Internet rules prevent broadband providers from blocking 
or throttling lawful online content or engaging in paid 
prioritization. It means reforming legacy video laws that 
hinder innovation and consumer choice, while protecting 
incumbent interests. And it means ensuring consumers can buy a 
set-top box from someone other than their pay-TV provider. The 
lack of competition in the set-top box space has left consumers 
paying on average a whopping $231 per year on rental fees 
alone.
    To promote competition, we also need commonsense policies 
that make it easier for new companies to enter the broadband 
market. A `dig once' policy is one such example of how to 
reduce the barriers to broadband deployment, increase 
competition, and do so while saving taxpayer dollars. When new 
competition is unlikely to emerge, such as in the $40 billion a 
year special access market, the FCC must act decisively to 
reform the market and stop anti-competitive practices.
    Finally, competition should be embedded in the decisions we 
make on spectrum. A balanced spectrum policy that recognizes 
the importance of both licensed and unlicensed spectrum will 
enhance competition, drive down prices and unlock new 
innovation.
    My special thanks to Chairman Wheeler and fellow 
Commissioners for being here today. With your commitment to a 
competitive telecommunications agenda, the second decade of the 
21st century can be the decade when entrepreneurs finally 
prevailed.

    Mr. Walden. Thank you.
    Ms. Eshoo [continuing]. Commissioners.
    Mr. Walden. I will now turn to the chairman of the full 
committee, the gentleman from Michigan, Mr. Upton, for opening 
comments.

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

    Mr. Upton. Well, thank you, Mr. Chairman.
    As we all know, 2 years ago, this committee welcomed a 
newly sworn-in Chairman Wheeler to this very hearing room. Our 
message then for the new Chair and the entire Commission was 
short and sweet: Given the FCC's jurisdiction over one of the 
most important sectors of our economy, the decisions that they 
would make would be critical to innovation, jobs, and our 
Nation's global leadership in technology.
    And, today, our request is just as simple: In executing its 
functions, the agency must operate with openness and 
transparency for the benefit of American consumers and job 
creators.
    Unfortunately, notwithstanding our clear and numerous 
concerns, the FCC has been plagued at times by process failures 
and a lack of healthy and honest policy debate. Ultimately, 
this has produced uncertainty in the market, harming our 
economy and the robust communication sector's ability to create 
the jobs that all Americans need.
    There remains many significant matters to be decided by the 
Commission. These are opportunities for the FCC to get back on 
track, to demonstrate its commitment to process reform and 
return to the bipartisan policymaking that was once a hallmark 
of the FCC.
    What you collectively do together matters to folks in 
Michigan and across the country, whose daily lives have been 
transformed by technology. And if the process can be improved, 
we will all be better for it.
    I yield the balance of my time to Mrs. Blackburn and then 
Mr. Latta.
    [The prepared statement of Mr. Upton follows:]

                 Prepared statement of Hon. Fred Upton

    Two years ago, the Energy and Commerce Committee welcomed a 
newly sworn in Chairman Wheeler to this very hearing room. Our 
message then for the new Chairman and the entire commission was 
short and sweet: given the FCC's jurisdiction over one of the 
most important sectors of our economy--the decisions that they 
would make would be critical to innovation, jobs, and our 
nation's global leadership in technology. And today, our 
request is just as simple: in executing its functions, the 
agency must operate with openness and transparency for the 
benefit of American consumers and job creators.
    Unfortunately, notwithstanding our clear and numerous 
concerns, the FCC has been plagued at times by process failures 
and a lack of healthy and honest policy debate. Ultimately, 
this has produced uncertainty in the market harming our economy 
and the robust communications sectors' ability to create the 
jobs Americans need.
    There remain many significant matters to be decided by the 
commission. These are opportunities for the FCC to get back on 
track, to demonstrate its commitment to process reform and 
return to the bipartisan policy-making that was once a hallmark 
of the FCC. What you collectively do together, matters--to 
folks in Michigan and across the nation whose daily lives have 
been transformed by technology. And if the process can be 
improved, we will all be better for it.

    Mrs. Blackburn. Thank you, Mr. Chairman.
    I want to say thank you to each of the Commissioners for 
taking your time to be here. It has been a while since we have 
had the full panel, and we are appreciative for this because we 
do have some questions. And FCC actions over the past several 
months have raised some questions about transparency and 
accountability and, as our chairman likes to say, regulatory 
humility or the lack thereof. So those are issues we want to 
cover with you today.
    We also are going to want to talk some about net neutrality 
and the Commission's potential entry into the online privacy 
realm. That has been the jurisdiction of the FTC, so we are a 
bit concerned about that and about how your policies seem to go 
about pushing the concept of picking winners and losers, which 
is not your job. The marketplace should do that.
    I am also going to have some questions about your decision 
to preempt state laws in Tennessee and North Carolina on the 
muni broadband issue. The chairman touched on this. You have a 
position there that even DOJ found that it could not support. 
So this is of concern to us.
    We thank you for being here to answer the questions.
    And I yield the balance of the time to Mr. Latta.
    Mr. Latta. Well, thank you very much. I appreciate the 
gentlelady for yielding.
    And, Mr. Chairman, thanks for today's hearing.
    And to the Commission, thanks very much for being with us 
today.
    Over the past year, this subcommittee has devoted many 
hearings to oversight of the FCC. This attention has not been 
misplaced. The communications and technology industry is a very 
productive and dynamic sector of our economy. We cannot afford 
to overlook the significance of regulatory policies and how the 
FCC's decisions affect the success of this vibrant industry.
    Without proper oversight, some actions emerging from the 
FCC, like the Downloadable Security Technical Advisory 
Committee proposals, can go unchecked and have negative impacts 
on a thriving industry. DSTAC, established by the FCC as 
directed by Congress, was formed to make recommendations on a 
software-based, downloadable security system for securing video 
content. However, the FCC allowed the DSTAC to focus on 
navigation interface issues, as well as downloadable security. 
This action goes against clear direction from Congress. As a 
result, the technical working group failed to achieve its 
intended purpose.
    I look forward to hearing from the Commissioners today on 
this issue, Mr. Chairman. And I yield back the balance of my 
time.
    Mr. Walden. The gentleman yields back the balance of the 
chairman's time.
    And we will now go to the ranking member of the full 
committee, the gentleman 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, Chairman, and I also want to thank 
our ranking member for holding this hearing.
    And thank you to all the Commissioners for coming up to 
talk with us once again.
    This is the fourth FCC oversight hearing we have had this 
year. I certainly appreciate the efforts the Republicans have 
put into overseeing the Commission. Oversight of all the 
agencies under our committee's jurisdiction is always a top 
priority for Democrats, and, still, I wish the committee had 
been as energetic this year about other problems the American 
people are grappling with, such as climate change, safe 
drinking water, or domestic violence in sports.
    Nevertheless, today's hearing is at least timely. We just 
recently commemorated the third anniversary of when Hurricane 
Sandy ripped through the East Coast. The storm left people 
across my district stranded without communication, some of them 
for weeks. And so I have spent the past 3 years making sure 
that we are better prepared for the next time disaster strikes. 
Because unless we do more to control climate change, there will 
be a next time.
    And that is why, yesterday, I introduced the SANDy Act to 
make sure people have better access to communications in an 
emergency. The bill recognizes the importance of phone service, 
TV, and radio during emergencies. I hope that the proposal in 
that bill, along with the efforts at the FCC to make networks 
more resilient, will mean that we never have a repeat of the 
communication failures from 3 years ago.
    But as important as network resiliency is, the FCC role in 
helping consumers is much broader. So I would like to briefly 
mention my other priorities for the Commission.
    First, online video. The future of communications is video, 
and the future of video is online and mobile. I thank the 
Commission for its ongoing work to understand this dynamic 
market, but I urge you to always remain focused on putting 
consumers first. Above all, the Commission's priority should be 
making sure consumers are the ones deciding what services and 
devices meet their needs.
    Second is spectrum. To make sure consumers can access the 
content they choose wherever they choose on whatever device 
they choose, they need more spectrum. The FCC is doing its part 
to meet this demand through its record-breaking spectrum 
auction earlier this year and its first-of-its-kind incentive 
auction set for early next year. I hope that Congress can 
continue to do our part by building on our recent work in the 
budget deal. We must find new ways to free more spectrum. We 
have not done enough.
    I know I have a couple other people here that want to use 
my time, but, before I yield, I wanted to thank Chairman Walden 
for his willingness to revisit the matter of broadcast 
ownerships. The chairman called a hearing to explore this issue 
a few months ago but had to cut it short. And this is an issue 
that the American people care deeply about, so I appreciate the 
fact that the chairman has offered to complete the hearing on 
December 3, and I look forward to it.
    So I thank, again, our witnesses. I look forward to hearing 
from you all about the important work the FCC is doing to help 
consumers.
    I have 2 minutes. I would like to give 1 minute to Mr. 
Butterfield and 1 to Ms. Matsui. We will start with Mr. 
Butterfield.
    Mr. Butterfield. I will do it very quickly, Mr. Pallone. 
Thank you very much for yielding.
    And thank you, Mr. Chairman, for convening this important 
hearing today.
    And to Commissioner Wheeler and to your colleagues, thank 
you so very much for coming.
    I would like to very quickly mention one thing because I 
may not be able to get it out during the remainder of the 
hearing. This is very important to me, and it is important to 
members of the Congressional Black Caucus. I recall that when I 
was a judge, when I was lawyer, and now as a community-based 
Congressman, I have run into this problem constantly throughout 
the years, and that has to deal with telephone calls from 
prisoners. Even when I was a trial judge, I used to get collect 
calls from those who were incarcerated.
    And you, Mr. Wheeler, and your Commission have addressed 
this issue, and I want to thank you and Ms. Clyburn and the 
others who worked so diligently on this.
    A call that used to cost as much as $14 per minute--a lot 
of people don't realize this--$14 per minute now costs 11 cents 
per minute. A 15-minute phone call used to be up to $210--a 15-
minute call, $210. Now it is $1.65 per minute.
    And I just want to commend you for your bold step in making 
that happen. I have a friend who is in prison. I visit him four 
times a year. And it is a big conversation among the population 
in the prison, how they have been relieved of these burdensome 
phone calls. And so I want to thank you for your work in that 
area.
    And now I yield to my friend, Ms. Matsui.
    Ms. Matsui. Thank you very much for yielding to me.
    Welcome back, Chairman Wheeler and Commissioners. We 
appreciate the work you are doing in many areas.
    One of my top priorities is making more spectrum available. 
The recently passed Budget Act took important first steps, but 
I believe Congress and the FCC need to build upon these 
provisions to identify new spectrum opportunities.
    We also share many other priorities, from modernizing the 
Lifeline program for broadband to keeping the incentive auction 
on track. I look forward to hearing more about the FCC's 
progress on promoting a competitive market for special access 
services.
    I also urge the Commission to work with the subcommittee to 
ensure any products of the set-top box working group process 
serve the public interest.
    Thank you, and I yield back.
    Mr. Walden. The gentlelady yields back.
    All time has expired.
    We will now go to the Chairman of the Federal 
Communications Commission, the Honorable Mr. Wheeler, for your 
opening statement. It is good to see you.
    And I just want to stipulate for the record, the red I am 
wearing has nothing to do with Ohio State.
    Let's go now to Mr. Wheeler.

     STATEMENTS OF THE HON. TOM WHEELER, CHAIRMAN, FEDERAL 
      COMMUNICATIONS COMMISSION; THE HON. MIGNON CLYBURN, 
   COMMISSIONER, FEDERAL COMMUNICATIONS COMMISSION; THE HON. 
   JESSICA ROSENWORCEL, COMMISSIONER, FEDERAL COMMUNICATIONS 
     COMMISSION; THE HON. AJIT PAI, COMMISSIONER, FEDERAL 
   COMMUNICATIONS COMMISSION; AND THE HON. MICHAEL O'RIELLY, 
        COMMISSIONER, FEDERAL COMMUNICATIONS COMMISSION

               STATEMENT OF THE HON. TOM WHEELER

    Mr. Wheeler. Mr. Chairman, it is a privilege to be here. 
Ms. Eshoo, Mr. Pallone.
    The color facts speak for themselves, sir.
    I have a prepared statement in the record, and I look 
forward to discussing a vast array of topics that have been 
suggested here today.
    Let me begin by applauding this body and the House for the 
bipartisan passage of H.R. 2583. We understand the process 
reforms that you seek, and we will comply with the law.
    Briefly today, let me focus on three topics that only 
Congress can resolve and pledge to work with this committee in 
addressing them.
    As I have said every time that I have been here, we have a 
crisis in bringing public safety communications into the 
digital era. We all mourn the events in Paris and the tragedy 
that happened there, but it reminds us of the need for constant 
preparedness and vigilance.
    When September 11 happened in this country, we discovered 
problems with the interoperability among our first responders, 
and Congress stepped up to address that. Mr. Pallone's new 
proposal that he just spoke about reminds us of the need to 
improve network resiliency in disasters.
    And there is another lurking problem, and that is the 
difficulty of our 6,800 public safety answering points, our 911 
operators, and the difficulty they are having adopting the next 
generation, the digital generation, of 911 capabilities. They 
risk becoming analog islands in a digital sea. The current 
systems are costly to operate and with limited capabilities 
compared to digital. The transition is expensive. It requires 
new equipment and new systems. It requires running redundant 
analog and digital during the conversion.
    There needs to be a national solution, national 
coordination, and national help to find the funds, perhaps from 
future auctions. It is worthy of public hearings, I would urge, 
Mr. Chairman, to illuminate the issue and the potential 
solutions, and we would look forward to working with the 
committee in that regard.
    Secondly, this committee has taken really important steps 
on infrastructure construction, and more opportunities await. 
There are really three goals. When you look at infrastructure, 
there are really three goals. How do you provide for clarity, 
consistency, and completion--the three C's of infrastructure.
    Insofar as clarity is concerned, today, court decisions 
decide infrastructure policy. Congress should decide 
infrastructure policy. You know, we need policy on activities 
that are deemed normally not to have significant impact on the 
environment. We need to eliminate the need for permits on 
technology upgrades without negative effects. We need to have 
the presumption that one commercial approval works for others; 
you don't have to have repetitive approvals. And we need to 
address the challenge in the Clean Water Act that says that 
when you dig up a street to replace the sewer you are 
prohibited by law from laying fiber. It just doesn't make any 
sense. Talk about ``dig once.''
    Insofar as consistency, only Congress can streamline the 
siting of facilities on Federal lands. There are just too many 
agencies with too many diverse processes to do serially.
    And on the question of completion, there needs to be 
certainty in the decisions. The reality is that appeals from 
the shot clock--we establish a shot clock, and then it goes to 
court in appeals, and it just delays the process further. One 
example of a solution was recently passed in the State of 
California, where the California law says that if a decision is 
not made within the shot clock it is deemed granted.
    So clarity, consistency, and completion are the goals we 
need to focus on for infrastructure, and we looked forward to 
working with you on those.
    And, finally, I know that this committee is concerned about 
pirate radio. During my tenure, we have taken 280 enforcement 
actions against pirate radio. That is in the last 2 years. 
Commissioner O'Rielly has been a real leader in keeping us 
focused on this. We are working with the NAB on a joint task 
force on pirate radio.
    But we need more tools. We are playing Whack-a-Mole right 
now. Every time a station pops up, we whack it. We need to have 
consequences for those who facilitate those stations popping 
up, the landlords who look the other way because helping 
pirates is risk-free. Congress could make it illegal to aid or 
abet pirate radio operations, and, in the process, denying them 
the opportunity to operate in this way would be a significant 
means of thwarting the continued growth of pirate radio.
    On these and all other issues, we look forward to working 
with this committee. And I thank you for the opportunity to be 
here.
    [The prepared statement of Mr. Wheeler follows:]
    
    
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    Mr. Walden. Mr. Chairman, thank you for those 
recommendations and suggestions. Thanks for being here. We look 
forward to the questions.
    We will now go to the Honorable Ms. Clyburn, Commissioner 
of the Federal Communications Commission.
    Thanks for your good work on the issues raised by Mr. 
Butterfield. And we look forward to your testimony.

              STATEMENT OF THE HON. MIGNON CLYBURN

    Ms. Clyburn. Thank you, Chairman Walden, Ranking Member 
Eshoo, distinguished members of the committee. I appreciate the 
opportunity to appear before you this morning in the company of 
my colleagues.
    We are living during an incredibly exciting time. America 
remains the land of opportunity. Technological advancements 
abound, providing new means to achieve the American Dream. And 
broadband is one of the biggest enablers of that dream. It is 
breaking down barriers to health care through remote 
monitoring, it is offering new paths to jobs and training, and 
it is providing our children with world-class learning.
    Most Americans enjoy ubiquitous access to broadband, but 
the number of those who do not remains high. I am both humbled 
and grateful that, from the directive issued by you, that the 
FCC has the obligation, ability, and opportunity to serve our 
Nation by acting to close chronic opportunity divides.
    My written testimony, which I ask to be included in the 
record, focuses on a promise and opportunities made possible by 
universal access to broadband, and it outlines our efforts to 
close those remaining communications access gaps.
    The Mobility Fund. While many of us enjoy nearly ubiquitous 
mobile coverage, pockets of our Nation remain in darkness. In 
2001, a bipartisan FCC adopted a dedicated Mobility Fund, but 
it has yet to be implemented. I believe that it is imperative 
that we move quickly to adopt a permanent Mobility Fund to 
eliminate coverage gaps across our Nation.
    Lifeline. The statute accords equal weight to rural high-
cost areas and low-income consumers when it comes to ensuring 
access to service reasonably comparable to those we enjoy in 
urban areas, and it is time that the FCC do so, as well. It is 
time to move from merely criticizing to fixing remaining 
problems in Lifeline.
    So I fully support the modernization of the program to 
address the affordability divide. And I believe that the steps 
we have already taken and the plan we have outlined in our 
notice of proposed rulemaking would not only eliminate 
incentives for waste, fraud, and abuse but enable Lifeline to 
become truly a real communications bridge to help Americans in 
need to get back on their feet.
    The incentive auction. The Commission has worked hard to 
implement your directives regarding the incentive auction. And 
I am proud that we adopted rules to incentivize smaller 
companies to deploy wireless networks in areas that lack 
advanced services.
    And, as you have heard, the reform of inmate calling 
services. I am deeply grateful that we finally acted, in the 
absence of a functional marketplace, to provide affordable 
communication services for those wanting and needing to stay in 
touch with the currently incarcerated. Too many families, 
friends, and attorneys are making unconscionable choices to 
stay in touch. And our Nation is plagued by the highest 
recidivism rate in the world in part because families cannot 
afford to maintain regular contact and too many former inmates 
go home as strangers and are unable to readjust.
    Our Connect to Health program. That task force is an effort 
to reach beyond the Beltway to focus on game-changing projects 
and stimulating new collaborations between public and private 
stakeholders and local communities that are seeking to solve 
health challenges through broadband-enabled solutions.
    And, lastly, we talked about it, the AM revitalization 
item. This bipartisan compromise addressed and met the needs of 
small businesses, AM radio owners, and the public by taking 
steps to increase the viability of AM radio stations through 
access to an FM translator.
    Mr. Chairman, this sums up my testimony. The rest is in the 
record. And I look forward to any questions you may have.
    [The prepared statement of Ms. Clyburn follows:]
    
   
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    Mr. Walden. Commissioner, thank you for your good work, and 
thanks for sharing those items with us.
    We will now go to Commissioner Rosenworcel.
    Thank you for being here. We look forward to your 
testimony, as well.

