    [House Hearing, 115 Congress]
    [From the U.S. Government Publishing Office]

          THE RACE TO 5G AND ITS POTENTIAL TO REVOLUTIONIZE AMERICAN
                                COMPETITIVENESS

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

                                    HEARING

                                   BEFORE THE

                 SUBCOMMITTEE ON COMMUNICATIONS AND TECHNOLOGY

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                               NOVEMBER 16, 2017

                                   __________

                               Serial No. 115-79

    [GRAPHIC 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

                              GREG WALDEN, Oregon
                                     Chairman
    JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
      Vice Chairman                        Ranking Member
    FRED UPTON, Michigan                 BOBBY L. RUSH, Illinois
    JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
    MICHAEL C. BURGESS, Texas            ELIOT L. ENGEL, New York
    MARSHA BLACKBURN, Tennessee          GENE GREEN, Texas
    STEVE SCALISE, Louisiana             DIANA DeGETTE, Colorado
    ROBERT E. LATTA, Ohio                MICHAEL F. DOYLE, Pennsylvania
    CATHY McMORRIS RODGERS, Washington   JANICE D. SCHAKOWSKY, Illinois
    GREGG HARPER, Mississippi            G.K. BUTTERFIELD, North Carolina
    LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
    BRETT GUTHRIE, Kentucky              KATHY CASTOR, Florida
    PETE OLSON, Texas                    JOHN P. SARBANES, Maryland
    DAVID B. McKINLEY, West Virginia     JERRY McNERNEY, California
    ADAM KINZINGER, Illinois             PETER WELCH, Vermont
    H. MORGAN GRIFFITH, Virginia         BEN RAY LUJAN, New Mexico
    GUS M. BILIRAKIS, Florida            PAUL TONKO, New York
    BILL JOHNSON, Ohio                   YVETTE D. CLARKE, New York
    BILLY LONG, Missouri                 DAVID LOEBSACK, Iowa
    LARRY BUCSHON, Indiana               KURT SCHRADER, Oregon
    BILL FLORES, Texas                   JOSEPH P. KENNEDY, III,
    SUSAN W. BROOKS, Indiana                 Massachusetts
    MARKWAYNE MULLIN, Oklahoma           TONY CARDENAS, California
    RICHARD HUDSON, North Carolina       RAUL RUIZ, California
    CHRIS COLLINS, New York              SCOTT H. PETERS, California
    KEVIN CRAMER, North Dakota           DEBBIE DINGELL, Michigan
    TIM WALBERG, Michigan
    MIMI WALTERS, California
    RYAN A. COSTELLO, Pennsylvania
    EARL L. ``BUDDY'' CARTER, Georgia
    JEFF DUNCAN, South Carolina

                 Subcommittee on Communications and Technology

                          MARSHA BLACKBURN, Tennessee
                                     Chairman
    LEONARD LANCE, New Jersey            MICHAEL F. DOYLE, Pennsylvania
      Vice Chairman                        Ranking Member
    JOHN SHIMKUS, Illinois               PETER WELCH, Vermont
    STEVE SCALISE, Louisiana             YVETTE D. CLARKE, New York
    ROBERT E. LATTA, Ohio                DAVID LOEBSACK, Iowa
    BRETT GUTHRIE, Kentucky              RAUL RUIZ, California
    PETE OLSON, Texas                    DEBBIE DINGELL, Michigan
    ADAM KINZINGER, Illinois             BOBBY L. RUSH, Illinois
    GUS M. BILIRAKIS, Florida            ANNA G. ESHOO, California
    BILL JOHNSON, Ohio                   ELIOT L. ENGEL, New York
    BILLY LONG, Missouri                 G.K. BUTTERFIELD, North Carolina
    BILL FLORES, Texas                   DORIS O. MATSUI, California
    SUSAN W. BROOKS, Tennessee           JERRY McNERNEY, California
    CHRIS COLLINS, New York              FRANK PALLONE, Jr., New Jersey (ex
    KEVIN CRAMER, North Dakota               officio)
    MIMI WALTERS, California
    RYAN A. COSTELLO, Pennsylvania
    GREG WALDEN, Oregon (ex officio)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Marsha Blackburn, a Representative in Congress from the
      State of Tennessee, opening statement..........................     1
        Prepared statement...........................................     2
    Hon. Michael F. Doyle, a Representative in Congress from the
      Commonwealth of Pennsylvania, opening statement................     2
        Prepared statement...........................................     4
    Hon. Greg Walden, a Representative in Congress from the State of
      Oregon, opening statement......................................     5
        Prepared statement...........................................     6
    Hon. Frank Pallone, Jr., a Representative in Congress from the
      State of New Jersey, opening statement.........................     7
        Prepared statement...........................................     8
    Hon. Susan W. Brooks, a Representative in Congress from the State
      of Indiana, prepared statement.................................    10
    Hon. Leonard Lance, a Representative in Congress from the State
      of New Jersey, prepared statement..............................    10

                                   Witnesses

    Chris Pearson, President, 5G Americas; Coleman Bazelon,
      Principal, Brattle Group.......................................    11
        Prepared statement...........................................    13
        Answers to submitted questions...............................   131
    Coleman Bazelon, Principal, Brattle Group........................    26
        Prepared statement...........................................    28
        Answers to submitted questions...............................   134
    Jonathan Adelstein, President and CEO, Wireless Infrastructure
      Association....................................................    32
        Prepared statement...........................................    34
        Answers to submitted questions...............................   138
    Shireen Santosham, Chief Innovation Officer, City of San Jose....    45
        Prepared statement...........................................    47
    David Broeker, Founding CEO, Indiana Biosciences Research
      Institute......................................................    57
        Prepared statement...........................................    59
        Answers to submitted questions...............................   140

                               Submitted Material

    Op-ed by Sam Liccardo entitled, ``Why Does Verizon Care About
      Telephone Poles?'' The New York Times, October 3, 2017.........    82
    White paper from the Brattle Group entitled, The Next Wave of
      Spectrum Reallocation: The Value of Additional Mid-Band
      Spectrum Reallocations.........................................    86
    Letter of November 15, 2017, from Kevin Davis, Mayor of Hardin
      County, Tennessee, to Hon. Marsha Blackburn....................   127
    Statement of the Federal Communications Commission...............   128

          THE RACE TO 5G AND ITS POTENTIAL TO REVOLUTIONIZE AMERICAN
                                COMPETITIVENESS

                                  ----------

                          THURSDAY, NOVEMBER 16, 2017

                      House of Representatives,
         Subcommittee on Communications and Technology,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to notice, at 9:58 a.m., in
    room 2123, Rayburn House Office Building, Hon. Marsha Blackburn
    (chairman of the subcommittee) presiding.
        Present: Representatives Blackburn, Lance, Shimkus, Latta,
    Guthrie, Olson, Kinzinger, Bilirakis, Johnson, Long, Flores,
    Brooks, Collins, Costello, Walden (ex officio), Doyle, Welch,
    Loebsack, Ruiz, Dingell, Rush, Eshoo, Matsui, McNerney, and
    Pallone (ex officio).
        Also Present: Representative Duncan.
        Staff Present: Jon Adame, Policy Coordinator,
    Communications and Technology; Ray Baum, Staff Director;
    Samantha Bopp, Staff Assistant; Kelly Collins, Staff Assistant;
    Robin Colwell, Chief Counsel, Communications and Technology;
    Sean Farrell, Professional Staff, Communications and
    Technology; Margaret Tucker Fogarty, Staff Assistant; Adam
    Fromm, Director of Outreach and Coalitions; Gene Fullano,
    Detailee, Communications and Technology; Theresa Gambo, Human
    Resources/Office Administrator; Elena Hernandez, Press
    Secretary; Zach Hunter, Director of Communications; Tim Kurth,
    Senior Professional Staff, Communications and Technology;
    Lauren McCarty, Counsel, Communications and Technology; Alex
    Miller, Video Production Aide and Press Secretary; Dan
    Schneider, Press Secretary; Evan Viau, Legislative Clerk,
    Communications and Technology; Hamlin Wade, Special Advisor,
    External Affairs; and Everett Winnick, Director of Information
    Technology.

    OPENING STATEMENT OF HON. MARSHA BLACKBURN, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF TENNESSEE

        Mrs. Blackburn. The Subcommittee on Communications and
    Technology will come to order just a little bit on the early
    side of 10:00 o'clock. The chair now recognizes herself for 5
    minutes for an opening statement.
        I want welcome everyone to the first hearing of this year
    that is devoted exclusively to the promise of fifth generation
    wireless service, or 5G, and to explore the potential
    impediments to its deployment and wide-scale development.
        In the interest of time, I will submit my full opening
    statement for the record. Suffice it to say, the race to 5G is
    on across the world as we compete with other countries and
    regions. As in any competition, one can either lead, follow, or
    get out of the way. As chairman of the subcommittee, I look
    forward to working on a bipartisan basis to ensure that America
    is first to the finish line.
        At this time I recognize the subcommittee ranking member,
    Mr. Doyle, for 5 minutes for an opening statement.
        [The prepared statement of Mrs. Blackburn follows:]

                  Prepared statement of Hon. Marsha Blackburn

        Welcome to the committee's first hearing this year devoted
    exclusively to the promise of fifth generation wireless
    service, or ``5G,'' and to explore the potential impediments to
    its development and wide-scale deployment. It is imperative
    Congress tackle these challenges. This hearing is entitled:
    ``The Race to 5G and its potential to Revolutionize American
    Competitiveness.'' Let there be no mistake, the race to 5G is
    on across the world; and as in any competition, one can either
    lead, follow, or get out of the way. As Chairman of this
    Subcommittee, I look forward to working on a bipartisan basis
    to ensure America is first to the finish line.
        The promise of 5G cuts across diverse industries and
    sectors of the economy. The potential benefits include:
    enhanced mobile broadband that can provide speeds that are 10
    to 100 times faster than what exists today; ultra-low latency
    communications that are necessary for mission-critical
    applications like autonomous vehicles and remote surgery; and
    the massive machine-to-machine communications that constitute
    the ``Internet of Things.'' According to Cisco, there will be
    nearly 50 billion IoT devices connected by the year 2020. Taken
    together, the applications of 5G promise to revolutionize
    manufacturing, healthcare, transportation, city management,
    power generation and distribution, as well as law enforcement
    and emergency response.
        As we gaze towards the promise of 5G, we must also be
    mindful of the impediments to its deployment. Potential speed
    bumps along the way pertain to the harmonization of
    international technical standards, the availability of
    spectrum, and the strangling red tape of small cell siting
    requirements at the federal, state, and local levels.
        Importantly, we must keep in mind that 5G is only part of
    the communications landscape that will ensure our
    competitiveness moving forward. 5G networks will exist
    alongside LTE networks, unlicensed spectrum necessary for Wi-
    Fi, as well as traditional cable and landline networks, fiber
    optics, as well as satellite technologies. Each of these will
    continue to play prominent roles as our nation transitions to
    5G wireless connectivity.
        Information is power, and history makes clear that
    countries with the best communications have the highest
    economic growth, and a distinct competitive advantage. 5G will
    play a major part in continuing our nation's leadership in
    communications. I am pleased to convene this hearing to explore
    the promise of 5G, and to examine the challenges to its
    development and deployment. I look forward to the testimony of
    our witnesses.

    OPENING STATEMENT OF HON. MICHAEL F. DOYLE, A REPRESENTATIVE IN
             CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

        Mr. Doyle. Thank you, Madam Chair.
        And I just want to comment that today is a notice for
    Pancreatic Cancer Awareness Month. And I see some of our
    friends in the audience and colleagues wearing purple today.
    And I just want to recognize that and acknowledge what a
    terrible disease that is, and hope we find a cure someday.
        Chairman, thank you for holding the hearing. And I want to
    thank all the witnesses here before us.
        I believe that 5G holds a lot of promise and a lot of
    potential to drive American innovation, competitiveness, and
    productivity. But before I get into that, there are a few
    matters that I think need to be mentioned related to the FCC
    and their open meeting and reports of their plans to vote for
    repeal of the Open Internet Order as part of next month's open
    meeting.
        In regard to this month's open meeting agenda, many
    members, myself included, have expressed grave concerns about
    the Chairman's agenda and the impact that it will have on media
    ownership, the Lifeline Program, and the ATSC 3.0 broadcast
    transition, or lack thereof, and the Commission's item on
    copper retirement.
        Each one of these items is terrible in its own right and
    will have grave impacts to the public. I would urge the
    Chairman to delay voting these items and seek bipartisan
    consensus and to chart a path forward that benefits all
    Americans, not just the biggest companies.
        In regards to next month's open meeting and widely reported
    rumors that Chairman Pai plans to repeal the Open Internet
    Order, I would tell him to stop and consider the broader
    consequences.
        The success of the internet and the internet ecosystem has
    to be based on open access and a level playing field where
    consumers can access the services they want and edge providers
    can access customers without having to pay to get permission
    from gatekeepers or having to pay tolls.
        Removing these rules removes this essential protection and
    threatens the virtuous cycle of investment and innovation that
    has made the internet what it is today.
        So putting that aside, and to the matter at hand, 5G, next-
    generation wireless networks have incredible potential to
    revolutionize our economy and our way of life. Think back to
    2007 and 700 megahertz auction. The iPhone has just been
    introduced, but the promise of smartphone technology and
    ubiquitous high-speed access was still just a dream.
        When Steve jobs announced the iPhone, it had to be
    connected to WiFi because 3G networks at the time weren't
    responsive enough. But today, nearly 80 percent of Americans
    own smartphones, and the global app economy has grown to be
    worth more than $1.6 trillion a year globally.
        In the same way that LTE has put the internet in our
    pockets, 5G has the potential to connect every aspect of our
    lives. From smart transportation and self-driving vehicles, to
    connected medical devices and predictive diagnosis, to virtual
    and augmented reality, the promise of 5G has the potential to
    bring these technologies into reach.
        But to get to this promised land and to bring the future
    into the present, we need to chart a course that facilitates
    this technology by making new spectrum available and easing the
    deployment of new wireless infrastructure. My hope is that we
    can advance bipartisan legislation to free up additional
    spectrum to meet the needs of licensed and unlicensed
    industries.
        On the other hand, I have seen draft legislation in the
    Senate, proposals at the State level, and heard rumblings from
    the FCC and their Broadband Deployment Advisory Council that
    all seek to preempt local government with a heavy hand.
        To me, these approaches are all stick and no carrot. We
    need an approach that is collaborate, and we need to bring
    State and local governments into these discussions in a more
    productivity way.
        I am happy to see a representative from San Jose here
    today. Reading your testimony, I see that your city has big
    plans: self-driving vehicles, smart infrastructure, and using
    technology to meet the challenges you face. I am proud to say
    we have been doing all of this in Pittsburgh for quite a while
    now, and I am glad to see Silicon Valley finally catching up.
        My point is that great innovation is happening in cities
    all across the country, and local governments in cities like
    Pittsburgh, San Jose, and so many others have risen to meet
    these challenges. They don't need someone to run roughshod over
    them. They need partners that will help them meet the needs of
    their citizens.
        I believe that there is much this committee can do to
    facilitate the deployment of 5G and wireless broadband. My hope
    is that we can do in a that way that is thoughtful and
    inclusive.
        Madam Chair, I thank you, and I yield back.
        [The prepared statement of Mr. Doyle follows:]

