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

                    NET NEUTRALITY AND THE ROLE OF ANTITRUST

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

                                    HEARING

                                   before the

                                SUBCOMMITTEE ON
                               REGULATORY REFORM,
                          COMMERCIAL AND ANTITRUST LAW

                                     of the

                           COMMITTEE ON THE JUDICIARY
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                NOVEMBER 1, 2017

                               Serial No. 115-24

                                   __________

             Printed for the use of the Committee on the Judiciary

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

          Available on the World Wide Web: http://judiciary.house.gov

                                      ______

                             U.S. GOVERNMENT PUBLISHING OFFICE

    30-101                         WASHINGTON : 2018

                           COMMITTEE ON THE JUDICIARY

                       BOB GOODLATTE, Virginia, Chairman
    F. JAMES SENSENBRENNER, Jr.,         JOHN CONYERS, Jr., Michigan
        Wisconsin                        JERROLD NADLER, New York
    LAMAR S. SMITH, Texas                ZOE LOFGREN, California
    STEVE CHABOT, Ohio                   SHEILA JACKSON LEE, Texas
    DARRELL E. ISSA, California          STEVE COHEN, Tennessee
    STEVE KING, Iowa                     HENRY C. ``HANK'' JOHNSON, Jr.,
    TRENT FRANKS, Arizona                    Georgia
    LOUIE GOHMERT, Texas                 THEODORE E. DEUTCH, Florida
    JIM JORDAN, Ohio                     LUIS V. GUTIERREZ, Illinois
    TED POE, Texas                       KAREN BASS, California
    JASON CHAFFETZ, Utah                 CEDRIC L. RICHMOND, Louisiana
    TOM MARINO, Pennsylvania             HAKEEM S. JEFFRIES, New York
    TREY GOWDY, South Carolina           DAVID CICILLINE, Rhode Island
    RAUL LABRADOR, Idaho                 ERIC SWALWELL, California
    BLAKE FARENTHOLD, Texas              TED LIEU, California
    DOUG COLLINS, Georgia                JAMIE RASKIN, Maryland
    RON DeSANTIS, Florida                PRAMILA JAYAPAL, Washington
    KEN BUCK, Colorado                   BRAD SCHNEIDER, Illinois
    JOHN RATCLIFFE, Texas
    MARTHA ROBY, Alabama
    MATT GAETZ, Florida
    MIKE JOHNSON, Louisiana
    ANDY BIGGS, Arizona
               Shelley Husband, Chief of Staff & General Counsel
            Perry Apelbaum, Minority Staff Director & Chief Counsel
                                     ------

        Subcommittee on Regulatory Reform, Commercial and Antitrust Law

                       TOM MARINO, Pennsylvania, Chairman
                     BLAKE FARENTHOLD, Texas, Vice-Chairman
    DARRELL E. ISSA, California          DAVID N. CICILLINE, Rhode Island
    DOUG COLLINS, Georgia                HENRY C. ``HANK'' JOHNSON, Jr.,
    KEN BUCK, Colorado                       Georgia
    JOHN RATCLIFFE, Texas                ERIC SWALWELL, California
    MATT GAETZ, Florida                  PRAMILA JAYAPAL, Washington
                                         BRAD SCHNEIDER, Illinois

                                C O N T E N T S

                                  ----------

                               OPENING STATEMENTS

                                                                       Page
    The Honorable Bob Goodlatte, Virginia, Chairman, Committee on the
      Judiciary......................................................     4
    The Honorable John Conyers, Jr., Michigan, Ranking Member,
      Committee on the Judiciary.....................................     6
    The Honorable Tom Marino, Pennsylvania, Chairman, Subcommittee on
      Regulatory Reform, Commercial and Antitrust Law, Committee on
      the Judiciary..................................................     1
    The Honorable David Cicilline, Rhode Island, Ranking Member,
      Subcommittee on Regulatory Reform, Commercial and Antitrust
      Law, Committee on the Judiciary................................     3

                                   WITNESSES

    Hon. Maureen K. Ohlhausen, Acting Chairman, Federal Trade
      Commission
        Oral Statement...............................................     9
    Mr. Michael Romano, Senior Vice President, Industry Affairs &
      Business Development, NTCA (The Rural Broadband Association)
        Oral Statement...............................................    11
    Hon. Terrell McSweeny, Commissioner, Federal Trade Commission
        Oral Statement...............................................    13
    Hon. Robert M. McDowell, Former Commissioner, Federal
      Communications Commission
        Oral Statement...............................................    15

                            OFFICIAL HEARING RECORD

    Responses to Questions for the Record from the Hon. Maureen K.
      Ohlhausen, Acting Chairman, Federal Trade Commission...........    36
    Responses to Questions for the Record from Mr. Michael Romano,
      Senior Vice President, Industry Affairs & Business Development,
      NTCA (The Rural Broadband Association).........................    39
    Responses to Questions for the Record from the Hon. Terrell
      McSweeny, Commissioner, Federal Trade Commission...............    43
    Responses to Questions for the Record from Hon. Robert M.
      McDowell, Former Commissioner, Federal Communications
      Commission.....................................................    47
                  Additional Material Submitted for the Record

    Report submitted by the Honorable Tom Marino, Pennsylvania,
      Chairman, Subcommittee on Regulatory Reform, Commercial and
      Antitrust Law, Committee on the Judiciary. This material is
      available at the Committee and can be accessed on the Committee
      Repository at:

        http://docs.house.gov/meetings/JU/JU05/20171101/106572/HHRG-
          115-JU05-20171101-SD004.pdf

    Statements, Letter, and Testimony submitted by the Honorable
      David Cicilline, Rhode Island, Ranking Member, Subcommittee on
      Regulatory Reform, Commercial and Antitrust Law, Committee on
      the Judiciary. These materials are available at the Committee
      and can be accessed on the Committee Repository at:

        http://docs.house.gov/meetings/JU/JU05/20171101/106572/HHRG-
          115-JU05-20171101-SD003.pdf

    Article submitted by the Honorable Pramila Jayapal, Washington,
      Subcommittee on Regulatory Reform, Commercial and Antitrust
      Law, Committee on the Judiciary. These materials are available
      at the Committee and can be accessed on the Committee
      Repository at:

        http://docs.house.gov/meetings/JU/JU05/20171101/106572/HHRG-
          115-JU05-20171101-SD005.pdf

                    NET NEUTRALITY AND THE ROLE OF ANTITRUST

                                  ----------

                          WEDNESDAY, NOVEMBER 1, 2017

                           House of Representatives,

        Subcommittee on Regulatory Reform, Commercial and Antitrust Law,

                          Committee on the Judiciary,

                                Washington, DC.