           STATEMENT OF THE HON. JESSICA ROSENWORCEL

    Ms. Rosenworcel. Good morning, Chairman Walden, Ranking 
Member Eshoo, and members of the subcommittee. Thank you for 
the opportunity to appear before you today along with my 
colleagues at the FCC.
    Today, communications technologies account for one-sixth of 
our economy, and that is no wonder, because these are the 
networks that carry all aspects of modern, commercial, and 
civic life. They are changing at a breathtaking pace, requiring 
us all to think boldly about the future. And, in the months 
ahead, the FCC will do just that as we begin the world's first 
spectrum incentive auction, work to speed the IP transition, 
and update universal service and media policies. This is lofty 
stuff.
    But I want to begin today by talking about the least 
glamourous part of the communications revolution. I want to 
talk about infrastructure. Because no amount of new fiberoptic 
facilities or spectrum matters without good policies on the 
ground.
    I believe it is time to take a comprehensive look at 
deployment practices and find a way to make them more 
consistent all across the country. We can begin with ``dig 
once'' policies, which can pave the way for more broadband 
deployment.
    And the notion behind ``dig once'' is simple. When 
construction crews are building or repairing roads, deploying 
broadband conduit at the same time adds only 1 percent to the 
cost of highway projects. But this small change can have big 
impact, yielding more broadband investment, more universal 
access, and more competition.
    We should also focus on Federal lands, which make up as 
much as one-third of our national real estate. We can expedite 
deployment here by creating an open data inventory of Federal 
infrastructure assets that can help support broadband and 
wireless deployment.
    We also need standard contracts from the GSA to facilitate 
deployment of antenna structures on Federal property. And, 
while we are at it, we should consider extending FCC's shot-
clock policies for State and local jurisdictions to Federal 
authorities so those who want to deploy infrastructure get a 
timely response.
    Not all of these policies can be acted on by the Commission 
alone, but I believe it is essential that we work with you and 
our Federal colleagues to help put them in place.
    Now, these gritty realities of network deployment may not 
get the glory, but they are important. Of course, it is also 
important that we focus on what we can do with our new 
networks. So now I want to talk about how our networks are used 
for learning.
    When I was growing up, homework required just a paper, 
pencil, and my brother leaving me alone. That is no longer 
true, because today 7 in 10 teachers assign homework that 
requires access to broadband. But FCC data suggests as many as 
one in three households do not subscribe to broadband service.
    Now, if you think about those numbers, where they overlap 
is what I call the homework gap. And if you are a student in a 
household without broadband, now just getting your homework 
done is hard. Applying for a scholarship is challenging. And 
while some students may have access to a smartphone, let me 
submit to you that a phone is just not how you want to research 
and type a paper, apply for jobs, or further your education.
    These students enter the job market with a serious 
handicap. And that is a job market today where half of all jobs 
require some level of digital skills. By the end the decade, 
that number jumps to 77 percent. But the loss here, ultimately, 
is more than individual, because it is a loss to our collective 
human capital and shared economic future that we need to 
address.
    Now, to address it is going to require a mix of public and 
private initiatives, modernizing FCC work to support 
connectivity in low-income households, more WiFi, more 
competition, and better infrastructure. But I think the sooner 
we act, the sooner we bridge the homework gap and give more 
students a fair shot at 21st-century success.
    Now, learning, of course, is just one example of how new 
communications technologies are remaking our world. There are 
others. Just last week, we had a cruel reminder from abroad 
that when the unthinkable occurs our security so often depends 
on connectivity. And in the days and weeks ahead, I know our 
horror will not fade, but our resilience will only grow. And at 
home and abroad, we need to study the mix of public alerts, 
first-responder communications, and social networking that 
facilitated safety. Those lessons can make us stronger, and we 
should submit ourselves to the discipline of learning them.
    Thank you. I look forward to answering any questions.
    [The prepared statement of Ms. Rosenworcel follows:]
    
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    Mr. Walden. Thank you, Commissioner.
    I will now turn to Commissioner Pai for your opening 
comments. Thanks for being with us. We look forward to your 
testimony.

                 STATEMENT OF THE HON. AJIT PAI

    Mr. Pai. Thank you, sir.
    Chairman Walden, Ranking Member Eshoo, members of the 
subcommittee, thank you for inviting me to testify today. Since 
2012, it has been a pleasure to labor alongside you on these 
issues of critical importance, and I look forward to continuing 
that work in the time to come.
    This morning, I would like to share my perspective on three 
important issues on which members of this subcommittee have 
recently focused, and I will start with broadband deployment.
    Before shovels even hit the dirt, Internet service 
providers must navigate a dizzying array of Federal, state, and 
local obstacles, and this comes at a cost. Every week spent 
negotiating with a municipality for access to local rights of 
way is another week that consumers must wait for a faster 
service. Every dollar spent complying with outdated regulations 
is a dollar that could have been spent delivering digital 
opportunities. I have heard and seen this for myself, 
everywhere from Fargo, North Dakota, to Hammond, Louisiana.
    I applaud the work of this subcommittee on breaking down 
the barriers to broadband infrastructure deployment. On a 
bipartisan basis, you have examined six bills that could boost 
broadband deployment, including the Broadband Conduit 
Deployment Act of 2015. This bill would help ensure that fiber 
accompanies every new highway and, thereby, improve broadband 
across America. This kind of work in the weeds is exactly what 
is needed if we are going to spur private-sector investment.
    Unfortunately, in my view, the FCC has not been as focused 
in promoting the digital revolution. The decision to regulate 
Internet service providers, like Ma Bell of yore, is a case in 
point, but that is not the only problematic decision. The FCC 
has also impeded the IP transition, making it harder for 
carriers to leave behind the fading copper networks of 
yesterday and focus on building next-generation networks.
    It is time for the Commission to change course. We should 
recognize that competition is the best guarantor of consumer 
welfare, certainly more than pervasive regulation. We should 
embrace the IP transition and clear out the regulatory 
underbrush that has slowed down the rollout of new services. 
And we should work with this subcommittee on further breaking 
down the barriers to infrastructure investment.
    Speaking of changing course, I hope the Commission will 
soon abandon its quest to regulate the over-the-top video 
market. So far, we have left this market to evolve on its own, 
and that has been a wise approach, in my opinion. As the 
Digital Media Association, which represents over-the-top 
providers including Apple, Microsoft, and Sony, put it, ``The 
tremendous developments in over-the-top services have emerged 
in an environment that permits innovators to be flexible and 
unencumbered.'' And so the Commission's proposal, as they put 
it, ``could end up backfiring, reducing resources and 
opportunities for these innovators rather than expanding 
them.''
    And, last month, Ranking Member Pallone called on the FCC 
to hit the ``pause'' button on regulating streaming video 
because consumers are beginning to have more programs to choose 
from, more ways to get them, and more options on prices. I 
wholeheartedly agree. And I think that the FCC should embrace 
the paradigm he expressed this morning of putting consumers 
first.
    One last concern I raise for the subcommittee's 
consideration is the agency's enforcement process. I applaud 
the leaders of this subcommittee for asking the GAO last month 
to investigate the management of the FCC's Enforcement Bureau.
    To be blunt, the FCC's enforcement process has gone off the 
rails. The FCC routinely asserts that companies have violated 
never-adopted rules, ignores facts that get in the way of good 
press, and plucks forfeiture amounts out of thin air.
    Things weren't always this way. Under Chairman 
Genachowski's leadership, I only dissented on one enforcement 
action, and that was because I thought the proposed forfeiture 
amount was too low. Under Acting Chairwoman Clyburn's 
leadership, I didn't dissent on any Enforcement Bureau actions, 
not one. But in the last 13 months, I have voted against 10. To 
be clear, I haven't changed my approach. It is the Commission's 
approach that has changed.
    One further problem is that Commissioners themselves can't 
oversee the enforcement process. On June 24, I asked the 
Enforcement Bureau to provide me with a list of their open 
investigations. One day before our last oversight hearing, the 
Chairman's office told me they believed they were a week or two 
away from supplying this information. Five months later, my 
office has followed up on this request no less than 12 separate 
times, and I still haven't received a list of open 
investigations.
    This is unacceptable. As someone nominated by the President 
and accountable to this body and to the American public for 
making FCC policy, I should be able to find out what the FCC, 
including its bureaus, is doing. That I can't indicates that 
the agency's process is broken.
    Chairman Walden, Ranking Member Eshoo, members of the 
subcommittee, thank you once again for holding this hearing. I 
appreciate your concern about areas of interest to the FCC and 
look forward to working with you once again in the time to 
come.
    [The prepared statement of Mr. Pai follows:]
    
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    Mr. Walden. Thank you, Commissioner Pai. That is very 
disturbing. We will follow up on that.
    Mr. O'Rielly, we are delighted to have you before the 
committee. Commissioner, please go ahead with your opening 
comments.

             STATEMENT OF THE HON. MICHAEL O'RIELLY

    Mr. O'Rielly. Thank you, Mr. Chairman. Thank you for the 
honor to be before this subcommittee to help further its 
oversight responsibility over the Federal Communications 
Commission.
    During my 2-year tenure, I have tried to be true to my 
principles, look for areas of agreement with my colleagues, and 
move past any disagreements that we may have. This subcommittee 
is right to focus significant attention on the Commission, 
given how our decisions impact the American economy. In 
retrospect, I wish I had pushed for more FCC hearings when I 
advised committee members years ago.
    With your indulgence, I would like to touch on four areas 
to help further the discussion.
    First, a key priority for me is expanding the amount of 
commercial spectrum available and updating infrastructure rules 
to facilitate build-out. While the Spectrum Pipeline Act is a 
step in the right direction, industry experts indicate that 350 
megahertz of licensed spectrum will be needed to meet projected 
demand by the end of the decade. Inevitably, Federal Government 
users must reduce their footprint. And we need to incentivize 
this transition, including instituting Federal Government 
spectrum user fees.
    The Commission's efforts to release more spectrum for 
commercial use include the upcoming broadcast incentive 
auction, a proceeding targeting specific bands above 24 
gigahertz, and examining the best ways to open the 5.9-
gigahertz band for unlicensed use.
    But no matter how much new spectrum is available, 
substantial infrastructure upgrades are needed. And I have 
discussed a number of ways to promote build-out in my written 
testimony.
    Second, the Commission recently moved to reduce barriers to 
private-sector, not government, foreign investment by proposing 
to extend the common carrier streamlined review process to 
broadcast licensees. This action is not just about increasing 
capital for domestic broadcasters but also about expanding the 
ability of U.S. firms to invest internationally.
    At the same time, fixing the process at the Commission will 
do nothing to alleviate the problems inherent in the opaque and 
lengthy Team Telecom review process. I respectfully request 
this body to consider ways to work across committee 
jurisdiction to craft an oversight function for Team Telecom 
that is grounded in fact and legitimacy rather than the whims 
of any Federal department at any given moment.
    Third, I repeat my call for some badly needed process 
reforms at the Commission. Top of this list is allowing those 
interested in Commission open meeting items to see the exact 
text being proposed to engage in a clear and level playing 
field, not through a dense fog of spin.
    Other reform ideas I have advocated were summarily deferred 
to a process review task force. My office has been actively 
engaged in this process, but suffice it to say that no action 
has occurred yet. The committee's legislation in this area is 
both helpful and needed.
    Lastly, the subcommittee should be concerned about the 
potential for Commission mission creep. Nearly every week, the 
Commission expansively interprets the Communications Act to 
claim broad authority outside that originally contemplated by 
the law. Without proper constraints, it is easy to see this or 
a future Commission trying to micromanage business practices of 
edge providers or online companies.
    The Commission's strong interest in regulating privacy and 
data security is a troubling example with major implications 
for the tech economy and those businesses that transact with 
customers online. The Commission should not freelance in an 
area where it has little expertise. The communications sector 
is much too important to the economy to be saddled with 
experimental regulations from any and all interested agencies.
    So, with that, I thank the chairman and wish to yield back.
    [The prepared statement of Mr. O'Rielly follows:]
    