                  Prepared statement of Hon. Michael F. Doyle

        Thank you Chairman Blackburn for holding this hearing and
    thank you to all of the witnesses for appearing before us.
        I believe that 5G holds a lot of promise and a lot of
    potential to drive American innovation, competitiveness, and
    productivity. But before I get into that, there are a few
    matters that I think need to be mentioned related to the FCC
    and their Open Meeting today, and reports of their plans to
    vote to repeal the Open Internet Order as part of next month's
    Open Meeting.
        In regards to this month's open meeting agenda, many
    Members, myself included, have expressed grave concerns about
    the Chairman's agenda and the impact that it will have on media
    ownership, the lifeline program, the ATSC3 broadcast
    transition, or lack thereof, and the Commission's item on
    copper retirement.
        Each one of these items is terrible in its own right and
    will have grave impacts on the public. I would urge the
    Chairman to delay voting these items and seek bipartisan
    consensus--and to chart a path forward that benefits all
    Americans and not just the biggest companies.
        In regards to next month's open meeting, and widely
    reported rumors that Chairman Pai plans to repeal the Open
    Internet Order, I would tell him to stop and consider the
    broader consequences. The success of the Internet and the
    Internet Ecosystem has be based on open access and a level
    playing field, where consumers can access the services they
    want, and edge providers can access customers without having to
    get permission from gatekeepers or having to pay tolls.
    Removing these rules removes this essential protection--and
    threatens the virtuous cycle of investment and innovation that
    has made the Internet what it is today.
        Putting that aside, and to the matter at hand--5G.Next
    generation wireless networks have incredible potential to
    revolutionize our economy and our way of life. Think back to
    2007 and the 700 Mega-hertz auction. The iPhone had just been
    introduced, but the promise of smartphone technology and
    ubiquitous high speed access was still a dream. When Steve Jobs
    announced the iPhone, it had to be connected to Wi-Fi because
    3G networks at the time weren't responsive enough. But today,
    nearly 80% of Americans' own smartphones and the global App
    economy has growth to be worth more than $1.6 trillion a year
    globally.
        In the same way that LTE has put the internet in our
    pockets, -G has the potential to connect every aspect of our
    lives--from smart transportation and self-driving vehicles, to
    connected medical devices and predictive diagnosis, to virtual
    and augmented reality; the promise of 5G has the potential to
    bring these technologies into reach.
        But to get to this promised land and bring the future into
    the present, we need to chart a course that facilitates this
    technology by making new spectrum available and easing the
    deployment of new wireless infrastructure. My hope is that we
    can advance bipartisan legislation to free up additional
    spectrum to meet the needs of the licensed and unlicensed
    industries.
        On the other hand, I've seen draft legislation in the
    Senate, proposals at the state level, and heard rumblings from
    the FCC and their Broadband Deployment Advisory Council, that
    all seek to pre-empt local government with a heavy hand.
        To me these approaches are all stick and no carrot. We need
    an approach that is collaborative, and we need to bring state
    and local governments into these discussions in a more
    productive way.
        I'm happy to see a representative from San Jose here today.
    Reading your testimony, I see that your city has big plans:
    self driving vehicles, smart infrastructure, and using
    technology to meet the challenges you face. I'm proud to say
    we've been doing all this in Pittsburgh for a while now--and
    I'm glad to see Silicon Valley finally catching up.
        My point is that great innovation is happening in cities
    across the country, and local governments in cities like
    Pittsburgh, San Jose, and so many others have risen to meet
    these challenges. They don't need someone to run rough-shod
    over them; they need partners that will help them meet the
    needs of their citizens.
        I believe there is much this Committee can do to facilitate
    the deployment of 5G and wireless broadband. My hope is that we
    can do so in a thoughtful and inclusive way.

        Mrs. Blackburn. The gentleman yields back.
        At this time, I recognize the chair of the full committee,
    Mr. Walden.

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

        Mr. Walden. Thank you, Madam Chair.
        And I have a very serious question for the gentleman from
    Pennsylvania. Do you know the way to San Jose?
        That was an old song, for those of you who are kind of new
    to this. The old radio guy in me coming out here. Do you want
    to sing it?
        OK. I want to welcome our witnesses. Thanks for being here
    today. We really value your testimony as we learn a lot about
    the fifth generation wireless technology, often called 5G. So
    thanks for being here, and thanks for your testimony.
        This is going to revolutionize America's competitiveness.
    In the interest of saving time, I will submit the whole
    statement for the record. But the chairman of the subcommittee
    is correct, we are in a global race to develop and deploy 5G
    networks. Let there be no mistake: The race to 5G is a sprint,
    not a marathon. Even as we speak, competitors in Europe, Asia,
    and elsewhere are working to steal the mantle when it comes to
    having the best, most robust, and fastest communication
    networks.
        I do want to make one point regarding the promise of 5G to
    our competitiveness in manufacturing, healthcare, energy, smart
    cities, and autonomous transportation. None of the applications
    enabled by 5G technology will be possible without adequate
    spectrum, and all the rhetoric around the race to 5G will be
    for nothing if we do not update the Communications Act to allow
    the Federal Communications Commission to deposit upfront
    payments from prospective spectrum auction bidders directly
    with the Treasury.
        Current law prevents the Commission from doing so. So I
    want to applaud the chairman of this subcommittee for including
    provisions in the FCC reauthorization bill to allow the
    Commission to do so.
        I also want to recognize the bipartisan work of
    Representatives Guthrie and Matsui in introducing standalone
    legislation to do the same thing. Thank you for that. I think
    we are all on the same page here.
        But let me be clear. Absent a change in law, the FCC can't
    hold any auction of consequence to bring about the 5G
    revolution that we must encourage. So we all need to work
    together on a bipartisan basis to change that law so the
    Commission can again hold meaningful spectrum auctions. The
    inability to do so will mean the loss of billions in auction
    proceeds for deficit reduction.
        So, anyway, thank you for being here. Thanks for your
    testimony.
        And, Madam Chair, with that, I will yield back.
        [The prepared statement of Mr. Walden follows:]

                     Prepared statement of Hon. Greg Walden

        Thank you, Madame Chairman. I want to welcome our witnesses
    to this hearing on fifth generation wireless technology, often
    called ``5G,'' and its potential to revolutionize American
    competitiveness.
        The Chairman of the Subcommittee is correct--we are in a
    global race to develop and deploy 5G networks. Let there be no
    mistake: the race to 5G is a sprint, not a marathon. Even as we
    speak, competitors in Europe, Asia, and elsewhere are working
    to steal the mantle when it comes to having the best, most
    robust, and fastest communications networks.
        Mobile, cellular technology was developed in the United
    States first. We have seen it evolve from first generation
    networks that were only capable of voice service, to digital
    second-generation networks capable of voice and text, to third
    generation networks capable of voice, text, and basic Internet,
    to today's fourth generation LTE networks that unleashed true
    mobile broadband and video service. Approximately every 10
    years American consumers have seen a generational leap in
    wireless connectivity and applications. Just as we were the
    first to deploy mobile technology, so we must be first to
    deploy 5G throughout the ecosystem of networks, services, and
    applications that constitute our communications architecture.
        So, what is 5G? In short, 5G represents the next
    generational shift that will provide broadband speeds faster
    than existing wireless networks by at least an order of
    magnitude. It will do so by combining existing low- and mid-
    band spectrum with higher, millimeter-band frequencies
    previously thought to be unusable for mobile broadband. It is
    only through combining low-, mid-, and high-band spectrum that
    we can realize the full promise of 5G in urban, suburban, and
    rural areas.
        It's been noted that 5G will enable enhanced mobile
    broadband, ultra-low-latency, and massive machine-to-machine
    communications. Examples of these benefits are in power
    generation and distribution through smart grid technology such
    as sensors on substations to report outages, as well as supply
    and demand readings on transmission lines that will allow
    dynamic pricing on smart home meters--potentially saving
    consumers hundreds of dollars annually on their power bills. We
    also anticipate increased efficiencies in the manufacturing
    sector through the application of 5G enabled sensors,
    controllers, and data analytics that allow for greater
    automation, predictive maintenance, and supply chain
    management.
        One of the most prominent examples of 5G applications is in
    autonomous vehicles. Earlier this year, our committee, and then
    the full House, unanimously voted for the first self-driving
    car legislation ever considered by Congress--the SELF DRIVE
    Act. This bill is critical to the development and deployment of
    self-driving car technology, which has the potential to save
    tens of thousands of lives each year. But the regulatory
    certainty provided by the SELF DRIVE Act will depend on the
    availability of spectrum. If America is to win the race to 5G,
    then we must figure out how to make more spectrum available for
    commercial service in addition to the regulatory reforms and
    international harmonization necessary to making this technology
    a reality.
        Lastly, and most importantly, I want to emphasize that all
    the rhetoric around the race to 5G will be for nothing if we do
    not update the Communications Act to allow the Federal
    Communications Commission (FCC) to deposit upfront payments
    from prospective spectrum auction bidders directly with the
    Treasury. Current law prevents the Commission from doing so. I
    want to applaud the Chairman of this Subcommittee for including
    provisions in the FCC Reauthorization bill to allow the
    Commission to do so. I also want to recognize the bipartisan
    work of Representatives Guthrie and Matsui in introducing
    stand-alone legislation to do the same thing. Let me be clear:
    absent a change in law, the FCC cannot hold any auction of
    consequence to bring about the 5G revolution. We must all work
    together on a bipartisan basis to change the law, so the
    Commission can again hold meaningful spectrum auctions. The
    inability to do so will mean the loss of billions in auction
    proceeds for deficit reduction.

        Mrs. Blackburn. The gentleman yields back.
        At this time, I recognize the ranking member of the full
    committee, Mr. Pallone, for 5 minutes for an opening.

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

        Mr. Pallone. Thank you, Madam Chairman.
        This Congress, Democrats on this committee have focused on
    protecting security, providing economic opportunities, and
    promoting democracy. Faster wireless networks have a potential
    to do all three.
        These technologies can make us safer by helping first
    responders react faster after an emergency or disaster. They
    can offer economic opportunity by helping people apply for jobs
    or train for a new career. And they can improve civic
    engagement by keeping people better connected with their
    government.
        People increasingly connect to the government using only
    their smartphones. That is especially true for the most
    vulnerable among us. Unfortunately, when they try to reach
    their government for help, too often they find Web sites that
    do not work on their mobile devices.
        And that is why I introduced the Connected Government Act
    earlier this year with Congresswoman Robin Kelly that was
    passed by the full House last night. Our bill ensures that all
    new Federal agency Web sites are designed to work well on
    mobile devices.
        And today I will look forward to discussing other ways that
    5G networks can serve all of our communities. While we have
    heard a lot this year about the importance of broadband in
    rural areas, today's hearing focuses on new technologies best
    designed for urban centers. These 5G technologies could present
    new opportunities for low-income Americans in urban areas who
    often struggle to pay for their connections.
        And I know that some say that speeding deployment of these
    networks means that we must sacrifice environmental
    protections, that we must undermine tribal sovereignty, and
    that we need to block our local governments. But I urge my
    colleagues to look passed these naysayers. Let's find a path
    that promotes broadband deployment while still respecting the
    public interest.
        And I believe that the LIFT America Act, which was
    introduced by the Democrats on this committee earlier this
    year, does just that. Our bill ensures high-speed broadband
    deployment to 98 percent of the country without jeopardizing
    the environment, city governments, or tribal rights.
        It is unfortunate that while we are working here today to
    bring high-speed wireless broadband to urban areas, the FCC is
    working against us. As we speak, they are voting to kill the
    Lifeline Program as we know it, effectively taking wireless
    phones out of the hands of the people who need them the most.
    They are acting to senselessly cut the wireless lifeline to 7.3
    million Americans. And that is cruel, particularly when some of
    those Americans live in places that are still recovering from
    natural disasters.
        So I hope they reconsider and work with Congress to help
    those who need it most. Mr. Doyle talked about all the terrible
    things that we expect from the FCC over the next days or weeks,
    and I want to join in his comments.
        But with that, I thank the witnesses.
        And I would like to yield the rest of my time, half to
    Congresswoman Matsui, and other half to Congressman McNerney.
    So I yield now to Congresswoman Matsui.
        [The prepared statement of Mr. Pallone follows:]

                 Prepared statement of Hon. Frank Pallone, Jr.