        The Subcommittee met, pursuant to call, at 10:00 a.m., in
    Room 2141, Rayburn House Office Building, Hon. Tom Marino
    [Chairman of the Subcommittee] presiding.
        Present: Representatives Marino, Goodlatte, Farenthold,
    Issa, Collins, Buck, Ratcliffe, Gaetz, Handel, Cicilline,
    Conyers, Johnson of Georgia, Eric Swalwell, Jayapal, and
    Schneider.
        Staff Present: Ryan Dattilo, Counsel; Slade Bond, Minority
    Counsel; and Andrea Woodard, Clerk.
        Mr. Marino. Good morning. The Subcommittee on Regulatory
    Reform, Commercial, and Antitrust Law will come to order.
    Without objection, the Chair is authorized to declare recesses
    of the Committee at any time. We welcome everyone to today's
    hearing on ``Net Neutrality and the Role of Antitrust'', and I
    now recognize myself for an opening statement.
        The Federal Communications Commission and its new Chairman,
    Ajit Pai, are in the process of evaluating what is the proper
    way to protect consumer welfare and support innovation in the
    Internet marketplace. We are here today to examine the role of
    antitrust law in that debate.
        The Internet has been an overwhelmingly positive
    development for our country by spurring innovation, creating
    jobs, and establishing a dynamic marketplace for goods and
    ideas. All branches of our government should strive to protect
    the unimpeded growth of the Internet so that consumers and our
    economy can continue to reap its benefits.
        I strongly believe, however, that actions should be taken
    to prevent discriminatory and anticompetitive conduct from
    occurring in the Internet marketplace. The question at hand
    today is what role should antitrust laws and the Federal Trade
    Commission, which helps to enforce those laws, play in
    preventing and policing this type of conduct. Antitrust law has
    a number of benefits we should consider.
        Antitrust law and the standards applied by the courts have
    developed, evolved, and been refined over decades. This stands
    in contrast to the regulations imposed under the previous FCC's
    2015 Open Internet Order, which can be interpreted and enforced
    by a constantly rotating commission, and the judicial
    interpretation of which is uncertain. Antitrust law uniformly
    applies to all participants in the Internet marketplace.
        In contrast, the 2015 order's regulations only apply to
    Internet service providers. Antitrust law deters and, as
    necessary, can be used to prosecute conduct once it occurs and
    determine on a case-by-case basis whether a violation has
    occurred. This allows for flexibility and pro-consumer
    innovation. The 2015 Order applies a ``one-size-fits-all''
    approach, imposing a burden on all regulated parties,
    regardless of whether they actually engaged or may want to
    engage in improper conduct, and discouraging potential
    innovation.
        The impact of today's discussion is significant. Consider,
    for example, the case of rural broadband. Because rural areas
    of America tend to be sparsely populated, satellite and fixed-
    wireless technologies are often used to deliver Internet access
    to rural customers. These technologies are costly, and
    consequently often involve strict data caps. A practice known
    as ``zero-rating,'' or the exemption of certain data uses from
    consumers and customers' data caps helps to address these
    concerns through competition and innovation, lowering prices,
    and improving service for customers. Yet under the 2015 Order,
    this consumer welfare-enhancing competition was almost stopped.
        Consider also the case of differentiated broadband plans.
    When American families buy groceries, they have the choice of
    purchasing food from the local supermarket or from a high-end
    organic retailer like Whole Foods. Families who just want the
    basics or are on a limited income, are not forced to subsidize
    the preferences of shoppers with higher-end preferences.
        But because of the FCC's rigid net neutrality rules,
    broadband consumers do not have the same flexibility. Under the
    guise of equal access, those who use the Internet sparingly--
    often, the poor and elderly--are forced to subsidize their more
    affluent high-bandwidth-consuming neighbors' broadband bills.
    Let's also consider the future of the Internet.
        5G, the next generation of mobile broadband, will deliver
    speeds far surpassing today's LTE technologies as well as the
    speeds of many American's home broadband connections. 5G
    promises not only to advance competition in the mobile wireless
    industry but also to connect a new array of ``Internet of
    Things,'' or ``IoT'' devices, such as network-connected
    agricultural monitoring devices, autonomous vehicles, and
    medical monitoring devices. 5G delivers on these promises by
    utilizing technologies that prioritize certain network uses
    that require extreme responsiveness. Innovations in telehealth,
    remote medical device monitoring, or communications amongst
    autonomous vehicles will all benefit from prioritized
    connections. Yet under the 2015 Order, such innovation might be
    stopped by the regulatory overreach of a future administration.
        I look forward to hearing the testimony of today's
    witnesses on the potential benefits, or, if relevant,
    limitations of using antitrust law to protect consumers and
    innovation in the Internet marketplace.
        The Chair now recognizes the Ranking Member of the
    Subcommittee on Regulatory Reform, Commercial, and Antitrust
    law, Mr. Cicilline of Rhode Island, for his opening statement.
        Mr. Cicilline. Thank you, Mr. Chairman, and thank you for
    calling this hearing today. Welcome to our witnesses. Today's
    hearing is an opportunity to examine whether antitrust
    enforcement is an effective and responsive substitute for the
    clear bright-line consumer protections established by the 2015
    Open Internet Order.
        When working families pay their bill for broadband Internet
    access, they expect to get what they pay for: access to the
    entire lawful Internet, not just portion of it, at the speed
    they pay for. Without these protections, broadband providers
    could slow down consumers' Internet speeds to certain websites,
    require payments by third parties to speed traffic to
    consumers, or block certain websites altogether. To be clear,
    these concerns are firmly grounded in reality.
        As the United States Court of Appeals for the D.C. Circuit
    observed in 2014, it is, and I quote, ``common sense economic
    reality'' that broadband providers have powerful incentives to
    require fees from edge providers to prioritize customer speeds
    and discriminate against certain types of traffic.
        Consequently, as the court noted, this behavior threatens
    Internet openness in ways that would ultimately inhibit the
    speed and extent of future broadband deployment. Importantly,
    these protections do not apply to reasonable management of
    networks by Internet service providers to ensure that their
    consumers have the fastest and most reliable Internet speeds
    possible.
        Moreover, and this is a fundamental point, these
    protections do not apply to specialized services, like heart
    monitors, energy consumption sensors, or voice services, which
    are entirely outside the scope of the 2015 Open Internet Order
    because they are not a former broadband Internet access service
    for consumers. Under the Trump administration, the Federal
    Communications Commission is considering whether to abolish or
    substantially revise these protections.
        According to the Commission's notice of proposed
    rulemaking, the proposed rule seeks to, and I quote, ``reverse
    the decline in infrastructure investment, innovations, and
    options for consumers'' and address the concerns of broadband
    providers with regulatory uncertainty.
        The Supreme Court has long held, however, that the
    Commission cannot simply rescind rules, but instead must
    examine the relevant data and articulate a rational connection
    between relevant facts and its deregulatory actions.
        Notwithstanding the Commission's claims that our current
    net neutrality protections have undermined broadband deployment
    and adoption, the U.S. Court of Appeals for the D.C. Circuit
    has held twice in the past 3 years that Internet openness
    fosters innovation and leads to the expansion and improvement
    of broadband infrastructure. Unless the Commission is able to
    explain why it has ignored this data showing the causal
    relationship between strong net neutrality protections and
    broadband investment, its actions are likely to be arbitrary
    and capricious under the Administrative Procedures Act.
        Turning to the subject of today's hearing, there is
    substantial uncertainty concerning the application of the
    antitrust laws to discriminatory conduct by broadband
    providers. First, it is unclear that the Federal Trade
    Commission has authority to enforce the antitrust law against
    common carriers, which are exempted under section 5 of the FTC
    Act, even where a carrier is acting as a broadband provider.
    This exact question is before the ninth circuit in an en banc
    review of its prior ruling that the FTC does not possess this
    authority.
        Secondly, to the extent that the Federal Trade Commission
    even has the authority over common carriers, there is no
    evidence that antitrust enforcement is a substitute for bright-
    line rules to ensure openness. The Commission's proposal does
    not address or even ask this question, while the Federal Trade
    Commission's 2007 report on broadband connectivity and
    competition policy does not provide clear guidance on whether
    paid prioritization blocking or throttling are cognizable harms
    under the antitrust laws.
        The point is underscored by bipartisan legislation
    introduced by Chairman Goodlatte in 1999 and Chairman
    Sensenbrenner in 2006, which each would have made
    discriminatory conduct by broadband providers an antitrust
    violation tacitly recognizing that this conduct does not
    violate the antitrust laws today. And finally, as Professor Tim
    Wu has previously testified before this Subcommittee, the type
    of economic analysis that antitrust enforcement relies upon
    does not reflect diffuse but important values, like speech or a
    healthy economy.
        In other words, it is virtually impossible for antitrust
    enforcement to protect against the full array of discriminatory
    conduct prohibited by the Open Internet Order. Before closing,
    I want to make a moment to note that a primary goal of
    preserving Internet openness is to prevent Internet gatekeepers
    from choosing the content that consumers are able to see online
    or balkanizing the Internet.
        Today, there is increasing concern that some platforms have
    abused their dominance to stifle innovation, undermine privacy,
    and divert readers and advertising revenue away from
    trustworthy sources of news and information, as the Open
    Markets Institute recently observed in a letter to the FTC. I
    have previously requested that the Committee hold a hearing to
    examine the effects of platform dominance on consumers,
    innovations, and workers to ensure that the antitrust laws are
    working effectively, and I renew that request today.
        As I have said before, we cannot retreat from hard
    conversations about new issues. I again thank the Chairman for
    calling today's hearing and look forward to the testimony of
    our esteemed panel of witnesses. And I yield back.
        Mr. Marino. Thank you. The Chair recognizes the Chairman of
    the full Judiciary Committee, Mr. Goodlatte from Virginia for
    his opening statement.
        Chairman Goodlatte. Thank you, Mr. Chairman. And I very
    much appreciate your holding this very important hearing today.
    Actually, today's hearing marks the seventh hearing over the
    past decade that the Judiciary Committee has held on the topic
    of net neutrality. The significant amount of time and effort
    devoted to this topic evidences the need for a more permanent
    solution. Fortunately, the FCC, under the leadership of newly-
    confirmed Chairman Ajit Pai, is taking actions to help steer us
    in that direction.
        On May 18, 2017, 2 years after the Obama administration's
    FCC imposed the Open Internet Order, the current FCC adopted a
    Notice of Proposed Rulemaking (``NPRM'') to reexamine the
    regulatory framework established by the 2015 Order. The NPRM
    proposes, among under things, to reverse the decision of the
    Obama administration's FCC to reclassify broadband Internet
    access service as a telecommunications service under the
    Communications Act of 1934. The NPRM also requests comment on
    whether to keep, modify, or eliminate certain ``bright-line
    rules'' adopted in the 2015 Order and whether regulatory
    intervention in the Internet service provider market is
    necessary. Finally, the NPRM proposes to eliminate the
    ``general Internet conduct standard,'' which gives the FCC
    significant discretion to prohibit any ISP practice that it
    believes runs afoul of a non-exhaustive list of factors.
        The Internet that existed before the 2015 Order was
    dynamic, competitive, open, and free. By raising costs,
    imposing heavy regulatory burdens, introducing significant
    regulatory uncertainty, and instituting government meddling
    into nearly every aspect of the Internet, the Obama
    administration's FCC seriously undermined the Internet's
    competitive nature.
        The Obama administration's FCC argued, under the guise of
    ``net neutrality,'' that imposing blanket regulation on the
    Internet marketplace is needed to encourage competition and
    promote a ``virtuous cycle'' of broadband use, innovation, and
    investment. I am deeply skeptical of these claims.
        In my experience, regulation generally stifles, rather than
    facilitates, competition and innovation. In fact, it is my
    belief that the Internet flourished precisely because it
    developed in a less regulated market. That is not to say that
    we should stand by and allow companies to engage in
    discriminatory or anticompetitive activities. Rather, I believe
    that the principles of ``net neutrality'' can be best achieved
    through the vigorous application of our Nation's antitrust laws
    and, at most, a much lighter-handed regulatory approach than
    that contained in the 2015 Order.
        Strong enforcement of our antitrust laws can prevent
    dominant Internet service providers from discriminating against
    competitors' content or in engaging in anticompetitive pricing
    practices. Supporters of net neutrality have voiced particular
    concerns over vertical agreements or mergers between Internet
    service providers and related businesses. Many experts
    acknowledge that these vertical agreements could possibly lead
    to anti-competitive conduct that could potentially harm
    consumers. In extreme cases, these arguments could eventually
    block downstream products, degrade services, and lead to higher
    prices for American families. I strongly agree that these anti-
    competitive practices should be aggressively deterred and
    punished.
        Yet, it is in these specific areas that the FTC has the
    relevant expertise and the most robust toolbox to address
    anticompetitive activities. Blanket regulation, by contrast,
    would deny consumers the potential benefits in cost savings and
    improved services that may result from vertical agreements.
        Furthermore, antitrust laws can be applied uniformly to all
    Internet market participants, not just to Internet service
    providers, to ensure that improper behavior is policed
    uniformly across all corners of the Internet marketplace.
        The House Judiciary Committee conducted previous hearings
    last Congress, examining whether antitrust law or regulation is
    more effective at protecting consumers and innovation on the
    Internet. And witnesses testified strongly in support of
    applying antitrust law.
        Given the NPRM being considered by the FCC, it is essential
    that we continue this conversation as we search for a more
    permanent solution to this issue that provides for the
    flexibility to drive innovation and consumer welfare.
        Ultimately, I am open to the idea of amending the antitrust
    laws, if necessary, to account for the characteristics of the
    Internet. I will continue to use the House Judiciary
    Committee's jurisdiction over our Nation's antitrust laws and
    enforcement agencies in order to protect an open Internet and
    ensure that the Internet continues to flourish in a competitive
    deregulatory environment.
        Today's hearing will demonstrate the significant support
    for reversing the 2015 Order and returning to a less-intrusive
    regulatory state in which the antitrust laws and the Federal
    Trade Commission play a significant role in addressing harmful
    conduct.
        I look forward to hearing today's testimony on the role of
    antitrust laws in creating a permanent solution to the net
    neutrality debate that has been raging for over a decade. And I
    yield back. Thank you, Mr. Chairman.
        Mr. Marino. Thank you. The Chair recognizes the Ranking
    Member of the full Judiciary Committee, Mr. Conyers of
    Michigan, for his opening statement.
        Mr. Conyers. Thank you, Chairman Marino. And top of the
    morning to all of our witnesses and members here, including the
    son of one of them. The Judiciary Committee has a central role
    in studying the issue of net neutrality and, more generally,
    competition on the Internet. As the Committee considers today
    the specific question of whether antitrust law would be a
    better tool than regulation to ensure Internet competition and
    innovation, we should keep several factors in mind.
        To begin with, failure to guarantee net neutrality is not
    an option. As I have previously observed at prior hearings on
    this topic, and I do not want to give my seniority away, but in
    2008, 2011, 2014, 2015, there are many areas in the United
    States where consumers have the choice of only one or two
    broadband Internet service providers. As a result, these
    broadband providers effectively function as monopolies or
    duopolies, let's face it.
        Their control over the broadband access market gives them
    the incentive and ability to provide differential treatment of
    content, depending on factors like how much a content provider
    pays or whether the broadband provider also offers competing
    content. Such discrimination can lead to less consumer choice,
    less innovation, higher costs, and more power to control the
    flow of information and ideas in the hands of fewer broadband
    providers. Enforcement of existing antitrust laws as the
    exclusive or primary means of ensuring an open Internet,
    however, would be insufficient.
        Under current antitrust law, there is relatively little
    that regulators can do outside the merger review context to
    address the conduct of a regulated industry, such as broadband
    Internet service, with respect to enforcing net neutrality
    principles. Through a series of decisions, the Supreme Court
    has limited the potential to successfully pursue claims under
    the Sherman Antitrust Act with respect to net neutrality.
        In addition, antitrust enforcement alone would be a
    cumbersome, more limited, more resource-intensive, and after
    the fact way than regulation to develop a regulatory regime for
    net neutrality. Moreover, antitrust law is not sufficiently
    broad in scope, as it fails to address the noneconomic goals of
    net neutrality, including the promotion of innovation and the
    protection of free speech and political debate.
        Now, while I welcome the recent efforts of some
    progressives to restore the original understanding and purpose
    of antitrust law to better account for the political
    implications of the excessive concentration of corporate power,
    antitrust law, nonetheless, will remain a necessary but
    insufficient tool with respect to ensuring net neutrality. In
    light of the foregoing, the Federal Communications Commission's
    2015 Open Internet Order provides a strong and vital set of
    rules for ensuring an open Internet, and the Commission should
    not rescind it.
        Rules to address net neutrality have the benefit of
    addressing potential threats to an open Internet before they
    fully materialize. Additionally, having a set of best practices
    enshrined in rules would provide certainty for the industry. I
    am particularly pleased that the Open Internet Order contains
    key provisions that many others like myself have long called
    for, including a rule preventing broadband providers from
    blocking or throttling Internet access or from imposing paid
    prioritization of Internet traffic and prohibition on any other
    practices that unreasonably interfere with or disadvantage
    users' ability to access broadband service or lawful content
    applications or services.
        These measures are the best way to protect the virtuous
    cycle of innovation which net neutrality fosters and which
    ensures both competition and innovation among broadband and
    content providers to the ultimate benefit of consumers. I thank
    Chairman Marino for holding this hearing, and I look forward to
    our witnesses' testimony today. Thank you, Mr. Chairman.
        Mr. Marino. Thank you. Without objection, other members'
    opening statements will be made part of the record.
        Statement submitted by the Honorable Henry C. ``Hank''
    Johnson, Jr., Georgia, Subcommittee on Regulatory Reform,
    Commercial and Antitrust Law, Committee on the Judiciary. This
    material is available at the Committee and can be accessed on
    the Committee Repository at: http://docs.house.gov/meetings/JU/
    JU05/20171101/106572/HHRG-115-JU05-MState-J000288-20171101.pdf.
         Mr. Marino. I will begin by swearing in our witnesses
    before we introduce them. If you would please all rise, and
    raise your right hand.
        Do you swear that the testimony you are about to give
    before this Committee is the truth, the whole truth, and
    nothing but the truth, so help you God?
        Let the record reflect that all of the witnesses have
    responded in the affirmative. Please be seated, and thank you.
        I am going to introduce all of the witnesses before we
    start with your opening statements. Maureen K. Ohlhausen was
    sworn in as Commissioner of the Federal Trade Commission on
    April 4, 2012 and was designated as Acting Chairman by
    President Donald Trump in January 2017.
        Prior to joining the Commission, Ohlhausen was a partner in
    Wilkinson Barker Knauer, LLP, where she focused on FTC issues,
    including privacy, data protection, and cybersecurity. Ms.
    Ohlhausen previously served at the Commission for 11 years,
    most recently as Director of the Office of Policy Planning from
    2004 to 2008, and she led the FTC's Internet access taskforce.
    Ms. Ohlhausen was also Deputy Director of that office.
        From 1998 to 2001, she was an attorney advisor for former
    FTC Commissioner, Orson Swindle, advising him on competition
    and consumer protection matters. Before coming to the FTC, Ms.
    Ohlhausen spent 5 years at the U.S. Court of Appeals for the
    D.C. Circuit serving as a law clerk for Judge David B. Sentelle
    and as a staff attorney.
        She also clerked for Judge Robert Yock of the U.S. Court of
    Appeals Claims from 1991 to 1992. Ms. Ohlhausen graduated with
    distinction from Antonin Scalia Law School, George Mason
    University in 1991 and graduated with honors from the
    University of Virginia in 1984. Commissioner, thank you for
    being here.
        Michael Romano is the Senior Vice President of Industry
    Affairs and Business Development at NTCA Rural Broadband
    Association, where he oversees public policy advocacy, industry
    affairs, business opportunities, and community outreach efforts
    for the trade association on behalf of several hundred rural
    telecom operator members.
        Prior to working with NTCA, Mr. Romano was general counsel
    with the firm Bingham McCutchen LLP, representing
    telecommunication carriers and other service providers in
    regulatory rulemaking and adjunctive proceedings and civil and
    administrative litigation.
        He has also worked with Global Telecom and Technology,
    formerly Global Internetworking as vice president and General
    Counsel, and at other tech companies, such as America Online
    and Level 3 Communications. Mr. Romano was also an associate at
    the firm of Swidler Berlin LLP, representing clients in
    regulatory processings for State regulators in the Federal
    Communications Commission and in contract negotiations with
    other industry operators. Mr. Romano earned his B.A. from
    Middlebury College and his J.D. from Georgetown University Law
    Center. Welcome, sir.
        Terrell McSweeny currently serves as Commissioner to the
    FTC. Prior to her appointment to the Commission by President
    Obama, Commissioner McSweeny served as Chief Counsel for the
    Competition Policy and Intergovernmental Relations Department
    with the Antitrust Division of the Department of Justice.
    Commissioner McSweeny also served as Senior Advisor to
    President Obama and Vice President Biden, Deputy Chief of Staff
    to then-Senator Biden, and counsel to the Senate Judiciary
    Committee.
        She also worked in private practice at the firm of
    O'Melveny and Myers. Commissioner McSweeny earned her
    bachelor's degree from Harvard University and her J.D. from
    Georgetown University School of Law.
        Robert McDowell is a partner with the firm Cooley LLP,
    where he specializes in regulatory communication mergers and
    acquisitions and telecommunications and wireless technology.
    Prior to joining Cooley, Mr. McDowell served as a Commissioner
    of the Federal Communications Commission, the FCC, for 7 years.
    He was first appointed by President George W. Bush in 2006 and
    again by President Obama in 2009.
         At the FCC, Mr. McDowell led efforts to expand consumer
    access to spectrum through his work on the two largest wireless
    auctions in the U.S. history at the time. He played a key role
    in 2009 digital television transition, and led efforts to
    establish the first Federal Civil Rights rule in a generation
    by creating a ban on racially discriminatory practices in
    broadcast advertising.
         He also helped oversee several large and complex mergers
    including SiriusXM and Comcast NBCUniversal. Prior to serving
    with the FCC, he was senior vice president for CompTel, the
    Competitive Telecommunications Association. Mr. McDowell earned
    his B.A. with honors from Duke University and his J.D. from
    William and Mary Law School. And I know that he has some very
    competent backup with him sitting behind him, his son. So,
    welcome.
        Each of the witnesses' written statements will be entered
    into the record in its entirety. I ask that each witness
    summarize his or her testimony in 5 minutes or less. To help
    you stay within that time, there is a timing light in front of
    you. The light will switch from green to yellow indicating that
    you have 1 minute to conclude your testimony. And when the
    light turns red, it indicates that the witnesses' 5 minutes
    have expired.
        I want to thank you witnesses for being here, and the
    Honorable Ms. Ohlhausen, please.