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    Mr. Walden. Commissioner O'Rielly, thank you.
    And thanks to all the Commissioners and the Chairman for 
being here and for your comments.
    I am going to start.
    Commissioner Rosenworcel, I noted in your recent testimony 
in the Senate that you supported cost-benefit analysis in the 
FCC's decisionmaking, reflecting what the President has 
proposed in his 2011 Executive order. Is that correct?
    Ms. Rosenworcel. Thank you for the question, Chairman 
Walden.
    I did acknowledge that the President issued an Executive 
order in July of 2011----
    Mr. Walden. Right.
    Ms. Rosenworcel [continuing]. Directing agencies to the 
extent possible to follow cost-benefit analysis, yes.
    Mr. Walden. And you support that?
    Ms. Rosenworcel. I can support an Executive order, yes.
    Mr. Walden. Some I do; some I don't.
    Commissioner Pai, do you support that concept, as well, the 
cost-benefit analysis in the FCC's decisionmaking, reflecting 
the President's order of 2011 for the other agencies?
    Mr. Pai. I do wholeheartedly, Mr. Chairman.
    Mr. Walden. Mr. O'Rielly?
    Mr. O'Rielly. Absolutely, Mr. Chairman.
    Mr. Walden. Commissioner Clyburn?
    Ms. Clyburn. I support the concept.
    Mr. Walden. So, Commissioner Wheeler, it looks----
    Mr. Wheeler. Oh, my goodness.
    Mr. Walden [continuing]. Like you have three to two here 
right now, or three to one. Is this something we can look 
forward to you maybe circulating?
    Mr. Wheeler. Well, I think the first thing that I clearly 
don't need to remind this committee----
    Mr. Walden. You are an independent agency not subject to 
the----
    Mr. Wheeler [continuing]. That we are----
    Mr. Walden [continuing]. President's Executive order.
    Mr. Wheeler [continuing]. Independent----
    Mr. Walden. That is why you can show leadership and----
    Mr. Wheeler. You knew it.
    Mr. Walden. Yes.
    Mr. Wheeler. And it is hard not to believe in cost-benefit 
analysis.
    Mr. Walden. OK.
    Mr. Wheeler. And the purpose of rulemakings is to conduct 
that kind of cost-benefit analysis and to discover, through the 
advocacy process, what are the costs----
    Mr. Walden. All right, but----
    Mr. Wheeler [continuing]. And what are the benefits and 
make a decision on it.
    Mr. Walden. As you know this process, I only have 5 
minutes, so I am going to cut to the chase here.
    Is that something you are willing to put out for the 
Commission to consider in a formal basis, that you will do 
cost-benefit analyses?
    Mr. Wheeler. So, Mr. Chairman, I have not specifically 
looked at the Executive order you referenced. Let me take a 
look at it, and I will be happy to get a response to you.
    Mr. Walden. All right. I will make sure and get it to you.
    This issue that Commissioner Pai raised is obviously 
disturbing to the committee. And he details how this has not 
been an issue in the past, now contends it is an issue. He has 
been trying to get access to what the Enforcement Bureau is 
looking at.
    If I were on the Commission, I would feel that 
responsibility and feel like I had the authority to get that. 
What is the issue there, Chairman?
    Mr. Wheeler. Thank you, Mr. Chairman.
    I think that the issue here is the difference between a law 
enforcement activity and a policy deliberation. And in the law 
enforcement side of things, you are dealing with sensitive 
information, you are dealing with information that can move 
markets, you are dealing with a presumption of innocence, that 
somebody's name gets dragged through the press----
    Mr. Walden. Well, but I guess if----
    Mr. Wheeler [continuing]. But let me----
    Mr. Walden. Because if prior Chairs have been willing to 
share that information, is there a specific----
    Mr. Wheeler. It is not my understanding that that is the 
case, sir, that the law enforcement activities have always 
been----
    Mr. Walden. But are all of these law enforcement, or are 
they just----
    Mr. Wheeler. They are all law enforcement, yes, sir.
    Mr. Walden. All right. Commissioner Pai seems to have a 
disagreement. I am going to try and sort this out.
    Commissioner Pai?
    Mr. Pai. Mr. Chairman, a couple of responses.
    First, I think, fundamentally, every Commissioner has the 
responsibility to understand, because we are accountable for 
the policy decisions that any subordinate bureau makes.
    Secondly, I have a security clearance comparable to any 
member of the Enforcement Bureau. I have been privy to some of 
the most sensitive government operations there are, far more 
sensitive, for example, than deciding whether or not Lyft or 
Uber or somebody else should get a citation from the 
Enforcement Bureau.
    Additionally, I think that it is a question of selective 
prosecution that has been raised. For example, on issues like 
the TCPA, our number-one source of complaints is for violations 
of the Do Not Call Registry. Yet, when we adopted the TCPA 
rules, we only had one Enforcement Bureau citation on the 
books. Why is that?
    Pirate radio. Commissioner O'Rielly has long been beating 
the drum, yet it wasn't a priority till----
    Mr. Walden. All right.
    Mr. Pai [continuing]. Recently. I want to understand why 
that is.
    Mr. Walden. Commissioner O'Rielly, have you had similar 
sort of problems?
    Mr. O'Rielly. I agree with my colleague on a number of 
fronts. And he raised these issues--I have raised them before 
publicly. I have a problem with a number of aspects of our 
Enforcement Bureau, both in the selective prosecution but also 
getting information.
    For instance, we have been trying to work on pirate radio 
for a while. In July, we adopted an item. I have been pushing 
them to do the policy statement that all of us agreed to do. It 
wasn't until last week, when this hearing was announced, or 2 
weeks ago, that we actually finally got some ideas out of the 
Enforcement Bureau in terms of how to address pirate radio.
    So I am troubled by how irresponsive they are to the 
concerns that we have and the activities that we would like to 
see addressed. But then, also, on the prosecution side, deep 
problems in terms of some of the items that we have adopted 
against my wishes.
    Mr. Walden. All right. My time for questions has expired. 
To be continued.
    We turn now to the gentlelady from California, Ms. Eshoo.
    Ms. Eshoo. Thank you, Mr. Chairman.
    Thank you for all of your opening statements.
    There is something that I failed to mention in my opening 
statement, and I think it is important enough to circle back. I 
was talking about new competition and when it is unlikely to 
emerge. An example is the $40-billion-a-year special access 
market. The FCC, I believe, has to act decisively to reform the 
market and stop anticompetitive practices. So I know that you 
are working on it, but I want to underscore it, because this 
isn't something that is small.
    I would also like to recognize Ambassador Verveer, who is 
in the audience.
    And thank you for your extraordinary service to our 
country, Mr. Ambassador. Welcome. You enhance the hearing room 
with your presence. Thank you very much.
    Mr. Walden. Here, here.
    Ms. Eshoo. Now, some questions.
    Commissioner O'Rielly, in March, you called for the 
Commission to proceed with setting rules and policies that 
affirmatively permit foreign ownership of broadcast licensees 
above the 25-percent cap. I know that the proposed rulemaking 
was unanimously adopted last month.
    Can you just quickly state what you think will come out of 
that proposal?
    Mr. O'Rielly. Absolutely.
    Ms. Eshoo. Because I think it is a very important one.
    Mr. O'Rielly. No, I think so, as well. And I agree. And I 
thank the good work of my colleagues, including the Chairman, 
who has been very cooperative on this issue.
    We have worked to try and provide a clear path for foreign 
investment into U.S. broadcast properties from the private 
sector, not the government, not foreign governments. And, in 
doing so, we think we can increase the amount of capital 
available for broadcasters in terms of things that they may 
need to do. That is very important.
    But it also, as I talked about in my testimony, it is also 
about allowing U.S. investors internationally. This has been a 
barrier that is pointed on in a number of----
    Ms. Eshoo. It does raise capital.
    Mr. O'Rielly. Absolutely.
    Ms. Eshoo. It raises capital. So thank you, and thank you 
for working on that.
    Commissioner Rosenworcel, you need to know that the 
chairman leaned over and said, ``What did you do to get so many 
Commissioners to talk about 'dig once'?'' One of these days, it 
is going to pass the Congress. But thank you. And thank you to 
the Chairman and anyone else that--I think that Commissioner 
Clyburn also said something about it.
    You suggested that legislative efforts to increase licensed 
spectrum for the licensed spectrum pipeline should also include 
unlicensed. Obviously, you know that I am a huge proponent of 
unlicensed spectrum. You have called this the WiFi dividend.
    Now, in crafting legislation, how do we ensure that the 
enormous economic value of unlicensed is reflected in CBO's 
scoring?
    I almost didn't ask you this, because you are not a CBO 
person, but you have been on the inside of the government. And 
this is a problem. Anyway, do you want to take a shot at it?
    Ms. Rosenworcel. Thank you for the question, difficult 
though it is.
    Everyone in this room has probably used unlicensed spectrum 
today.
    Ms. Eshoo. Sure.
    Ms. Rosenworcel. Maybe it has been WiFi, your garage-door 
opener, an RFID tag when you were at the store, or a baby 
monitor overnight. Everyone in this room has used it. It is a 
huge part of our daily lives, and it is a huge part of our 
economy, responsible for more than $140 billion in economic 
activity annually.
    Ms. Eshoo. Right.
    Ms. Rosenworcel. So, when we talk about spectrum policy, we 
need to make sure we talk both about licensed and unlicensed. 
And when legislation moves through this committee, including a 
swath of unlicensed is a good thing for the wireless economy. 
It is what I have called the WiFi dividend.
    The challenge, as you acknowledge, comes with the 
Congressional Budget Office, which reviews spectrum legislation 
and has a heavy bias towards spectrum that gets auctioned and 
sold through the FCC's auction process. It strikes me that that 
accounting is outdated because it doesn't account for the $140 
billion in economic activity every year that is dependent on 
unlicensed spectrum.
    And so the idea behind a WiFi dividend is to continue to 
move unlicensed spectrum when licensed legislation comes about. 
And I think, if we do that, we can see the economy grow and the 
Internet of Things really flourish.
    Ms. Eshoo. Yes, that is great. Thank you.
    Mr. Chairman, our Senate colleagues have done a study and 
concluded that consumers pay an average of $231 annually. I 
said that in my opening statement. What are we going to do 
about this?
    I think that section 629 is pretty specific in terms of its 
intention to give consumers a choice in what device they want 
to use. Do you want to comment on this?
    Mr. Wheeler. Well, thank you, Ms. Eshoo.
    Just last week, we closed a comment period in which we were 
asking for responses to the DSTAC report that Mr. Latta had 
referenced, and I think we need to then decide what we do to go 
on from there.
    You know, I was reading section 629 this morning in 
anticipation it might be a topic. And I note that it 
specifically says that the Congress is telling the FCC to 
``assure,'' quote/unquote, the availability of competitive 
navigation devices.
    So we are going to get the comments in. We had a really 
fulsome DSTAC process. It produced two separate reports. We put 
both of those out for comments. The comments closed last week. 
We will review them and decide what happens next.
    Ms. Eshoo. My time has expired. I have more questions. I 
don't know if we are going to do more than one round.
    Mr. Walden. We will try to.
    Ms. Eshoo. Thank you very much.
    Mr. Walden. We will go now to Mrs. Blackburn next.
    Mrs. Blackburn. Thank you, Mr. Chairman.
    Chairman Wheeler, I want to talk about the Downloadable 
Security Technical Advisory Committee report and the final 
report it issued on development of downloadable security 
systems that would facilitate the delivery of video programming 
over third-party services. And, as you can imagine and as we 
have talked many times, my content producers in Nashville have 
a lot of concern about this.
    And one of the proposals would allow MVPD service to be 
disassembled into individual piece parts that any retail device 
manufacturer could selectively reassemble into a new 
configuration and a new service. And it is similar to the 
AllVid concept considered by the FCC in 2010. Disaggregating 
this MVPD content would also lead third parties to circumvent 
the consumer protections that are built into regulated MVPD 
service but not into AllVid.
    So, with respect to AllVid, I am concerned by ideas that 
are being pushed right now by some individuals and groups that 
would allow third parties to use the content for their own 
service in ways that violate the licensing terms and without 
consent of the content creator.
    And we have a TV marketplace that is producing more video 
content than ever, so why would the government support this 
kind of intervention and theft?
    Mr. Wheeler. Thank you, Ms. Blackburn.
    I think the first reality here is that AllVid was an idea 
from half a dozen years ago. The world has moved on 
substantially since then.
    As I indicated to Ms. Eshoo, the goal of DSTAC was to 
address exactly the question that you raise. And there were 
strong opinions on both sides. And the conclusions, the 
comments on it have just been filed.
    I can assure you that it is no one's goal to thwart the 
security that protects the sanctity of copyrights and that we 
will review the record that has been developed accordingly.
    Mrs. Blackburn. So we can be assured that you all are not 
going to diminish the right of these content creators to 
control their content, correct?
    Mr. Wheeler. We have to protect copyright, madam.
    Mrs. Blackburn. OK.
    Let me move on. I watched some video statements made by 
Jonathan Chambers over at the North Carolina Rural Center's 
Rural Broadband Conference that was held back in September. And 
he did a presentation called ``Build It Anyway.'' And he, in 
this, personally talked about how he personally secured $100 
million, which he referred to as a tiny amount of money, for a 
rural broadband experiment.
    And I want to play that right now.
    [Video shown.]
    Mrs. Blackburn. OK. If we can come back to the questioning.
    Mr. Chairman, were you aware of this presentation and aware 
that he was discussing $100 million as a tiny amount of money? 
Because I can assure you, to my constituents in Tennessee, it 
is not a tiny amount of money.
    Mr. Wheeler. I am unaware, but you just gave me a new piece 
of information. I had not seen that video, nor had I heard a 
report of this presentation.
    Mrs. Blackburn. Are you aware of this supposed experiment?
    Mr. Wheeler. Yes. We all voted on that experiment. And the 
question is, are there alternative ways to get broadband 
delivery in rural areas? We have a crisis in terms of broadband 
in rural America----
    Mrs. Blackburn. The private sector, I think, can probably--
--
    Mr. Wheeler. The issue is we are currently subsidizing one 
group of people who build fiber. And so the question was, 
``should there be tests of others who also build fiber, such as 
electric co-ops, and whether they can provide service where it 
is not being provided?'' That is what this test was about.
    Mrs. Blackburn. But to the tune of $100 million?
    Mr. Wheeler. That is what the test is about. Yes, ma'am.
    Mrs. Blackburn. You think that that is worth $100 million?
    Mr. Wheeler. There are huge areas----
    Mrs. Blackburn. OK.
    Mr. Wheeler [continuing]. Of our country that are not being 
served by broadband.
    Mrs. Blackburn. Is this an example of regulatory humility 
with which you approach your job?
    Mr. Wheeler. No, I think our responsibility, I hope, is to 
make sure that we are using funds to expand the reach of 
broadband and to do so creatively.
    Mrs. Blackburn. Mr. Chairman, I have letters from both the 
Governor and the Lieutenant Governor of the State of Tennessee 
I would like to submit for the record about their concerns----
    Mr. Walden. Without objection.
    Mrs. Blackburn [continuing]. With overriding muni 
broadband.
    [The information appears at the conclusion of the hearing.]
    Mrs. Blackburn. I yield back.
    Mr. Walden. The gentlelady yields back.
    I recognize the ranking member of the full committee, Mr. 
Pallone, for 5 minutes.
    Mr. Pallone. Thank you, Mr. Chairman.
    I mentioned earlier that, yesterday, I introduced the 
Securing Access to Networks in Disasters, or SANDy, Act. And 
the SANDy Act is a result of an examination of what went wrong 
during Hurricane Sandy 3 years ago and incorporates some 
lessons learned.
    I wanted to ask initially, Commissioner Rosenworcel, I know 
you visited New Jersey shortly after Sandy struck, and, based 
on your experiences, do you have any suggestions for 
legislative steps we can take to help consumers during 
emergencies and disasters?
    Ms. Rosenworcel. Thank you, Congressman Pallone.
    I did in fact visit the New Jersey shore right after 
Hurricane Sandy hit, and I won't soon forget what I saw: the 
coast ripped apart by wind and rain and the people who lived 
there and their stamina and fortitude and desire to rebuild. I 
know that our communications networks worked during that storm, 
but not all of them, and on the New Jersey coast, far too few 
of them.
    So I think your SANDy legislation is a terrific start to 
force us to look at network resiliency in a new way, to come up 
with master contacts for our Nation's 911 call centers, and 
also to adjust the Stafford Act to reflect a priority of 
communications service providers in crisis.
    Mr. Pallone. Thank you.
    Let me ask Chairman Wheeler: A second component of this 
issue involves network resiliency. And, as you know, over 40 
percent of the wireless towers went out in New Jersey during 
Sandy. What is the status of the FCC's proceeding on network 
resiliency?
    Mr. Wheeler. So we have had a 911 network resiliency 
proceeding which we completed, and we continue to work on the 
other resiliency issues. I think that your legislation is 
helping to focus on these issues and will provide some more 
responsibilities to follow through on.
    Mr. Pallone. All right. I am going to follow up with you 
about some of this after the hearing----
    Mr. Wheeler. Great.
    Mr. Pallone [continuing]. If that is OK.
    Let me ask you, Chairman Wheeler, about the incentive 
auction. I know that running a successful incentive auction 
next year is one of your top priorities, and that----
    Mr. Wheeler. Yes, sir.
    Mr. Pallone [continuing]. Is one of mine, as well. And I 
have heard some concerns that the software you are using to run 
the auction may not be ready in time. So I just wanted to give 
you a chance to respond.
    Two questions. When do you expect the incentive auction 
software package to be finalized? And do you plan to give the 
impacted industries practice rounds with the software before 
the auction starts?
    Mr. Wheeler. Thank you very much, Mr. Pallone.
    The software packages are being developed over time, and 
are virtually all completed at this point. They are being run 
through an internal red team process; an outside, third-party, 
break-it process, if you will.
    And then, specifically to your question, we will be having 
trials and mock auctions, where it will be tested ultimately by 
those who are going to use it.
    Mr. Pallone. OK.
    Let me just ask you about pirate radio. I know you have 
been fairly successful lately in finding bipartisan support on 
a number of things. And I think an issue that you discussed 
that should have bipartisan support are the problems with the 
proliferation of illegal pirate radio stations. You mentioned 
it in your statement.
    Do you think that there are any changes in the law that 
could help the FCC better enforce against illegal pirate radio 
stations?
    Mr. Wheeler. Yes, sir. This has been an effort that 
Commissioner O'Rielly and I have both been working on, and he 
has particularly been the cattle prod on the activity.
    But, as I said in my statement, it is Whack-a-Mole right 
now. They pop up, we jump on them, they pop up, we jump on 
them, but they just move to the next place.
    Landlords turn a blind eye to this. If there was a way that 
we could go and say to the landlords, ``Excuse me, you have 
some liability in this decision, as well.'' They just see it as 
income--``Hey, I have somebody that is going to start paying me 
money for this space. I will rent it out to them.'' If they 
understood that there were consequences from that kind of 
enabling and illegal act, I think that would be very helpful.
    Mr. Pallone. OK.
    Did you want to respond, Mr. O'Rielly?
    Mr. O'Rielly. No. I agree with the Chairman's comments. I 
think I want to be careful exactly on approaching landlords. We 
would like to have an education process, as well. Many may not 
be familiar. I do not want to expose landlords in a broad 
category. I want to be careful when we do it.
    But it is not just landlords. It is political campaigns 
that advertise on these illegal pirate stations. And there are 
a lot of other--concert promoters. There are things that we 
need to educate the community that should not be participating 
with these pirate radios. They are illegal, and we should go 
after all the mechanisms to eliminate them.
    Mr. Pallone. All right. Thanks a lot.
    Thank you, Mr. Chairman.
    Mr. Walden. We will now turn to the gentleman from Texas, 
Mr. Barton, for 5 minutes.
    Mr. Barton. Well, thank you, Mr. Chairman.
    I apologize to the Commission for not being here for their 
opening statements. As you know, we have the Health 
subcommittee, and they are meeting at 10, so we always have to 
go back and forth. So I missed their statement, but I am 
appreciative of the Commission being here.
    Those of you that have attended hearings like this in the 
past, my normal routine would be to start asking the Chairman 
and the other members a series of questions about low-power 
television. I am going to submit those for the record, so I am 
not going to disappoint you, but we will put them in the 
written part of the record.
    What I am going to do is kind of go off script--yes, and 
Greg says, ``Uh-oh''--but in a positive way, I hope, 
bipartisan.
    We just had this terrible attack in Paris, and hundreds of 
people were killed. We need to do something about it. ISIS and 
the terrorist networks can't beat us militarily, but they are 
really trying to use the Internet and all of the social media 
to try to intimidate and beat us psychologically.
    My question--and I will start with the Chairman, but then 
each of the members of the Commission: Isn't there something we 
can do under existing law to shut those Internet sites down? 
And I know they pop up like weeds, but, once they do pop up, 
shut them down, and then turn the Internet addresses over to 
the appropriate law enforcement agencies to try to track them 
down?
    I would think that, even in an open society, when there is 
a clear threat, they have declared war against us, our way of 
life, they have threatened to attack this very city that our 
Capitol is in, that we could do something about the Internet 
social-media side of the equation.
    So I would start with the Chairman and then anybody else 
who wishes to comment.
    Mr. Wheeler. Thank you, Mr. Barton.
    As you have done, we cannot underestimate the challenge 
here. I am not sure that our authority extends to picking and 
choosing among Web sites, but I do think there are specific 
things that we can do. As you----
    Mr. Barton. Well, do we need to, on a bipartisan basis, 
give additional authority to shut some sites down?
    Mr. Wheeler. One of the issues here is the question of 
``What is a lawful intercept?'' is something that the Congress 
can define. You did it in CALEA. Things have moved on since 
then. You know, you read in the press that they were using 
PlayStation 4 games to communicate, which is outside the scope 
of anything ever considered in CALEA. So there are probably 
opportunities to update the lawful intercept concept.
    I think there is also a question about the security of our 
networks. There have been 17 fiber cuts in the Bay Area in the 
last few months mysteriously happening. There were two fiber 
cuts yesterday, not in the Bay Area but elsewhere in the 
country. We need to have some kind of a big-data capability of 
determining what is happening to our network out there. Because 
it is not just people getting on the network; it is, perhaps, 
people doing things to the network.
    We have the only reporting system in the Nation that we 
run, called the Network Outage Reporting System, NORS. We don't 
have the ability to use that to go for big data, to have big-
data analysis. It is barely holding together with baling wire 
and glue because it is using ancient technology. We have been 
asking for appropriations to upgrade that.
    I know the appropriation process is still underway, and I 
know it is not this committee, but this experience has called 
out the importance of network security. And if we can't connect 
the dots--you know, after 9/11, we kept hearing about ``We 
couldn't connect the dots, we couldn't connect the dots.'' We 
have the ability inside our systems to use big data to connect 
the dots, but we don't have----
    Mr. Barton. Well, my time----
    Mr. Wheeler [continuing]. The capacity to do it.
    Mr. Barton [continuing]. Is about to expire. I would assume 
it is a ``yes'' answer, that the Commission will work with the 
committee if we need to update our laws to do so.
    Mr. Wheeler. It is a capital ``Yes,'' sir.
    Mr. Barton. OK.
    Is there anybody else who wants to comment on that before--
my time just expired.
    Ms. Eshoo. Well, I want to thank you for raising this. And 
I know that the FBI, relative to the cuts in the Bay Area, have 
said that they need to deal with HPSCI, the House Permanent 
Select Committee on Intelligence. And so we will just----
    Mr. Barton. Well, it is a clear and present danger.
    Ms. Eshoo. Yes. Of course it is.
    Mr. Barton. They have declared war against us.
    Ms. Eshoo. And I don't think any of this is coincidental 
either.
    Mr. Barton. And they are using the Internet in an extremely 
offensive, inappropriate----
    Ms. Eshoo. Effective way.
    Mr. Barton [continuing]. Way against us. And we ought to be 
able to make it, at a minimum, much more difficult and, 
hopefully, absolutely shut it down.
    With that, Mr. Chairman, I would yield back.
    But I will get you my questions on low-power TV.
    Mr. Wheeler. I look forward to them, sir.
    Mr. Walden. The gentleman yields back the balance of his 
time.
    The chair now recognizes the gentleman from Pennsylvania, 
Mr. Doyle.
    Mr. Doyle. Thank you, Mr. Chairman.
    And I just want to say to Mr. Barton, I wholeheartedly 
agree with what you said, too, and hopefully we can work on 
that.
    Chairman Wheeler, at the risk of sounding like a broken 
record, I want to talk to you a little bit about special 
access.
    Mr. Wheeler. Yes, sir.
    Mr. Doyle. First, I want to thank you for the Commission's 
continued work on special access. And while I was somewhat 
concerned that the comment deadlines were once again extended, 
I want to applaud the Commission for beginning its 
investigation into tariff rates and conditions in these 