        Thank you Madam Chairman. This Congress, Democrats on this
    Committee have focused on protecting security, providing
    economic opportunities, and promoting democracy. Faster
    wireless networks have the potential to do all three.
        These technologies can make us safer by helping first
    responders react faster after an emergency or a disaster. They
    can offer economic opportunity by helping people apply for jobs
    or train for a new career. And they can improve civic
    engagement by keeping people better connected with their
    government.
        People increasingly connect to the government using only
    their smartphones. That's especially true for the most
    vulnerable among us. Unfortunately, when they try to reach
    their government for help, too often they find Web sites that
    do not work on their mobile devices.
        That's why I introduced the Connected Government Act
    earlier this year with Congresswoman Robin Kelly that was
    passed by the full House last night. Our bill ensures that all
    new federal agency Web sites are designed to work well on
    mobile devices.
        Today, I look forward to discussing other ways that 5G
    networks can serve all of our communities. While we have heard
    a lot this year about the importance of broadband in rural
    areas, today's hearing focuses on new technologies best
    designed for urban centers. These 5G technologies could present
    new opportunities for low-income Americans in urban areas who
    often struggle to pay for their connections.
        I know that some say that speeding deployment of these
    networks means that we must sacrifice environmental
    protections, that we must undermine tribal sovereignty, and
    that we need to block our local governments. But I urge my
    colleagues to look past these naysayers. Let's find a path that
    promotes broadband deployment while still respecting the public
    interest.
        I believe that the LIFT America Act-which was introduced by
    the Democrats on this Committee earlier this year-does just
    that. Our bill ensures high-speed broadband deployment to 98
    percent of the country, without jeopardizing the environment,
    city governments, or tribal rights.
        It is unfortunate that while we are working here today to
    bring high-speed wireless broadband to urban areas, the FCC is
    working against us. As we speak, they are voting to kill the
    Lifeline program as we know it, effectively taking wireless
    phones out of the hands of the people who need them the most.
    They are acting to senselessly cut the wireless lifeline to 7.3
    million Americans. That's cruel, particularly when some of
    those Americans live in places that are still recovering from
    natural disasters. I hope they reconsider and work with
    Congress to help those who need it most.
        With that, I thank the witnesses, and I would like to yield
    one minute of time to Congresswoman Matsui and one minute of
    time to Congressman McNerney.

        Ms. Matsui. Thank you, Ranking Member Pallone.
        Additional spectrum will be critical for both 5G and
    advancements in technology and innovation. Carriers and
    broadband providers will need to find creative ways to free up
    bandwidth to meet consumer needs in a 5G-and-beyond world. This
    would be necessary to account for the Internet of Things
    economy, autonomous vehicles, virtual reality, and new
    innovations that we have yet to hear about.
        A realistic 5G-and-beyond strategy will need to be creative
    and will not be a one-size-fits-all solution. I think that
    technologies like blockchain could play an interesting role for
    spectrum sharing and one that could potentially maximize the
    efficient use of spectrum bands.
        Thank you. And I yield to Mr. McNerney.
        Mr. McNerney. Well, I thank the ranking member, and I thank
    my friend and colleague from Sacramento.
        I am basically going to repeat what the ranking member
    said. As we sit here today holding a hearing about increasing
    connectivity, the FCC is voting on an item that would do just
    the opposite; namely, a proposal to dismantle the Lifeline
    Program.
        This will disconnect millions of low-income Americans. In
    my district alone, there are more than 56,000 households that
    participate in the Lifeline Program. The FCC Chairman's
    proposal will be absolutely devastating for those folks.
        We all have constituents who rely on this program for
    essential communication services, all of us have constituents,
    such as getting in touch with family and friends and obtaining
    help during emergencies. We owe it to our constituents to help
    them stay connected.
        While I look forward to the hearing and I appreciate the
    witnesses coming today, I can't help but think about how today
    will be a serious step backward for connecting Americans.
        Mr. Chairman, I yield back.
        Mr. Pallone. And I yield back, Madam Chairman.
        Mrs. Blackburn. The gentleman yields back.
        Mr. Walden. Madam Chair.
        Mrs. Blackburn. Mr. Walden, you are recognized.
        Mr. Walden. Well, with the indulgence of the committee,
    today likely marks the last day of one of our veteran staff
    members, David Redl, who has worked for the committee for the
    last 7 years, was my chief counsel on the telecommunications
    subcommittee, and continued on in that role under our current
    chairwoman until the administration decided to pluck him from
    us, rather slowly. But that was the Senate, actually. The
    Senate was slow.
        But they have now confirmed him, and we have every reason
    to believe the President will sign the paperwork today and
    David Redl will go off into the administrative landscape of the
    NTIA where he will be on a completely faithful search for more
    spectrum to free up and make available.
        So if we could honor our staffer, David Redl.
        [Applause.]
        Mr. Walden. And with that, Madam Chair, I yield back. And
    we get back his section of the payroll, too. So thank you.
        Mrs. Blackburn. That is correct. And we wish Mr. Redl well.
    And we should send our friends in the Senate a case of Red Bull
    and encourage them to work more expeditiously as they approach
    the issues that he is going to handle for the administration.
        This concludes the member opening statements. The chair
    would like to remind members that, pursuant to the committee
    rules, all members' opening statements will be made a part of
    the record.
        At this point, I would like to ask unanimous consent to
    enter into the record the opening statement of Mrs. Brooks and
    other members who may want to submit.
        Without objection, so ordered.
        [The information follows:]

                   Prepared statement of Hon. Susan W. Brooks

        Thank you, Mr. Chairman.
        I'm thrilled to be here today for this important hearing
    and would like to thank all of the witnesses for being here.
    I'm especially thrilled to have a Hoosier witness here, David
    Broecker, from the Indiana Biosciences Research Institute
    representing the great innovations occurring in our state.
        I have become increasingly engaged on efforts to empower 5G
    for a number of reasons. I'm proud that Indiana is one of
    thirteen states that have enacted state legislation to
    streamline the deployment of small cell networks, Indianapolis
    is an AT&T test site for 5G evolution build-out, and we have
    brilliant leaders like David working to innovate and build our
    communities.
        As the saying goes, innovation waits for no one, and for
    our economy to move at the speed of innovation, we must support
    new and emerging technologies. I recently co-founded the 5G
    Caucus with my colleague Congresswoman Debbie Dingell as a
    means to educate members and staff about how 5G will
    revolutionize our communities and the role we, as policymakers,
    need to play to empower 5G. Unfortunately, Congress isn't known
    for moving fast, and it is difficult for Congress to keep up
    with the speed of innovation.
        Establishing a pipeline of new spectrum auctions to help
    meet America's mobile needs, promoting infrastructure reform to
    unlock tens of billions in 5G investment, and ensuring that
    wireless operators have rights to access municipal
    infrastructure in a timely manner are all key aspects as we
    work to unleash the power of 5G. Any regulations we consider
    should act like guardrails--not roadblocks or speed bumps--so
    that 5G pioneers can create the next generation of advancements
    within the guardrails--instead of having to navigate around a
    roadblock that would stifle or even prohibit technologies that
    improve the way we live our lives.
        5G means the opportunity for faster emergency response
    times that can save lives, smart cities, remote surgery, and
    unleashing the potential of the anticipated 50 billion new
    internet of things connected devices coming online by 2020.
        I look forward to leading with Congresswoman Dingell on
    this issue and working together to advance sound policy that
    unlocks the economic potential of 5G and maintains and
    strengthens US leadership in next-generation technology.
                                  ----------

                    Prepared statement of Hon. Leonard Lance

        Thank you Madam Chairman and welcome to our distinguished
    panel. Thank you for being with us here today.
        Wireless services have come a long way over the last 50
    years. The jump in capabilities from the first iteration of
    cellular technology, developed largely from the work done at
    Bell Labs in New Jersey, to the current 4th Generation LTE has
    been immense. However, these past innovations pale in
    comparison to the potential 5G has to revolutionize wireless
    communications. From improved data rates and speeds for
    consumers, to commercial applications in industries such as
    health care, agriculture, energy, education and manufacturing,
    5G's potential applications are almost limitless.
        As countries around the globe compete to lead in 5G, the
    district I serve is a hub of 5G development, thanks to the
    companies such as Verizon, AT&T, Nokia, Qualcomm and Samsung.
    Because of companies like these, New Jersey is leading the
    effort to maintain the United States as the leader in wireless
    innovation.
        American companies have already invested billions of
    dollars into 4G LTE and as they continue to invest in 4G, they
    have promised to invest hundreds of billions more in 5G.
    According to a recent report by Accenture, Americans will use
    five times more mobile data in 2021 than they do now. 5G has
    the potential not only to help networks manage this
    unprecedented data demand, but also to add over 3 million jobs
    in the next seven years and support 22 million jobs by the year
    2035.
        However, private investment alone will not win us the
    global race to 5G. Policymakers in Congress and the Federal
    Communications Commission must pursue policies to create
    regulatory regime that is conducive to the deployment of 5G
    infrastructure and ensure there is sufficient spectrum
    available for commercial use to meet future needs. We must help
    facilitate innovation by fueling the spectrum pipeline and
    removing regulatory barriers to deployment.
        Wireless networks are complex and require a mix of
    different types of spectrum to meet coverage and capacity
    requirements. As our demand for wireless connectivity continues
    to skyrocket, the FCC and Congress must examine spectrum use in
    high, mid, and low bands.
        Thank you again for being with us here today and I look
    forward to your testimony and discussion on this important
    topic.

        Mrs. Blackburn. We want to thank our witnesses for being
    here today and taking the time to testify for the subcommittee
    and for preparing your testimony in advance.
        Today's witnesses are going to have the opportunity to give
    their opening statements, followed by a round of questions from
    the members. We are fully aware that we are on an abbreviated
    schedule for today as the President will arrive at 11:30 for
    the Republican Conference meeting.
        We want to welcome our witnesses. Chris Pearson, president
    of 5G Americas. Dr. Coleman Bazelon, principal of the Brattle
    Group. The Honorable Jonathan Adelstein, who has been with us
    so many times, former FCC Commissioner and the current
    president and CEO of the Wireless Infrastructure Association.
    Shireen Santosham, the chief innovation officer for the city of
    San Jose, California--and she does know the way to San Jose.
    David Broeker, the founding CEO of the Indiana Biosciences
    Research Institute.
        We appreciate that each of you are here today and for
    preparing your testimony.
        We will begin the panel with you, Mr. Pearson. You are
    recognized for 5 minutes for an opening.

     STATEMENTS OF CHRIS PEARSON, PRESIDENT, 5G AMERICAS; COLEMAN
        BAZELON, PRINCIPAL, BRATTLE GROUP; JONATHAN ADELSTEIN,
    PRESIDENT AND CEO, WIRELESS INFRASTRUCTURE ASSOCIATION; SHIREEN
      SANTOSHAM, CHIEF INNOVATION OFFICER, CITY OF SAN JOSE; AND
       DAVID BROEKER, FOUNDING CEO, INDIANA BIOSCIENCES RESEARCH
                               INSTITUTE

                       STATEMENT OF CHRIS PEARSON

        Mr. Pearson. Chairman Blackburn, Ranking Member Doyle, and
    members of the subcommittee, thank you for having me here
    today. I am Chris Pearson, president of 5G Americas, an
    association representing mobile operators and vendors from
    around our region. 5G Americas' board of governors includes
    AT&T, Cisco, CommScope, Ericsson, HPE, Intel, Nokia, Qualcomm,
    Samsung, Sprint, and T-mobile.
        5G Americas is also a Market Representative Partner of the
    standards forum 3GPP, where 5G is being standardized, and works
    with regulators around the world.
        5G Americas represents our region in the Global 5G MOU
    Event twice a year in countries in Asia, Europe, and the
    Americas that are dedicated to winning the race to 5G. And next
    year, 5G Americas hosts our event here in the United States.
        5G, or fifth generation of wireless technology, is
    comprised of three use cases: enhanced or faster Mobile
    Broadband; Massive Machine Type Communications, also known as
    the Internet of Things; and Ultra-Reliable Low Latency
    Communications, often called critical communications.
        So 5G is just not about faster broadband, although it would
    be nice to download that movie in seconds before you board that
    plane. It is about other things as well. Machine Type and
    critical communications will enable connected, autonomous
    vehicles and revolutionize our industries and lives with
    enhanced productivity, smarter cities and homes, safer roads,
    and more effective healthcare. Our industry is expected to
    invest $275 billion in 5G, resulting in $500 billion in GDP
    growth and millions of new jobs.
        But this revolution requires more spectrum and efficient
    siting of wireless facilities. So we are grateful for this
    subcommittee's leadership on spectrum and its continued focus
    on ensuring that there is adequate spectrum for 5G.
        We support Mr. Guthrie and Ms. Matsui's spectrum auction
    receipts bill, which the FCC needs to hold any further auction,
    and urges the committee to act on that quickly.
        Spectrum will be required for 5G in every range, low band,
    mid-band, and high band. Other countries around the world are
    making mid-band available for 5G, and the U.S. should, too.
        The countries that make new globally harmonized spectrum
    available for 5G are the ones that are going to lead this race.
    And thanks to this subcommittee, the U.S. led the way in 4G
    because it made new spectrum available for auction at 700
    megahertz and also in the mid-bands.
        To create the global economies of scale that benefit U.S.
    consumers and businesses, we must have globally harmonized
    spectrum for 5G. In addition to allocating sufficient amounts
    of harmonized low-, mid-, and high-band spectrum, the U.S. must
    expedite siting procedures for the small cells that will be
    necessary for 5G. And for this reason, 5G Americas also
    supports the MOBILE NOW bill.
        Mobile data traffic is expected to grow seven to eight
    times in just a few short years, and meeting that demand will
    require operators to densify their networks, requiring
    streamlined procedures for all those new small cells. As we
    will hear from Mr. Adelstein, we must have model siting
    procedures that allow network densification.
        5G Americas supports the FCC's work in its BDAC advisory
    council bringing together stakeholders to recommend model codes
    for State and local government siting. And as necessary, should
    that effort not result in the streamlined siting required for
    U.S. leadership, 5G Americas supports this Congress or the FCC
    for establishing some sort of national standards for small cell
    siting.
        Additionally, 5G Americas supports the FCC's order on
    eliminating separate historic review for replacement poles. 5G
    Americas urges the FCC to do even more to eliminate unnecessary
    reviews in rights-of-way without affecting the historic areas.
        Again, thank you, and I look forward to your questions
    today.
        [The prepared statement of Mr. Pearson follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mrs. Blackburn. The gentleman yields back.
        Dr. Bazelon, you are recognized.