     STATEMENTS OF MAUREEN K. OHLHAUSEN, ACTING CHAIRMAN, FEDERAL
       TRADE COMMISSION; MICHAEL ROMANO, SENIOR VICE PRESIDENT,
        INDUSTRY AFFAIRS AND BUSINESS DEVELOPMENT, NTCA (RURAL
    BROADBAND ASSOCIATION); TERRELL MCSWEENY, COMMISSIONER, FEDERAL
      TRADE COMMISSION; AND ROBERT MCDOWELL, FORMER COMMISSIONER,
                   FEDERAL COMMUNICATIONS COMMISSION

                   STATEMENT OF MAUREEN K. OHLHAUSEN

        Ms. Ohlhausen. Chairman Marino, Ranking Member Cicilline,
    and members of the Subcommittee, I appreciate this opportunity
    to appear before you today to discuss network neutrality and
    the role of antitrust. Ten years ago, a bipartisan FTC approved
    a staff report that analyzed competition in consumer protection
    issues related to net neutrality and cautioned against
    regulation. Applying economic and antitrust analysis, our
    report explained that banning non-neutral behavior could harm
    consumers more than it helps them. Instead, the report noted
    that the FTC could assess whether ISP's practices are
    anticompetitive, unfair, or deceptive on a case-by-case basis.
        The report also recommended that ISPs clearly disclose the
    material terms of broadband access, particularly any traffic-
    shaping practices. This report remains highly relevant today,
    and where the evidence has changed, it shows the broadband
    market is more competitive than it was in 2007, strengthening
    the report's conclusions. More recently, FTC staff filed a
    comment to the FCC detailing our expertise and recommending
    that the FCC reclassify broadband as a title I noncommon
    carrier service. And I agree with that recommendation, and
    filed my own comment to that effect.
        As the 2007 report and subsequent comments state, the FTC's
    antitrust and consumer protection tools help ensure that
    consumers can pursue their preferences, whether for prioritized
    services or for equal treatment of all data by ISPs. The FTC
    has addressed a wide range of anticompetitive behavior,
    including the kinds of behavior that concern net neutrality
    advocates.
        For example, the FTC has sued companies for foreclosing
    rival content in an exclusionary or predatory manner, and
    challenged problematic access discrimination, pricing, and
    bundling practices. And we have conditioned vertical mergers
    that would have foreclosed competition in a downstream market.
    Antitrust enforcement, by protecting the competitive process,
    can promote net neutrality if that is what consumers want.
        Advocates of regulation often argue that consumers value
    the equal treatment of data by ISPs. If so, then any ISP that
    systematically degrades applications and content that its
    subscribers demand will certainly face a backlash. On the other
    hand, consumers may desire and benefit from certain non-neutral
    ISP practices, such as streaming services bundles or
    prioritization of telemedicine services. Case-by-case antitrust
    enforcement focused on competitive harm will allow ISPs and
    content providers to experiment in ways that benefit consumers,
    while guarding against arrangements that foreclose access to
    edge providers.
        Supporters of net neutrality regulation also commonly
    assert that the retail broadband market lacks competition, but
    measuring competition is not a simple exercise of counting how
    many wireline ISPs in an area provide broadband at a certain
    speed threshold. It requires careful product and market
    definitions and analysis of the disciplining effects of
    substitutes and potential entrants. The evidence of growing
    competition, such as improving speeds, the expansion of mobile
    broadband, and vigorous pricing competition, must also be
    considered when determining whether net neutrality regulation
    is necessary.
        Like our antitrust tools, the FTC's consumer protection
    authority can help address concerns that consumers are not
    getting what they expect from their ISP. Our deception
    authority bans companies from offering consumers one product or
    service but providing them something different. And if ISPs
    promise to adhere to net neutrality principles, the FTC can
    hold them to these promises. Our deception authority also
    requires companies to disclose material information--for
    example, blocking or throttling practices--if not disclosing it
    would mislead a reasonable consumer.
        The FTC's unfairness authority prohibits practices where
    the actual or likely consumer injury is substantial,
    unavoidable, and not outweighed by benefits to consumers or
    competition. The FTC has used this authority to sue companies
    that unilaterally violated their promises. Indeed, the FTC is
    currently challenging as unfair and deceptive AT&T Mobility's
    alleged practice of throttling wireless data plans which they
    advertise as unlimited.
        Case-by-case enforcement against particular instances of
    harm to consumers or competition is the right approach when we
    know that a type of practice typically benefits consumers and
    spurs competition.
        In contrast, a per se prohibition is appropriate only where
    we have evidence that a specific practice nearly always harms
    consumers without corresponding benefits. In short, the FTC has
    tools that are capable of protecting consumers and competition
    online. Thank you.
        Hon. Ohlhausen's written statement is available at the
    Committee or on the Committee Repository at: http://
    docs.house.gov/meetings/JU/JU05/20171101/106572/HHRG-115-JU05-
    Wstate-OlhausenM-20171101.pdf.
        Mr. Marino. Thank you. Mr. Romano.

                      STATEMENT OF MICHAEL ROMANO

        Mr. Romano. Chairman Marino, Ranking Member Cicilline, and
    members of the Subcommittee, thank you for the chance to offer
    the perspective of small, rural broadband network operators on
    agency roles and governance related to broadband. I am Mike
    Romano, Senior Vice President of NTCA, the Rural Broadband
    Association.
        Our nearly 850 members serve the most rural parts of the
    U.S., less than 5 percent of the U.S. population, spread across
    more than 35 percent of the U.S. land mass. On average, they
    employ a few dozen people.
        Nonetheless, these small, hometown businesses strive to
    deploy networks that position rural America for success in a
    broadband world. Any small business can talk to the perils of
    ambiguous and heavy handed regulation, but for rural broadband
    operators in particular, time and resources needed to comply
    with the complex rules can hinder efforts to fulfill a
    statutory mandate for universal service, ensuring that every
    American, no matter where they live, has access to services
    reasonably comparable in price and quality to those in urban
    areas.
        At the same time, the capital-intensive nature of rural
    telecom makes regulatory certainty essential. Finding a steady
    balance in any framework is critical to promote and sustain
    rural broadband. This requires a division of labor between
    agencies based upon clear statutory constructs, core
    competencies, and expertise. Thus, even as NTCA has urged rules
    of the road to enable and sustain rural broadband, we have
    expressed concern about rules that may reach too far or be used
    as a platform for yet more rules to come.
        To this end, NTCA did not support retail broadband
    regulation by the FCC leading up to the Open Internet Order. We
    advocated, instead, for a different regime that would have
    targeted oversight of interconnection between the underlying
    networks. We had hoped the 2015 Open Internet Order might adopt
    a limited approach like we advocated, but it did not. Instead,
    the order imposed complex and escalating obligations only upon
    retail broadband providers, despite the dynamic, multisided
    nature of the broadband ecosystem.
        Beyond questions of burden and the one-sided nature of the
    rules, the value of some of the rules adopted in 2015 remains
    unclear. For example, NTCA argued that new sector-specific
    privacy rules to govern custody and the use of data would only
    burden retail broadband providers and confuse customers, given
    other firms have control of the same data subject to different
    rules.
        For these reasons, NTCA was grateful when the FCC and
    Congress earlier this year put brakes on certain of the rules.
    Our Nation now has an important opportunity to reset and to
    establish a more appropriate division of labor, based, again,
    upon clear statutory constructs, core competencies, and agency
    expertise.
        NTCA submits that consumer broadband protection and retail
    marketplace competition issues are better overseen by the FTC,
    which is well-versed in such matters in the oversight of mass
    market services generally than by the FCC. Placing these
    responsibilities with the FTC, pursuant to its statutory
    mandates, can help avoid the kinds of concerns I described
    moments ago. But other distinct statutory provisions are
    important to keep in mind too, as our Nation considers next
    steps with respect to promoting the use of broadband.
        Of particular significance to rural America is the separate
    statutory mandate for universal service. The ongoing importance
    of promoting universal service in a broadband world must be
    sustained in any regulatory transitions to come. To help
    fulfill this statutory mandate, NTCA has highlighted the need
    to ensure that underlying networks interconnect and exchange
    data. A targeted focus by the FCC on such matters would be in
    sharp contrast to retail broadband services that have been the
    subject of sweeping regulatory attention to date.
        A network-focused framework need not, and indeed must not,
    interfere with a dynamic retail broadband marketplace. It must
    not transform into new net neutrality rules, creep into retail
    regulation, or erect ex-ante obligations that hinder
    innovation. This, in fact, was one of our primary concerns with
    the Open Internet Order in that the new rules looked very
    different than even the title II based frameworks under which
    our members had operated for years as historical telephone
    companies.
        But representing networks that sit hundreds of miles away
    from potential interconnection points and have already faced
    connectivity challenges in other contexts, NTCA is deeply
    concerned about ensuring rural America gets and stays connected
    with the rest of the broadband world, consistent with the goals
    of universal service.
        NTCA submits the FCC is well-equipped by law and experience
    to deal with matters of interconnection specifically as a
    distinct and separate matter from any net neutrality
    considerations. We, therefore, encourage a continued role for
    the agency in this discrete yet critical regard, even as the
    FTC might soon reassume primacy with respective to consumer
    protection and competition in the retail broadband marketplace.
        In short, as changes are contemplated to address broadband
    policy, NTCA urges Congress and the FCC and FTC working in
    partnership to ensure that other distinct but important public
    policy principles, such as universal service and connectivity,
    are also fulfilled and sustained in a broadband world. NTCA
    looks forward to continuing to work with you and the agencies
    on behalf of our hundreds of small operator members and the
    millions of rural Americans they serve. Thank you.
        Mr. Romano's written statement is available at the
    Committee or on the Committee Repository at: http://
    docs.house.gov/meetings/JU/JU05/20171101/106572/HHRG-115-JU05-
    Wstate-RomanoM-20171101.pdf.
        Mr. Marino. Thank you. The Chair now recognizes the
    Honorable Ms. McSweeny.