markets. I believe that the Commission has worked hard and 
diligently on this proceeding. I just wish you would work 
faster. However, I know some of my colleagues on the other side 
of the aisle have taken issue with this proceeding.
    Mr. Chairman, I have two questions.
    First, if ILECs are using their market position to charge 
anticompetitive rates to competitors, jacking up prices for 
competing services, or driving competitors out of business, do 
consumers benefit from that?
    And, secondly, does investment in broadband infrastructure 
increase or decrease in competitive markets?
    Mr. Wheeler. Well, I think the answer to the first is 
``no,'' and the answer is ``increase'' in the second.
    You know, one of the things that gets lost in this issue is 
we call it ``special access.'' Boy, there is a term that 
doesn't say anything. What we are talking about is services 
that are necessary for competition. We ought to start calling 
these ``competitive services.''
    Because you can't have cell densification, which makes 
wireless networks work better, without backhaul, which requires 
this special access. You can't have the Internet of Things in 
5G built out. It is going to do nothing but expand the need for 
this, let alone the kind of competitive services you were 
talking about that increases service opportunity by competitive 
providers and lowers costs.
    So I think we ought to call it what it is. This is services 
that are essential for competition.
    Mr. Doyle. Thank you, Mr. Chairman.
    Mr. Chairman, I also want to ask you, the Commission 
recently decided, in evaluating spectrum transitions, to take a 
closer look at deals that involve low-band spectrum. And the 
FCC recognized the unique value of that spectrum and the fact 
that there is already significant concentration of that 
spectrum among just a few carriers.
    You have now evaluated several transactions in which you 
have conducted that enhanced review, but in each case you still 
decided to allow further concentration of low-band spectrum. 
Just last week, the Commission approved a transaction where the 
buyer exceeded the low-band screen established by the 
Commission.
    My question is, what is the point of creating a mechanism 
for enhanced review if the Commission is not prepared to use 
it?
    Mr. Wheeler. Well, thank you, Congressman.
    I think there are two parts to that. One is you always want 
to have this enhanced review because that, in itself, is 
putting a stake in the ground, if you will.
    Secondly, it is a review. And so the question becomes ``Is 
there a legitimate application that overcomes that stake in the 
ground?'' In this particular instance, which involves some 
rural broadband, some rural spectrum for AT&T, the Commission 
reached the decision that, yes, on the merits, this would be 
enhancing to service to consumers.
    Mr. Doyle. Thank you.
    Mr. Chairman, let me ask you, on privacy, I am concerned 
about some of the ongoing reports we are seeing that ISPs are 
tracking consumers online by using tracking headers and other 
types of unsecure technologies that can endanger consumer 
privacy and user security. Third-party companies are already 
publicly claiming that they are using these super-cookies to 
track users online. Mr. Chairman, I just want to urge the 
Commission to take action and rein in these harmful practices.
    And, finally, on set-top boxes, the DSTAC recently released 
its report on new proposals that would allow consumers to buy 
and use third-party devices for video programming. I believe 
the future of this technology is over-the-top services. I 
encourage the Commission to continue working on this issue. 
Pay-TV subscribers should not have to suffer exorbitant rental 
fees for poorly designed and produced equipment. And I would 
urge the Commission to continue your work on these proceedings.
    Mr. Chairman, thank you and all of the Commission for being 
here before us today. I know we see you frequently, and we 
appreciate your input and the work that you are doing on the 
Commission.
    I yield back.
    Mr. Walden. The gentleman yields back the balance of his 
time.
    The chair now recognizes the vice chair of the subcommittee 
on Communications and Technology, the gentleman from Ohio, Mr. 
Latta.
    Mr. Latta. Thank you very much, Mr. Chairman, for yielding.
    And, again, to the Commissioners for being here, thanks 
very much.
    If I could go back to a question the chairman had asked a 
little bit earlier to Commissioners Clyburn and Rosenworcel.
    Do you have access to the Enforcement Bureau's work?
    Ms. Clyburn. Every 2 to 3 weeks, I have meetings with the 
Enforcement Bureau. We go through items, you can call them hot 
topics, so to speak. Some of them are extremely hot. You know, 
some are at, I guess, the genesis of some of the conversations 
here today.
    So I have never felt that there was any information that I 
requested or that I needed to know what is going on in the 
bureau, know what's going on in the ecosystem, and make a 
decision that might come up to us. I have never felt----
    Mr. Latta. OK. Let me ask this, though. You say you have a 
meeting every couple of weeks. How current is that information 
from the Enforcement Bureau? Is it something that has happened 
in the last 2 weeks, or is it something that has gone on for 
weeks and months beforehand?
    Ms. Clyburn. It depends on the status of the item, so it is 
just all of the above.
    Mr. Latta. Could I ask a follow-up on that, then? When you 
say it is the status of the item, how many would be older type 
of enforcement work?
    Ms. Clyburn. If I had to handicap it based on the last 
three or four meetings, sort of 50/50. Again, an item might get 
teed up, and then you will get a status----
    Mr. Latta. So some of them have been going on for a lot 
longer before you ever find out about it.
    Ms. Clyburn. Naturally. And when you talk about NALs, 
notice of apparent liability, and process, you get updates. And 
these often take quite a bit of time, because, again, there is 
due process to the party that might have the NAL. So it can be 
a mixture there.
    Mr. Latta. OK.
    Let me ask Commissioner Rosenworcel, what is your response 
to that?
    Ms. Rosenworcel. My access is virtually the same as what 
Commissioner Clyburn just described.
    Mr. Latta. Commissioner Pai?
    Mr. Pai. So the conversation thus far has focused on things 
that are circulated to the Commissioners for a vote--a notice 
of apparent liability, for instance.
    What I am talking about is a list of open investigations, 
things that the Enforcement Bureau is doing without our 
knowledge that is not ultimately, perhaps, going to be 
presented to us for a vote.
    Quite often, we hear about these things only when they 
reach the press. And, for example, the recent Hilton letter of 
inquiry is something that I learned about and my staff learned 
about because of press reports.
    And it seems to me that it is not too much to ask for the 
people who are tasked by this body with setting communications 
policy to understand what it is----
    Mr. Latta. Let me----
    Mr. Pai. The Enforcement Bureau is not an independent 
agency with----
    Mr. Latta. Yes, let me interrupt, if I could. When you say 
you got something from a press report, how long had that 
Enforcement Bureau's work been going on prior to you even 
seeing it in the newspaper?
    Mr. Pai. I am not sure how long it had been going on, but 
it was issued contemporaneously with some other enforcement 
actions we took that very day.
    Mr. Latta. OK.
    If I could ask Commissioner O'Rielly?
    Mr. O'Rielly. I have similar problems. But can I give you 
an example that just happened yesterday? We came out with an 
FTC-FCC memorandum of understanding. I had an opportunity to 
talk to some folks at the FTC. They were notified of it on last 
Thursday. I learned of it yesterday morning. So, I mean, it is 
just a lack of sharing.
    Mr. Latta. OK. Thank you.
    Commissioner Pai, if I could go on to another question for 
you. In June, Congressman Green and I sent a letter to Chairman 
Wheeler stating our concerns with the direction of the DSTAC 
and urged the Commissioner to follow the clear statutory 
language set forth in STELA and ensure that the DSTAC inquiry 
and report do not go beyond the bounds of the statute. And, 
unfortunately, changes were not made to DSTAC, which was unable 
to reach a consensus on recommendations for downloadable 
security solutions for set-top boxes.
    DSTAC produced a report with two recommendations, one that 
would rely on apps, and one referred to the AllVid. And, again, 
the gentlelady from Tennessee had asked some questions 
questioning to the Commissioner on this, or the Chairman of the 
Commission.
    If I could ask you, Commissioner Pai, on the app, if apps 
are already prevalent in the market and used on smartphones, 
smart TVs, and Apple TVs, et cetera, why isn't the FCC keeping 
focused on consumer demands and preferences rather than looking 
backward to the AllVid approach?
    Also, are you concerned that such a strict technological 
mandate, which would take years to develop, would be obsolete 
by the time it is even implemented?
    Mr. Pai. Thank you for the question, Congressman. And I 
understand that is a widespread concern. I think that here 
regulatory humility is called for, not just because it is 
imperative that the FCC hew strictly to the mandate that was 
set forth in the law but also because, as you pointed out and 
have pointed out various times before, this marketplace is 
changing rapidly, and so any FCC intervention could have 
unintended consequences.
    So, therefore, I don't think it is appropriate for us to 
issue technological mandates or otherwise adopt proposals that 
could frustrate innovation, that could allow for the theft of 
content, that could otherwise stand in the way of consumer 
benefits.
    Mr. Latta. OK.
    Well, thank you. My time has expired.
    And, Mr. Chairman, if I could ask unanimous consent to 
enter the letter from Congressman Green and myself----
    Mr. Walden. Without objection.
    Mr. Latta [continuing]. Into the record.
    [The information appears at the conclusion of the hearing.]
    Mr. Walden. I appreciate that.
    We will now go to Mr. Loebsack from Iowa.
    Mr. Loebsack. Thank you, Mr. Chair. Thanks for having this 
hearing.
    It is good that all five of you are here today. I really 
appreciate your presence and responding to questions.
    Before I ask my question about USF, which I ask almost 
every time we have somebody here at least, I do want to mention 
again that I think that Mr. Barton raised a very serious issue 
here, not necessarily what we can do with the Internet and 
restricting it, whatever the case may be, but I think bigger 
questions beyond that even.
    And, Chairman Wheeler, I was very happy to hear you--or not 
happy, but I appreciate the fact that you had some information 
on fiber cuts.
    I was on the Armed Services Committee for 8 years before I 
got on this committee. Traveled overseas to zones of conflict 
often. I guess it heightens my concern, obviously, about what 
happened in Paris. We all are concerned about that. But then we 
bring it home here to our infrastructure in the United States. 
And the Internet fiber, all of this is part of our 
infrastructure.
    It is absolutely essential that we know where all of this 
is so that we can protect it and so we can make sure that we 
can prevent an attack on that part of our infrastructure. I 
think it is really critical. So thank you for addressing that. 
And I am sure we are going to go forward with this, in 
cooperation with you folks, to make sure that we can prevent 
those kinds of attacks from happening on that very important 
part of our infrastructure.
    I do want to ask about universal service. You all know--I 
think I have mentioned this a number of times--that I represent 
a very rural district. When I first got on this committee 
earlier this year, I went to all 24 counties, and I talked to 
folks about rural broadband and how important it is for the 
economy, for education, for health care, for farmers, economic 
development, on and on and on.
    And folks are very frustrated in my district, especially 
when it comes to the USF. And so I kind of want to know what 
the status is, if we can have a status update for fixing the 
standalone broadband problem that ties the Universal Service 
Fund to voice service, denies support for broadband-only 
service in areas served by smaller rural carriers.
    We have gotten bipartisan support to do something about the 
USF and to reform it so that we really can bring that service 
to folks in theses rural areas. It is bipartisan.
    And so I would like to get a little update, if I could, 
from you, Chairman Wheeler, about where we are on that. And I 
promised folks last week when I was talking to them that I 
would ask you directly about that.
    Mr. Wheeler. Thank you, Congressman.
    Yes, this is a bipartisan effort. We have a bipartisan 
working group of three of us up here--Commissioner O'Rielly, 
Commissioner Clyburn, and myself--who are working on a rate-of-
return carrier reform package that we hope to have on the floor 
of the Commission next month.
    Mr. Loebsack. Good.
    Mr. Wheeler. A lot of people have focused on a December 
date that we had talked about in a Senate hearing. We are not 
going to be controlled by the calendar, but we want to get this 
done quickly.
    The key issue here is whether or not we are going to make 
sure that the money is spent for the expansion of broadband. 
Because that is what your consumers want. They say, ``How do I 
get broadband further out into my areas?''
    There are some proposals that are put forth that are called 
fixes to this that say, ``OK, we will send the money out, but 
there is no requirement that it actually expand broadband.''
    Mr. Loebsack. That is right.
    Mr. Wheeler. And our group, the three of us, are working to 
say, ``How do we make sure that we have money that is going out 
to rural areas that will result in expansion of broadband 
service?''
    Mr. Loebsack. I appreciate that.
    Did you want to say something, as well, Commissioner 
Rosenworcel?
    Ms. Rosenworcel. Oh, sure.
    Mr. Loebsack. Or Commissioner Clyburn?
    Ms. Clyburn. We get mixed up all the time.
    Mr. Loebsack. Sorry about that.
    Ms. Clyburn. One of the reasons why I am so excited about 
working with this group is, I asked myself a question: Is there 
a mechanism in place when it comes to these carriers that will 
tell us how many households are connected? And when I could not 
answer that question, I said: We have to do something beyond 
modernizing this program. We need a way to track to make sure 
that we are on target, to make sure that the moneys are going 
to close the broadband gap.
    And so this is why it is so important for us to make sure 
that each dollar we spend is to enable broadband deployment.
    Mr. Loebsack. Thank you.
    Ms. Clyburn. And I am proud to work with these men to see 
that that happens.
    Mr. Loebsack. Thanks to all of you. I really appreciate it.
    I am near the end of my time. I do want to submit, however, 
a question for the record on video relay service, if I may, Mr. 
Chair. I would like to be able to submit that question, as 
well.
    Thank you so much. I yield back.
    Mr. Latta [presiding]. The gentleman yields back.
    The chair now recognizes the gentleman from Illinois, the 
chairman of the Subcommittee on Environment and the Economy, 
for 5 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman.
    Hey, Loebsack, how many counties?
    Mr. Loebsack. Twenty-four.
    Mr. Shimkus. I have 33. So I just say ``ditto'' to his 
comments, and I don't have to go down that route.
    But I would also--the good response, what popped in her 
head was the failure of broadband stimulus to do a lot of what 
we want it to do in rural America. And it was the overbuilding 
of competitive areas. And just on the record, being here for a 
while helps you remember some of the old stories, and we lost a 
great opportunity there.
    Chairman, you mentioned clarity, consistency, completion?
    Mr. Wheeler. Yes.
    Mr. Shimkus. I like that. I am starting to wrap my mind 
around reliability, affordable, and sustainable. I think those 
are also good goals to reach in a lot of different areas. And I 
think it highlights telecommunication in the next era for all 
Americans, again, dealing with the rural changes.
    But that goes to an issue that we talked about the last 
time, I think, when the full Commission was here. We still have 
a terrible problem with dropped calls in rural America. And I 
talked to the association this morning, said I would raise it.
    I think the last answer was, ``We have the rules to enforce 
it.'' I think our folks don't see it that way. Or my point is, 
they are still having a problem, and it is not fixed.
    Do you want to comment briefly on that?
    Mr. Wheeler. Thank you. Thank you, Mr. Shimkus.
    Mr. Shimkus. Briefly.
    Mr. Wheeler. I mean, there are several things. One--I will 
be--watch how fast.
    One is that we did pass a rule that false rings, which is 
what was going on, are no longer allowed.
    Secondly, we heard a lot about enforcement today. We have 
moved against three major carriers who were allowing this to 
happen. We just finished with Verizon, for instance, with a $2 
million fine and a requirement that they do $3 million to fix 
the situation because they knew it was going on, and they did 
nothing about it.
    So, yes, sir, we are trying to be aggressive on this front.
    Mr. Shimkus. And let me have a followup. What is the status 
of this data collection effort? And will this information be 
made public? And, if not, why?
    Mr. Wheeler. We are----
    Mr. Shimkus. On the call completion question.
    Mr. Wheeler. On the call completion, we are completing 
that. And to the extent that there is nonconfidential data, it 
will be on the record.
    Mr. Shimkus. OK. Thank you.
    I want to talk also about--because the ranking member of 
the subcommittee and I, we do the first responders. And Ranking 
Member Pallone talked about his proposal. FirstNet has to get 
its act together. FirstNet came to see us. I think they are 
making better strides. But they are on the hook if we have 
another major event, and we have not moved aggressively.
    Now, in discussions with me, they say they now understand 
that they have to, in essence, contract with people who build 
out networks, which was what we were trying to say when we 
fought on the legislation to begin with.
    But shame on us and shame on FirstNet and shame on the 
Commission if we have another event and we cannot communicate. 
So we need to all have our shoulders at the wheel and do what 
we can to push this.
    Commissioner O'Rielly?
    Mr. O'Rielly. Can I only say that, when we were working on 
the statute I was working on behalf of a number of Senators, 
the structure that is now outlined is something I disagreed 
with. And the Commission actually doesn't have a great role in 
FirstNet. NTIA, at the Department of Commerce, has a greater 
role in its oversight function. I lost that debate, and now we 
have a process exactly playing out how I thought it might.
    Mr. Shimkus. I think I lost some of the debate during that 
discussion, too, and I am not sure it is appropriately placed. 
And I don't think we have a--I am just concerned. I am glad 
they came to visit with me. But the public is not going to say, 
``Oh, it is NTIA,'' right?
    Mr. O'Rielly. True.
    Mr. Shimkus. They are going to say FCC, they are going to 
say Members of Congress and the executive branch.
    Mr. O'Rielly. No, I tried to provide authority to the FCC 
through that process. I just lost that discussion. So if 
Congress wishes to give us more authority, we would be happy to 
have more involvement.
    Mr. Shimkus. Thank you.
    And let me just continue with you. That memo you received, 
you got it yesterday?
    Mr. O'Rielly. Yes, sir.
    Mr. Shimkus. You said the FTC had it Thursday?
    Mr. O'Rielly. Yes, sir.
    Mr. Shimkus. Commissioner Pai, when did you get that memo?
    Mr. Pai. I saw it on the Web site yesterday.
    Mr. Shimkus. Commissioner Rosenworcel?
    Ms. Rosenworcel. Yesterday.
    Mr. Shimkus. Commissioner Clyburn?
    Ms. Clyburn. The same.
    Mr. Shimkus. Chairman Wheeler, do you want to respond?
    Mr. Wheeler. I have been working on it for 18 months. The 
reality here is that it was signed yesterday, it became 
effective yesterday, and that----
    Mr. Shimkus. But you understand the problem. This is 
illustrative of this debate about communicating. And I know we 
have, you know, three to two, and I know Democrats have the 
majority, but I would hope the Commissioners are kind of one 
big, happy family and work together to move telecommunications 
processes. Just like we do on this committee, right?
    So I think it is just a little----
    Ms. Eshoo. Thank you, Brother Shimkus.
    Mr. Shimkus [continuing]. Illustrative, and everybody 
should have the information when everyone has the information.
    And I yield back.
    Mr. Latta. The gentleman's time has expired, and he yields 
back.
    The chair now recognizes the gentlelady from California for 
5 minutes.
    Ms. Matsui. Thank you, Mr. Chairman.
    Chairman Wheeler, Congress tasked the FCC with balancing 
many priorities in the incentive auction, including protecting 
access to local broadcasting.
    Now, during the last few weeks, I had a chance to meet with 
many of our Sacramento broadcasters. They work hard to keep my 
constituents informed. My local broadcasters have also told me 
that they are invested in the success of the incentive auction.
    I believe the incentive auction can clear the beachfront 
spectrum to fuel our wireless economy while making sure 
Sacramentans and consumers across the Nation still get the 
local news and information that they need.
    My local broadcasters also brought up the concern that they 
could be at risk of losing their license after the auction if 
they aren't able to transition to a new channel assignment 
within 39 months. I know how critical it is to get the spectrum 
into the market, but we need to make sure that this transition 
doesn't leave TV viewers in the dark.
    Chairman Wheeler, my question is: How can the FCC, number 
one, make sure broadcasters successfully make this transition 
after the auction? And two, what is the FCC's plan if 
broadcasters can't meet the FCC's deadline?
    Mr. Wheeler. Thank you very much, Ms. Matsui.
    I totally agree on the importance of local community 
broadcasting and why it has to remain after the auction.
    Here is how it works. We had 36 months that the statute 
said before you have to move off after getting money. Then we 
put 3 months in for construction permits, which is how you got 
to 39 months.
    Now, the interesting thing is that the National Association 
of Broadcasters, in our proceedings, said, ``Oh, we only need 
30 months.'' But, be that as it may, what we would do in this 
kind of a situation that you outlined is to have an extension. 
I mean, there is a 6-month extension at least that you can get 
on this that we will be able to work through.
    This is not a drop-off-the-edge-of-the-table situation for 
anybody. As we see that things are approaching the edge of the 
table, there are solutions that can be taken.
    But at the same point in time, those who are bidding on 
spectrum need to know that there is some certainty that they 
are going to get it, or else it doesn't have any value to them. 
And so we look at 39 months, we look at the extension, we look 
at certainty, and I think we can work it out.
    Ms. Matsui. So you will balance this out and work with 
them.
    Mr. Wheeler. I think we can work with them, yes.
    Ms. Matsui. OK, great. I can assure my locals then.
    Mr. Wheeler. Yes, ma'am.
    Ms. Matsui. Thank you.
    Commissioner Rosenworcel, you have spoken about the need 
for smart spectrum policies so that the United States can 
continue to lead the world in 5G. I know the FCC has taken some 
recent steps to look at opening up higher-frequency spectrum 
bands for next-generation mobile services. Congress has also 
acted. The Bipartisan Budget Act included important provisions.
    Now, Commissioner Rosenworcel, what more can the FCC do to 
identify new spectrum opportunities? What more can Congress do?
    Ms. Rosenworcel. Thank you, Congresswoman Matsui, for the 
question.
    Today, as you probably know, the bulk of our spectrum 
activity takes place at 3 gigahertz or below, but, going 
forward, we are going to look way, way up there. And when we 
do, if we combine really stratospheric frequencies with dense 
networks of small cells, we are going to develop wireless 
services that go further and faster than ever before.
    It is absolutely imperative that the FCC lead when we deal 
with this issue, because the rest of the world is starting to 
look at high-band spectrum and trying to find ways to deploy. 
We have a rulemaking, and it is important that we conclude that 
rulemaking and identify bands where we can proceed.
    Ms. Matsui. OK. Great.
    Chairman Wheeler, you have highlighted the FCC's work on a 
spectrum above 24 gigahertz as critical for 5G. I hope the FCC 
will move forward expeditiously so that we can create a climate 
for American leadership in 5G.
    And I know this is really important. We just ought to 
reiterate this. When do you expect to issue final rules for 
this important proceeding?
    Mr. Wheeler. Thank you, Congresswoman.
    As Commissioner Rosenworcel just indicated, we just 
developed in this proposed rulemaking for 28 GHz, 37 GHz, and 
39 GHz bands, as well as for 64 GHz to 71 GHz for unlicensed 
purposes. And we did that in a timely manner so that we could 
go to the World Radio Conference in Geneva, which is being held 
right now, and get a leg up, if you will, on advocating our 
position to the world.
    Ms. Matsui. OK.
    Mr. Wheeler. So that was step one. We will close this 
rulemaking by the summer, clearly. And I have also committed to 
my colleagues that we will also open a new rulemaking on 
additional spectrum up in the higher bands.
    Ms. Matsui. OK. Good.
    Well, thank you very much.
    And I know my time is up. I yield back.
    Mr. Latta. Thank you.
    The gentlelady's time has expired, and she yields back.
    The gentleman from New Jersey is recognized for 5 minutes.
    Mr. Lance. Thank you, Mr. Chairman.
    Good morning to the panel.
    Commissioner O'Rielly, I believe there is a good deal of 
room for criticism of the net-neutrality order. And I ask you 
what message you believe this sends internationally when our 
government asserts such authority over the Internet. Are you at 
all concerned that other nations, including some repressive 
regimes, could get the wrong idea about America's commitment to 
free speech and free expression online?
    Mr. O'Rielly. Yes, sir. Thank you for the question.
    I experienced this when I was in Barcelona recently, when 
we had an opportunity to talk to some of our European 
colleagues about what they were planning to do and what 
activities the United States signals were sending to their 
activities. And if you see what the European Union has done 
recently on the issue of net neutrality, it is different than 
what the United States has done and is actually a step back, I 
would say, from some of the extensive steps that we have taken 
and problematic steps that we have taken.
    So I am troubled by what message it sends internationally, 
how far and how wide the United States has moved through the 
net-neutrality proceeding at the Commission. I think it is the 
wrong signal internationally. Thankfully, some of the other 
nations are looking at it a little differently, but it is very 
problematic going forward.
    Mr. Lance. Thank you.