                      STATEMENT OF COLEMAN BAZELON

        Mr. Bazelon. Thank you.
        I would like to thank the committee for the opportunity to
    testify today on this important topic.
        I started my career as an analyst at the Congressional
    Budget Office just as the second generation cellular services
    were beginning to be deployed. The developments of third and
    fourth generation technologies have helped fulfill the promise
    of wireless.
        The same will be true of, 5G which will bring unprecedented
    speeds and low latency to wireless networks, supporting new
    applications and development of an Internet of Things. And as
    with those earlier developments, additional spectrum is needed
    to fulfill the 5G promise.
        Unlike the previous technological advancements, 5G combines
    new technologies with a new architectural model of how spectrum
    is deployed. The architecture of a robust 5G network will
    require spectrum in a variety of bands: low-band spectrum below
    1 gigahertz for wide-area and long-range communications; mid-
    band spectrum between 1 and 6 gigahertz for applications that
    would benefit a combination of coverage and capacity; and high-
    band spectrum for short-range communications requiring fast
    data rates and low latency. All three pieces of this spectrum
    trifecta will be crucial for the successful deployment of 5G
    networks.
        The Principle of Spectrum Reallocation states that when the
    value of a band of spectrum in a new use exceeds the value in
    an existing use, plus the cost of transitioning the
    frequencies, it should be reallocated.
        This simple principle, that benefits should exceed costs,
    can face many obstacles in practice. Incumbent users, whether
    TV broadcasters or government agencies, tend to be reluctant to
    relinquish spectrum assignments. Consequently, mechanisms where
    incumbents are compensated are beneficial because they overcome
    resistance.
        In fact, anything that can be done to smooth the transfer
    of spectrum is helpful. For example, the recently introduced
    Spectrum Auction Deposits Act, which overcomes impediments
    identified by Chairman Pai to holding spectrum auctions, will
    facilitate future auctions, and the Spectrum Reallocation Fund
    will help provide frequencies for those auctions.
        The new 5G deployments will have profound implications for
    spectrum value. On the one hand, being able to integrate
    massive amounts of high-band spectrum into commercial mobile
    networks will flood the market with spectrum capacity, at least
    in dense or more populous areas and for applications that can
    utilize the higher frequency spectrum. On the other hand, these
    new networks will enable new wireless services and increase
    consumer expectations about throughput and reliability.
        The net impact of these two offsetting effects is
    uncertain, and overall spectrum values could go up or down. But
    within the overall net impact on spectrum values, there is a
    clear implication for different types of spectrum from
    increased user expectations for throughput, mobility, latency
    that will be fostered by the new 5G deployments.
        The value of mid-band spectrum used for capacity outside
    the areas served by high-band 5G deployments should increase
    because demand for network capacity, reset to a user experience
    based on a higher level of throughput in the urban areas, will
    be greater in those non-urban areas.
        The Principle of Spectrum Reallocation is applicable to all
    bands that make up the 5G spectrum trifecta, but I will focus
    on mid-band spectrum, the connective tissue of 5G deployments.
        In my accompanying paper submitted to the committee that
    CTIA released yesterday, I examined the value of making an
    additional 100 megahertz of mid-band spectrum available in the
    1,300 to 1,350 megahertz and 1,780 to 1,830 megahertz bands.
    After accounting for a moderation in spectrum value compared to
    recent highs, I find that a 50 plus 50 megahertz paired band
    would be expected to raise $63 billion in auction receipts.
    Making those frequencies available is expected to cost up to an
    estimated $8 billion in relocating existing users, providing
    them with at least equivalent and in many cases improved
    wireless infrastructure. Consequently, this band could be
    expected to raise $55 billion in net receipts.
        Admittedly, there is some uncertainty about forecasting
    future auction receipts. Frankly, it is not for the faint of
    heart. But as long as the auction of this 100 megahertz of mid-
    band spectrum raises more than $8 billion, a paltry amount for
    so much spectrum that could be used for mobile broadband,
    reallocating the Federal users and auctioning the reclaimed
    spectrum will create value.
        The application of the Principle of Spectrum Reallocation
    does not end here. For example, all or part of the 3.7 to 4.2
    gigahertz band could be valuably deployed in support of 5G
    networks.
        I have investigated this band and found that, even with
    conservative assumptions about the value of both the existing C
    band services and potential new deployments, reallocating some
    or all of this band would likely create value. A voluntary
    mechanism that ensures incumbents benefit from any transition
    will help facilitate making additional needed frequencies
    available for new 5G networks.
        Thank you.
        [The prepared statement of Mr. Bazelon follows:]
      [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mrs. Blackburn. The gentleman yields back.
        Mr. Adelstein, you are recognized for 5 minutes.

                    STATEMENT OF JONATHAN ADELSTEIN

        Mr. Adelstein. Thank you, Madam Chairman and Ranking Member
    Doyle, members of the subcommittee, for the opportunity to
    testify. This hearing today is historic for a number of
    reasons, not just the topic, but because it is David Redl's
    last time on that side of the dais and not over here where he
    will soon be.
        We congratulate Mr. Redl on his rapid confirmation by the
    Senate. And you wonder why I say ``rapid.'' By my standards,
    what I went through, it is actually pretty quick. So it is all
    relative.
        I represent the Wireless Infrastructure Association that
    represents companies that build, own, manage, and maintain
    wireless facilities across the country. And we applaud the
    leadership of this subcommittee on promoting wireless broadband
    deployment.
        The wireless industry stands ready to make enormous
    investments, up to $275 billion to build out 5G. It will lead
    to 3 million new jobs and $500 billion to boost GDP.
        And the U.S. is really well-positioned to lead 5G,
    especially with David Redl as head of the NTIA. It will be
    something that will face stiff competition, though. We have
    competition from around the globe. Fortunately, this
    subcommittee, the FCC, and the administration have all shown a
    clear commitment to policies that encourage 5G investment.
        5G could prove one of the most transformational
    technologies in the history of technology. But as promising as
    the standard for 5G is, it is only as good as the
    infrastructure on which it is deployed. 5G will involve up to a
    hundred times more antenna locations than 3G or 4G, so all
    types of infrastructure are needed. And fully realizing the
    potential of 5G depends on how effectively it gets deployed.
    Responsible infrastructure deployment is key.
        Our industry works very closely with local governments,
    like San Jose. But if a company carelessly circumvents
    localities, it rightly angers the community and creates
    resistance to siting new facilities, and that can slow 5G.The
    WIA and its members seek to work in partnership with
    localities, because that is the best way to develop networks
    over the long-term.
        This subcommittee has long promoted responsible deployment.
    In fact, the great example of that is Section 6409(a) of the
    Spectrum Act. The law clearly sped 4G deployment by allowing
    upgrades on cell towers without burdensome zoning reviews, and
    it will continue to provide relief for the deployment of 5G
    through colocation, which is preferred by localities.
        Many communities welcome wireless deployments with
    streamlined siting policies. In fact, 13 States have passed
    laws to streamline deployment. I think Congress can bring all
    communities up to that same high standard by speeding the
    approval of permits and applications. Congress should provide a
    deemed granted remedy if a locality fails within a prescribed
    shot clock to approve an application.
        The FCC system for working with tribes who indicate a
    possible historic cultural interest often far outside of tribal
    lands is not working properly. It should be updated to exclude
    deployments with no new ground disturbance and ensure that fees
    are reasonable and appropriate.
        Congress should also modernize the historic preservation
    laws by excluding certain small cell deployments from
    unnecessary reviews. And Congress should revamp the Byzantine
    process of siting on Federal lands to speed deployment on rural
    areas, something we have concentrated on, on the BDAC, in the
    subcommittee I chaired.
        Another barrier to 5G is the growing gap between the skills
    of today's workers and the skills needed to build tomorrow's
    wireless networks. Many of our members report they are having
    difficulty in filling positions with qualified applicants.
        Now WIA is working to build bridges that will jump across
    that gap so that we can bring apprenticeships for the first
    time into the wireless industry. WIA is also developing
    training programs to support that, because we can't afford the
    lack of trained workers to slow the path to 5G.
        We are encouraged that Congress and the administration are
    seeking new ways to partner with industry on job training and
    on apprenticeship programs, because thousands of new high-wage
    jobs await those with the proper skills.
        The movement to 5G has the potential to unleash a wave of
    job creation, economic growth, and greater global
    competitiveness. That is why the subcommittee's leadership is
    so critical, and we are so grateful that you held this hearing
    today and invited me to testify. So thank you again for holding
    this hearing.
        [The prepared statement of Mr. Adelstein follows:]
       [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mrs. Blackburn. Thank you.
        Ms. Santosham, you are recognized, 5 minutes.

                     STATEMENT OF SHIREEN SANTOSHAM

        Ms. Santosham. Good morning, Chairman Blackburn, Ranking
    Member Doyle, and members of the subcommittee. I am Shireen
    Santosham. I am chief innovation officer for Mayor Sam Liccardo
    in San Jose, California, the largest city in Silicon Valley.
    Thank you for the opportunity to discuss how cities are
    creating favorable environments to speed deployment of
    broadband.
        I want to particularly thank Congresswoman Eshoo for her
    focus on this issue and her excellent service for all
    Californians. We are truly fortunate to have her represent us.
        Cities large and small are eager for increased broadband
    investment and competitive choices for our residents. We
    understand the benefits of broadband to economic growth and
    creating an on-ramp to opportunity for our young people to
    learn and participate in the jobs of tomorrow.
        In San Jose we welcome technological advancement with open
    arms. This year alone we have launched an autonomous vehicle
    initiative, a crowdsourced civic challenge utilizing drones,
    entered into public-private partnerships with companies like
    Facebook. Just this past Monday our city council unanimously
    passed our broadband and digital inclusion strategy that
    includes several recommendations to streamline deployment and
    pave the way for technologies like 5G.
        San Jose is excited and ready to welcome 5G to our
    community. But at the same time, we have 95,000 residents in
    our city without broadband access. Think about that. In the
    heart of Silicon Valley, nearly 10 percent of our residents
    don't have adequate access to the internet.
        It breaks my heart every time I hear about children in our
    community who are trying to do their homework on a mobile
    device outside their school because they don't have internet
    access at home. They are losing the race before it starts.
        So while I welcome this next generation of the internet, we
    can't leave people further behind in the process. How this
    technology is deployed and who benefits matters.
        Unfortunately, much of the State-level legislation that
    recently passed in over a dozen States to streamline deployment
    goes too far and gives telecommunications industries the
    benefit of a public utility without the obligation to serve
    everyone at affordable rates.
        I am going to tell you about one of these bills, SB 649,
    which was wisely vetoed by our Governor in California and
    highlights issues relevant to Federal action that we believe
    are important for you to consider.
        The first is the extremely low caps that allowed cities to
    charge--that were allowed for placing small cells in the public
    right-of-way at cost. In fact, upon an independent review,
    these rates were found to be below cost, resulting in the State
    obliged to reimburse cities for the difference had it been
    signed into law.
        Not only would the bill cost cities, but it also stripped
    away the ability of local governments to incentive build-outs
    in traditionally underserved areas. In San Jose, we have
    digital deserts in the middle of our city where low-income
    Latino families live. By using market-based pricing of assets
    and negotiating citywide deployments, we can incentive the
    telecom industry to build out in these underserved areas.
    Preemption of local authorities to charge market rates and
    giving by-right access to industry removes these incentives.
        Second, equipment size and scale matters. Although the
    industry describes small cells as the size of a pizza box, the
    dimensions listed under SB 659 for small cells were over 21
    cubic feet, the size of a standard refrigerator. Such massive
    pieces of equipment need adequate safety review, and
    communities will want input if thousands are deployed on their
    sidewalks.
        Finally, the public benefits from local governments acting
    as a referee for the competing needs of the finite space in the
    public rights of way.
        So how can we move forward? We need a balanced approach to
    ensure that we are speeding deployment while benefiting the
    public broadly. Cities can create one-stop shops for providers,
    co-create design standards with industry, negotiate citywide or
    batch process permits, and offer transparent and fair pricing.
        On the Federal level, we must avoid preemption of cities if
    we want to see equitable and safe deployment. The Federal
    Government should instead focus on developing the capacity of
    local leaders to manage deployments in community-centric ways.
    The Federal Government should also be careful not to pick
    winners and losers through policy.
        On behalf of Mayor Liccardo and the city of San Jose, I
    want to thank the subcommittee for inviting me to participate
    in this hearing today. I look forward to questions, and we are
    willing and able to help in any of your districts that are also
    struggling with some of these questions of deployment.
        Thank you.
        [The prepared statement of Ms. Santosham follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mrs. Blackburn. The gentlelady yields back.
        Mr. Broeker, you are recognized for 5 minutes.