                     STATEMENT OF TERRELL MCSWEENY

        Ms. McSweeny. Good morning. Thank you very much, Chairman
    Marino and Ranking Member Cicilline, Chairman Goodlatte,
    Ranking Member Conyers; a pleasure to see you and the
    distinguished members of the Committee. I am Terrell McSweeny.
    I am a commissioner at the Federal Trade Commission, but today
    I am speaking on behalf of myself, not the commission. I
    support the FCC's 2015 Open Internet Order because it
    establishes clear rules to protect consumers and entrepreneurs
    who are dependent on a few very large broadband providers that
    serve as the gatekeepers to the Internet.
        For more than a decade, the status quo in the United States
    has been an open Internet that supports thriving innovation. I
    am proud to serve at the Federal Trade Commission, but it is
    wrong to assume that a framework that relies solely on
    backward-looking consumer protection and antitrust enforcement
    can provide the same assurances to innovators and consumers as
    forward-looking rules contained in the FCC's Open Internet
    Order.
        While it is true that the FTC possesses a great deal of
    expertise in areas of antitrust and consumer protection, it
    does not possess specialized subject matter expertise in
    telecommunications, data network management practices, or in
    detecting instances of data discrimination. That expertise is
    housed at the FCC. These are very real and significant limits
    to the effectiveness of the FTC's tools in policing
    nondiscrimination on networks and protecting competition.
        Moreover, antitrust tools are designed to protect
    competition, but broadband markets are highly concentrated. The
    majority of American consumers have little or no choice when it
    comes to wireline broadband. Competitive pressure cannot be
    counted on to either push ISPs to offer consumers better
    contract terms or quality of service or to limit discriminatory
    conduct.
        Since most U.S. consumers are dependent on a few big
    players to access the Internet, the critical question, then, is
    whether these companies have the incentive and ability to harm
    consumers and competition. Both the Department of Justice and
    the Federal Communications Commission have recognized that they
    do.
        For example, big broadband companies also supply video
    programming. That means that their revenues are directly
    threatened when consumers use broadband connections to access
    competing video providers or new entrants. It is well-
    established that appropriately tailored regulation can
    complement antitrust law in highly concentrated markets,
    particularly when vertically integrated incumbents have
    incentives to harm competitors. Absent clear rules, the
    detection of discriminatory conduct is costly, difficult, time-
    consuming, and hard to remedy.
        For example, let's say you are watching streaming video,
    and your stream becomes slow or grainy. Is that caused by
    intentional data discrimination by your ISP, or might it be a
    server issue related to the content provider? Perhaps it is a
    spotty connection, or maybe it is something else entirely. How
    would a typical consumer know? How would the FTC?
        If the FTC were to detect a possibly anticompetitive
    practice, antitrust enforcement requires not only detection but
    thorough investigation, prosecution, a potentially lengthy rule
    of reason analysis, and perhaps a multiyear appeals process. At
    the end of that process, we could not travel back in time to
    undo the harm that had excluded the rival or reset the
    competitive evolution of the marketplace. Remedy remains a
    serious challenge to relying on an antitrust enforcement
    approach.
        Moreover, the premise of Internet openness is that
    consumers should be able to use their broadband connections to
    access the lawful content of their choosing. Noneconomic
    values, such as freedom of expression and diversity of
    discourse, may not be easily reached under antitrust law.
    Finally, the FTC's jurisdiction over common carriers remains
    unclear. Even if the FCC reclassifies broadband as an
    information service, the majority of providers will continue to
    provide common carrier services, and, therefore, will remain
    classified as common carriers.
        Unless Congress repeals our common carrier exemption, we
    will continue to face challenges to our authority over these
    industries. Additionally, renovations to the FTC's authority--
    for example, giving it more extensive tools to protect consumer
    data and privacy, making sure it has the proper resources, and
    giving it more leeway to challenge anticompetitive measures and
    conduct in highly-concentrated markets--would help the
    Commission keep pace with changes in the economy.
        Earlier this year, Congress took the unfortunate action, in
    my view, of repealing the FCC's broadband privacy rules,
    leaving consumers without important protections over how their
    data is used and shifting the risk from industry giants onto
    American families. We should not double down on this approach.
    This is not a situation where we have an either-or choice
    between clear FCC rules to protect an open Internet and FTC
    enforcement.
        By design, the agencies have different tools, with
    different features. Both have a role to play when it comes to
    protecting consumers and ensuring an Internet that fosters
    innovation. Thank you.
        Hon. McSweeny's written statement is available at the
    Committee or on the Committee Repository at: http://
    docs.house.gov/meetings/JU/JU05/20171101/106572/HHRG-115-JU05-
    Wstate-McSweeneyT-20171101.pdf.
        Mr. Marino. Thank you. The Chair recognizes the Honorable
    Mr. McDowell.