    Mr. Pai, do you have an opinion on that?
    Mr. Pai. I would agree with what my colleague said. And I 
also have had the opportunity to speak with counterparts from 
South Asia to South America who have expressed amazement that, 
having built the Internet economy that is the envy the world, 
the U.S. would put that at risk with a regulatory scheme that 
creates more uncertainty and impedes future broadband 
deployment.
    Mr. Lance. Thank you.
    Chairman Wheeler, you stated your intent to commence a 
rulemaking to promulgate rules, quote, to clarify the FCC's 
expanded privacy authority under the new Internet rules and 
that you would hope that this would be forthcoming this fall.
    Could you please update us on that, given the timeframe?
    Mr. Wheeler. We have missed fall, Mr. Lance. And----
    Mr. Lance. Congress misses deadlines all the time, so----
    Mr. Wheeler. And it is, I think, because of the 
significance of the issue. We have long had responsibility for 
privacy issues. And how that maps over into the IP world is 
something that I hope we will be able to begin to surface in 
proposals early next year.
    Mr. Lance. Thank you.
    Are there other members--Mr. Pai?
    Mr. Pai. Two aspects of that.
    First, the agency's decision divested the Federal Trade 
Commission of jurisdiction, and they are the agency with 
longstanding expertise as well as statutory authority over this 
area.
    In the meantime, unless and until the FCC, the five of us, 
promulgate rules, the binding guidance upon the agency was put 
out in an Enforcement Bureau advisory on May 20 of last year. 
And this is the core rule now that the private sector has to 
adhere to: ``The Enforcement Bureau intends that broadband 
providers should employ effective privacy protections in line 
with their privacy policies and core tenets of basic privacy 
protections.''
    I have no idea what this means. Neither does the private 
sector. And the entire industry is at the mercy, from edge 
providers to ISPs, as to how the agency is going to proceed in 
this brave new world.
    Mr. Lance. Yes, I tend to agree with that.
    Would other members of the Commission like to comment?
    Commissioner Rosenworcel?
    Ms. Rosenworcel. Sure.
    Privacy is a cherished principle, and it is also a 
complicated one in the digital age. So, going forward, we are 
going to have to provide more clarity. I respect that the 
Chairman wants to have a rulemaking on that. And I acknowledge, 
as Commissioner Pai said, that our existing guidance is 
insufficient to date.
    Mr. Lance. Yes. Thank you.
    Commissioner Clyburn?
    Ms. Clyburn. One of the things that is uplifting and great 
about this is we have complementary jurisdiction with the FTC, 
and we work collaboratively. We meet on a monthly basis to make 
sure that consumers are protected. So our job, our 
collaborative, combined role is to ensure that there are no 
holes when it comes to protecting consumers.
    And so we will work and we will get more clarity when 
something is before us. But in terms of the jurisdiction under 
section 222, our role, as provided by you, is clear when it 
comes to privacy.
    Mr. Lance. Commissioner O'Rielly?
    Mr. O'Rielly. I have spent a great deal of time on the 
issue of privacy. I have to say, I find that the Commission's 
understanding of the issue is lacking and its expertise is low.
    The FTC spent over the last two decades becoming an expert 
in this space and providing guidance and providing the 
structure, and we are going to waltz in there and provide quite 
a bit of damage, I think, going forward, notwithstanding the 
fact that it is a very important issue.
    Mr. Lance. Thank you. I think we will continue to monitor 
this, and I thank you for your testimony.
    Thank you, Mr. Chairman.
    Mr. Latta. Thank you.
    The gentleman's time has expired, and he yields it back.
    The chair now recognizes the gentleman from California for 
5 minutes.
    Mr. McNerney. I thank the chairman.
    And I thank the Commissioners for giving us your wishlist 
this morning. I think it was an interesting list.
    Mr. Chairman, would you update us a little bit on the 
Commission's efforts to address cybersecurity, specifically 
coordination with some of the other Federal agencies?
    Mr. Wheeler. Yes, sir.
    As a matter of fact, next week, I am meeting with a 
coordinating group of the heads of all of the independent 
agencies of the government--Nuclear Regulatory Commission, FTC, 
FERC, the whole group--where we are coordinating our policies.
    And the approach that we have taken at the FCC is one of 
the models that is being talked about across all agencies, 
which is, how do you work with a multistakeholder group inside 
your industry to come up with processes that are both self-
reviewing and self-enforcing, with the involvement of the 
agency, and how do we do that across the board?
    The financial industry has been very successful in doing 
that. We are successfully now underway on that, and we will be 
continuing to work with other agencies.
    Mr. McNerney. Are you a lead agency in regard to this 
issue?
    Mr. Wheeler. I would hope so, sir.
    Mr. McNerney. Do you think there is a potential that sort 
of a knee-jerk reaction to the tragic Paris attacks could 
actually make us less secure, specifically----
    Mr. Wheeler. I am not sure what you mean by ``a knee-jerk 
reaction.''
    Mr. McNerney. Well, I mean some policies that are designed 
to sound tough but actually cause problems, more problems than 
they were intended, specifically with cyber and maybe backdoor 
policies.
    Mr. Wheeler. So, it is interesting. I was having a 
discussion with Ms. Matsui, who I see has left, before the 
hearing that--one of the things that I have found my 2 years in 
this job is that the regulatory process--because it provides 
for so much diverse input from so many different parties--is a 
slow process. So I think that that tends to mitigate the kind 
of knee jerk you are talking about.
    And the fact that there wouldn't be lots of opinions heard, 
I think, is not a reality that exists, as the Administrative 
Procedure Act set out our procedures.
    Mr. McNerney. Thank you.
    Commissioner Clyburn, you mentioned the Mobility Fund 
hasn't really been implemented yet. Do you see a path forward 
to that?
    Ms. Clyburn. Yes, I do. I have been working with our 
Wireless Bureau, and they assured me that we have a pathway to 
completion.
    You and I have both experienced traveling down roads, 
traveling down state highways where we look at our phones, 
absolutely no bars, absolutely no coverage. At night, alone, it 
is not the most comfortable feeling.
    And so we are looking at this, how do we ensure the safety 
in terms of travel, the opportunities, particularly in rural 
America, that they have comparable service. And I think we are 
on a pathway of doing that real soon.
    Mr. McNerney. Thank you.
    Commissioner Rosenworcel, you mentioned the Federal lands 
for broadband deployment. What is your vision for that?
    Ms. Rosenworcel. Well, by some measures, one-third of our 
Nation's real estate is owned by the Federal Government. And 
they are some of the areas that have the sparsest deployment of 
communications services.
    So the question is, what Federal facilities exist on those 
lands that we could use to support broadband deployment or 
antenna structures? And if we could identify what facilities we 
have, we would be in a position to expedite deployment in rural 
America and lower the cost of deployment while we are at it.
    Mr. McNerney. So the initial phase, then, would be just to 
identify existing facilities.
    Ms. Rosenworcel. I think it would be important for us to 
identify existing facilities. I also think it would be 
important for us to develop a master contract with the GSA so 
that the private sector that is interested in deployment would 
have a single contract they could use. And I also think we 
should consider shot clocks, which would reduce the amount of 
time that the Federal Government had to respond to those 
requests for deployment.
    Mr. McNerney. OK. Thank you.
    Mr. O'Rielly, you mentioned that Federal Government user 
fees are needed. Would you expand on that a little bit?
    Mr. O'Rielly. So it is a suggestion I said. My colleague 
and I have had a good, healthy discussion over the years 
regarding in terms of incentives that may provide. I also think 
you need to provide a mechanism to force Federal users to 
relinquish spectrum, and I think that one way to do that is 
impose a spectrum fee.
    So we put the opportunity cost to the spectrum for the 
Federal Government users on an annual basis, and, therefore, 
they have an incentive to decrease how much they use.
    Mr. McNerney. Thank you.
    I was certainly interested in the comment on high-frequency 
spectrum, but we will have to put that one off.
    Thank you, Mr. Chairman. I yield back.
    Mr. Latta. Thank you very much.
    The gentleman's time has expired, and he yields back.
    The chair now recognizes for 5 minutes the gentleman from 
Texas.
    Mr. Olson. I thank the chair.
    And welcome to our friends from the FCC.
    I am going to talk about privacy and the Enforcement Bureau 
this afternoon. I want to ask about what I call a what-the-heck 
moment I had back home.
    About 2 weeks ago, Chairman Wheeler, you were on the 
Charlie Rose show, and you shared that in the next several 
months the FCC would address privacy of the networks. You 
stated, ``We need a voice in the collection of information 
about us,'' end quote. Those 10 words set off an onslaught of 
what-the-heck questions from back home.
    So, Commissioner O'Rielly, I may be mistaken here, but 
doesn't the FTC have jurisdiction over the privacy of the 
networks, not the FCC? Are you concerned about the takeover, 
mission creep of the FCC getting involved in the FTC's 
business?
    Mr. O'Rielly. So, as the result of our net-neutrality 
decision, we now have an issue regarding the privacy of 
networks, broadband networks, and the treatment of them under, 
as my colleagues highlighted, section 222.
    I am extremely concerned about that and have highlighted 
that for a considerable amount of time and what it can mean for 
two different regulatory agencies to have oversight over 
similar information and that providers that operate on both 
sides of the equation will be stuck with two different 
regulators fighting over each other. The MOU is an attempt to 
try and say that we are going to cooperate, but the different 
treatment of the same data is going to be problematic, in my 
opinion.
    I have also highlighted why I think that our expertise on 
the subject matter is pretty dormant and lacking compared to 
the FTC.
    Mr. Olson. Mr. Pai, your comments, sir? Same issue.
    Mr. Pai. I would agree with Commissioner O'Rielly on that.
    And I think it is also critical to remember that our 
authority, as granted by Congress, is extremely limited. Under 
section 222, telecommunications carriers, backed up by the 
FCC's rules, have a duty to protect customer proprietary 
network information. That is a very narrow category of 
information, such things as your telephone number or what 
service you subscribe to. It is not the vast array of 
information that people think about when they think about 
privacy.
    And so I worry, as well as Commissioner O'Rielly has 
suggested, that the agency's newfound zeal to enforce these 
privacy mandates may bleed over to edge providers. If you like 
something on Facebook, is that, sort of, a consumer piece of 
information that consumers would expect to be private? It may 
well be, in which case the FCC would have the incentive and 
ability to get into that space.
    Mr. Olson. I share those concerns.
    Any comments, gentlemen, about this MOU that came out 
yesterday between the FTC and FCC? Any comments about that?
    Mr. Pai. I agree with what Commissioner O'Rielly has said, 
both in terms of process, the fact that all of us found out 
about it yesterday, and in terms of substance, that the MOU 
wouldn't have been necessary if we had each stayed within our 
lanes and let the FTC handle what it is statutorily empowered 
to do. And if we focused on building out broadband to a lot of 
these areas as opposed to regulating the network heavily, this 
entire MOU would have been obviated.
    Mr. O'Rielly. There is one sentence or at least one clause 
in here that just highlights the exact problem I have 
indicated. It says, ``... Including FCC's authority over 
activities engaged in by common carriers and by non-common 
carriers for and in connection with common-carrier services.''
    The scope of that is extremely broad. ``By non-common 
carriers for and in connection with common-carrier services.'' 
There is no limiting principle on that concept. I think that is 
very problematic.
    Mr. Olson. Again, what the heck?
    And then about the Enforcement Bureau, the rise of the 
Enforcement Bureau, the current head was quoted last April in 
the National Journal as saying this: ``Generally speaking, I 
have found that most companies want to do the right thing. And 
when it's clear that something is impermissible, they generally 
don't do it,'' end quote. He said, ``When it's clear, they 
generally don't do it.'' But then he said: I'm almost always 
working in a gray area.
    ``Clear'' to me means black and white. ``Gray'' is gray, 
nebulous. That gray area has earned him the title from the 
National Journal of ``the FCC's $365 million man.'' Back home, 
again, people say, what the heck?
    So my question for you, Mr. O'Rielly and Mr. Pai, is: How 
does fines totaling $365 million help consumers, promote 
innovation and investment? How come they should have that role 
instead of Congress?
    Mr. Pai. That is a good question, Congressman. I suppose 
those companies should be grateful to the extent that the 
agency was generous. In the Ortel case, for example, it said 
that the FCC had the authority to fine those companies $9 
billion, but, out of the goodness of its heart, it was only 
going to fine them $5 million. But I think, in a lot of cases, 
it is simply a number drawn out of thin air.
    And in this regard, I tend to be old-fashioned. I think, 
before you enforce a rule, you have to have a rule. If you are 
going to pick a number, it should have some grounding in 
objective fact and, you know, precedent. That is just not the 
way the enforcement operation works anymore.
    Mr. O'Rielly. Can I comment on top of that? And I 
highlighted this in my testimony. If you see some of the 
citations that we issued against First National Bank and Lyft, 
we didn't provide them any kind of notice that they were even 
coming. They didn't even know what was happening.
    So the idea that you referenced, where they are working 
with the carriers and trying to make sure that they do the 
right thing, these weren't carriers; these are non-carriers--
had no idea what was coming their way, and there was no 
communication from the Commission.
    So I agree with my colleague's just point. These numbers 
are picked out of the air. We are not going to see $365 
million. It is great for a press release, but it is not going 
to actually develop.
    Mr. Olson. And that is very frightening for the market.
    One final question. You guys are----
    Mr. Wheeler. Could I----
    Mr. Olson. I only have a little time here. Sorry, 
Commissioner Wheeler, but I have one last question.
    You all are in charge of the bureau, the Enforcement 
Bureau. Let's play like you are grade school teachers, you give 
them grades. What grade would you give them, A through F?
    Mr. Wheeler. A.
    Mr. Olson. A.
    Ms. Clyburn?
    Ms. Clyburn. A.
    Mr. Olson. Ms. Rosenworcel?
    Ms. Rosenworcel. A.
    Mr. Olson. Mr. Pai?
    Mr. Pai. Not passing.
    Mr. Olson. Mr. O'Rielly?
    Mr. O'Rielly. A fine individual but a D-minus.
    Mr. Olson. D-minus.
    Thank you much. I yield back.
    Mr. Wheeler. Let me say that we worked with the attorney 
general of Texas on that $353 million settlement. It was 
billions of dollars that were crammed onto the bills of 
millions of subscribers across the country. And of that $353 
million, some went back to the State of Texas, as the AG 
insisted, and to other States. But $267 million went back into 
the pockets of consumers who had been bilked because they were 
charged for things they did not buy.
    That is rational enforcement. That is the kind of job I 
think that all consumers expect us to be doing. Millions of 
people, billions of dollars, done in conjunction with all 50 
State AGs.
    Mr. Olson. I hear you, but----
    Mr. Latta. The gentleman's time has expired.
    Mr. Olson [continuing]. Pay this money right now. Yes. 
Again, we don't have that. You guys should not have that 
weapon. You should be working with our governors, our attorney 
generals. That is my interest.
    Mr. Latta. Thank you.
    The gentleman's time has expired, and he yields back.
    The chair now recognizes the gentlelady from Colorado for 5 
minutes.
    Ms. DeGette. Thank you, Mr. Chairman.
    Well, Chairman Wheeler, I wanted to ask you, with respect 
to these recent enforcement efforts, the recent ones, what is 
your view of the FCC's authority vis-a AE2-vis your ability to 
take these efforts?
    Mr. Wheeler. Thank you. I think we have the responsibility 
and the authority as granted in the act.
    And the interesting thing, what we are hearing here is, so 
we have 19 notices of apparent liability this year. The average 
annual notice of apparent liabilities by the last Republican 
administration of the FCC was an average of 215 a year.
    Ms. DeGette. Thank you.
    Now, yesterday, the FTC and the FCC announced a memorandum 
of understanding for continued cooperation on consumer 
protection. And this MOU mentioned that the agencies are going 
to engage in joint enforcement actions. So are there some 
specific areas where you think that consumer protection is 
particularly at risk and where this cooperation is going to be 
especially beneficial?
    Mr. Wheeler. Thank you.
    The other thing that is key to know about that MOU is that 
it replaced the previous MOU. This is not some unique 
relationship.
    Ms. DeGette. Right. It didn't just come up out of thin air.
    Mr. Wheeler. And so what we have always tried to do is to 
say, OK, what are the lanes, and where do we cooperate? Because 
our authorities abut with these other. And I think we have an 
excellent working relationship with the FTC, and we were able 
to codify it in this MOU.
    Ms. DeGette. And are there some specific areas in which you 
think you can cooperate that will be beneficial?
    Mr. Wheeler. So, for instance, on the issue of the cramming 
that was discussed a moment ago, the $353 million fine, we have 
worked with the FTC on that. It is clear that the FTC has 
authority over the non-common-carrier----
    Ms. DeGette. I only have 5 minutes.
    Mr. Wheeler [continuing]. Activity of common carriers.
    Ms. DeGette. Are there other areas that you think----
    Mr. Wheeler. FTC has authority over the----
    Ms. DeGette. Cramming. Are there other areas you are going 
to focus on?
    Mr. Wheeler. Yes.
    Ms. DeGette. What are they?
    Mr. Wheeler. So, for instance, they have authority over 
non-common-carrier activities of common carriers.
    Ms. DeGette. OK.
    Now, there are 14 months left in the Obama administration, 
and, obviously, the Commission has a lot of pending actions and 
rules. One thing I think the Commission should focus on 
completing is any further actions on the Satellite TV Extension 
and Localism Act reauthorization that this subcommittee 
authored last Congress.
    In that act, Congress directed the Commission to prepare a 
report on downloadable security capabilities for pay-TV 
content. Now, what I understand is that a technical advisory 
group has completed its report, and some stakeholders are 
seeking a rulemaking that would require changes to the set-top 
boxes used in cable, IPTV, and satellite TV providers. This is 
something Mr. Doyle was talking about a little bit.
    One of the main issues we hear about from consumers over 
and over again is that customer service can be complicated to 
navigate and also onerous. And so a lot of us feel like we need 
to protect consumers, while at the same time giving providers 
and content creators the flexibility they need to adapt to 
changing business models.
    So I am wondering if the Commission has considered, if 
leased set-top boxes are responsible for their own customer 
service, that could cause a lot of confusion.
    Mr. Wheeler. So, thank you, Congresswoman.
    The comment period on the recommendations of the DSTAC 
report ended last week. I don't know if this was an issue that 
was raised in the comments. I would suspect so. And we have not 
fully worked through those comments.
    Ms. DeGette. Well, once you do, I would appreciate it if 
you would supplement your testimony so that we could get an 
answer to that.
    Now, I, lastly, want to touch on the special access issue. 
Many competitive telephone providers use the physical 
infrastructure of incumbent carriers to provide telecom 
services to businesses through an arrangement called ``special 
access.''
    The FCC has been considering updating the special access 
rules for decades, as some of us on this committee know, and it 
has recently completed an extensive data-gathering process to 
inform changes to the rules.
    I am wondering, Chairman Wheeler, if, now that the 
Commission has undertaken such a significant effort, will this 
be a priority for the FCC during the remainder of this 
administration?
    Mr. Wheeler. Yes, ma'am.
    Ms. DeGette. Thanks.
    I yield back.
    Mr. Latta. Thank you.
    The gentlelady yields back.
    And the chair now recognizes the gentleman from Kansas for 
5 minutes.
    Mr. Pompeo. Thank you, Mr. Chairman.
    We have heard from four Commissioners today, Mr. Wheeler, 
that they are getting late information, incomplete information 
with respect to Enforcement Bureau practices.
    Your explanation implied somehow that they were 
untrustworthy or incapable of handling the sensitive 
information. I think that is counterfactual. I think they, all 
four, are cable people, highly capable of handling that 
information. And I also think it is inconsistent with how this 
Commission ought to operate.
    And so I would certainly urge you to change that practice 
and would urge this committee to do all that we can to make 
sure that you do.
    Mr. Wheeler. Well, I would hope that I was not giving an 
impression that they are untrustworthy. As Commissioner Clyburn 
said, they are briefed every 2 weeks by the Enforcement Bureau 
as to----
    Mr. Pompeo. Thank you. I don't have much time. It was 
certainly the implication that I heard from you. Perhaps I got 
it wrong.
    I want to talk about competition in the cybersecurity 
world. I spend a fair amount of time on this in my role on the 
Intelligence Committee and here on this subcommittee.
    Not too long ago, you were talking about network providers, 
Mr. Wheeler, and you talked about a common set of standards for 
cybersecurity.
    Mr. Wheeler. Yes, sir.
    Mr. Pompeo. My judgment is that would make it easier for 
hackers. If you had a common set of standards, it is easier to 
attack.
    These businesses, these network providers, are in the 
business of providing secure, reliable connectivity. That is 
how they operate their business, how they make money.
    Why is it you think you can develop a set of standards that 
would be superior to what AT&T or Sprint or Verizon or any of 
the others might be able to accomplish in the world of 
cybersecurity?
    Mr. Wheeler. We didn't develop them. They developed them. 
What we did was provide a coordinating body. This was a 
multistakeholder process where everybody sat down and put 
together the best heads and said, what are the kind of 
processes that we all need to make sure that we have in place, 
and how do we monitor those processes so that we know, are they 
being done, A, and, B, as you just suggested, the hackers are 
always working ways around, and how do we keep up with that.
    Mr. Pompeo. Right. It makes no sense to me for a common set 
of standards to be a regulatory tool that the FCC issues. It 
just makes it simple.
    Mr. Wheeler. We have not issued them, sir. It is not a 
regulatory tool.
    Mr. Pompeo. Great. I am glad that you have now committed to 
not doing that today.
    Mr. Wheeler. No, let me----
    Mr. Pompeo. I appreciate that.
    Mr. Wheeler. We have a process that was developed in 
conjunction with--it is not developed as a rule, OK? It is 
flexible. It is designed to be flexible----
    Mr. Pompeo. Great.
    Mr. Wheeler [continuing]. For the very reasons you are 
talking about.
    Mr. Pompeo. I am thrilled.
    You talk about competition all the time. The IP transition 
is supposed to make sure we have the most updated technology. 
And yet the Commission, when it decided to impose requirements 
that carriers provide IP-based wholesale replacement services 
to competitors, the fiber facilities, that you said you 
required, quote, ``reasonably comparable to those of legacy 
services.''
    Why would you create what appears to me to be a real 
disincentive for deploying new facilities and new services?
    Mr. Wheeler. Thank you, sir.
    Because of the fact that you don't want a situation where 
regulation is encouraging the people who are currently using 
competitive facilities to not be able to have equivalents.
    So if I am selling a service to you and it is based on 
copper and suddenly the carrier decides, I am taking the copper 
out or shutting it down, I need to be able to continue to 
provide a service to you. And so, if that migrates over into 
fiber and IP, I ought to still be able to have a relationship 
with that carrier so that I can continue to provide the service 
to you.
    Mr. Pompeo. Commissioner Pai, do you agree with that 
analysis in terms of the disincentive it creates for build-out?
    Mr. Pai. I don't, Congressman.
    And I think you put your finger right on the concern. The 
notion that the government should force one company to stay in 
a business that it doesn't want to be in for the benefit of 
another company is the very definition of intrusive government 
intervention.
    Instead, we should recognize that the marketplace is much 
more competitive, that cable companies are deploying metro 
Ethernet, that wireless is increasingly an alternative, and get 
out of this business of, you know, sort of, Depression-era 
regulation of a marketplace that simply isn't the way it was 
back in the 1930s.
    Mr. Pompeo. You actually made the case more articulately 
than I did. Thank you.
    Mr. Wheeler. But nobody is saying that you should stay in a 
business you don't want to be in. What the rule says is that 
you can't shut somebody off without offering them the same kind 
of service in your new technology.
    Mr. O'Rielly. Well, and the rule also states, Congressman, 
that you can't change your services without our permission, 
which we will never give you.
    Mr. Wheeler. Which has been the rule forever.
    Mr. Pompeo. Right.
    Mr. Wheeler. That is in 214.
    Mr. Pompeo. Would you agree we should that rule?
    Mr. Wheeler. Section 214----
    Mr. Pompeo. But, no, I am asking--no, I understand the 
history.
    Mr. Wheeler. Section 214----
    Mr. Pompeo. So it has not only been there a long time, but 
you like it.
    Mr. Wheeler. Section 214 has been the bedrock of 
telecommunications policy for the last 80 years.
    Mr. Pompeo. Chairman Wheeler, have you read the reports, 
Reuters reports, about WCRW and its connection to control by 
Chinese entities?
    Mr. Wheeler. Yes, sir.
    Mr. Pompeo. Tell me what the FCC is doing about that and 
what your position is with respect to that particular station 
that is airing pro-Chinese communications here in the United 
States.