                       STATEMENT OF DAVID BROEKER

        Mr. Broeker. Good morning. Thank you, Committee Chair
    Blackburn, Ranking Member Doyle, and Congresswoman Brooks and
    other honorable members of this committee, for inviting me here
    today to talk about the impact of 5G on the future of life
    sciences and advanced manufacturing.
        My name is David Broeker, and I am the founder and
    principal of a legacy bioscience consulting company. I help
    entrepreneurs and innovators in the life sciences area advance
    their ideas to the marketplace. And I am also the founding
    president and CEO of the Indiana Biosciences Research
    Institute.
        Indiana is home to one of the most diverse, robust life
    science sectors in the country, with companies in
    biotechnology, pharmaceuticals, medical devices, agriculture,
    animal health, and diagnostics. Eleven percent of our workforce
    are employed by these companies.
        The State has consistently been second to our colleagues
    from California as the largest exporter of life science
    products in the United States, exporting more than $9.9 billion
    in products and contributing over $62 billion to the Indiana
    economy in 2016.
        Across life sciences today, biology and applied data
    science are converging to help researchers and scientists
    understand the genome and the massive amounts of data that are
    being generated every day. This convergence will require now
    capabilities and infrastructure like 5G to allow researchers to
    share these large data streams in ways that are better, faster,
    cheaper.
        The ability to do this will enhance discovery for new
    medicines and treatments for patients and enable the Massive
    Internet of Medical Things that are upon us to create new
    innovation.
        The development of the Massive Internet of Medical Things
    will connect patients to their physicians through telemedicine,
    augmented and virtual reality, interventions. It will make
    digital technologies like smart devices, wearables and sensors
    a part of the delivery of care to improve patients' lives. And
    when combined with other enabling technologies like blockchain,
    data standards, and encryption, it will create a shift away
    from place-dependent electronic medical records to virtual
    individual health records that will improve the quality of care
    through personalized medicine.
        5G technology will enable life science manufacturers to
    create better and more secure supply chains that will connect
    patients and distribution partners as well as create
    opportunities to improve the quality and productivity of the
    research and development process and the ultimate tech transfer
    and manufacturing of these products.
        For example, 5G technology will enable the real-time
    capture of appropriate patient information to improve safety
    monitoring and adverse event reporting. It will also allow for
    100 percent tracking of product distribution to the patient.
        It will improve the efficiency of clinical studies by
    providing 100 percent verifiable external data capture and
    exchange with researchers and development partners like
    contract research organizations. It will improve the technology
    transfer within companies between development teams and
    manufacturing operations to shorten timelines and bring
    innovations to the market faster.
        5G will also create opportunities to connect the patient
    literally to the shop floor and integrate advanced
    manufacturing capabilities like 3-D printing to make customized
    devices, cell-based therapies and therapeutics.
        Finally, 5G will result in more automation of
    manufacturing, improving the speed and efficiency, creating
    more manufacturing jobs, and enhancing the technology focus
    within the current manufacturing operations.
        Just like the Nation's interstate highway system made the
    fast and easy exchange of goods across the country possible, 5G
    technology will drive innovation in the life sciences by
    providing a better avenue for exchange of massive amounts of
    data being generated across the information-rich landscape of
    healthcare and life science innovation.
        I would just like to leave you with one factoid that I
    researched in coming to the committee today.
        I don't know how many people know what a zettabyte is. But
    a zettabyte is 1 followed by 21 zeros. So it is a pretty big
    number. And if you look at the major internet service providers
    today, they traffic a little over 1 zettabyte of information.
        In the next 3 years, it is projected that that will
    increase by over fiftyfold. So think about that amount of data
    and the infrastructure that is required to exchange, connect,
    and the convergence that is possible in life science and
    manufacturing.
        5G is critical enabling technology for America and will
    help drive new innovations in healthcare and increase
    competitiveness in advanced manufacturing.
        Thank you, and I look forward to your questions.
        [The prepared statement of Mr. Broeker follows:]
       [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mrs. Blackburn. The gentleman yields back. This concludes
    our opening statements, and we are ready to move to questions
    and answers. And I will recognize myself for 5 minutes to begin
    that portion.
        Mr. Broeker, I want to start with you. I am so pleased that
    you mentioned the manufacturing component. We have 341,000
    Tennesseans who are in manufacturing. Last year, $30 billion
    worth of exports. So we are not quite to where you are with
    your Indiana number.
        But I want you to talk about this from two sides. You look
    at one of our States and you say: This is the potential if the
    investment is made, and this is what could happen if the
    investment is not made into 5G. Because I think this is
    something that we all are discussing. Mr. Johnson is working on
    broadband expansion. Mrs. Brooks is chairing the effort on 5G.
    So if you will take it from those two sides.
        Mr. Broeker. Chairman Blackburn, a very good question.
        I have been in and around life sciences my whole career,
    over 30, 35 years, and I actually started off as a
    manufacturing engineer. So I was one of those engineers running
    around the shop floor.
        Manufacturing is both a capital-intensive and a people-
    intensive business. And currently, if you look at
    manufacturing, most companies can site that manufacturing
    anywhere in the world.
        And so what really drives companies to make decisions
    related to that manufacturing are a favorable business
    environment, which includes things like tax policy;
    availability and access to a trained workforce and talent; and
    the infrastructure that is required to make all of those things
    work.
        And so my point would be that if we don't do this,
    manufacturing will go elsewhere. It will start to--continue to
    go outside the United States, because it is a global
    opportunity for companies to go other places to set up new
    manufacturing and manufacturing of the future.
        So I think 5G enables us to become even more competitive
    than we have. And when you look at the future of the innovation
    that is possible, then we can capture that making it here in
    the great States that all of you represent.
        Just yesterday, I saw that for the very first time the FDA
    has approved a digital pill. This is a pill that is a
    combination of a drug. You swallow it. When it hits your
    stomach, there is a sensor in the pill that releases
    information to your smartphone that can go to the patient, it
    can go to their family, it can go to your healthcare provider.
        These are the kinds of things that are possible even today.
    FDA, as I said, just approved this digital pill yesterday. And
    so I think, without a technology like 5G and the infrastructure
    that this represents from a manufacturing standpoint, we have
    the potential to fall behind other countries that implement it
    better and faster than we do.
        Mrs. Blackburn. Thank you.
        And, yes, we had watched the development of this in the
    Software Act this committee passed out as a part of 21st
    Century Cures as a part of enabling that type technology to
    move forward with, I think it is, Otsaku is the company.
        Mr. Broeker. It is Otsuka.
        Mrs. Blackburn. Yes.
        Mr. Broeker. It is a new medicine for schizophrenia.
        Mrs. Blackburn. Which is a great opportunity.
        Mr. Adelstein, I have got 19 counties, 10,000 square miles
    in my congressional district. And I was out last weekend
    talking with one of our county mayors and he was all about 5G,
    so excited about the potential that is there for 5G.
        If you were talking to one of my mayors, and economic
    development, bringing jobs back is something they talk about,
    they also talk about healthcare and educational opportunity, if
    you were to kind of crunch it down, talk about that
    opportunity. How is this going to change what is happening in
    rural communities with the advent of 5G, what is going to be
    most significant and most notable?
        Mr. Adelstein. I think probably, as you indicated, what is
    most significant is the economic development opportunity for
    rural areas. Suddenly rural areas have at their fingertips the
    vast amounts of data they can both communicate and receive, as
    anybody anywhere in the world, if they can have that level of
    technology available, if it gets deployed to rural America,
    which we hope it can as quickly as possible.
        So there is opportunity for jobs to be located there, for
    people that are visiting to stay longer because they can get
    their work done there, for new businesses to locate there,
    where it is a better quality of life and lower cost of living
    and lower cost of doing business.
        So it is really an opportunity to revolutionize the way
    that business is done in rural America. I think it is something
    that a lot of folks that I spoke with when I worked at the
    Rural Utilities Service, as the head of it, were so concerned
    about.
        Mrs. Blackburn. Thank you for that.
        And I am going to at this point yield 5 minutes to the
    ranking member.
        Mr. Doyle. Thank you.
        Ms. Santosham, you are a member of the FCC's Broadband
    Deployment Advisory Council, right? And San Jose is the only
    local government on this 30-member council. Is that correct?
        Ms. Santosham. Actually, we were the only municipal
    representative when it was first appointed, but now they have
    added two more.
        Mr. Doyle. Great.
        Ms. Santosham. One from Kansas and one from Georgia.
        Mr. Doyle. Tell me, what is the impact of local government
    representation? How do you think it is impacting the
    recommendations of the Advisory Committee?
        Ms. Santosham. It has been a challenge in terms of both the
    process and the output of how we are working. And it is an
    issue that the National League of Cities, National Association
    of Counties, and U.S. Conference of Mayors, along with 237
    bipartisan mayors across the country have written to Chairman
    Pai about.
        And the numbers speak for themselves in terms of the
    approach to how we will deploy broadband. And we really do need
    more local government representation. And we are at the table,
    we are talking to the FCC. But we hope that we can get more
    representation.
        Mr. Doyle. Thank you.
        Commissioner Adelstein. Jonathan, welcome back. Good to see
    you.
        You are on the commission too, right?
        Mr. Adelstein. Yes.
        Mr. Doyle. How do you think local government input is being
    handled?
        Mr. Adelstein. Well, there are also members of local
    government on the working groups that aren't on the full BDAC.
    There is also a State commissioner from the State of
    Massachusetts sits on the group. So there are a number of
    representatives of municipal and local governments.
        I think the chairman is really seeing this as an
    opportunity for industry to work with localities to try to come
    up with consensus solutions. For example, a State code that
    would be a model, a municipal code that is a model. There has
    been a lot of good dialogue going back and forth between
    localities and the industry on that.
        And we have the opportunity to take input from outside of
    the working group as well. I mean, we are listening very
    closely to localities. We feel that if we can't get a good
    State or local code that is a consensus document that really is
    working together, it is not going to get adopted anyway.
        Mr. Doyle. Thank you.
        Mr. Bazelon, let me ask you. In your testimony, you
    mentioned the challenges of freeing up the spectrum resources
    for deploying 5G networks. And when we look at the lower part
    of the C band, the 3.7 to 4.2 gigahertz band, do you think it
    is realistic that satellite users will totally vacate the whole
    band, as some in the wireless industry have suggested, or do
    you think it is more realistic that the FCC might be able to
    repack some part of the band to free up spectrum that could be
    used for mobile license usage.
        I mean, I know in your heart of hearts you would like to
    have the whole thing. But I am just curious where you think
    reality lies given the complexities in the incumbent licenses.
        Mr. Bazelon. Thank you.
        So first the economist answer is that the value created by
    the band should be more than enough to compensate the existing
    users. And so from a social perspective, the band probably
    should be freed up. But there are stakeholders there, and they
    have legitimate and real concerns. And a process where they are
    working with the reallocation process is one that is more
    likely to be successful.
        So a voluntary mechanism that allows them to share in the
    gains of their efforts to free up the spectrum is one that I
    think is more likely to be successful. Whether that ends up
    clearing the entire band or part of the band I think is for the
    people who know best in the band to figure out.
        Mr. Doyle. Thank you.
        Mr. Pearson, in your testimony you talk about international
    harmonization of 5G bands. What part of the C band that I have
    just asked Mr. Bazelon about is being considered for global
    harmonization?
        Mr. Pearson. I would have to go back and look at that and
    study it a little bit further. But what we are looking at in
    most countries around the world is they are looking at focusing
    on low-, mid-, and high-band spectrum, all three. And so the C
    band would be one of those things they are looking at. I would
    have to look at exactly where I would go to focus on that, a
    little bit more research.
        Mr. Doyle. OK.
        Finally, Ms. Santosham, following up on my initial question
    to you. It seems like San Jose has been identified by some in
    the wireless industry as a problem child, that you are impeding
    the deployment of broadband technologies. Why do you think you
    are being labeled that way? I mean, from what I can tell, you
    and your city seem to be working very hard to advance the
    deployment of broadband technologies. Where is the disconnect
    there?
        Ms. Santosham. Well, it was a surprise to us, to be honest.
    We are one of the leading cities on these issues, on technology
    issues broadly, as I talked about. And we recently hired Smart
    Cities' lead for our city, who has 25 years of telecomms
    experience, hadn't worked in government before, is coming in
    and completely retooling how our city is approaching broadband
    deployment in order to speed permitting.
        So we were surprised that we were getting accused of
    charging fees and rates that were actually well in excess of
    what we actually do charge. And it was disappointing that we
    couldn't have a more collegial conversation about how do we
    actually deploy broadband.
        Because cities around this country, we want it. We want
    investment. When I go to neighborhood associations with the
    folks in my community, they want neighborhood fiber, because
    they are not happy about the investment that has been made.
        Mr. Doyle. Thank you.
        Thank you, Madam Chair.