                      STATEMENT OF ROBERT MCDOWELL

        Mr. McDowell. Thank you, Mr. Chairman. Chairman Goodlatte,
    Chairman Marino, Ranking Members Conyers and Cicilline, and all
    distinguished members of the Committee, thank you so much for
    having me back before your Committee today. Also, thank you for
    the special recognition of my aide-de-camp for the day, Cormac
    Augustine McDowell. It is an honor to be back here and also
    with this distinguished panel with Chairman Ohlhausen,
    Commissioner McSweeny, and Mr. Romano.
        So, I am a partner at Cooley LLP, and today, I am
    representing Mobile Future, where I am the Chief Public Policy
    Advisor. Mobile Future is a coalition of cutting-edge
    technology and communications companies and a diverse coalition
    of nonprofit organizations working to support an environment
    that encourages investment and innovation in the dynamic
    wireless sector, such as with 5G and the Internet of Things.
        During my 7 years as a commissioner of the Federal
    Communications Commission, from 2006 to 2013, I worked
    extensively on protecting an open and freedom-enhancing
    Internet, and testified before this Committee during many of
    the hearings that Mr. Conyers pointed out earlier.
        During the course of my work, I weighed the costs and
    benefits of ex-ante economic regulation of these markets versus
    ex-post enforcement of antitrust and competition laws. Each
    time I examined the facts and the law, I determined that ex-
    post enforcement worked far better for the dynamic and fast-
    paced Internet market than top-down ex-ante telecom regulation
    drawn from antiquated statutes. I was also inspired by the
    FTC's unanimous and bipartisan report from 2007, which
    underscored the importance of avoiding unnecessary economic
    regulation in this space, and it prophetically warned against
    its likely unintended consequences.
        Indeed, bipartisan and light-touch Internet policies
    engendered during the Clinton-Gore administration worked
    incredibly well, making the Internet the greatest deregulatory
    success story of all time. Internet technologies proliferated
    faster than any other disruptive technology in history and are
    improving the human condition more and more each day as the
    direct result of flexible light-touch public policy.
        But in 2015, the FCC radically departed from that long-
    standing bipartisan light-touch consensus when it voted three
    to two to classify broadband Internet access as a telecom
    service for the first time in U.S. history. In so doing, it
    imposed a 1934 law designed for phones that were held in two
    hands onto the complex and dynamic Internet, all while
    stripping the Federal Trade Commission of its ability to police
    the broadband market due to the common carrier exemption.
        As a result, investment in next-generation networks has
    been deterred, popular innovations, such as zero-rating
    offerings, have been discouraged, and the legal landscape has
    been thrown into a state of confusion, especially when it comes
    to consumer privacy protection.
        The FCC is poised to reverse that error, however. Assuming
    it will rescind the title II Order, consumers, entrepreneurs,
    innovators, and investors alike should all know that American's
    time-tested antitrust and competition laws stand at the ready
    to protect the Internet ecosphere and keep it vibrant, just as
    they did so well before the counterproductive 2015 Order.
        Both the Department of Justice, who is not here today, and
    the FTC have proven themselves to be highly effective cops on
    the beat throughout the complex Internet economy.
        Lastly, and perhaps most importantly, today it is my hope
    that when the FCC rescinds the title II Order, it will also
    reiterate that broadband Internet access is inherently an
    interstate service, which calls for exclusive Federal
    jurisdiction.
        The Commission should, therefore, preempt all State and
    local laws attempting to regulate broadband services, including
    those addressing privacy. Having a byzantine patchwork of state
    and local laws attempting to regulate the borderless and global
    Internet will wreak havoc on the digital economy, suffocate
    investment and innovation, confuse consumers, and encourage
    foreign governments and multilateral international bodies to
    respond in kind.
        Rescinding the title II Order with strong Federal
    preemption will simplify the regulatory landscape, provide
    certainty to all market players, and offer consumers one set of
    strong and clear Federal privacy protections administered by
    the one expert agency for privacy, the Federal Trade
    Commission. Thank you very much, and I look forward to your
    questions.
        Hon. McDowell's written statement is available at the
    Committee or on the Committee Repository at: http://
    docs.house.gov/meetings/JU/JU05/20171101/106572/HHRG-115-JU05-
    Wstate-McDowellR-20171101.pdf.
        Mr. Marino. Thank you. We will now begin our 5 minutes of
    questioning, and the Chair recognizes the Chairman of the full
    Judiciary Committee, the gentleman from Virginia, Congressman
    Goodlatte.
        Chairman Goodlatte. Thank you very much, Mr. Chairman.
    Welcome to all of these panelists. I think you have given us
    excellent testimony. Mr. McDowell, let me start with you. In
    your testimony, you discussed the regulatory whiplash that has
    resulted from the 2015 Order. Can you elaborate on that
    description, and compare what impact an ex-post antitrust
    approach would have on innovation and the Internet?
        Mr. McDowell. What we mean by that is the ex-ante
    regulation can be translated in the vernacular as a mother-may-
    I. So, if you look at popular service offerings, such as zero-
    rating, consumers like zero-rating. It can benefit consumers.
    It can cost them less money for services and products.
        The FCC, initially, kind of gave a green light, or a
    cautious green light, that zero-rating was allowed under its
    2015 Order, and then immediately after that, started to pull
    back from that, and question it, and wanted to see case-by-case
    what each offering of zero-rating entailed, whether or not they
    did like it. And that started to inhibit the offering of a very
    popular service.
        So, that is part of the regulatory whiplash. And then, of
    course, we have this, you know, ping pong match that has gone
    on over the years throughout a large percentage of my career of
    the FCC issues an order, it goes up to the appellate courts, it
    comes back to the FCC, there is a surprise election, the FCC
    changes hands, there is going to be another order, maybe other
    appeals. And that is where I think it would be great for
    Congress to give some clarity, and ultimately, put this debate
    to rest.
        Chairman Goodlatte. Mr. Romano, you used the example of
    rural call incompletion in your testimony to describe how
    certain anticompetitive conduct could also occur with respect
    to rural broadband providers. Can you elaborate more on those
    fears?
        Mr. Romano. Thank you, Chairman Goodlatte. Yes. So, rural
    call completion, for those that are not familiar with it, is
    essentially this notion of where we have seen instances of
    calls failing to reach rural America, where consumers and
    businesses cannot receive their calls that are placed by urban
    consumers or businesses. We cite that as a concern of where we
    think that there is a need for some limited involvement by the
    FCC.
        We have seen that in the past, the FCC has been very
    effective in that specific instance of where you are talking
    about interconnection of networks being able to delve into the
    problem, figure out who the actors are in the space, and
    helping to resolve the concern, so that service is restored. We
    think that is an example of the right kind of regulation, the
    right targeted, limited regulation that is handled on an ex-
    post basis, mind you, but allows somebody to jump in and be a
    cop on the beat, if you will, to address such concerns.
        Chairman Goodlatte. Thank you. Commissioner Ohlhausen, what
    improvements, if any, should be made to the antitrust laws to
    ensure an open and competitive Internet marketplace? Should
    some sort of antiblocking or throttling or prioritization
    standards, or even categorical bans, be enacted, in your view?
        Ms. Ohlhausen. One of the first improvements I would
    recommend is to get rid of the common carrier exemption that
    the FTC is subject to, because I think that does create a lack
    of clarity. Certainly, the Department of Justice can bring
    enforcement actions, but I would recommend that. And then
    secondly, I think the antitrust laws have been able to address
    these kinds of behaviors in other markets.
        And so, I would be interested in hearing further proposals
    about what kind of changes, you know, Congress thinks would be
    appropriate here. I certainly have been supportive of the idea
    of the transparency requirement that the Internet service
    providers are subjected to. I think that creates a very good
    baseline, so that they are at least clear to consumers about
    what traffic-shaping behavior they may be engaging in.
        Chairman Goodlatte. Thank you. And Commissioner McSweeny,
    critics of the antitrust law approach, such as yourself, assert
    that litigation can be expensive and that a resolution can take
    too long relative to the dispute at issue. However, how would
    you compare that to the expense of an FCC action or litigation
    under the Open Internet Order and the potential time it takes
    for the FCC or courts to reach a resolution under the order? Is
    not that going to be an equally long and expensive process?
        Ms. McSweeny. Thank you for the question. I think from my
    perspective, I am primarily concerned about the impact of
    relying on an after-the-fact enforcement approach, as it
    relates----
        Chairman Goodlatte. I think that is critically where you
    and I disagree. You think you know ahead of time what you need
    to do to protect consumers, and I think that the dramatic
    competition that takes place on the Internet and new ideas is
    much better to figure out what consumers want, and then, let
    them decide, rather than you tell us ahead of time, because I
    think as former-Commissioner McDowell has pointed out, that has
    already begun to have a distortive effect on what is available
    on the Internet.
        Ms. McSweeny. I think what is really challenging is for
    entrepreneurs on the edge: app developers, the people who are
    generating the enormous demand for all of the wonderful
    innovation flowing from the Internet. If they cannot reach
    their audience, and they have to pay multiple fees----
        Chairman Goodlatte. But they can.
        Ms. McSweeny [continuing]. In order to connect with them--
    --
        Chairman Goodlatte. But they can and do.
        Ms. McSweeny [continuing]. Then they will not be able to
    scale. And there is no remedy for that available to them under
    antitrust law.
        Chairman Goodlatte. I get that. But they can, and they do.
    And there is just no evidence that what you are arguing is
    taking place.
        Ms. McSweeny. Well, they can, and they do because the
    status quo in the United States is an open Internet.
        Chairman Goodlatte. Right. But it has been based upon free
    and open competition, not based upon an order that they have to
    look at just as much as the telecom providers have to look at,
    in terms of what the rules of the road are. And that is really,
    in my opinion, the camel's nose under the tent in terms of what
    the FCC will do to regulate all aspects of the Internet, not
    just the broadband providers. Thank you, Mr. Chairman.
        Mr. Marino. Thank you. The Chair recognizes the gentleman
    from Michigan, Congressman Conyers, for his questions.
        Mr. Conyers. Thank you, Mr. Chairman. I want to begin by
    asking unanimous consent to enter into the record a letter from
    the National Association of Realtors, a statement from Anant
    Raut, a visiting fellow on behalf of public knowledge on net
    neutrality and the role of antitrust, a letter from Consumer
    Union to you, Mr. Chairman, and Ranking Member Cicilline, and
    finally, a statement of four sentences by our colleague, Frank
    Pallone.
        Mr. Marino. Without objection.
        These materials are made available at the Committee or on
    the Committee Repository at: http://docs.house.gov/meetings/JU/
    JU05/20171101/106572/HHRG-115-JU05-20171101-SD003.pdf.
        Mr. Conyers. Thank you. Commissioner McSweeny, please could
    you discuss with us the limitations of antitrust law in
    enforcing net neutrality principles? That is why we are here.
        Ms. McSweeny. Yes. I think setting aside the jurisdictional
    question that we have been discussing about whether the FTC
    even has appropriate jurisdiction under its statute, there are
    some real challenges associated with relying on an antitrust
    enforcement approach because this conduct may be difficult to
    detect. The antitrust enforcement agencies may not have
    sufficient expertise in network management to fully understand
    certain types of conduct.
        And, of course, antitrust enforcement necessarily relies on
    a full investigation and approach that balances through the
    rule of reason analysis, both the harms but also the benefits
    of the activity and is focused primarily on economic values as
    opposed to noneconomic values, like speech and freedom of
    discourse.
        Finally, I think there is a real challenge associated with
    what remedies may be available. If you are an innovator on the
    edge, and you are seeking to connect to your audience, then you
    may have a really difficult time relying solely on antitrust
    laws as a remedy. If you can never afford to make all the
    payments that you need to make to get access to the customers
    in the first place, then antitrust law 5 years after that has
    happened is not going to be a very useful remedy for you.
        Mr. Conyers. Here is what Frank Pallone, our colleague, a
    Ranking Member on House's Energy and Commerce Committee said:
    ``The FCC's current net neutrality protections provide the
    strongest protections for free speech and innovation online and
    have been upheld by the court. Keeping these rules in place is
    the fastest and surest way to protect consumers.
        Unfortunately, the FCC is working to undo these protections
    at the behest of a few large corporations. I urge my colleagues
    to stand united in defense of these protections. That is the
    best option to ensure an open Internet into the future.'' What
    do you think?
        Ms. McSweeny. I agree.
        Mr. Conyers. Okay. What effect would rescinding the Open
    Internet Order have on investment and innovation in the entire
    Internet market?
        Ms. McSweeny. I think that is a really important question,
    one that would require probably additional investigation,
    except there is an extensive record that the FCC has already
    relied on and that has been before the courts considering the
    order as well that really points to this virtuous cycle, this
    cycle of innovation that is incredibly important. It generates
    demand for investment in the infrastructure. It generates
    demand for all of the new services on the edge. And what we
    risk here is undermining all of the economics of that cycle and
    all of the innovation that is generated by it.
        Mr. Conyers. You know, some of have suggested that
    broadband providers do not have economic incentive to engage in
    discriminatory conduct because broadband markets are
    competitive, and consumers can switch easily among providers.
    What do you say?
        Ms. McSweeny. Well, most U.S. broadband markets are highly
    concentrated. Most consumers do not have a lot of choices when
    it comes to what providers to use.
        Mr. Conyers. That is true.
        Ms. McSweeny. And finally, we do have a very serious
    challenge, I think, when it comes to relying on competition to
    solve the problems that could be generated by very large
    vertically integrated firms that have an incentive to interfere
    with their competitors.
        Mr. Conyers. Thank you, commissioner. I yield back the
    balance of my time.
        Mr. Marino. Thank you. The Chair now recognizes the
    gentleman from Texas, Congressman Farenthold.
        Mr. Farenthold. Thank you very much. I want to start out
    with the troubling case in the court right now that we may rule
    that AT&T is a common carrier even for their Internet service,
    which would take away the FCC's jurisdiction. And I wanted to
    ask the members of our panel do you think Congress should act
    to remove that exemption or create specific exceptions or wait
    and see? We will start with Ms. Ohlhausen.
        Ms. Ohlhausen. The FTC on a unanimous bipartisan basis has
    long recommended that Congress remove common carrier exemption.
    So, I would continue to support the removal of that.
        Mr. Farenthold. And Mr. Romano.
        Mr. Romano. Yes. I think this is one of these areas where