    Mr. Wheeler. We have an investigation going on to find out, 
with the representations that have been made along the way as 
they filed for increases in power and other kinds of things. We 
learned about it through the Reuters report, just as you did.
    Mr. Pompeo. Great. And so I assume, because there is an 
investigation going on, there is nothing more you will share 
with me this morning. Is that correct?
    Mr. Wheeler. Thank you, sir.
    Mr. Pompeo. Great. Thank you.
    I yield back the balance of my time.
    Mr. Latta. The gentleman yields back.
    And the chair now recognizes the gentleman from Kentucky 
for 5 minutes.
    Mr. Yarmuth. Thank you very much, Mr. Chairman.
    Thanks to all the Commissioners for their testimony and 
appearance.
    A couple years ago, I was in a middle school in my 
district, which is Louisville, Kentucky. And it is a school 
that is not atypical in an urban setting. Ninety-five percent 
of the kids were on free and reduced lunch. And I asked the 
principal what percentage of her students she would estimate 
had access to the Internet at home. She said probably 10 
percent. And, you know, that breaks your heart because you know 
those kids are lost, particularly if they are already in middle 
school.
    So what we have been trying to do in Louisville is--
broadband, expanded broadband is great. Wireless technology is 
great. But there are families who can't afford $10 a month for 
whom broadband means nothing because they don't have a 
computer, whose only access might be through the phone, and so 
forth.
    So we have been trying to do a local initiative to try and 
just create in some neighborhoods public WiFi, free WiFi, so 
kids could at least be able to have it, whether they have a 
tablet or a phone. And AT&T and others have been very helpful 
in trying to accomplish that.
    So I would just throw that out as--I know some of you are 
sensitive to this. But as you consider expanded access, that is 
a critical consideration.
    Secondly, earlier this year, I introduced the Keep Our 
Campaigns Honest Act, which would require the FCC to use its 
existing authority to require disclosure of those who are 
funding campaign spots.
    We just concluded a campaign in Kentucky in which the vast 
majority of all the ads run for both gubernatorial candidates 
were run by outside groups. Nobody knows who they were. Nobody 
still knows who they were. I would say that my constituents' 
reaction was that, if there were a lot of Styrofoam bricks 
available, they would have bought as many as they could have 
afforded. The outrage was palpable.
    So, once again, I would request that the Commission 
consider that. We are going into a campaign that has already 
started with anonymous ads. And this is something that I think 
is a high priority for Americans, and it is certainly for, I 
think, the benefit of democracy that people know who they are 
being influenced by.
    I know Chairman Walden has a problem with the KOCH Act, as 
we call it, because he says it would require too many donors to 
be listed. But I think the Commission could do something; say, 
anybody who funded more than 25 percent of the ads, so, at the 
most, you would have four people identified in the ad. But, 
again, I think this is critical, and I would urge you to 
proceed on that.
    And, finally, a question that I have to ask because the 
person I live with would not welcome me back unless I did. And 
I am new to this subcommittee and relatively new to the 
committee, so I may have missed something, but where does the 
implementation of the requirement on volume of ads in 
television shows stand? Because, anecdotally, it seems that it 
has not been implemented very extensively.
    I would throw it open to anybody. Chairman?
    Mr. Wheeler. So, first of all, I understand the reporting-
to-a-higher-authority challenge that you face.
    And, you know, the interesting thing that is going on, I 
can't answer specifically--and I will get something for the 
record for you--but the interesting thing that we are now 
seeing is that there is actually a decrease in the number of 
ads on most of the major networks right now, as they are 
feeling the pressure from online competition and people not 
wanting to sit through ads.
    And that is the marketplace operating, and that is an 
encouraging thing. I am not sure what an agency's role should 
be in saying there should be this many ads, but----
    Mr. Yarmuth. No, I am not talking about the frequency, the 
number of ads. I am talking about the sound volume.
    Mr. Wheeler. Oh, the sound. Oh.
    Mr. Yarmuth. The sound volume.
    Mr. Wheeler. Yes, Commissioner Clyburn has just passed me a 
note saying----
    Mr. Yarmuth. Thank you.
    Ms. Eshoo. Would you yield just for 2 seconds?
    Mr. Yarmuth. Sure. I yield.
    Ms. Eshoo. It is going to be on my tombstone as the only 
thing that people in the country know me for. But thanks for 
asking about it.
    Mr. Yarmuth. And I actually notice that there are some 
commercials, actually, where the volume drops. And I don't know 
whether that is intentional, somebody trying to get people to 
pay more attention or not. But I am just curious as to where 
the enforcement mechanism is or whether it is being enforced.
    Mr. Wheeler. I would be happy to get back to you on that.
    Mr. Yarmuth. Thank you very much, Mr. Chairman. I yield 
back.
    Mr. Latta. Thank you.
    The gentleman yields back the remainder of his time.
    And the chair now recognizes the gentleman from 
southeastern Ohio for 5 minutes.
    Mr. Johnson. Thank you, Mr. Chairman.
    And I thank our panel members for being with us today.
    Chairman Wheeler, as you know, we had concerns about your 
proposal to relocate the 200 servers from your headquarters to 
West Virginia. We sent you letters to that effect. Those 
concerns were not with the purpose of the move but the 
disruption that it would cause to operations and the risk of 
data loss.
    We have had a number of open inquiries and investigations 
on the FCC, and we are still waiting on some of those documents 
to be produced.
    So, according to the materials that you provided in 
response to our letters, you were permitted, at your request, 
to reprogram $8.5 million for this effort. How much did the 
move actually cost? Did it cost $8.5 million?
    Mr. Wheeler. I don't know that off the top of my head.
    Mr. Johnson. You don't know the answer for that? So you 
don't know whether it was more? Less?
    Mr. Wheeler. I can get you----
    Mr. Johnson. Can you get me that, please?
    Do you have a plan for where you plan to move--if it didn't 
cost the $8.5 million, do you have a plan for where you intend 
to put the surplus that you asked for?
    Mr. Wheeler. I don't know that it exists.
    Mr. Johnson. OK. So you will get that back for the record?
    Mr. Wheeler. Yes.
    Mr. Johnson. All right.
    Well, suffice it to say the move didn't go as smoothly as 
we were told it would. You ran into problems with cabling that 
were attributed to the contractor. And the move took an 
additional 3 days, according to senior FCC management.
    According to at least one press report, employees were told 
to stay at home when the problems were encountered, and you 
were unable to get all the systems back up and running in the 
time that you allotted. Is that true?
    Mr. Wheeler. Yes, sir.
    Mr. Johnson. OK.
    According to another report, a senior FCC manager stated, 
``We could have always asked for more time up front, possibly 
padded our schedules. Instead, we chose to be ambitious in our 
timelines because that is what a startup mentality culture 
does.''
    So the way I read that statement is, rather than appreciate 
the impact of taking the agency off line on other 
organizations, agencies, regulated entities, and the public, a 
decision was made to go for the sound bite. Am I reading that 
wrong?
    Mr. Wheeler. Yes, sir.
    Mr. Johnson. OK.
    Well, then, didn't the FCC have the final say on the plans 
for the move? How did you allow this to happen?
    Mr. Wheeler. No, I think that this was a question of what 
is a logical way of doing it----
    Mr. Johnson. I am an IT guy, Chairman Wheeler, and I have 
been doing implementations for a long time, and any planning up 
front includes planning for things like this.
    Mr. Wheeler. I am an IT guy, too. I agree.
    Mr. Johnson. Did you guys have that in your consideration?
    Mr. Wheeler. Yes, sir. And we built in, and it was wrong.
    Mr. Johnson. OK. Good. So you acknowledge that that was a 
failure.
    Mr. Wheeler. But I must say----
    Mr. Johnson. Good.
    Mr. Wheeler [continuing]. I think that our staff is 
fabulous----
    Mr. Johnson. Let me move on. Let me move on, Mr. Chairman.
    Does the FCC have in place a policy on the approval and the 
use of social media and Web 2.0--for example, using Twitter and 
YouTube? Such a policy would seek to insulate the FCC from 
cyber threats and social engineering, would it not?
    Mr. Wheeler. I am sorry, do we have----
    Mr. Johnson. Do you have a policy on the approval and the 
use of social media and Web 2.0, like Twitter and YouTube?
    Mr. Wheeler. On our----
    Mr. Johnson. On your employees.
    Mr. Wheeler. Yes, we have a policy.
    Mr. Johnson. You do.
    Does the FCC have general guidelines for use of these 
technologies for FCC employees in their official capacities, in 
their responsibilities of FCC employees?
    Mr. Wheeler. I believe so, that it said use it in your 
official capacity.
    Mr. Johnson. You say you believe so. You do, or you don't?
    Mr. Wheeler. No, I believe so. And I believe that the 
counsel is to use it appropriately in your official capacity.
    Mr. Johnson. Do these guidelines extend to the use of these 
technologies for FCC employees in their unofficial capacity?
    Mr. Wheeler. This is a question of the use of FCC 
facilities for unofficial activities----
    Mr. Johnson. In their unofficial capacity----
    Mr. Wheeler. Yes, sir.
    Mr. Johnson [continuing]. Are there guidelines on how FCC 
employees should be using those kinds of technologies?
    Mr. Wheeler. Yes, sir.
    Mr. Johnson. Can you describe to us what those policies 
are?
    Mr. Wheeler. You are supposed to have--you are using this 
for official purposes. I believe that there have been actions 
taken against some employees who didn't. I believe that there 
have been Office of Inspector General inspections in some 
situations and that people have lost their jobs.
    Mr. Johnson. OK.
    Well, are you familiar with the several videos posted 
online memorializing the server move? Have you seen some of 
those videos?
    Mr. Wheeler. No, sir, I haven't seen those.
    Mr. Johnson. Well, in these videos, the Commission revealed 
several pieces of non-public information, including the names 
and license plates of some FCC employees, the types of servers 
the FCC is using to store important and sensitive data, and 
many pictures of the specific setup the FCC has at its new data 
center.
    Chairman Wheeler, it is a little hard for me, as an IT 
professional, to take seriously the FCC as an agency that wants 
to be a privacy and cybersecurity regulator when it sacrificed 
important cyber information, employee privacy, at the altar of 
good PR.
    Commissioner Pai, were you aware these videos were being 
posted?
    Mr. Pai. I was not, Congresswoman.
    Mr. Johnson. Commissioner Clyburn, were you aware that the 
videos were being posted?
    Ms. Clyburn. I was not.
    Mr. Johnson. Commissioner Rosenworcel?
    Ms. Rosenworcel. No.
    Mr. Johnson. No?
    Commissioner O'Rielly?
    Mr. O'Rielly. No, sir.
    Mr. Johnson. OK.
    Mr. Wheeler. I was not either, sir.
    Mr. Johnson. You were not either? OK.
    Chairman Wheeler, our colleagues on the Committee on 
Appropriations are currently working on final provisions to 
fund our government agencies. Among the issues that they are 
tackling as part of that process is putting into law a ban on 
the FCC's use of its authority to regulate rates for broadband 
Internet access service, consistent with your consistent 
statements to Congress that FCC won't regulate, rate-regulate 
broadband.
    It is my understanding that Appropriations staff asked the 
FCC to provide technical assistance in drafting this provision 
and that the FCC refused to provide Congress with the benefit 
of your expertise. It is completely inappropriate for an agency 
of the government to refuse to engage in the provision of its 
expertise to the Congress.
    When will you remedy this situation? And can you assure 
that it will not happen again? Are you guys going to provide 
that information to the Appropriations staff or not?
    Mr. Wheeler. I was unaware of that situation, Congressman. 
I do think that it is unnecessary to put those kind of riders 
on the Appropriations----
    Mr. Johnson. But that is not your call. That is not your 
call. That is Congress' request. Are you going to provide the 
information?
    Mr. Wheeler. I was unaware of the situation----
    Mr. Johnson. And are you going to provide the information?
    Mr. Wheeler [continuing]. It is not hard to figure out how 
to draft it. Yes, sir.
    Mr. Johnson. OK. All right.
    Mr. Chairman, my time has expired.
    Mr. Latta. Thank you very much.
    The gentleman's time has expired.
    And the chair now recognizes the gentlelady from New York 
for 5 minutes.
    Oh, I am sorry. I didn't see Mr. Butterfield come back in.
    Mr. Butterfield. Thank you, Mr. Chairman.
    Mr. Latta. The gentleman is recognized for 5 minutes.
    I am sorry.
    Mr. Butterfield. Thank you, Mr. Chairman.
    Let me first direct my question to you, Chairman Wheeler. 
As I understand it, the congressionally mandated Downloadable 
Security Technology Advisory Committee report provides no 
assurances that, under the AllVid approach, unlike an apps 
approach, congressionally mandated protections like privacy and 
emergency alerts would be honored.
    Now, tell me, how does that serve the public interest?
    Mr. Wheeler. I am not sure I understand the question, that 
this is----
    Mr. Butterfield. Maybe I am reading it incorrectly. Let me 
try it again.
    As I understand it, the congressionally mandated 
Downloadable Security Technology Advisory Committee report----
    Mr. Wheeler. Right.
    Mr. Butterfield [continuing]. Provides no assurances that, 
under an AllVid approach, congressionally mandated protections 
like privacy and emergency alerts would be honored. Does that 
serve the public interest?
    Mr. Wheeler. So, thank you, Congressman.
    Mr. Butterfield. Yes.
    Mr. Wheeler. AllVid was a half-a-dozen-years-ago kind of 
approach. I know people like to characterize what is going on 
as the resurgence of AllVid.
    What we did was to have a report that dealt with the 
security issues involved in fulfilling our section 629 
responsibilities. And the comments on that just closed last 
week.
    Mr. Butterfield. OK.
    Mr. Wheeler. I am unaware, having not been through the 
comments yet or seen a briefing on the comments, of the kind of 
issues that you have raised having been raised in the comments, 
but I will certainly look for them.
    Mr. Butterfield. And if this approach does not honor 
licensing terms that are negotiated between programmers and 
MVPDs, how would that affect the diversity of programming 
available to consumers?
    Mr. Wheeler. So, as I said to Ms. Blackburn, one of the 
reasons that you had the security discussion to begin with was 
the protection of copyrights so that the kind of situation you 
talk about wouldn't happen.
    Mr. Butterfield. Does that also give online video 
distributors a competitive advantage over traditional 
distributors, as OVDs would not be overburdened by the rules? 
Does it give a competitive advantage to the traditional 
distributors?
    Mr. Wheeler. I think we want to make sure--the question 
is--so there are online over-the-top services coming through on 
the Internet part of the cable that comes into your house. The 
question then becomes, on the cable part of the cable, if you 
will, what is the impact of the set-top box?
    And the important thing--because I know this committee is 
very interested in making sure that there is no thwarting of 
innovation through regulation. And we share that, as well. One 
of the questions that I hope was addressed--and I look forward 
to the comments--is what is the impact of the set-top box on 
thwarting the kind of opportunities for consumers that I think 
you were just talking about.
    Mr. Butterfield. All right.
    Let's go to Lifeline modernization. Lifeline modernization 
appears to be on good track, but the question still remains, 
how do we create a wireless broadband solution under the 
current rate of $9.95?
    Mr. Wheeler. So, yes, it is on track. And, thanks to 
Commissioner Clyburn for the work that she has been doing, 
Commissioner Rosenworcel and her calling us out constantly on 
the homework gap, we are going to address those problems.
    And I think that if you look at the kind of capacity that 
can be bought at that kind of price, that what we want to do is 
give people the opportunity to do that and to exercise their 
own choices along the way, as well.
    Mr. Butterfield. Can you speak to how you intend to promote 
competition among Lifeline providers at this price?
    Mr. Wheeler. Consumers should have choices.
    Mr. Butterfield. Finally, how will the FCC ensure that 
voice-only still remains a service offering for eligible low-
income consumers?
    Mr. Wheeler. It is important.
    Mr. Butterfield. All right. The next question would take 
longer than 40 seconds, so I am going to stop right there and 
yield back.
    Mr. Latta. Thank you very much.
    The gentleman yields back the balance of his time.
    And the chair now recognizes the gentleman from Illinois 
for 5 minutes.
    Mr. Kinzinger. Thank you, Mr. Chairman.
    And thank you all for being here today and having a good 
time with us. We appreciate it.
    Mr. Chairman, before I get started with my questions, I am 
going to ask unanimous consent to include in the record a 
letter from the Illinois Chamber of Commerce on the need for a 
regulatory approach at the FCC that fosters investment and 
innovation in the deployment of technology.
    Mr. Latta. So ordered.
    [The information appears at the conclusion of the hearing.]
    Mr. Kinzinger. Chairman Wheeler, I understand that the FCC 
has established a broadcast reimbursement deadline of 39 months 
after the auction. If the Commission plans to repack up to 
1,100 local TV stations, there is a reasonable question about 
whether that 39 month deadline is technically feasible with so 
few tower crews, structural consultants, a lack of antenna 
manufacturing capacity, among other things.
    Even if we assume that all of those issues are resolved, 
there is still the outstanding issue of whether or not the 
relocation fund will be sufficient to pay for moving all of the 
broadcasters. You have responded to some of those concerns, 
stating that you have no reason to believe that the $1.75 
billion broadcaster relocation will be insufficient to cover 
their relocation costs.
    That leaves a secondary question of, what if the fund isn't 
sufficient to pay for the moving of all broadcasters? Again, 
your Commission stated that you believe the fund will be 
sufficient, but if it is not, the FCC has the authority to 
develop a prioritization scheme for reimbursement claims. What 
would this scheme entail?
    Mr. Wheeler. So, obviously, it is a hypothetical at this 
point in time----
    Mr. Kinzinger. Right.
    Mr. Wheeler [continuing]. And you would want to know what 
the realities of the situation are. The $1.75 billion is a 
number that set by the committee, and we will adhere to that. 
There is----
    Mr. Kinzinger. Well, no, I understand. I have limited time, 
but if it is not sufficient. So you said you would prioritize.
    Now, are you saying that you would provide funding over the 
$1.75 billion? Or would you be pulling from one broadcaster to 
pay another? How is that going to work?
    Mr. Wheeler. So we are limited to $1.75 billion. One of the 
challenges of the whole auction is it is an auction, and you 
don't know what the result is going to be.
    Mr. Kinzinger. Yes.
    Mr. Wheeler. And so we could sit here and hypothesize----
    Mr. Kinzinger. But we need to hypothesize, to an extent, 
because----
    Mr. Wheeler. I am sorry, what?
    Mr. Kinzinger. I said, to an extent, we need to 
hypothesize, because we have to plan, we have to understand so 
we are not surprised.
    Mr. Wheeler. And what that means is you have to be ready to 
be able to deal with the issue should it arise.
    Mr. Kinzinger. Yes.
    Mr. Wheeler. And that includes maybe coming back to 
Congress and saying, hey, there were some judgment calls here 
that didn't work out. And so, that may be----
    Mr. Kinzinger. But you see it--potentially on the table 
would be prioritizing broadcasters or maybe pulling from one--
--
    Mr. Wheeler. So, actually, I think that the broadcasters--I 
don't want to get in the situation where you are picking and 
choosing.
    Mr. Kinzinger. Yes.
    Mr. Wheeler. That is not the job of this agency.
    Mr. Kinzinger. No.
    Mr. Wheeler. I do want to be in a situation of adhering to 
the law, which says 1.75.
    Mr. Kinzinger. OK.
    Mr. Wheeler. And if that means we have to come back and say 
to the committee, hey, it didn't work and here are the facts--
but I haven't got those facts to give you now.
    Mr. Kinzinger. OK.
    For the whole panel, let's assume for a moment that the 39 
month deadline for relocating broadcasters can't be met. And I 
know you assume it can. Let's assume for a moment it can't. 
Would you allow broadcasters to be forced off the air at that 
point?
    Mr. Wheeler. No.
    Mr. Kinzinger. I guess we will start with Mr. O'Rielly.
    Mr. O'Rielly. No, sir.
    Mr. Pai. No.
    Ms. Rosenworcel. No.
    Ms. Clyburn. Absolutely not.
    Mr. Wheeler. No. And the interesting thing is we have a 6-
month extension that is provided for now. And the other thing 
that is fascinating to us is that, when the NAB participated in 
this, they told us they would only need 30 months.
    Mr. Kinzinger. OK.
    Mr. Wheeler. And, we are all learning as this process goes 
on.
    Mr. Kinzinger. Yes.
    And not to skip back to the relocation fund, but one of the 
things I want to make sure, though, is one of the possibilities 
is not forcing broadcasters to then shoulder the cost of it if 
it is above $1.75 billion, right?
    Mr. Wheeler. This is clearly no one's goal.
    Mr. Kinzinger. OK. Well, that is good. It is not anybody's 
goal; I just want to make sure it is not really there as an 
option.
    Mr. Wheeler. I understand, Congressman.
    Mr. Kinzinger. Commissioner O'Rielly, in a welcome sign of 
the kind of collaboration that we expect but seldom see on the 
Commission, you and Commissioner Clyburn both issued a joint 
statement of support for the public notice recently issued to 
remind USF recipients of expenditures that should not be 
supported by the universal service.
    Your joint statement went further and stated concerns with 
certain other expenses not related to the provision of service, 
such as for artwork and cafeterias, that may be permitted under 
certain readings of the rules. You both called on the 
Commission to initiate a proceeding to address these issues in 
the coming months.
    Commissioner O'Rielly, what would be the benefits of such a 
proceeding?
    Mr. O'Rielly. So the vast number of rural carriers do a 
wonderful job in serving and completely don't do some of these 
practices. But we have found that some providers have been 
doing a very interesting reading of our rules. We do not 
believe that the scarce universal service funding should go to 
things like artwork within the building of the provider or 
building a cafeteria for their employees. So we want the 
dollars to be spent on building out networks and providing 
service to consumers.
    Mr. Kinzinger. And, basically, everybody on the panel would 
agree, I think, this?
    Mr. Wheeler. Yes.
    Mr. Kinzinger. All right.
    Mr. Chairman, hopefully that is----
    Mr. Latta. Thank you very much.
    Mr. Kinzinger [continuing]. That is good input. And I will 
I yield back.
    Mr. Latta. The gentleman's time has expired.
    And also, the chair has heard that we might have votes 
around 1:05 to 1:20. So if we can keep our questions at 5 
minutes, I would appreciate it.
    And the gentleman from Vermont is recognized for 5 minutes.
    Mr. Welch. Thank you very much. Sorry for my absence.
    First of all, I want to thank the Commission for the 
tremendous work that you do. There are very hard, contentious 
issues. In the hope that we have on this committee--Bob Latta 
and I, of course, started the Rural Working Group--and I know 
the hope on your Commission is that you would find ways to work 
together in a contentious time.
    But let me ask, Commissioner Pai, you had indicated your 
problem with the enforcement process now, and I heard you loud 
and clear. I just thought I would ask Mr. Wheeler, I would give 
you an opportunity to respond to that.
    Because I assume all of you hope, against hope at times, 
that you can get a bipartisan votes. That eludes us on this 
panel more than we would like. It eludes you on your Commission 
more than you would like.
    But, Mr. Wheeler, I would like you to at least have an 
opportunity to respond to Commissioner Pai.
    Mr. Wheeler. Well, thank you. And, as I said, we have been 
following the processes that have been in place for the 
Commission for years and years and years. There are actually 
fewer notices of apparent liability that have been issued than 
when Commissioner Pai was in the General Counsel's Office. So 
there have been some changes in that regard.
    We want to make sure the Commissioners continue to get 
briefed on a regular basis, as they always have. And we want to 
recognize that there are certain things that are law 
enforcement activities and certain things that are policy 
activities.
    Mr. Welch. Yes. All right. Thank you.
    And, Commissioner Rosenworcel, I want to thank you.
    Commissioner Rosenworcel came up to Vermont. People were 
impressed. You might want to have her in Indiana.
    But you were talking about the homework gap. And that is, 
in fact, a big deal. What kind of progress are you making, and 
what can we do to be helpful?
    Ms. Rosenworcel. Thank you. I appreciate the question. And 
I appreciated the opportunity to head home to New England, too.
    I think the homework gap is the cruelest part of our new 
digital divide, but it is within our power to bridge it and fix 
it. We can update a low-income program known as Lifeline to 
make sure it supports broadband. We should focus in a laser-
like way on households that have children who are in school. 
And we should also promote the availability of more unlicensed 
spectrum and WiFi.
    Those things will all make a difference, as will more 
public- and private-sector partnerships to help bring computers 
and broadband to students who are in school.
    Mr. Welch. OK.
    And you also spoke in the beginning about ``dig once.''
    I wonder, Mr. Pai and Mr. O'Rielly, that seems to me to be 
such a practical way to try to avoid cost and have the money 
spent really, Mr. O'Rielly, in the way you were suggesting, 
where other moneys were not properly spent.
    Is that something we can make progress on? Ms. Eshoo has 
been a leader on this. But I will start with you, Mr. Pai, and 
then you, Mr. O'Rielly.
    Mr. Pai. Thanks for the question, Congressman.
    I think, absolutely, there is bipartisan agreement here, as 
there is on this panel, on ``dig once'' and other policies like 
it. As I pointed out in my testimony, I think the six pieces of 
legislation that you have introduced and/or are considering are 
terrific.
    And I have seen that for myself. Just last week, I was in 