        Mrs. Blackburn. Mr. Walden, you are recognized.
        Mr. Walden. Thank you, Madam Chair.
        Mr. Bazelon, in the report you released this week, I
    understand you estimated two bands of spectrum could raise us
    $54 billion in net revenue to the Federal Government after
    relocation cost to incumbents. Even here in Washington we think
    that is a lot of money.
        I know the focus of your paper was on mid-band spectrum,
    but are there potential low- and high-band spectrum bands we
    could combine with these in spectrum auction legislation?
        Mr. Bazelon. Certainly, as has been said, all three types
    of spectrum are needed. And to the extent that auctions would
    facilitate reallocations, that would be a good idea. But as
    with all bands, there are incumbent users, and it sort of
    depends on the specifics.
        I would suggest that, at the low band, the television
    frequencies are still ripe for the economic tests I suggested
    about the value in new use versus current use, but also
    appreciate that is unlikely to be an area of focus any time
    soon.
        And the FCC, I don't know what time it is, but they may
    have just reallocated more spectrum from the high band. And
    should any of those be auctioned, that would be about a useful
    addition.
        Mr. Walden. All right.
        And, Mr. Pearson, do you have any thoughts on this matter?
        Mr. Pearson. Yes. I think that, as you said, there is a lot
    of money at stake here, because if you put in auction processes
    and rules that make that spectrum, whether it is low, mid, or
    high, it is very valuable spectrum for the mobile wireless
    industry.
        I know there has been a lot about 5G just being a
    millimeter-wave story. And if you look at internationally
    specifically, if you go to China, if you look at Japan, if you
    look at Korea and Europe, they are looking at this in all the
    bands.
        And so specifically, the mid-bands and the millimeter
    coupled together become part of the story of 5G. It is a bigger
    story than just millimeter-wave.
        Mr. Walden. All right.
        And, Mr. Bazelon, there is a perennial debate around here
    about authorizing specific bands for auction versus providing
    the FCC with blanket auction authority. The most recent
    estimate from the CBO, Congressional Budget Office, said that
    if we just gave blanket authority, it would raise a very small
    amount of money compared to what you have put forward. A
    blanket extension, I think, would be around a billion dollars.
        A billion dollars is still a lot of money. But when you put
    it up against the potential for $54 billion net to the Treasury
    just for those two bands, do you have a view on whether we
    should give blanket authority or reserve it for auction?
        Mr. Bazelon. There is no reason that the FCC shouldn't have
    blanket authority, and the two are not actually in conflict.
        The reason, my understanding, and now I have put on my
    green eyeshades from my CBO days as a budget scorer, the reason
    blanket authority today has such a low score is because, in
    essence, the low-hanging fruit of what can be reallocated and
    auctioned has already happened.
        So that is why it is important that the incumbents are
    incentivized to cooperate, whether that is through government
    diktat or through a market mechanism, and typically that takes
    additional legislation. But those additional efforts by
    Congress would create a positive score even if----
        Mr. Walden. Are you sure? We did that in 2012, and AWS-3
    auction came back at zero from CBO, and it sold for $44.4
    billion. So I don't have a lot of faith in taking away our
    tools, relying on others.
        Mr. Bazelon. I don't think that whether there was blanket
    authority or not would have changed that score. So it is an
    issue. And as I said, it is a very difficult thing, forecasting
    receipts, and also the clearing costs. But I don't think the
    blanket authority is what is actually creating the problem
    there.
        Mr. Walden. All right.
        Mr. Pearson, do you have any comment on this? Do you care
    about this issue?
        Mr. Pearson. I don't have any comment to add any further,
    no.
        Mr. Walden. All right. Well, I just think we worry up here
    about losing the incentive to do a lot of this work if we don't
    get a score out of it. I think that is a driving force really.
        We want to continue to make spectrum available, don't get
    my wrong. But you have to put a lot of work into a lot of
    issues, and I am afraid if we give blanket authority, CBO is
    going to say: Well, there went your money in the future, and
    that 54 billion you have identified may be there, but you don't
    get to count it. And we have things we are going trying to get
    done.
        So I think it does present--Mr. Adelstein, do you want to--
    --
        Mr. Adelstein. One thought for CBO is that the Guthrie-
    Matsui bill would allow an auction otherwise the chairman is
    saying can't take place. So it seems to me, if CBO is being
    accurate, they should give a very good score to that, because
    that auction for high frequency bands could yield a very large
    sum for the Federal Treasury.
        Mr. Walden. And just one, maybe, for the record, because I
    know my time has expired. But is anybody looking at--I heard a
    discussion the other night about, literally, AM radio side
    bands and new technology to do compression on the down wave
    side that doesn't get counted.
        Is anybody looking at that? Are you aware of any of that?
    All right.
        It was an interesting new theory. Thank you.
        No, no, no. I was hoping to get more information.
        Thank you, Madam Chair.
        And thanks again to our witnesses for being here.RPTR
    TELLEDTR CRYSTAL[10:58 a.m.]
        Mrs. Blackburn. The chairmanis reminding us that he has
    that broadcast knowledge and information.
        OK, Mr. Welch, 5 minutes.
        Mr. Welch. Thank you very much.
        Mr. Adelstein, I think I will start asking questions to
    you.
        When you describe what the potential benefit is in rural
    America, that is really the heart of my concern, because we
    have to have the build-out in rural America. We don't have it.
    Mr. Latta and I have started a bipartisan caucus, the Rural
    Caucus.
        And the real issue here is, frankly, my skepticism that the
    investments that will be required for 5G will be made in rural
    areas. And specifically, as I understand it, you need more
    towers with 5G. They don't have the penetration powers, the
    signal penetration is shorter, and it is much more vulnerable
    to obstacles.
        So the worry I have is that the same cost-prohibitive
    obstacles to build out in rural areas under existing technology
    will persist with 5G technology. So can you address that major
    concern and how those of us who do represent rural areas can be
    just absolutely certain we are not going to get the short end
    again?
        Mr. Adelstein. Well, I think you identified a very
    legitimate issue. I mean, basically the biggest problem with
    rural deployment is economics. The industry builds to where
    there is demand, and they build where there is a return,
    especially when it is very costly to build these networks and
    there----
        Mr. Welch. No, no, we all understand that. It doesn't pay
    economically. So what do we need for build-out rules if, in
    fact, the rural America is going to get the benefits that you
    described are right there if we have the system in place?
        Mr. Adelstein. Well, every dollar spent on needless
    regulation is a dollar that can't be spent on rural America.
    There is limited capital budgets. And so if we are getting
    caught up----
        Mr. Welch. Wait. No, no. Wait. I get it on regulation. But
    you said something that is obviously true. If the market isn't
    there, it is sort of like electricity, there is no incentive,
    regulation or not, for an investor to go to rural Vermont as
    opposed to urban Burlington, let's say, right? That is just
    economics.
        So there has got to be some public policy. And let's assume
    we have a favorable regulatory system, as you see it, because I
    don't want extra regulations. How do we guarantee that there
    will be build-out in rural America when there is no money in it
    for the big players?
        Mr. Adelstein. The primary mechanisms for policy are the
    Universal Service and the Rural Utilities Service that work in
    concert. As a matter of fact, when I was administrator of the
    Rural Utilities Service we provided a grant to VTel in Vermont
    that was----
        Mr. Welch. So what would we need? I mean, look, all of us
    here represent rural America, OK, and this is a problem. So
    let's just say we agree on regulations because we don't want to
    make it more expensive, but there has got to be some money that
    goes into it without the rural America having to beg for
    everything. I mean, are we entitled to the same level of
    services in urban areas or not? That is the question.
        Mr. Adelstein. Well, the Communications Act says comparable
    service and comparable rates, and that is the purpose of
    Universal Service. So it is in this committee's jurisdiction to
    try to ensure that Universal Service builds it out.
        Mr. Welch. Right. But, actually, I loved your testimony,
    but you are not reassuring me, because I am asking the ``how''
    question.
        All right. Dr. Bazelon, how about you?
        Mr. Bazelon. So there are lots of benefits to living in
    rural areas. One of the costs is that some things cost more
    there. When there is a public policy to make sure that is
    provided to rural areas the government is going to have to step
    in and assure it.
        Mechanisms in the past where there have been internal
    cross-subsidizations from urban to rural areas have been shown
    to be rather costly, and we have moved away from that model to
    more directly, if you want to create demand in a rural area,
    you subsidize the cost to providing the service. Once that is
    in place, though, and there is demand from people in rural----
        Mr. Welch. How do we get it in place? I mean, the build-out
    expenses, as I understand it, in rural areas is going to be
    high, and there is not going to be the incentive for the
    investors to do that because they don't get their return.
        So how do we avoid making the same mistake? A lot of
    rhetoric about the benefits of this build-out in rural America
    but no follow-through.
        Mr. Bazelon. It is a Universal Service-type program where
    the difference in the cost of serving those customers and what
    is considered a reasonable price needs to be made up from other
    users or from the public. So that will create the demand. With
    the demand the carriers will come and build to them.
        Mr. Welch. Mr. Pearson.
        Mr. Pearson. Well, the only thing I would like to add to
    the discussion is when you say it is going to cost more to
    build out a 5G in these areas, really when you look at building
    out 5G, if you lose the low bands or the mid-bands, it is not
    necessarily more costly to go. We already have one carrier that
    got spectrum from the 600 auction, and they have said that they
    are going to build out 5G in that band, and it carries waves
    that will cover----
        Mr. Welch. All right. My time has expired.
        I just want to say one thing, Madam Chair. I think we need,
    those of us who represent rural America, some concrete build-
    out rules that can give us concrete confidence that somehow,
    some way, the system is going to serve rural America.
        I yield back.
        Mrs. Blackburn. So noted.
        At this time, Mr. Lance, you are recognized, 5 minutes.
        Mr. Lance. Thank you, Chairman.
        Dr. Bazelon, Congress, and specifically this committee,
    recognized the need to address more commercial spectrum that
    resulted in the 2012 Spectrum Act, and it spurred three
    auctions. Now that these auctions have run their course, is it
    your view that we need a new spectrum pipeline initiative to
    meet America's future spectrum needs?
        Mr. Bazelon. As I think has been pointed out numerous
    times, it takes a long time from when an idea becomes law even
    to the time that the spectrum is reallocated, so the sooner we
    start the better. But, yes, we need more spectrum. We should be
    thinking not just about the next 5 years but the next 10 and 20
    years of how we are going to transition incumbent users out to
    be able to make frequencies available.
        Mr. Lance. Thank you very much.
        In your recent paper you noted there is skyrocketing global
    demand for mobile wireless services. And with the coming of 5G
    it is important to find spectrum to fuel that growth.
        The two bands you discuss are complementary to AWS-3
    spectrum, which was auctioned for over $40 billion. You
    estimate the two bands you have discussed could auction over
    $62 billion. What drives the price so high for these particular
    bands?
        Mr. Bazelon. In this case I actually start with the prices
    paid and the AWS auctions and reduce them a little bit to
    recognize that increased supply would reduce prices. In the
    case of this auction, there is about twice as much spectrum
    being auctioned, but I am only estimating about a 50 percent
    increase in price.
        Mr. Lance. Would you insist that they be auctioned
    together?
        Mr. Bazelon. The current estimate is based on the idea that
    they are auctioned together and paired so that you have the
    uplink, downlink architecture in place, and I think that is
    still the highest valued use for the spectrum. At some future
    time, and it depends how far in the future, that may not be as
    important, but for now I think if you want to maximize the
    value you should pair them.
        Mr. Lance. How would the mid-band spectrum identified by
    the Commission in its recent NOI fare in this type of auction
    in your opinion, Dr. Bazelon?
        Mr. Bazelon. I am not sure which specific frequencies you
    are referring to, but the need, I mean, I think as many of us
    have said, the need for mid-band spectrum in this new
    architecture is going to be high.
        This is the spectrum--imagine in the denser areas, it
    doesn't have to be just urban but anywhere where there is
    enough people to deploy the high frequencies, there is going to
    be an expectation of large bandwidth, low latency, high
    connectivity, and as you move outside those areas you are not
    going to want your devices to stop working. That is actually
    going to put increased demand on these mid-band spectrum
    frequencies.
        Mr. Lance. Thank you.
        Mr. Pearson, as you mention in your testimony, several
    countries in Europe and Asia are taking concrete steps to make
    lower portions of the mid-band, specifically frequencies
    between 3 and 6 gigahertz, available for commercial 5G
    deployment.
        Do you believe policymakers here in the United States,
    including us, are doing an adequate job to make similar bands
    available for 5G?
        Mr. Pearson. I think we are making progress in the United
    States, and I think we need to do more. If you look at most of
    these countries, they are very proactive and aggressive in
    their planning processes and where they are directing their
    industry to go and their governments to go with the mid-bands,
    and specifically I would say the 3.5 band.
        Recently I think we have made some steps here with the CBRS
    band to improve maybe the opportunity for investment in that,
    whether it is going to be LTE or 5G, and that is helpful. But I
    do think we need to do more in the United States, if you look
    at the competition from around the world and what they are
    doing, and the economies of scale that are going to happen in
    that band.
        Mr. Lance. Thank you.
        And, Chairman, I yield back 40 seconds.
        Mrs. Blackburn. The gentleman yields back.
        Ms. Matsui, you are recognized.
        Ms. Matsui. Thank you, Madam Chair.
        Congressman Guthrie and I recently held a Spectrum Caucus
    event on 5G, and we had a great panel made up of leading
    wireless providers and a leading chip manufacturer, a leading