    Congress could indeed help out and provide clarity with the
    statute.
        Mr. Farenthold. Ms. McSweeny, I know you are----
        Ms. McSweeny. I agree.
        Mr. Farenthold. All right.
        Mr. McDowell. Without speaking directly to that case, but
    yes, mobile broadband, in particular the common carrier
    exemption, should be eliminated.
        Mr. Farenthold. All right. Let's talk a little bit about
    rural broadband for a second. Mr. Romano, correct me if I am
    wrong: most rural broadband is delivered by independent folks.
    I mean, we do not have the big boys going out into the smaller
    counties.
        Mr. Romano. As I mentioned, our average employee base for
    our membership is about 25 employees.
        Mr. Farenthold. And do any of these companies generate
    massive content that they might want to prioritize over, you
    know, Netflix or Hulu?
        Mr. Romano. Not generally speaking. No, sir.
        Mr. Farenthold. All right. And so, while I have you, I am
    going to kind of jump around here, and I apologize for that.
    You talked in your testimony with Mr. Goodlatte about some of
    the interconnect issues and call completions. Are you seeing
    some of the interconnect issues also in broadband, or is it
    just primarily in the voice service?
        Mr. Romano. The call completion issue has been distinct to
    voice service, Congressman. The question that arises in our
    mind, though, is 10 years ago we would not have thought call
    completion would be an issue. We want to have somebody who can
    be some cop on the beat to jump in should that problem arise.
    We do not think, however, firm, hard, ex-ante rules are
    appropriate for this.
        Mr. Farenthold. But do not your rural broadband folks
    typically get their feed from fiber to go to some big pairing
    point somewhere? If that happens, could not they just switch to
    somebody else in that same pairing point and solve that?
        Mr. Romano. In many cases, Congressman, there may be
    multiple routes for interconnection; however, in other cases
    there are not, particularly in more rural States. It can be
    hard to--and distant, hundreds of miles away--to get to those
    interconnection points.
        Mr. Farenthold. All right. And Ms. McSweeny, you are kind
    of the lone pro net neutrality person on this panel. So, I want
    to visit with you for a second. I am concerned that if we adopt
    your pre-regulatory scheme that you are talking about, we
    actually make it harder for those innovators to get in because
    if you have got a new product that the regulations do not seem
    to contemplate, that is potentially a bar to entry too, is not
    it?
        Ms. McSweeny. Well, I think the innovators that I am
    worried about are generally innovators on the edge that are
    trying to enter the marketplace and connect with customers and
    scale very quickly. And, of course, they need to be able to do
    that without having to pay tolls to multiple companies.
        Mr. Farenthold. Who is that happening to now?
        Ms. McSweeny. Well, we have the Open Internet Order in
    place now. So, we are protecting them.
        Mr. Farenthold. Okay. Who was it happening to a year before
    the Open Internet Order?
        Ms. McSweeny. Well, again, I think the status quo of the
    United States has been the open Internet, which is why having
    rules to continue to protect it are very, very valuable.
        Mr. Farenthold. Are not the Open Internet Rules then just a
    solution looking for a problem?
        Ms. McSweeny. They are an important preservation of the
    pipeline for innovation to customers and the Internet. So, I
    think that they are very critical in preserving all of the
    innovation that we have enjoyed from having principles that
    protect the open Internet.
        Mr. Farenthold. All right. I want to go back to moving more
    of this over to the FCC, because a lot of the net neutrality
    rules deal specifically with who delivers the Internet to your
    house. And we have had some big discussions on privacy there.
        And if we move back to the FTC, the regulation is not just
    limited to say, as you will, the edge providers. You get the
    service providers too. I am as concerned about my ISP having my
    personally-identifiable private information as I am with Google
    and Facebook and any other place that I happen to order a pair
    of shorts from. So, why do we need to divvy this up between so
    many people? Mr. McDowell?
        Mr. McDowell. You raise an excellent point. Historically,
    the U.S. has had one expert agency to administer privacy
    regulation. That has been the Federal Trade Commission. It is a
    very complex issue. They have grappled with it beautifully. The
    FCC stumbled as it tried to implement that privacy order, and
    we need to revert jurisdiction back to the Federal Trade
    Commission.
        Mr. Farenthold. I wish I had time to give the other folks
    an opportunity to answer this, but I see my time is expired,
    Mr. Chairman.
        Mr. Marino. Thank you. The Chair recognizes the gentleman
    from Rhode Island, the Ranking Member of this Committee,
    Congressman Cicilline.
        Mr. Cicilline. Thank you, Mr. Chairman. I think at the
    outset, it is important to note that when the Chairman of the
    full Committee said, you know, ``Why is not it just up to
    consumers?'' It is important to note that 22 million people
    commented on net neutrality or an open Internet. And
    overwhelmingly, consumers said we want an open Internet and net
    neutrality and support the rule. So, if we want to listen to
    consumers that is a good beginning point.
        I would like to begin with Commissioner Ohlhausen. You said
    in your testimony that these noncompetitive actions of
    throttling and blocking, et cetera, can be cured when consumers
    identify it, and they can switch to a provider. So, I guess the
    first question I have is, is this really realistic that an
    individual consumer would be able to determine when a broadband
    provider is throttling, blocking, or prioritizing content, and
    then make this very frictionless transition to another provider
    in the absence of competition in many places in our country,
    and the inability for just an individual to know that?
        So, does not your model or your response imagine this kind
    of myth that an individual consumer has the ability to detect
    all this stuff? Is not that why that notion of competition
    being the framework that will prevent this from happening just
    does not work?
        Ms. Ohlhausen. So, Mr. Cicilline, the edge providers who
    are trying to transmit this content to consumers have an
    enormous interest in making sure that that content or services
    are delivered. So, these are not individual consumers. They are
    some of the most powerful, well-funded companies in the United
    States.
        And so, often when there have been complaints that their
    traffic is being degraded, that certainly has gotten a lot of
    attention. They have a lot of incentive and ability to do that.
    As for switching, one of the issues that we have seen is the
    enormous growth in wireless broadband access. So, I think that
    we need to include in the market wireless providers. And so,
    switching has become a lot easier.
        Mr. Cicilline. But to follow up on that, should consumers
    be forced to incur fees, delayed access to high-speed Internet,
    and the trouble of finding comparable broadband service, even
    if it exists, to remedy the harms of discriminatory conduct of
    broadband providers? Does not that shift the costs of this to
    the consumer?
        Ms. Ohlhausen. Well, the increased competition in the
    market, we have already seen that there are not fees for
    changing. Or if they are changing to a different provider,
    often that provider will pay the fees for them.
        Mr. Cicilline. Okay. Commissioner McSweeny, would you
    respond to that? Do you agree?
        Ms. McSweeny. Well, I do agree. I am very concerned that we
    are shifting an enormous amount of the cost of this onto
    consumers who are not well-positioned, as you point out, to
    detect most of this conduct, and very often may either have
    little choice or, in some cases, may be in contracts that
    require them to pay additional fees in order to make a change.
        So, I see these markets as highly concentrated. I am very
    concerned about relying on just consumer demand and competition
    that may or may not exist in order to generate the results that
    we are hoping to have by having the Open Internet Order.
        Mr. Cicilline. And Commissioner McSweeny, you said in your
    testimony something to the effect that broadband markets are
    highly concentrated and that competition alone will not provide
    the protection that I hope we all want. I am sure you heard the
    testimony of Commissioner Ohlhausen. I did not completely
    understand it, but the idea that we should look at competition,
    not just in terms of the way we look at competition normally,
    but some other analysis. Did that make any sense to you?
        Ms. McSweeny. Well, I think competition is a wonderful
    virtue. It is terrific in markets, but when we do not have very
    competitive markets, relying on an enforcement tool that is
    about preserving the competition or even trying to generate the
    competition can be a very imperfect tool. And that is why it is
    very well established that regulation is a complementary tool,
    as it is in this case, in order to ensure both the outcomes
    that we want, but also to make sure that consumers are
    protected and to make sure that noneconomic values, political
    discourse, freedom of speech, access to content, that kind of
    thing, are protected as well.
        Mr. Cicilline. Thank you. My final question is for
    Commissioner Ohlhausen. Do you believe that paid prioritization
    is a form of exclusionary conduct under the antitrust law?
        Ms. Ohlhausen. I think it can be, but it is not necessarily
    in every case. It depends on the market power and the ability
    of other competitors to get into the market. But paid
    prioritization is common in other markets outside of broadband,
    as well.
        Mr. Cicilline. And do you see any special danger of that
    being present in the Internet service provider sector?
        Ms. Ohlhausen. I think we need to examine each market very
    carefully, and my point about market competition is that we
    need to understand who all the competitors are in the
    marketplace to be able to make an accurate analysis of what the
    state of competition is in that market.
        Mr. Cicilline. Thank you. I yield back, Mr. Chairman.
        Mr. Marino. Thank you. The Chair now recognizes the
    gentleman from Colorado, Congressman Buck.
        Mr. Buck. Thank you, Mr. Chairman. Mr. McDowell, I noticed
    that you twitched earlier when the Ranking Member asked
    Commissioner McSweeny a question, and I just want to give you
    the opportunity to answer that question.
        Mr. McDowell. So, good thing I am not a poker player
    because, apparently, I have a terrible tell.
        Mr. Buck. So, let me ask the question, and then you can
    answer it. How does that sound? The question was, ``what is the
    effect of rescinding the Open Internet Regulations on
    investment and innovation of the Internet,'' and you seemed
    anxious to answer that. So, I just wanted to give you that
    opportunity.
        Mr. McDowell. Thank you. Yes. Actually, there are a number
    of studies out there showing an investment in broadband
    infrastructure has been deterred or stalled or slowed as a
    result of the 2015 title II Order. So, we saw robust investment
    and innovation throughout all corners of the Internet ecosphere
    before the 2015 Order. Whenever you introduce new rules in any
    context, investors have to first figure out what those rules
    are, and there is a pause at a minimum.
        As we start to approach the need to invest in 5G, which
    will be, by the way, a substitute for fixed wireline broadband.
    It will be 100 times faster than 4G, and the Internet of
    Things, as well, investment needed there are hundreds of
    billions of dollars. We need to rollback ex-ante mother-may-I
    regulations. So actually, investors the,--record at the FCC is
    replete with analyses from investors saying the best
    environment is the pre-2015 Order.
        Mr. Buck. Thank you. Chairman Ohlhausen, it is my
    understanding that a number of States have indicated that they
    intend to impose regulation on network ISPs if the FCC rolls
    back the title II provisions. What should or can Congress do in
    that situation? And then, I want to ask you what can the FCC
    do?
        Ms. Ohlhausen. Well, Congress certainly, if it were to take
    this up as a legislative matter, could ensure that the Federal
    legislation preempted State actions in this space.
        Mr. Buck. Okay. And what about the FCC?
        Ms. Ohlhausen. What the FCC could do? I believe the FCC has
    in other regulatory matters stated that it preempted State
    action in that space.
        Mr. Buck. Mr. Romano, I represent a rural area of Colorado.
    And I have visited with a number of citizens and leaders in
    that area, and they are very concerned about the lack of
    broadband in rural Colorado. One of the primary concerns is
    that it is very difficult to have economic development in areas
    that do not have broadband. What can we do? What should
    Congress do? What can the government do to try to encourage
    universal broadband?
        Mr. Romano. Thank you for the question, Congressman. You do
    represent a very rural area. I think we have 15 members just in
    your area alone, in eastern Colorado.
        Mr. Buck. I have heard from each of them.
        Mr. Romano. Us too. I would say three things. First of all,
    with respect to sort of the topic of this hearing, I think
    right size regulation, light-touch regulation is important. The
    effect on these companies, these small companies where they
    only have a handful of employees, of regulatory compliance
    costs can be significant on their operations, if not their
    investments. But just in managing the number of people they
    have to deal with and the kinds of markets they face, that is
    an important piece.
        A second piece would be looking more towards making sure
    that they can stay connected to urban markets; the
    interconnection issue I talked about. Making sure that the fact
    that they are far away from urban markets, that they can still
    get reasonably comparable broadband. That the costs of reaching
    those urban markets are taken care of or accounted for somehow,
    and what you have to charge a rural consumer is very important.
        And the third piece flows from that which is the universal
    service program. It is the best, most proven program ever put
    into place to promote rural networks which enable broadband. It
    is in a state of flux right now. Shoring up that program would
    do far more for rural broadband than any other proposal we have
    seen.
        Mr. Buck. And what can Congress do to shore up that
    program? Because the feedback that I am getting is that the
    reimbursement rates are decreasing, and that as a result of
    that, many of these rural providers are reluctant to expand the
    programs that they now have.
        Mr. Romano. That is spot on, Congressman. The fact is that
    we are at levels of investment or recovery under the Universal
    Service Program that track back to 2010. We are being asked to
    do more and more to invest in broadband deeper and deeper into
    rural areas. I think everybody wants that. It simply cannot be
    done for the same price we used to compensate for telephone
    networks ages and ages ago. We are asking these networks to do
    more, but yet these companies are facing right now on average a
    12 percent cut to their support because of the caps in that
    program. And it is undermining rural broadband investment and
    operations.
        Mr. Buck. My time is up. I thank you very much.
        Mr. Marino. Thank you. The Chair now recognizes the
    gentlewoman from the State of Washington, Congresswoman
    Jayapal.
        Ms. Jayapal. Thank you so much, Mr. Chairman. And thank you
    all for your testimony and for your service. The Internet
    should be free from discrimination against users and preserve
    choice and opportunity of communication for everyone. That is
    my basic belief. In my hometown of Seattle, believe it or not,
    my constituents still experience the consequences of a lack of
    competition among Internet providers.
        Even though we have six broadband providers, their coverage
    areas do not overlap, and result in slower speeds and higher
    prices for my constituents. So, the consequences of media
    consolidation loom large. And increasingly with entities which
    create content, also distributing content, I worry that full
    promise of greater choices and lower cost to consumers stands
    to be reversed.
        Can it be clearly said that companies that create and
    distribute content have a vested interest in ensuring that
    their consumers have access to their products first? We need to