Hammond, Louisiana, stringing fiber along mud in the Bayou, and 
I heard firsthand how difficult it is to navigate around some 
of these regulatory obstacles.
    Mr. Welch. Well, Mr. Chairman, I hope we can really do 
that.
    Mr. O'Rielly?
    Mr. O'Rielly. Yes, I support the legislation, but I think 
it may require Congress to--we can't do it ourselves--require 
congressional action, and we support that.
    Mr. Welch. OK. So you are really recommending to this panel 
that we do everything we can to do something sensible to save 
money and expand access.
    Mr. O'Rielly. Absolutely. And there is a number of build-
out ideas my colleagues and I have had, and we think those 
would be very hopeful.
    Mr. Welch. All right.
    Mr. Chairman, I move the bill. We can get away with it. We 
are here.
    Mr. Latta. Is the gentleman yielding back there?
    Mr. Welch. I am not yielding. I still have another minute.
    Mr. Latta. OK.
    Mr. Welch. Mr. Wheeler, on the broadband speed, you know, 
there are two standards out there now, 10/1 versus 25/3. So 
that conflict is a conflict, and I am wondering if you can 
address that.
    Mr. Wheeler. Thank you, Congressman.
    Yes, 25 down and 3 megabits up is what we call table 
stakes, and it is available today to about 80 percent of the 
population. The problem is it is not available to 20 percent of 
the population, and how do we get there.
    So, first, you have to have universal service reform that 
makes sure that money is being spent to expand broadband. And 
then, secondly, you have to recognize that this is a growing 
process, that the most expensive part of building broadband is 
laying the fiber. After that, it is all electronics, and the 
cost actually declines.
    So how do we get broadband, good broadband, but not what we 
would like to see across the board, out first? And that is what 
we are saying. So we will support 10/1 as a minimum. But a lot 
of people are building more. I was at the NTCA convention and 
met a gentleman from North Dakota who said that he serves 
14,000 square miles, has 4,000 subscribers, and he has fiber to 
the home.
    Mr. Welch. That is great.
    I see my time is up, but I just want to at least thank--I 
can't ask my question--Commissioner Clyburn, who also came to 
Vermont and gave an outstanding presentation to all our utility 
folks.
    So thank you very much, Commissioner.
    Mr. Latta. Thank you.
    The gentleman's time has expired.
    The chair now recognizes the gentleman from Missouri for 5 
minutes.
    Mr. Long. Thank you, Mr. Chairman.
    Chairman Wheeler, I am going to channel my inner Chairman 
Dingell here and ask for a yes-or-no answer to a simple 
question.
    Isn't regulating broadband providers, but not anybody else, 
going to create confusion or even a false sense of security 
among consumers that whatever rules apply to broadband 
providers will apply to whoever sees their information on the 
Internet, yes or no?
    Mr. Wheeler. I am sorry, I didn't understand what you were 
saying at the end. Whoever sees----
    Mr. Long. Shouldn't consumers have the same protection on 
privacy issues, shouldn't they assume that they have the same 
protection, whether they are going over a line or whether they 
are using a third party? Shouldn't the protections be the same?
    Mr. Wheeler. There should be uniform expectation of 
privacy, yes, sir.
    Mr. Long. OK.
    Even if you can't or just don't want to impose privacy 
obligations on other entities, what steps should other agencies 
or Congress take to ensure that consumers' information is 
protected in a uniform manner on the Internet?
    Mr. Wheeler. Well, as you say, we have said that we will 
not regulate edge providers. And the FTC has moved with its own 
set of guidelines. The administration has its white paper. And 
I expect that what we do will be operating within those same 
kind of concepts so that there is some parity along the way.
    Mr. Long. Regulating the edge providers differently.
    Mr. Wheeler. No, we will not be regulating the edge 
providers differently.
    Mr. Long. You won't.
    Mr. Wheeler. We will not.
    Mr. Long. OK.
    Commissioner Pai, do you want to weigh in on this?
    Mr. Pai. Congressman, I think this is essentially the 
problem, is that if consumers are to have a uniform expectation 
of privacy, then it would seem to follow from that that 
everybody in the broadband ecosystem, from your Internet 
service provider all the way to the edge provider, should face 
the same regulations.
    Mr. Long. Right. I mean, to me, that makes common sense, 
and that is what I am trying to get to.
    Commissioner O'Rielly, do you have any comment on that?
    Mr. O'Rielly. I agree with my colleague's point. I imagine 
that when this item is done we are going to have different 
regimes for different types of--based on the provider used or a 
third-party provider. And that is going to be problematic for 
consumers.
    Mr. Long. OK.
    Chairman Wheeler, in STELA, this committee requested that 
the GAO, Government Accountability Office, study the impact of 
any phaseout of the compulsory copyright licenses for cable and 
satellite on the related provisions in the communications law. 
The GAO is currently conducting that study and has yet to 
report back to Congress on its findings.
    I have concerns with the FCC moving ahead and repealing 
exclusivity rules which are interrelated with these licenses 
before GAO has reported back to this committee and has made any 
predetermination as to the appropriate public policy decision. 
Is it necessary that the FCC phase out these rules now, which 
seems premature?
    Mr. Wheeler. Thank you, Congressman.
    STELA also required the Commission to begin a proceeding on 
retransmission consent negotiations. Exclusivity is an issue 
that factors into that. I think that is the appropriate place 
to address it.
    Mr. Long. OK.
    I will stay with you, Chairman Wheeler. I have a little 
time here left, I think.
    As you know, the committee has been very active in working 
to find ways to get more spectrum into the commercial 
marketplace to fuel the growing need for broadband. We have 
taken a series of legislative steps to make that happen, but 
the FCC plays a crucial role here also.
    One area where we can make quick progress is 
commercializing the spectrum of 1675 to 1680 megahertz. This 
spectrum has been the subject of a 3-year-old proceeding at the 
FCC, and both Congress and the administration have offered 
budget language encouraging its use for the wireless broadband 
by 2017. So how and when will the FCC complete these 
proceedings?
    Mr. Wheeler. For 16 gig? We are looking----
    Mr. Long. Yes.
    Mr. Wheeler. We are looking at all of the above-3-gig 
spectrum. I believe that we will----
    Mr. Long. 1675 to 1680 megahertz is what I am----
    Mr. Wheeler. Megahertz?
    Mr. Long. Yes. Not gig, megahertz.
    Mr. Wheeler. Sorry. I thought you were talking about the 
upper band.
    I can't answer that question specifically, sir, and give 
you a time. I will be happy to get back to you.
    Mr. Long. Yes, I would love for you to get back to my staff 
on that.
    And, as you know, this committee has been very active in 
working to find ways to get more spectrum into the commercial 
marketplace to fuel the growing need for broadband. We have 
taken a series of legislative steps to make that happen. But, 
like I say, you all play a crucial role. So if you could check 
that out and get back to me, I would really appreciate that.
    Mr. Wheeler. We certainly agree with the importance of 
doing that.
    Mr. Long. I yield back.
    Mr. Latta. Thank you.
    The gentleman yields back.
    And, also, the members see that they have just called our 
first votes, with about 13:49 left.
    And the chair now recognizes the gentlelady from New York.
    Ms. Clarke. Thank you, Mr. Chairman. And I thank our 
ranking member, Ms. Eshoo. And I would like to thank our 
Commissioners for their appearance and responses today.
    Like many of you, I am encouraged, actually excited, about 
the recent signing of the bipartisan budget agreement, which 
included provisions of the Spectrum Pipeline Act of 2015 that 
is based on a draft that my office introduced. And I look 
forward to the FCC fulfilling the goals of this act and 
identifying and repurposing wireless spectrum from Federal to 
commercial uses.
    More spectrum can only translate into more opportunities 
for our Nation's citizens, particularly those from historically 
underserved communities where wireless broadband is often the 
only gateway to opportunities.
    On this point, I have a question related to increasing 
engagement for seasoned and aspiring entrepreneurs and 
businesses of color in the upcoming spectrum auction and 
beyond. But, prior to that, I would just like to say to 
Commissioner Clyburn, congratulations on the reform of the 
inmate calling services. This will help to mitigate a lot of 
the hardship millions of families across our Nation have faced 
in dealing with that service.
    But I would like to ask, do you see the FCC's revamped 
designated-entity rules as sufficient enough to create 
opportunities for minority spectrum ownership? And what can the 
FCC do to enhance and incentivize secondary market transactions 
that have the potential to drive more diversity in minority 
ownership of commercial wireless spectrum?
    I was directing that to you, Commissioner Clyburn.
    Ms. Clyburn. OK. Thank you very much. I appreciate it.
    A number of things that we have done in the past year and a 
half or so, I think, will stimulate the marketplace and the 
ecosystem.
    We repealed the attributable material relationship rule and 
the former defaulter rule because we recognize that, while 
well-intentioned, they were keeping businesses, particularly 
diverse businesses, out of the market.
    We also adopted a rural bidding credit, which will give 
more incentive to those in those particular areas, which is a 
twofer. It would, you know, stimulate more deployment in those 
particular areas, and it would allow for more opportunities in 
a smaller footprint.
    We also are looking at small-business incentives, bidding 
credits, that, again, would stimulate that type of investment 
and opportunities.
    And, of course, we are always looking for ways to stimulate 
secondary-market transactions. Again, a smaller footprint, in 
some cases, and a more laser-beam focus.
    And so we are looking at and continuing conversations with 
those who have great ideas to really do what we can to 
diversify the ecosystem for businesses of all sizes and 
businessowners from all backgrounds.
    Ms. Clarke. Thank you. That is encouraging. We want to 
definitely stay focused on that. There have been some 
substantial losses, particularly in black communities, over the 
years, and we would like to see opportunities particularly for 
young, more inspired businessowners and entrepreneurs to really 
gain a foothold in this market.
    Shifting gears a bit, the FCC appears to have been focused 
on expanding online video platforms, but there still appears to 
be challenges in getting the content directly to the consumer, 
as evidenced in the current AllVid debate.
    So I want to drill down just a little bit and ask Chairman 
Wheeler: The proposal made by the AllVid proponents in your 
DSTAC proceedings requires a new box just to get the MVPD 
content to the new retail device. Instead of getting rid of 
boxes, AllVid requires an additional box. And I think you have 
heard colleagues commenting on this this morning.
    This is a concern on two fronts for consumers, increased 
box costs and increased energy costs, in addition to no 
guarantee of consumer protection. This seems out of step with 
today's marketplace.
    Aren't these increased costs and diminished consumer 
protections a concern for the FCC, as well?
    Mr. Wheeler. Thank you, Congresswoman.
    There has been a lot of talk today about AllVid, which is a 
half-dozen years old and apparently somebody has wanted to 
resurrect.
    We have just finished a comment period on the DSTAC 
requirement that was in STELA. It was finished last week. The 
making of conclusions from that is premature.
    We believe that section 629 says to us that we have the 
responsibility to assure that there is competitive choice in 
terms of navigation devices. DSTAC had several approaches as to 
how to do that. The decision about where you go from there is 
one that we have not yet made because the comments just closed 
last week.
    Ms. Clarke. Well, let me just say this. I think it is clear 
that we need to monitor this very closely. Because there is no 
doubt, if two devices are needed, there is going to be an 
increase in energy costs. There is no doubt about that.
    Mr. Wheeler. It is also possible there could be no devices 
needed and there would be a reduction in cost. I mean, that is 
the interesting thing that we have to----
    Mr. Latta. And I am sorry to have to cut the Chairman off. 
We have----
    Ms. Clarke. Yes. No problem. I yield back, Mr. Chairman.
    Mr. Latta [continuing]. About 7 minutes left on the roll 
here.
    And the chair now recognizes the gentleman from New York 
for 5 minutes.
    Mr. Collins. Thank you, Mr. Chairman. I guess we will see 
if I can be a little bit brief.
    Mr. Wheeler, at the end of July, in this hearing room, I 
asked you about pirate radio. I am a New Yorker. That is a big 
issue certainly down State, even though I am from the Buffalo 
area. And I did send you a letter signed by the entire New York 
delegation----
    Mr. Wheeler. Yes, sir.
    Mr. Collins [continuing]. And most of the New Jersey 
delegation, including Ranking Member Pallone.
    But, since then, I have continued to be disappointed. There 
have only been, as I understand it, five or six fines issued 
related to pirate radio. And it is such a small number, it is 
certainly the feeling within the industry that that has done 
nothing to address the serious issue, that we consider a 
serious issue, of the multiple pirate radio operators that 
continue to operate in the New York metropolitan area.
    So, you know, my contention is, you know, to be very 
direct, that you have paid this lip service and, frankly, 
little more than lip service. You know, you decimated the 
Enforcement Bureau. You have closed offices and eliminated 
field engineers in an effort you call consolidation. But I can 
tell you, coming from the business sector, and I do understand 
consolidation, you need results to go with it, and, in this 
case, there have been few to no results.
    So my staff called your Enforcement Bureau and said, ``Can 
you give us an update on what is going on with pirate radio and 
the enforcement efforts?''--directly to your Enforcement 
Bureau. I don't know if you will be surprised to hear this. 
Their comment was, ``We are not handling that. You will have to 
call Mr. Wheeler's personal office to find out what is being 
done on pirate radio.''
    My perspective? That is an embarrassing runaround, 
disrespectful to my office for sure, that your Enforcement 
Bureau says, ``We are not doing anything.''
    Mr. Wheeler. I agree with you, sir.
    Mr. Collins. So I would like you and would ask you to get 
back to us----
    Mr. Wheeler. Yes, sir.
    Mr. Collins [continuing]. In particular to my staff, who 
came off of that phone call and you can imagine the comments 
that they made about what we consider to be lip service to 
pirate radio. And if nothing else, if that is all it is, tell 
us that is all it is. But I would very much appreciate not 
having to wait months to get a response on this, because I 
found that unbelievable, frankly.
    Mr. Wheeler. So do I.
    Mr. Collins. Well, good. So I will look----
    Mr. Wheeler. Because the reality is, as I said in my 
statement, Congressman, there have been 280 enforcement actions 
that we have taken in the last 2 years under my chairmanship. 
And we have a joint task force that we are working with the NAB 
on this.
    And I suggested in my testimony that there were also some 
additional steps that Congress could take to help us deal with 
the landlords, because they are the ones who are facilitating 
this. And the pirate radio folks, you shut them down, they 
thumb their nose at you, and they go someplace else.
    Mr. Collins. No, we understand that piece. But we were 
quite frustrated by the----
    Mr. Wheeler. I would be, too.
    Mr. Collins [continuing]. Very direct response----
    Mr. Wheeler. I would be, too.
    Mr. Collins. So we will just jointly dig to the bottom.
    Mr. Wheeler. We will fix that.
    Mr. Collins. Now, the other thing--and I reach out to the 
industry and ask them to help me with some questions. I am 
sitting here at the bottom of the dais, and, usually, by the 
time, 30 other questions are asked. And I will tell you, what 
came back from me asking them to ask you was really a 
frustration they see right now in the investment side, actions 
that are a wet blanket and really having a negative impact on 
investments.
    But they also pointed out, from their perspective--and I 
don't know whether this is a rhetorical comment or asking a 
question, but--what they see from the FCC as selective 
enforcement on the TTY issue, spectrum set-asides for companies 
who are not participating in the auctions, and onerous 
regulations extended to new technologies like streaming video 
that do nothing but discourage investments.
    Mr. Wheeler. Thank you for asking. Let me see if I can tick 
them off real fast.
    Mr. Collins. All right.
    Mr. Wheeler. TTY. It is really interesting. AT&T asked for 
a waiver. We granted them the waiver. We called them and said, 
``We are going to grant you the waiver.''
    They followed the next day with a letter saying, ``Why 
haven't you granted us the waiver? And, by the way, what about 
our competitors on this?''
    We went back to them, and we said, ``Would you file a 
complaint so we can see if it is appropriate to take 
enforcement?''
    Mr. Collins. I am about to run out of time.
    Mr. Wheeler. They didn't want us to do that.
    And, secondly, on over-the-top, we have started a 
rulemaking on that. The purpose of rulemakings is to learn. We 
learned the vast number of things that are developing very 
rapidly. And we have not moved forward on that notice of 
proposed rulemaking. And I don't see, until the situation 
changes, that we would.
    And I forget your third.
    Mr. Collins. That is OK. My time has expired.
    Mr. Latta. The gentleman's time has expired.
    Mr. Collins. And I do look forward to catching up with you 
on the enforcement piece. Thank you.
    Mr. Latta. The chair now recognizes the gentleman from 
Illinois for 5 minutes.
    Mr. Rush. I want to thank you, Mr. Chairman.
    And I also want to commend the Commission and Commissioner 
Clyburn, in particular, for the capping on the predatory phone 
rates for our inmates across the country.
    But I wanted to ask the Commission in general, I want to 
raise a question and raise an issue that is affecting my city, 
Chicago, other urban areas all across the Nation, and this is 
on the issue of urban violence.
    There have been 2,587 shootings and 435 murders in Chicago 
so far this year--more than L.A. And New York City combined. 
And it is well-known that these gang leaders who are primarily 
perpetrating this violence, that they are using social media to 
advance their agendas and their conflicts.
    Knowing that the FCC has limited jurisdiction over 
Facebook, Twitter, and Instagram, is there anything within the 
realm of public safety that the FCC can use to help address and 
curtail this violence? Can and will the FCC add its important 
voice, its stature, to this dynamic discussion?
    Mr. Wheeler. Mr. Rush, the situation that you describe is, 
as you say, tragic. It is not dissimilar to what Mr. Barton 
raised a moment ago with regard to terrorist threats and 
terrorists using social media.
    We do not have jurisdiction over Facebook and all the other 
edge providers. We do not intend to assert jurisdiction over 
them. And I don't believe that they are--as legitimate as your 
concern is, I don't believe that we have the jurisdiction to do 
the kind of thing that you suggest.
    Mr. Rush. That means that you don't think that the FCC 
could weigh in on this in any way?
    Mr. Wheeler. I am happy to use the bully pulpit. I am happy 
to talk to Mark Zuckerberg and others to raise this issue and 
to say, hey, this is important kind of thing, we need to be in 
this together. But we don't have regulatory authority.
    Mr. Rush. I am not seeking regulatory.
    Mr. Wheeler. OK.
    Mr. Rush. I would grant you that I don't believe that you 
have jurisdiction. But I think that there is a bully pulpit, 
that you and others may be able to address this issue. I am not 
trying--I don't want to----
    Mr. Wheeler. I will call Mark Zuckerberg this afternoon to 
raise the issue that you have raised and the issue that Mr. 
Barton has raised. And I am sure that he is concerned about it, 
as well, and he will have some thoughts.
    Mr. Rush. Thank you.
    Ms. Clyburn. Right quickly, sir. Good to see you. And thank 
you for the acknowledgement.
    One thing that we are acting on and working with law 
enforcement and other authorities are stolen phones, as people 
are still using throwaway phones and burner phones or whatever 
you want to call them to commit crimes. We are continuing to 
work--our Consumer and Government Affairs Bureau is working 
with our sister agencies and then, like I said, law enforcement 
authorities and mayors across this Nation to address that 
issue. So where we can, we will.
    Mr. Rush. Thank you.
    Does any other Commissioner have anything to offer?
    Mr. Pai. Congressman, this doesn't directly relate to 
social media, but one of the things that I was disturbed to 
find when I visited a maximum-security prison in Georgia 
recently was that the use of contraband cell phones is having a 
direct and severe effect on people outside of prisons. I heard 
about family members, witnesses, and others, crime victims, 
who, because of the use of contraband cell phones in prison, 
have faced threats, including to their very lives.
    And I think that is something where the agency, a couple of 
years ago, teed up a number of different ideas. And I think it 
would be appropriate for the agency to come to closure on that 
to help protect some of these people, disproportionately 
minority, who are getting, some killed or robbed or otherwise 
threatened by use of this technology.
    Mr. Rush. Thank you, Mr. Chairman. I yield back.
    Mr. Latta. Thank you very much.
    The gentleman yields back.
    Just to let everyone know, we are about 18 minutes into 
this vote, with about 230 that haven't voted.
    And the chair recognizes the gentleman from Florida.
    Mr. Bilirakis. Thank you, Mr. Chairman. I will be as brief 
as I possibly can.
    Thank you for the Commissioners' testimony today. I really 
appreciate it so much.
    Chairman Wheeler, as part of the Enforcement Bureau's 
ongoing work, it is my understanding that there has been a 
letter of inquiry, or LOI, seeking information from a hotel 
chain on all of the properties from, again, its name, the name 
of the hotel chain--including franchises, over which it may not 
have any legal authority.
    To your knowledge, does the Enforcement Bureau have any 
reason to believe there are violations of the Commission's 
rules at these facilities? That is the first question.
    Mr. Wheeler. Thank you, Congressman.
    Typically, an LOI, a letter of inquiry, is sent when there 
is a belief that this is and they are seeking information to 
find out whether that belief is factual.
    Mr. Bilirakis. Based on the size of the request--again, all 
the properties--the cost to the hotel and loss of productivity 
and wages would seem to be quite high, I am sure you will 
agree, given the technical nature of the request, without any 
notion that this fishing expedition will bear fruit for 
consumers.
    Isn't this exactly the kind of thing that a cost basis 
analysis would prevent from being unnecessarily imposed on, 
again, American job creators? Would you agree with that?
    Mr. Wheeler. Thank you.
    There have been multiple actions that we have brought 
against hotel chains because what they have been doing is 
jamming the signals of people like you and me in order----
    Mr. Bilirakis. You are sure of that? You are certain of 
that?
    Mr. Wheeler. I am certain we have brought these actions and 
that is what was going on and that what has happened is that 
they have been forcing people to buy services from them instead 
of using the licensed services that we have authorized. And 
section 333 of the act says that we have a responsibility to 
protect the licensed services that we authorize. And----
    Mr. Bilirakis. And it specifically states that in the act--
--
    Mr. Wheeler. Yes, sir.
    Mr. Bilirakis [continuing]. With regard to WiFi. Is that 
correct?
    Mr. Wheeler. It is an appropriate service of the agency.
    And so I am unfamiliar with exactly the specifics that you 
are talking about here, but if there is a letter of inquiry 
that was sent out, I would imagine that there have been some 
indications of difficulties and WiFi access being blocked in 
contravention of the law.
    Mr. Bilirakis. You are assuming that. OK. Thank you.
    Commissioner Pai, there has been some renewed attention to 
the TCPA this summer. The FCC recently passed a package of 
declaratory orders, but I fear they didn't impose real reforms 
to actually stop unwanted calls or help on this. And maybe it 
would cause unnecessary litigation.
    A statement from the Chairman about telephone townhalls had 
been quickly corrected after our last oversight hearing, within 
a few hours, I understand. I have a different question this 
time for this hearing.
    We talked about apps for customer relationship management 
and whether a smartphone is or can be an autodialer under the 
FCC's majority's interpretation. There are many small 
businesses in America, in my district as well, that rely on 
smartphones to run their businesses.
    I have a few questions. Yes-or-no answers would be greatly 
appreciated.
    Mr. Pai. Sure.
    Mr. Bilirakis. If a small business owner has a smartphone 
and uses one of those apps, has that person violated the TCPA, 
in your opinion?
    Mr. Pai. Yes, according to the majority.
    Mr. Bilirakis. Could that person be subject to FCC 
enforcement action even for a misdial?
    Mr. Pai. Yes.
    Mr. Bilirakis. Unbelievable.
    Would that person be subject to the private right of action 
provided under the TCPA?
    Mr. Pai. Yes.
    Mr. Bilirakis. OK.
    Commissioner Rosenworcel, is this a result that you 
support?
    Ms. Rosenworcel. Well, let me be clear. I don't like 
robocalls, and I think most people are not fond of them. So I 
think we should take any and all actions we can to prevent 
them, because those unwanted calls are not something that 
people are all that eager to receive.
    Mr. Bilirakis. However, we are not accomplishing our goal--
--
    Ms. Rosenworcel. No, but let me speak to you exactly to 
what you were talking about with autodialers.
    The Telephone Consumer Protection Act was passed in 1991. 
In 1991, an autodialer was a big, bulky piece of equipment. One 
of our challenges today is that we have to still use that law 
when we have software that can accomplish what that hardware 
did decades ago.
    And so I think the struggle that the agency has is trying 
to figure out how to manage with a statute that didn't 
contemplate the digital world we live in today.
    Mr. Bilirakis. OK. Let me ask you again. Do you----
    Mr. Latta. I am sorry. The----
    Mr. Bilirakis. OK. Yes, we have to go.
    Mr. Latta [continuing]. Gentleman's time has expired.
    Mr. Bilirakis. All right. I am going to submit something 
for the record.
    [The statement of Mr. Bilirakis follows:]