    software company, and a small rural wireless carrier.
        Now, 5G will include spectrum but also rely on advanced
    chip sets, software capabilities, and other innovative
    technologies.
        Mr. Bazelon and Pearson and perhaps Mr. Broecker, do you
    think that blockchain, since you mentioned it, also will play a
    role in 5G and, specifically, to make efficient use of spectrum
    sharing?
        Mr. Bazelon. I haven't examined the use of blockchain in
    spectrum sharing. Clearly mechanisms that allow more users to
    share the same frequencies are going to increase the
    productivity of band to spectrum, and as demand on spectrum is
    increasing, anything that will help in that way will be useful.
    But I wouldn't want to comment specifically on blockchain.
        Ms. Matsui. Right. We are at the beginning stages then is
    what you are saying with that. Thank you.
        Would you like to comment on that.
        Mr. Broecker. I can't tell you what the technical details
    are around blockchain, but I can tell you that it is going to
    be an important technology, just like the internet. The
    internet is the portal for communication and information, and I
    think blockchain will be the internet of value and asset
    exchange.
        And so I think that the technical details are still--
    blockchain is a still a cumbersome technology. But there are
    other companies that are rapidly trying to advance that
    technology to make it more widespread. And so I think just
    basic infrastructure requirements will have to increase, and I
    think 5G will be a part of that.
        Ms. Matsui. OK. Great. Thank you.
        And also things like advanced chipsets and software
    capabilities I believe will play an important role, too. Is
    that right?
        Mr. Bazelon. It has been compared to magic, this
    technology. That is more true as time goes on.
        Ms. Matsui. OK.
        I know we have been talking about the mid-band spectrum,
    but it has unique propagation characteristics that make it
    ideal for reliable satellite distribution and particularly
    valuable for terrestrial mobile use. Wireless, fixed wireless,
    satellite services, and others have identified certain mid-
    range bands as ideal for 5G operations. But we know there is
    considerable disagreement over the best mechanism to enable 5G
    deployments to utilize the spectrum, including in the C-band.
        Mr. Bazelon, what would a market-based incentive that would
    allow incumbents to voluntarily clear portions of this band
    look like?
        Mr. Bazelon. So I understand that a joint proposal by Intel
    and Intelsat was put forward that would allow the incumbent
    users--give them the authority to negotiate with new
    terrestrial wireless users. And although I have worked with
    those companies on this issue, I have not developed--worked on
    developing the mechanisms.
        But the principle behind it, that the incumbent users will
    benefit from their efforts of participating in the process and
    making the spectrum available I think is the key part to having
    it happen in a timely manner.
        Ms. Matsui. So you think it is possible to devise rules for
    these bands so that you can protect incumbent operations while
    also allowing mobile broadband use?
        Mr. Bazelon. Yes. I mean, in some cases it is about, say,
    cordoning off geographic areas that are going to be protected.
    It may be about taking an earth station out an urban area and
    moving to it a rural area and then connecting it back with a
    fiber optic cable and that way you are able to geographically
    partition the spectrum.
        These are really all quite complicated issues with how this
    band could evolve, and it is the incumbent satellite carriers
    and the new terrestrial wireless carriers that will know best
    how to work that out.
        Ms. Matsui. One of the spectrum bands the FCC is examining
    in its mid-band inquiry is--wait a minute. No, I want to go
    this one here.
        The Citizens Broadband Radio Service, the 3.5 megahertz
    band, as co-chair with Representative Guthrie of the Spectrum
    Caucus, we are very focused on the opportunity that this
    particular band will offer. A mix of low-, mid-, and high-band
    spectrum is necessary both for wireless coverage today and to
    build network capacity in the future; 3.5 gigahertz can be a
    significant component of mid-range bands that facilitate 5G
    network deployment.
        Mr. Pearson, do you think there is a way to ensure this
    band is open to every innovative wireless opportunity it
    intends to promote?
        Mr. Pearson. Yes. Number one, I think when you talk about
    the opportunity for that band in 5G, it is a band that, again,
    is a great emphasis if you go around the world.
        Now, as far as the improvements that can be made in that
    band for investment, I mean, from a mobile wireless industry
    side, I think we need, as we have seen, longer license terms,
    larger geographic areas, and so forth, and the expectation of
    renewal on those licenses. That is where you get investment in
    our industry.
        And if you go around the world there are very few other
    geographic or other countries that have some of the issues that
    we have with the Navy radar and so forth. So they are looking
    at that as pretty much clean spectrum of them moving forward
    with for 5G.
        Ms. Matsui. OK. Great.
        Thank you very much, and I yield back.
        Mrs. Blackburn. Mr. Shimkus, you are recognized, 5 minutes.
        Mr. Shimkus. Thank you, Madam Chairman.
        I am glad Peter Welch is still here, and I hate to say he
    is right sometimes, but all he does is kind of give voice to
    frustration in rural America that we just don't get there. But
    I would also argue that there are still some regulatory issues
    with maintaining copper wires that we should have a discussion
    about, reforming the Universal Service Fund. I think Mr.
    Adelstein talks about RUS.
        I mean, there are tools, it is just we have got to refine
    those, and I would be happy to work with you on those things.
    So it is very frustrating out there.
        Ms. Santosham, I mean, the real debate for me is industry
    getting in or the concern of municipalities blocking. So how
    large is San Jose?
        Ms. Santosham. It is a little over a million people.
        Mr. Shimkus. And these other communities are now part--they
    must be smaller. Do you know the size of the Kansas----
        Ms. Santosham. Lanexa and Valdosta. I think Valdosta is
    about 40,000. I am not sure about Lanexa.
        Mr. Shimkus. OK. And so your 5G, for lack of a better word,
    desert, or areas that you want to go to that are not served,
    the Latino community that you were mentioning, do you know the
    population area of that.
        Ms. Santosham. I don't, but I am happy to get back to you
    on that.
        Mr. Shimkus. My basic point is that is probably bigger than
    most of my communities. That area that should be of your
    concern. I am not saying as a municipal leader. If I was a
    municipal leader I would be concerned about that. And sometimes
    in rural America that is bigger than--I have a county that only
    has 5,000 people in it.
        So it goes to that debate of how do you get there and get
    deployed. This is a different era than coaxial cables and
    access to poles, which is kind of how this original--how did
    municipalities then give right-of-ways, leverage for dollars
    and access, versus affixing pizza boxes or refrigerators in
    local communities to provide this service.
        So in 2009 the FCC said we should have a shot clock to help
    some deployment, and that shot clock was--the Supreme Court
    supported that in a decision in 2013 and which is kind of the
    law of the land.
        But, Mr. Adelstein, even with the shot clock and the ruling
    and with the Supreme Court, are you still perceiving that there
    are problems in market entry?
        Mr. Adelstein. Well, there is still a problem with the shot
    clock if it is not deemed granted at the end, because you have
    to go to Federal Court, and then it is an endless loop that you
    end up there.
        This committee was responsible for, as I mentioned,
    enacting 6409(a), which allowed the FCC the authority, clear
    authority to say at the end of the process, if a locality won't
    allow a colocation, it is going to be deemed granted, and that
    means it gets done. We haven't had any pushback on that.
        But on these other shot clocks we have had numerous
    examples. As a matter of fact, the tendency is for the
    community to go beyond the shot clock and for our industry not
    to sue because we know we will be back at that community again
    later, and we know that the Federal court mechanism is not a
    particularly effective one. So we could use additional
    authority of the FCC to allow for deemed granted.
        Mr. Shimkus. And how would you--so, I mean, I guess you
    answered it. Deem granting would be the provision that you
    think would help in that.
        Ms. Santosham, you wanted to commend on that.
        Ms. Santosham. Yes, I just want to take a little bit of a
    step back.
        So the infrastructure that we are talking about now to
    deploy 5G is largely light pole infrastructure, infrastructure
    that is traditionally used for lights, maybe you put a banner
    up, right? They are not always structurally sound to put a
    heavy piece of equipment on, and they oftentimes need
    remediation.
        Mr. Shimkus. That is true, but if I may, in previous
    hearings here we had talked about the ability of some of these
    things to be placed on the side of buildings.
        Ms. Santosham. Yes, but by and large it will be mostly
    street lights because of the density that you need to deploy
    the networks. And so when communities--when we say that the
    communities are taking a little bit longer it is partially
    because we are taking this 200-year-old infrastructure and then
    we have got to change the way that we have permitted and used
    that infrastructure.
        Mr. Shimkus. I only have 12 seconds left, and I appreciate
    that. I guess what we are trying to find is we need to have a
    balancing act. You want your folks to have 5G. We want our
    folks to have 5G.
        Mr. Adelstein.
        Mr. Adelstein. One quick point on San Jose. The State of
    California enacted a deemed granted remedy for shot clocks. So
    San Jose is under that. And so if California can do it, the
    United States can do it.
        Mr. Shimkus. Thank you, Madam Chairman. I yield back.
        Mrs. Blackburn. Mr. McNerney, you are recognized for 5
    minutes.
        Mr. McNerney. I want to thank the chairlady for the
    hearing.
        And I thank the witnesses. It has been interesting to hear
    what you have had to say.
        Mr. Pearson, in your written testimony you emphasized the
    importance of U.S. leadership in the global race for 5G. At a
    hearing earlier this fall we heard that the Sinclair merger
    could delay the repack of the 600-megahertz band, slowing down
    5G deployment and U.S. competitiveness.
        Do you agree that it is important the FCC not take steps to
    delay the clearing of spectrum for 5G? Do you believe that that
    would hurt us?
        Mr. Pearson. I think that we should do everything we can to
    clear the spectrum to put it to the best use, in this case
    mobile wireless. I think connecting society is some of the best
    uses.
        Mr. McNerney. So the Sinclair merger, which may delay that,
    would be an impediment in this case?
        Mr. Pearson. I would have to research that.
        Mr. McNerney. I know you are not an expert on that. I just
    wanted to make that point. Thank you.
        Where are we in the standards-making process for 5G?
        Mr. Pearson. In the standards?
        The standards are making great progress. What we are
    actually looking at is a draft of the first release of what is
    called--I don't want to get too technical--but of a first
    release of 5G at the end of this year. So everyone will know
    what kind of chipsets and silicon to start producing.
        That will be completed in early 2018. The second phase of
    5G will then be December of 2019, just in time for ITU to do
    their blessings in 2020.
        Mr. McNerney. So is cybersecurity being taken into account
    in the standards process?
        Mr. Pearson. Pardon me?
        Mr. McNerney. Cybersecurity, is that a significant part of
    the process?
        Mr. Pearson. Yes, it is. It is part of it. 3GPP has two
    different areas that are working on--well, actually several,
    but several areas that are working on that and security is a
    mainstay for our industry, as well as the standard.
        Mr. McNerney. OK.
        Ms. Santosham, in your written testimony you noted that the
    city of San Jose has deployed an Internet of Things network.
    How important is IoT data security, for example, that devices
    be patchable and downloadable?
        Ms. Santosham. It is incredibly important. You know, data
    is the new oil, and cybersecurity is incredibly important to
    our cities. Cities will be obviously a target for cyber
    threats. And privacy is also of concern.
        Mr. McNerney. Good. I personally believe that digital
    device security is critical and that we are late in the game on
    this process.
        Earlier this year I introduced the Securing IoT Act, which
    would require that cybersecurity standards be developed for IoT
    devices and that those devices be certified. I hope that the
    committee takes up this legislation soon.
        Ms. Santosham, I am aware of the many benefits that the 5G
    has to offer, including faster speeds, but I am worried about
    the costs. For my constituents, there is a real concern because
    more than 21 percent of my households earn less than $25,000 a
    year. How do you expect the 5G deployment to impact the cost of
    wireless services?
        Ms. Santosham. Today there are no guarantees that cost to
    consumers will go down, and cost of service and cost of devices
    are the top two barriers to digital inclusion. And I think when
    we are talking about subsidizing infrastructure deployment
    rates for large corporations we should be asking for something
    back.
        Mr. McNerney. Well, you mentioned, I think, you had 75,000
    residents that don't have broadband access in San Jose. If the
    Federal Communications Commission eliminates the Lifeline
    program today, how would that impact these and other residents
    in San Jose?
        Ms. Santosham. Twenty-nine percent of our low income
    residents only have access to the internet through mobile
    phones. And so if Lifeline goes away that will have a
    significant impact on their ability to be connected.
        Mr. McKinley. Thank you. That is what I thought.
        Mr. Adelstein, you testified that the U.S. is in a position
    to retain our lead moving into 5G. Could you explain what that
    means exactly? What does it mean quantifiably that we have a
    lead in 5G?
        Mr. Adelstein. Well, the important thing is that other
    countries are making it very easy to move forward. In Japan and
    Korea, for example, that are moving quickly toward 5G, they
    could site anything, anywhere, any time. And I am not saying we
    need that here because we have always worked in close
    partnership with localities, but some unreasonable impediments
    are going to slow down the deployment.
        Mr. McNerney. What does leadership mean? What does that
    mean?
        Mr. Adelstein. Usually it would mean that we would be the
    first to implement the network. We would be ahead in terms of
    the chipsets, as we already are with our leading chipset
    manufacturers. We would be ahead with the devices that we get
    into the hands of consumers.
        Mr. McNerney. I mean, could we include rural access as a
    part of that definition of leadership in this field?
        Mr. Adelstein. Ideally it would. I mean, we talked earlier
    about the issues with rural, which is expensive. I mean, the
    greater costs you have to deploy this, the less likely we are
    to get to rural and the longer it will take.
        I mean, rural historically has been the last to get these
    devices, and it is unfortunate, but the costs are extremely
    high to provide this type of network. And we need to do