    dig deeper into the realities of a world where as of a few
    years ago, just 2011, 90 percent of the American media was
    controlled by just half a dozen companies. Compare that to
    1983, when 90 percent was owned by 50 companies. And
    nationwide, 62 million Americans in urban areas and 16 million
    in rural areas cannot access fast Internet.
        And it is a serious issue, given how much the Internet is
    ingrained into our lives. More and more, you cannot apply for a
    job unless you have access to the Internet. You cannot pay
    bills or even check your kids' grades, as I found out when
    everything went online, in terms of checking what was going on
    with my son. So, it is clear that there is much work to be
    done, especially in light of ongoing efforts to undermine net
    neutrality.
        And so, while I am pleased that we are holding a hearing on
    this critical issue, I am simply not convinced yet that
    antitrust enforcement alone is sufficient to protect consumers.
    And particularly on noneconomic issues like free speech, on
    throttling, blocking, or prioritizing content, and of questions
    that, Ms. McSweeny, you raised in your testimony or your
    answers around prevention versus remedy.
        So, in the process that led up to the 2015 Internet Order
    and again this year, there was tremendous input from consumers
    to the FCC, civil rights groups, musicians, independent
    filmmakers, arts organizations, and many expressed concerns
    about free expression and viewpoint diversity. And yesterday,
    in The New York Times, comedian Kamau Bell wrote about the
    impact of net neutrality on artists. And I will just quote him.
        He says, ``This fair Internet, where everyone from an
    amateur comedian to a celebrity to a huge media company plays
    by the same rules, means you do not need a lot of money or the
    backing of someone with power to share your content with the
    world.'' Mr. Chairman, I ask unanimous consent to enter this
    op-ed into the record.
        Mr. Marino. Without objection.
        This material is available at the Committee or on the
    Committee Repository at: http://docs.house.gov/meetings/JU/
    JU05/20171101/106572/HHRG-115-JU05-20171101-SD005.pdf.
        Ms. Jayapal. Thank you. Ms. McSweeny, since the FTC
    typically views such concerns as outside of its jurisdiction,
    how would antitrust law have to be expanded and modified to
    address those concerns?
        Ms. McSweeny. Well, I think one of the questions that I
    would ask about whether we wanted to expand antitrust law to
    reach noneconomic concerns would be whether we really want to
    take a set of tools that is designed to protect competition and
    consumers in the marketplace and expand it outward, especially
    when we have an expert regulator, the Federal Communications
    Commission, that already has expertise and a public interest
    mandate on this beat.
        So, I would argue that we can get the job done by using the
    tools the Federal Communication Commission has and by perhaps
    expanding and complementing the FCC's jurisdiction with the FTC
    as a backup. But I do not think it is necessary for this to be
    an either/or premise.
        So, yes, there are ways we could expand antitrust law that
    I think, in my view, would be very helpful in promoting
    competition; not just protecting net neutrality, but promoting
    competition generally in the marketplace and online as well.
    And it would be helpful maybe in protecting consumers, but we
    already have an expert agency with an extensive record that has
    proceeded in putting in place very clear rules to protect the
    open Internet.
        Ms. Jayapal. And Mr. Romano, in your testimony, in your
    written testimony, you seem to indicate that you do believe
    that there is some role for both the FTC and the FCC in
    regulation. And, in fact, if I read this correctly, you seem to
    be more concerned about who is being regulated rather than the
    regulation itself.
        So, you are asking for regulation around access of network
    providers. You are saying do not just put it all on the ISPs.
    Put it on the network providers for accessibility. But can you
    clarify? Do you support complete repeal of the 2015 Open
    Internet Order?
        Mr. Romano. It is hard to say, with respect to a 300-page
    order, that there is nothing in there that we like. However,
    what I would say is that the rules that were adopted in 2015--
    and we're companies that have operated under title II for
    years, perhaps the most heavily regulated is local telephone
    companies historically. Although today, of course, they are
    broadband providers, primarily.
        The issue I think we have with the 2015 Order is more that
    it took title II, and it did not just take title II in a way
    that we were used to. It re-wrote some of the rules and
    frameworks in a way that no one was used to. So, for example,
    in the privacy space, the CPNI rules that were under the FCC's
    section 222 mandate in the Communications Act, we were used to
    operating under those as telephone companies, with respect to
    telecommunications information. The way in which those were
    rewritten to gather all sorts of information that not only
    telephone companies or broadband providers have, but also sweep
    in stuff that other people have, we just did not see that as
    being sort of a logical outgrowth of what title II had been.
        Ms. Jayapal. But to be clear, repealing the order
    completely would potentially have tremendous disastrous
    consequences for rural areas, and I think the point that Ms.
    McSweeny was making about competition, it is difficult
    sometimes to get competition to operate in rural areas and
    places where there are not as many consumers, where there is
    not as much money to be made. And so, I yield back, Mr.
    Chairman.
        But just wanted to say that I think there is a lot more
    nuance to this than simply repealing an order that would
    produce--than saying we should repeal the order, and it would
    produce benefits. I think there is great harm to be done. Thank
    you, Mr. Chairman. I yield back.
        Mr. Marino. Thank you. The Chair recognizes the gentlemen
    from Georgia, Congressman Collins.
        Mr. Collins. Thank you, Mr. Chairman. I appreciate it. I
    think that was an interesting exchange, and I appreciate my
    friend from Washington in discussing that, because I think it
    really goes back into the role of what antitrust is and what
    antitrust is not. And I think Ms. McSweeny, that your answer
    there really sort of gave an interesting insight into why I
    think this Committee is so relevant, not only in this
    discussion, but other discussions that we can have in this
    because the question really becomes in a certain situation is
    what are we using antitrust for?
        Are we trying to go out of everything that FCC already
    currently can do, and are we trying to expand it? Or are we
    simply trying to look at it from a perspective. What the big
    debate has become is, what is this role of antitrust? Is it to
    solve all of these ills of big companies and little companies,
    or is to make sure that there is a level playing field, that
    there is access to markets, there is access to it, which is
    traditional antitrust?
        Just because someone is big does not mean that they are
    bad. And I think you can look at many companies coming from
    many different States that they are not acting in an antitrust
    violation. They are just large. They have made that precision.
    So, I think it is interesting for me this discussion, but I
    disagree. I am glad that it is looking to be rolled back, and I
    think that is a positive step in letting the trust side of it
    be dealt with.
        And I think we can have more hearings in this regard. But
    Chairman, I do have a question for you, madam, is, and we have
    talked about this before, but under the FCC's Open Internet
    Order, paid prioritization is prohibited, per se, in a sense.
    Would you consider paid prioritization to be vertical restraint
    in the context of antitrust law?
        Ms. Ohlhausen. Paid prioritization certainly is a vertical
    restraint, but that does not mean that it is anticompetitive or
    makes consumers or competition worse off.
        Mr. Collins. Okay. And I say how well situated would be, as
    the FTC, with dealing with strictly antitrust here, FTC to
    analyze vertical restraints and their impact on this in this
    environment?
        Ms. Ohlhausen. I think we are very well-positioned, and I
    actually want to bring the Committee's attention to recent
    cases that the FTC has brought against companies that have
    foreclosed rival content in a way that has hurt competition.
    So, we have the Realcomp case from 2009 and a recent case
    against 1-800 Contacts, which I will not say any more about,
    because it will be appealed to the Commission. But it is an
    area, foreclosing rival content in a way that is
    anticompetitive that we have brought action, and we certainly
    have the tools to continue.
        Mr. Collins. And when I think in expanding that out for a
    just minute, and I think I have heard from others, and I have
    read your opinions, what would be the long-term effects of ex-
    ante or per se prohibition on this paid prioritization?
        Ms. Ohlhausen. My concern is that the long-term effects is
    to stifle innovation. We do not know what new technologies
    might be out there, and as we move to a world of the Internet
    of Things with so many connected devices, the ability to
    transmit some of that traffic in a way that has prioritization
    may be enormously beneficial when you think about things like
    connected cars or telemedicine.
        So, my concern is about freezing the Internet to the way
    that it looks today. And as we go back to the 2007 report, one
    of the biggest changes we have seen is the explosion of mobile
    Internet access.
        Mr. Collins. One of the things in following up on that
    really where we have gotten to in the Internet today has been
    because there has been that freedom. There has been that, you
    know, to work within a current system as we go forward.
        Ms. McSweeny, I just do have one question. It is my
    understanding that you have testified that you support the Open
    Internet Order as it is, correct? Including its ex-ante per se
    prohibition on paid prioritization, is that correct?
        Ms. McSweeny. Yes, that is correct. If I could just add,
    though, on this specialized services question, innovation
    around telemedicine and Internet of Things, that kind of thing,
    I believe--and I am not the FCC, so please ask them--but it has
    contemplated already in the Open Internet Order that waivers
    and such can be granted for that kind of innovation. So, I do
    not see this order as foreclosing that at all.
        Mr. Collins. Okay. If some are starting to maybe just going
    off this in a different aspect of the Internet ecosystem, from
    your perspective, would you support, you know, it is like
    including edge provider support in ex-ante regulation there is,
    as well as relying on market forces and antitrust enforcement.
    Would that be something?
        Ms. McSweeny. You know, I think it is a really interesting
    question. Many are arguing that the ISPs should have the same
    set of rules as edge technology companies, especially the very,
    very large platforms that are having a huge impact on the
    marketplace, but also in our daily lives. And I think one of
    the really important questions here is what are those impacts?
    How much power do those companies have? And if they are very
    powerful, like today's ISPs in the highly-concentrated
    broadband markets, then we should be having a conversation
    about whether our antitrust tools are sufficient.
        Mr. Collins. Well, I think that is going to become the
    honest question that we are having now, and unfortunately, I
    have seen this before, big bad, small good. We got to get out
    of that and go back to what antitrust is actually supposed to
    look like.
        But I cannot let this go, Mr. Chairman, without also saying
    for those of us in rural areas, northeast Georgia for mine,
    when you have players who are supposed to be providing
    broadband access, and they are not. They are using their CAT
    funds and other things to do other things such as they are in
    my area, this is just, you know, prohibiting it out. That is
    why we are looking at other acts of the GO Act and other things
    to actually provide broadband services to rural areas and get
    competition into the marketplace. And with that, Mr. Chairman,
    I yield back.
        Mr. Marino. Thank you. The Chair recognizes the gentleman
    from Georgia, Congressman Johnson.
        Mr. Johnson of Georgia. Thank you, Mr. Chairman. Do any of
    you or do all of you support the concept of an open Internet
    and the principles of no blocking, no throttling, and no paid
    prioritization? Do you all support that concept? Ms. Ohlhausen,
    yes or no?
        Ms. Ohlhausen. I support an open Internet, but I would not
    support a per se prohibition on paid----
        Mr. Johnson of Georgia. Ms. McSweeny.
        Ms. McSweeny. I support the open Internet as contemplated
    in the 2015 Open Internet Order.
        Mr. Johnson of Georgia. All right. And Mr. McDowell?
        Mr. McDowell. I support an open Internet, but it also
    depends for each of those. For instance, blocking of a child
    porn site. That should be allowed, right?
        Mr. Johnson of Georgia. Well, it is already allowed under
    the 2015 Order. Is it not?
        Mr. McDowell. There are many exceptions. I just wanted to
    make sure that we talked about exceptions, and each of those
    are important.
        Mr. Johnson of Georgia. Well, yeah, of course, subject to
    those exceptions. So, you support, Mr. McDowell, principles of
    no blocking, no throttling, no paid prioritization?
        Mr. McDowell. All those can have benefits. So, paid
    prioritization----
        Mr. Johnson of Georgia. Yes or no?
        Mr. McDowell. By the way, paid prioritization in the
    context of title II, there is a myth out there that title II
    would prohibit that. Actually, title II----
        Mr. Johnson of Georgia. It is a real simple question.
        Mr. McDowell [continuing]. Permits paid prioritization.
    Actually, it gets very complicated very quickly.
        Mr. Johnson of Georgia. Well, I understand. Okay. You do
    not want to answer yes or no to the question.
        Mr. McDowell. Because it is complicated and nuanced.
        Mr. Johnson of Georgia. Well, Mr. Romano and Ms. Ohlhausen
    were quite clear, and I was just wanting to----
        Mr. McDowell. Well, they are looking at it through the
    antitrust lens, and I am looking at it through the FCC lens.
        Mr. Johnson of Georgia. All right. Well, let me ask this
    question. Do you believe, Mr. McDowell, that in order for there
    to be an open Internet----and I am just going to assume for
    purposes of this question that you do support an open Internet.
        Mr. McDowell. Absolutely.
        Mr. Johnson of Georgia. Do you believe that there should be
    rules or regulations or legislation that guarantees that
    concept?
        Mr. McDowell. I would love to see Congress in this debate,
    this back and forth, and pass new legislation that could
    support an open Internet and where we would have a win-win-win
    situation for all the players involved. Yes, sir.
        Mr. Johnson of Georgia. What about you, Ms. Ohlhausen?
        Ms. Ohlhausen. Well, I really think it depends on what that
    legislation looks like, but I certainly would be, you know,
    encouraged by Congress taking this on as an issue and opening
    it up to further debate.
        Mr. Johnson of Georgia. Do you think Congress would be
    better equipped to deal with this issue than would the FCC or
    the FTC?
        Ms. Ohlhausen. I think it depends on what the legislation
    looked like, because I would hope it would contemplate a
    continuing role for the FTC going forward.
        Mr. Johnson of Georgia. I see. Okay. Thank you. What about
    you Mr. Romano?
        Mr. Romano. I think the term, Congressman, that I used in
    my testimony was regulatory pendulum swinging, and to the
    extent that Congress could help bring an end to that, I think
    that all involved would benefit greatly. The details of the
    legislation are important, but to the extent that something
    authoritative that assigns divisions of labor in the right way
    to the respective agencies based upon informed judgement of
    this body, I think would be welcomed.
        Mr. Johnson of Georgia. Ms. McSweeny, what is your
    response?
        Ms. McSweeny. Well, I support the 2015 FCC Open Internet
    Order, so I would want to look very carefully at what was being
    proposed. I think there are ways to strengthen the FTC that
    would be helpful. But so far, the action that we have seen in
    this Congress has been harmful to consumers. The repeal of the
    Broadband Privacy Rule, in my view, was very harmful to
    consumers, because it eliminated the consumer choice around how
    their information is monetized and used. And we do not have