              Prepared statement of Hon. Gus M. Bilirakis

    I would like to register my disappointment in your October 
22 order limiting the ability for jails to collect commissions 
on inmate phone calls. We've exchanged letters on this issue 
this year, and law enforcement officials in my district, like 
Sherriff Chris Nocco from Pasco County, continually inform me 
how important these fees are to their operations.
    Services like GED programs, parenting classes and industry 
certification training programs are solely funded by these 
fees, and now are at risk of termination.
    While it's on questionable legal grounds that the FCC can 
even regulate intrastate rates charged by payphone service 
providers in the first place, the practical result of this 
order will cap rates in aggregate so that revenues won't cover 
expenses at all.
    Reintegration services will disappear, and that's a shame.
    Thank you and I yield back.

    Mr. Bilirakis. Thank you, Mr. Chairman.
    Mr. Latta. Thank you very much.
    And the chair recognizes the ranking member.
    Ms. Eshoo. Thank you, Mr. Chairman.
    Just very quickly, two things.
    Thank you to all of the Commissioners. I have some more 
questions. I will put them in writing.
    Commissioner Clyburn, I didn't get to say earlier, thank 
you for your work on Lifeline. Thank you. It is really helping 
to make a difference.
    And to Commissioners O'Rielly and Pai, I hope that I didn't 
hear you siding with people that rip off consumers. Any outfit 
that is going to place charges on a consumer's bill and bilk 
them, I don't think that is the place where anybody wants to 
stand. Now, maybe you have some other issues with the 
enforcement part of the agency. But that is not only the wrong 
side, it is the wrong side of history.
    Mr. Chairman, I would like to ask for a point of 
clarification on the introduction of multimedia during our 
hearings. Earlier in our hearing today, one of our colleagues 
introduced a video as part of her line of questioning without 
asking for objection. As you know, when letters or other 
written materials are entered into our record, we first have to 
ask for unanimous consent.
    The Democrats on the committee had previously sent a letter 
to our Republican colleagues asking them, when video or other 
multimedia evidence is introduced, that we first check with our 
colleagues on the other side. Now, she may not have known that 
that request should have been made.
    And I think, for regular order here, no side ever wants to 
be surprised. So I ask----
    Mr. Latta. If I could----
    Ms. Eshoo. But let me just ask the parliamentarian the 
following----
    Mr. Latta. Well, just if I could, to the ranking member, 
because of the interest of time and we are going to miss the 
vote, if we could ask our staffs to work together on your 
question.
    Ms. Eshoo. Yes, but let me put my question----
    Mr. Latta. OK.
    Ms. Eshoo [continuing]. Out there so it is a part of the 
record.
    It is a parliamentary inquiry, and it is the following: Can 
you provide some clarification as to whether video and 
multimedia evidence will be treated the same as written 
materials as a matter of this subcommittee's process?
    And we will await the----
    Mr. Latta. We will work with our staff.
    Ms. Eshoo. Yes. Not the staff, the parliamentarian.
    Mr. Latta. OK. Thank you.
    Ms. Eshoo. Thank you, Mr. Chairman.
    Mr. Latta. And if I could real quickly just, again, thank 
the Commission for being with us today. On behalf of the 
chairman of the subcommittee and also the ranking, we thank you 
for your time.
    And, without any other questions coming before us, we stand 
adjourned.
    Ms. Eshoo. Thank you.
    [Whereupon, at 1:25 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]
    
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