    everything we can to lower those costs to allow that capital
    budget that the companies do have, which is the largest of any
    industry, 30 billion a year being invested, and a lot of that
    in rural America.
        Mr. McNerney. My time has expired, and I am sure the chair
    is anxious to move on. So thank you for the answer.
        Mrs. Blackburn. The gentleman yields back.
        Mrs. Brooks for 5 minutes.
        Mrs. Brooks. Thank you Madam Chairwoman. Thank you so much
    for holding this hearing today.
        Mr. Broecker, wonderful to have you here. You noted in your
    testimony the exponential growth of the Internet of Things,
    which we have talked about a bit--smart devices, wearables, and
    sensors, and thank you for sharing with us the issue of the new
    discovery and use of the digital pill--will increasingly be
    part of the delivery of care to improve patients' lives. We
    have had quite a discussion also about rural America.
        How do you believe that these innovations are going to have
    the power to bring better care, better healthcare to patients
    in rural areas? I represent rural areas, as well, in central
    Indiana. And do you have any specific examples of scenarios
    where 5G can improve that doctor-patient relationship and
    improve the delivery of care in rural areas?
        Mr. Broecker. Absolutely. You know, there is an emerging
    trend, and it is increasing, and it is the notion of
    telemedicine where patients don't actually have to go to a
    hospital or to a doctor's office and through internet
    connection and other technology-enabled solutions they can have
    a consult.
        There is robotic surgeries occurring where surgeons in
    completely different parts of the United States can be doing
    surgery in a hospital someplace else.
        So as I mentioned in my testimony, healthcare is going to
    be driven less about place and more about the connection to a
    healthcare system, and that doesn't necessarily need to be
    right next door. I mean, it is great if it is, but there are
    going to be technologies and solutions and innovations that are
    going to allow people and patients and healthcare systems and
    physicians to be connected in completely different ways.
        Mrs. Brooks. Switching gears a little bit to the focus that
    you put on automation of manufacturing and that 5G will result
    in even more automation, some become nervous about increased
    automation as it relates to jobs and the people on the
    manufacturing floor, so to speak. And we also know automation
    increases speeds and efficiency of manufacturing to create
    these jobs.
        Are there any policy areas Congress should be looking at to
    help the workforce adapt as we continue to push and believe in
    the importance of implementation of 5G to the world of
    innovation, automation, and manufacturing? What should Congress
    be doing for the workforce and how do we help the workforce
    adapt?
        Mr. Broecker. I mean, the general trend is toward STEM
    education and enhanced STEM education and starting early in a
    student's life, whether that is in grade school or high school
    and getting involved in things like robotics and getting
    familiar with technology. You can now do biology genome
    experiments in eighth grade, whereas before you needed to have
    a Ph.D. and be at MIT, where I went to school. These things are
    now possible.
        But it really gets back to an educated workforce, starting
    with the next generation. But it also means skills and
    developing the skills amongst the current workforce to be able
    to do that.
        You know, I said I started off in manufacturing, and I saw
    lots of innovation come over my 20-plus-year career. And the
    same debate was argued, you know, OK, we are going to get all
    these fancy pieces of equipment and machines to do the work. It
    never replaced people. At the end of the day it still took
    people overseeing, managing, making sure that the machines did
    what they were supposed to do. But it takes an educated
    workforce in order to do that.
        Mrs. Brooks. Thank you very much.
        I am going to yield back the balance of my time so others
    can ask their questions. Thank you.
        Mrs. Blackburn. Thanks.
        Ms. Eshoo, you are recognized for 5 minutes.
        Ms. Eshoo. Thank you, Madam Chairwoman.
        And thank you to all of the witnesses. It is good to see
    Jonathan again.
        And a very warm welcome to Ms. Santosham from San Jose,
    California. I think you gave very important testimony today.
    And I appreciate the warm words that you directed toward me,
    and I return them to you.
        First, I want to make a couple of comments about the whole
    issue of 5G. I believe that it has--it holds the potential for
    many benefits, and several of you have mentioned them, and how
    it will lead to competition and bridging the digital divide and
    unlock the Internet of Things.
        So I think that it represents a real opportunity for all of
    us. And of course I always say I am not satisfied with America
    being 5th or 12th or 17th. I want us to be number one and lead
    the world in whatever it is, whatever the undertaking is, and
    whatever the sector is. And obviously we are all going to have
    to work together to move in a direction that is going to make
    this a reality.
        But I am also concerned that there are some things that are
    being pushed aside in the race to 5G. And I want to associate
    myself with some of the comments that both our ranking member,
    Mr. Doyle, and also Mr. Welch made.
        We have two problems, two big problems. And I think that as
    we move forward with this and any other initiative that has
    anything to do with spectrum, which is the gold in all of this,
    because there is an insatiable appetite for it, and as we
    continue to innovate, you have to have spectrum. Spectrum is
    the platform, it is the fuel that makes everything go.
        But Mr. Welch spoke about one. How do we assure that there
    is accessibility in rural communities? No matter what we do,
    this issue keeps coming up. We are not making progress there. I
    mean, it is like the 10,000-pound gorilla in the room.
        I also have concerns about how we are going to deal with
    local communities. I have a reverence for local government. I
    came from it. I spent a decade in local government. We cannot
    run roughshod over local government. And I think that there is,
    most frankly, a rush to do that.
        In fact, what Mr. Doyle raised about how did San Jose get
    this reputation and this attack on them for being whatever, I
    don't know where that came from. But it seems to me, because
    you raised your voice about, wait a minute, we have to be
    considered in this, we have citizens that we need to respond
    to, and you can't just run roughshod over us.
        So to Ms. Santosham--first of all, I want to ask for
    unanimous consent to place in the record a New York Times
    editorial by the mayor of San Jose, Sam Liccardo, dated 10/3/
    17, Mr. Chairman.
        Mr. Lance [presiding]. So ordered.
        [The information appears at the conclusion of the hearing.]
        Ms. Eshoo. Wireless providers have been accused of
    redlining certain neighborhoods, a practice that obviously
    exacerbates the digital divide. And I would like you to comment
    on that, but also tell us what the importance of cities like
    San Jose is implementing market-based infrastructure leases to
    ensure that private industry is enhancing broadband access for
    all communities.
        It is not just San Jose. San Jose is speaking up. But they
    have an issue, and they are not rural, of 95,000 people in
    their city that have nothing. They have no access to it. This
    is the largest city in Silicon Valley.
        So would you comment on that? Because I find that deeply
    disturbing.
        Ms. Santosham. Yes. So, first of all, market-based rates
    and incentives are things we should all believe in. And there
    is a little bit of an irony that we as a city government are
    asking for market-based rates and the private sector is asking
    for cost-based.
        And market-based rates allow us to incentivize buildouts,
    especially when we are allowed to build out entire communities.
    So we are able to say: Hey, hereis all the space in the city we
    would like to build out, and we will give you a discount on
    some of this infrastructure if you are willing to go to the
    communities that need to be served.
        And so I think that is what is missing in this
    conversation, is by speeding the deployment and running
    roughshod over local government you are then taking away the
    ability to shape and manage where deployment happens in
    communities so that communities benefit.
        Ms. Eshoo. So is the BDAC the place where this will be
    decided?
        Ms. Santosham. The BDAC? I don't think so, but I am
    concerned about the direction there because of the lack of
    representation both on the voting body and in the subgroups.
        Ms. Eshoo. I wrote to the chairman about that. And I think
    if you have mostly industry people then it is just going to be
    weighted that way. I am not opposed to industry people, but you
    have to have some kind of balance in this. And that is another
    red flag.
        Thank you to all of you.
        I think, Mr. Chairman, that more work needs to be done in
    the areas that have been raised. They are legitimate concerns.
    I don't think it is a Republican or a Democratic concern. I
    think they are concerns that we need to build in solutions so
    that they are addressed.
        And I think that then the promise that is being spoken of
    here today about 5G will be kept. Otherwise we are going to
    have another new generation but plagued with the same issues
    that we keep talking about.
        So thank you. And I thank you for your patience in giving
    me extra time.
        Mr. Lance. Thank you very much.
        The chair now recognizes the gentleman from Pennsylvania,
    Mr. Costello.
        Mr. Costello. Thank you.
        Could all of you share a little bit about WiFi enabled by
    unlicensed spectrum and what role that may play in the 5G
    world?
        Mr. Pearson. Well, if you look at the standard in what they
    are going to be doing in 5G, they are actually including
    unlicensed spectrum in the 5G.
        Now, when you start specifically, you say WiFi, well, WiFi
    is actually integration--has integration capabilities right now
    with LTE. There is also LTE in a license, again separate from
    WiFi.
        So all of these things are being done for basically to
    provide the consumer the best experience they can. Sometimes it
    is anchored with what would be LTE today and at some point
    would be 5G. Sometimes it is specifically unlicensed, which
    would be only WiFi. And other times it is actually another type
    of aggregation tool of interoperating. But it is usually one or
    the other.
        Mr. Bazelon. WiFi is a very important access technology,
    and unlicensed spectrum is very important to allow for that.
    And there is clearly a lot of demand for it. And it should be
    something that grows. Whether or not it ends up being actually
    integrated in with the commercial mobile networks I think is
    just an open question.
        Mr. Adelstein. Some of the high frequency spectrum that is
    being set aside is being set aside for unlicensed use, and that
    allows for individuals to use that to offload some of the
    demand that is going on in the broader networks that are being
    designed by the cellular industry. So it is very helpful to
    have unlicensed and licensed in a proper balance.
        Ms. Santosham. I am going to defer to my colleagues here
    who know much more about the issue than me.
        Mr. Broecker. Same.
        Mr. Costello. We have heard a lot about State and local
    impediments to the deployment of wireless infrastructure. Is
    the same true for next-generation wireline infrastructure?
        Mr. Adelstein. Well, fiber is a major part of 5G. I mean,
    5G really can't function to its highest potential without fiber
    because of the latency requirements.
        So virtually every one of these little antennas is going to
    have a fiber connection. We are talking about potentially
    millions of antennas, if not hundreds of thousands. The
    estimates range between those. And so you are talking about
    very many antennas close to the end user, all of which require
    fiber connections.
        So impediments to the deployment of fiber are impediments
    to the deployments of 5G. And we do see those. We see those as
    well as--sometimes I think when the antenna gets attached at
    the end there is even more resistance for a number of different
    reasons from localities, even though they provide such a great
    opportunity for consumers and there is so much demand for it.
        So we do need policies, such as Dig Once, that allow for a
    fiber deployment to take place rapidly, because I think we are
    going to see another huge build-out of fiber in the United
    States preparing for 5G.
        Mr. Costello. So your testimony is that wireline equipment
    does also face delays in permitting and access to rights of
    way?
        Mr. Adelstein. It certainly does, yes.
        Mr. Costello. I have one more question. Can you, Mr.
    Adelstein, share with me your familiarity with the way that
    spectrum transactions between various companies and the need to
    be able to do through like kind exchange?
        Mr. Adelstein. The FCC has done a very good job of allowing
    for a very fluid secondary market in spectrum, and they readily
    approve transactions that are within the caps that they have
    placed that are informal. They can go beyond that if they have
    to. So they have really done a great job on a bipartisan basis
    and under both administrations of allowing for a very fluid
    secondary market.
        I mean, our concern right now is getting more spectrum into
    market. And the issue is with 5G, you have understood there is
    this bill that is needed to get it done. Because we would like
    to see by December 2018 the opportunity for the FCC to hold an
    auction of these high frequency bandwidths. And if it is
    possible the chipsets will be ready by then, the equipment will
    be ready, the standards will be in place. So if we can get the
    Guthrie-Matsui bill through that would pave way for even more
    high frequency spectrum that could then be put into that mix.
        Mr. Costello. Good. Thank you. I yield back.
        Mr. Lance. Thank you very much, Congressman Costello.
        Does anyone else on the committee wish to ask further
    questions?
        Seeing there are no further questions from members, I thank
    our witnesses for being here today. It has been a very
    informative panel by a distinguished group of guests.
        Before we conclude, I ask unanimous consent to enter the
    following letters into the record.
        The recently released white paper from the Brattle Group.
        [The information appears at the conclusion of the hearing.]
        Mr. Lance. A letter from Mayor Kevin Davis of Hardin
    County, Tennessee.
        [The information appears at the conclusion of the hearing.]
        Mr. Lance. And thank you, Dr. Bazelon, for the white paper.
        Ms. Eshoo. Mr. Chairman?
        Mr. Lance. Yes.
        Ms. Eshoo. May I just add my best wishes to everyone here--
    I know the committee is all gone, but in absentia--for a
    wonderful Thanksgiving. We have much to be grateful for in our
    great and good country. So happy Thanksgiving.
        Mr. Lance. Thank you, and I share that sentiment. And among
    the major holidays it is my favorite holiday because it is the
    traditional American holiday.
        And to all in the audience, I certainly agree with
    Congresswoman Eshoo.
        Pursuant to committee rules, I remind members that they
    have 10 business days to submit additional questions for the
    record. And I ask that witnesses submit their responses within
    10 business days upon receipt of the questions.
        Seeing no further business before the subcommittee today,
    without objection, the subcommittee is adjourned.
        [Whereupon, at 11:40 a.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]
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