    current authority at the FTC to step in and protect consumers.
        So, I would want to look very carefully at whatever was
    proposed, and make sure that we were appropriately protecting
    the open Internet and consumers and competition.
        Mr. Johnson of Georgia. Mr. McDowell, your response to Ms.
    McSweeny?
        Mr. McDowell. Thank you. So, first of all, the FCC's
    privacy rules never went into effect. While broadband is still
    classified as a telecom service, which as of this moment, it
    still is, section 222 of the FCC's rules apply. But the best
    way to get consumer privacy protection is to get the best cop
    on the beat on privacy, the Federal Trade Commission, back on
    the beat. And that would be to return it to its information
    service categorization.
        Mr. Johnson of Georgia. So, you believe the FTC is better
    equipped to deal with this issue of open Internet than would be
    the FCC?
        Mr. McDowell. Privacy and the open Internet. These are
    competitive issues, inherently. These are section 5 issues,
    inherently.
        Mr. Johnson of Georgia. Ms. McSweeny, do you see it that
    way?
        Ms. McSweeny. I do not because I think, as we have been
    discussing, there is an expert agency, the Federal
    Communications Commission, that is protecting both consumers
    and competition and the open Internet with its authorities, and
    it should be doing that. The FTC is a generalist antitrust and
    consumer protection enforcer.
        And yes, we are very good at trying to bring cases to
    protect consumers' privacy, but we have on a bipartisan basis
    for years requested additional authorities to better secure
    consumer data. I think that is necessary, and I think there is
    nothing that forecloses an expert regulator like the FCC using
    its authorities to also protect consumers' privacy.
        I do not hear Americans out there thinking they need less
    protection from exploitation of their information. I hear them
    asking for more.
        Mr. Johnson of Georgia. Thank you, and I yield back.
        Mr. Marino. Thank you. The Chair now recognizes the
    gentleman from Texas, Congressman Ratcliffe.
        Mr. Ratcliffe. Thank you, Mr. Chairman. As I have listened
    to the testimony and the questions today, it strikes me that I
    think this hearing is emblematic of the larger ideological
    debate between those that believe in a blanket one-size-fits-
    all approach to regulation and commerce, versus those that
    believe that a free market buffeted by reasonable antitrust
    protections provides a better framework and better access for
    consumers.
        I certainly fall into the free market camp, because I think
    even if it is well-intentioned, the overly zealous approach of
    regulatory overreach often just equates to a solution in search
    of a problem.
        And so, to that point, I want to start with you,
    Commissioner McSweeny, because in 2007, the FTC issued a report
    that said and concluded that antitrust laws were sufficient to
    protect against anticompetitive actions on the Internet and
    also concluded that additional regulations would likely do more
    harm than good. So, my question to you is what has changed
    since 2007?
        Ms. McSweeny. Well, a lot has changed since 2007. That was
    a decade ago. The technology was wildly different. iPhones were
    relatively new. I think I got my first iPhone in 2008.
        Maybe I was not an early adopter, but I think what we are
    talking about here 10 years later is still a highly-dynamic,
    very innovative ecosystem that is rapidly changing, but that
    has relied fundamentally on the principles that are enshrined
    in the FCC's order. We have been aggressively trying to protect
    that pipeline of innovation for more than a decade, as I am
    sure Mr. McDowell can talk about.
        Mr. Ratcliffe. I appreciate that. Let me reclaim my time on
    that. I want to give Ms. Ohlhausen a chance to respond to that
    line of thinking, with respect to the FCC's conclusions in
    2007.
        Ms. Ohlhausen. What I have seen change from 2007 to now is
    in quite a shift towards greater competition in these markets.
    So, wireless broadband providers now provide speeds greater
    than what wired broadband providers provided in 2007. We have
    four wireless broadband providers nationally. I mentioned
    improving speeds. We have seen this expansion of mobile
    broadband and vigorous pricing competition. So, competition has
    grown since that time period.
        Mr. Ratcliffe. Terrific. Thank you. Mr. McDowell,
    Congressman Buck had a number of questions to you about rolling
    back title II provisions, and I read with interest your
    testimony about the Internet, calling it the greatest
    deregulatory success story of all time. And I agree with you
    that a light-touch regulatory framework is the ideal approach
    to any dynamic industry. And I certainly see the 2015 FCC Order
    as rolling back that longstanding approach.
        I am curious what your perspectives are. If the FCC had
    imposed that sweeping net neutrality order back in the 1990s,
    what do you think Internet access and connectivity would look
    like today? In other words, would it be safe to say that costs
    would largely be higher, and access to connectivity would
    largely be reduced?
        Mr. McDowell. So, I am sorry. Just to make sure I
    understand your question: you talked about net neutrality order
    from the 1990s. Do you mean in terms of treating broadband or
    Internet access back in the 1990s under the Clinton-Gore
    administration? Okay.
        So, that was the continuation of many proceedings among
    both Republican and Democratic administrations to treat
    information services, essentially computer-to-computer
    communications, as something called an information service or
    an enhanced service back in the day. And that would not be
    common carriage under title II.
        So, that set the stage, when the Internet was privatized in
    the mid-1990s--when it migrated further away from government
    control--that set the stage for, I think, the largest explosion
    of entrepreneurial brilliance in world history in all corners
    of the Internet ecosphere. And it was led right here in the
    United States of America.
        This was an American phenomenon, which spread throughout
    the world. So, that is what we want to preserve. That is the
    openness and the pro-competition, the pro-investment, the pro-
    innovation and ultimately, the pro-consumer environment that we
    want to revert back to.
        Mr. Ratcliffe. Terrific. Thank you. My time is about to
    expire, but Mr. Romano, I did want to ask you. You know, you
    raised concerns about the FCC's Open Internet Order as singling
    out retail broadband providers with which you called ill-
    fitting regulations and one-sided duties. Regarding the one-
    sided duties that were imposed on retail Internet service
    providers, can you elaborate for me and for everyone how this
    has affected small and rural providers because as you know,
    that is a big part of my district?
        Mr. Romano. Absolutely, Congressman. Thank you for the
    question. So, a couple of things do jump to mind. Immediately
    first is the privacy regulation we talked about earlier, which
    was poised to take effect and would have put our small
    companies serving very rural areas in the position of having
    greater protections with respect to the same data that some of
    the largest edge providers in the world hold. And they would
    have been subject to different rules and that whatever the
    rules are that need to be put into place to govern that data,
    we wanted the same rules put into place to govern everybody who
    holds that data.
        That has an impact, obviously, on their operations in the
    sense that they have to take additional steps, practices,
    procedures to put into place to comply with the new privacy
    rules that were different than even the telecom privacy rules
    in place before it.
        Mr. Ratcliffe. Thank you. Mr. Chairman, I appreciate the
    indulgence. I yield back.
        Mr. Marino. Thank you. The Chair now recognizes the
    gentleman from California, Congressman Issa.
        Mr. Issa. Thank you, Mr. Chairman. I am sorry the
    gentlelady from Washington State has left, because it seemed
    like Seattle is a bastion of no communication choices that
    apparently Amazon and Microsoft are unable to generate enough
    bandwidth in that area to quite an underserved area. But having
    said that, I would like to concentrate on an assumption of
    monopoly for a moment. We were talking earlier, quite a while
    earlier, about getting rid of the common carrier exemption.
        And I will start, and I will go down the road quickly,
    because I know this is probably an area that unites us. If we
    could not eliminate it completely, would it do a great service
    to bifurcate the exemption? In other words, as a common
    carrier, you are still excluded. But to the extent that you
    provide any products or glean any economic benefit other than
    as a common carrier--for example, you own part of some other
    content supplier and the like--that you would automatically not
    be covered by the exemption. Would that do most of the good you
    need to deal with?
        Ms. Ohlhausen. It would take care of some of it, but not
    all of it. But it still leaves open the possibility that the
    FCC could classify wide swaths of the communications network as
    a common carrier service and cut the FTC out of oversight.
        Mr. Issa. Okay. So, your concern is to the extent that you
    would be cut out. So, legislation should be such that you not
    be precluded from doing in one section of the communication
    delivery system what you would be able to do in another?
        Ms. Ohlhausen. That is correct, and it is particularly
    acute for consumer protection, because at least the Department
    of Justice, which also shares antitrust oversight, is not
    subject to the common carrier----
        Mr. Issa. And you often do a one-two with the Department of
    Justice?
        Ms. Ohlhausen. That is correct.
        Mr. Issa. Is that pretty much within an answer for all that
    that limitation is to? Well, go ahead, Ms. McSweeny.
        Ms. McSweeny. I would support a clean repeal of the common
    carrier----
        Mr. Issa. No, I understand that you would like to have
    potentially a clean repeal. I am saying that it is pretty clear
    that when people are complaining, let's say, about Comcast,
    Cox, whoever it happens to be, they are always talking about
    not--and I am going to get to the other part in a moment--the
    throttling or the prioritization only, which I know you are.
    But they are complaining particularly about their products and
    services, which may be prioritized. That has been a big part of
    the discussion.
        Certainly, I will go to Mr. McDowell. It was something that
    was justifying the FCC's action was the theory that it was
    their products and services that were being prioritized over
    somebody else's in an anticompetitive way. Would that be fair?
        Mr. McDowell. Yes. I think your question is very
    intriguing, all the questions embedded there, because what you
    are putting your finger on is convergence in the marketplace.
    So, we have tech companies and communications companies,
    wireless companies, and telecom companies, all with thousands
    of miles of fiber, using radio frequencies, connecting servers
    and routers all over the country, all over the world, that are
    flooded with a slurry of ones and zeros.
        And I have just described a plethora of business plans
    here. But these old statutes, especially the Communications Act
    from 1934, tries to impose these silos, these regulatory silos,
    depending upon the flavor of the moment or who is politically
    favored or not. And that is why precisely, I think Congress
    needs to act.
        Mr. Issa. Well then, and Commissioner Ohlhausen, let me
    take something that is within your purview and compare it to
    the discussion of the day. If you are in a small town, and
    Safeway is the only grocery store, within Safeway, they have
    decided that each endcap, each row, is going to be sold to
    whoever will pay the most: Pepsi, Coke, whoever. That is
    certainly a prioritization that is paid for in a, in this case,
    an exclusive opportunity to buy within, let's say, 50 miles.
    Would you see that as something where you would come in under
    antitrust?
        Ms. Ohlhausen. It really depends.
        Mr. Issa. But it happens every day in America, and you do
    not come in.
        Ms. Ohlhausen. Exactly. It is very common. Paid
    prioritization is extremely common through all markets through
    the economy.
        Mr. Issa. Okay. So, the test, and you said depends, and I
    think this is important, and I want give Ms. McSweeny an
    opportunity for this sort of a discussion. Paid prioritization
    is an economic model that actually allows other people down the
    road to get a different price. The same would be true of a
    newspaper or magazine. They sell locations in their magazines
    at premium. The back cover is not randomly selected. It is paid
    for as a premium. And within that market, the relevant market,
    if you will, of a magazine, the magazine has 100 percent market
    share. So, every day, buyers and sellers make these decisions,
    and as long as you do not see an unfair monopolistic--in other
    words, they do not pass the other tests that exist under
    antitrust--we look at those and say that particular behavior is
    okay in this example. Correct?
        Ms. Ohlhausen. Absolutely correct.
        Mr. Issa. So, Ms. McSweeny, you obviously have a little bit
    more of a command and control. You would like to cure all the
    evils of society through these various regulatory processes,
    including that everyone should come for an exemption if they
    somehow have a medical device that needs a priority and hope
    that the government will give it to them. And I am not trying
    to be snide, but that is what I heard you say.
        So, listening to the Chairwoman, is not it true that, in
    fact, we do have to recognize that the provisions of antitrust
    over the many decades have been the abuse of these otherwise
    available privileges, such as prioritization and so on of one's
    product, and that what you have proposed--which is that you go
    to government when you want to have an exception, rather than
    you do your business and a series of tests--will determine
    whether or not you have crossed the line, not just based on a
    behavior but based on market share and intent. Correct?
        Ms. McSweeny. Well, here is the difference. It is very well
    established in antitrust law, and there is bipartisan support
    for this, that when we have highly concentrated industries,
    especially when there is vertical integration of the
    incumbents, that clear ex-ante rules to prohibit certain
    conduct is required.
        So, for example, my agency just earlier this year sent a
    very nice comment to FRT, which looks at this in energy
    generation markets supporting clear ex-ante rules because
    simply relying on antitrust enforcement is not sufficient. So,
    I do not think it is a controversial concept when you are
    dealing with this kind of question to have an antitrust
    enforcement agency say, ``Look, there are limitation to how we
    can step in here.''
        Mr. Issa. Since I am last, I would like to let the
    Chairwoman respond because I think that although what Ms.
    McSweeny is saying is true, is not it true that, in fact,
    giving over to the FCC, as the last administration did, they
    actually preempted you. It was not like you were saying your
    regulations are complementary. What they really said was to the
    Federal Trade Commission and to a certain extent Department of
    Justice, ``You sit on the sidelines. We are going to determine
    winners and losers, and they have to come to us for permission
    if they need a private network or they need prioritization for
    anything, including a lifesaving procedure.'' Is not that true?
        Ms. McSweeny. Indeed. In fact, the Open Internet Order
    stated that competition in the marketplace, even if there was
    competition in the marketplace, that was not going to be
    sufficient. I also just want to mention that electricity
    networks are very much a unique case, right, where you have a
    true, natural monopoly. They are a monopoly provider. I would
    point the Committee's attention to the FTC's staff report from
    2007 that looked at this particular market and said that
    competition and antitrust law and consumer protection were the
    appropriate tools.
        Mr. Issa. Thank you. Thank you, Mr. Chairman.
        Mr. Marino. Thank you. This concludes today's hearing. I
    want to thank all the witnesses for attending. And without
    objection, all members will have 5 legislative days to submit
    additional written questions for the record and submit
    additional materials for the record as well. Thank you very
    much.
        [Whereupon, at 12:21 p.m., the Subcommittee adjourned.]

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