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FCC Chairman Tom Wheeler House Oversight Hearing Testimony

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Released: May 20, 2014

Statement of

Tom Wheeler

Chairman

Federal Communications Commission

Before the

Subcommittee on Communications and Technology

Committee on Energy and Commerce

U.S. House of Representatives


Hearing on

“Oversight of the Federal Communications Commission”

May 20, 2014

I.

INTRODUCTION

Chairman Walden, Ranking Member Eshoo, and Members of the Subcommittee, I
appreciate the opportunity to appear before you again regarding oversight of the Federal
Communications Commission.
It has been about six months since we last were all together, and, befitting the fast-
moving communications sector, much has happened since that time. Last December, I shared
my guiding principles for how the Commission should approach the vast array of issues we face.
These priorities – promoting economic growth and U.S. leadership; protecting the Network
Compact; and ensuring networks work for everyone – are infused throughout the actions we have
taken and the public interest-minded priorities we have set.
Thanks to a highly capable team of public servants at the Commission – including my
fellow Commissioners Clyburn, Rosenworcel, Pai and O’Rielly - we have hit the ground
running. I am very proud of our accomplishments over the past six months, and am eager to
build on that progress going forward.

II.

PROMOTING ECONOMIC GROWTH AND U.S. LEADERSHIP

Technological innovation, growth and national economic leadership have always been
determined by our networks. Competition drives the benefits of those networks, and we have a
responsibility to see the expansion of those networks, including the appropriate allocation of
adequate amounts of spectrum.

A. Spectrum Policy

Consumer demand for mobile broadband is exploding. There are more connected mobile
devices in the United States than people, and more than 60 percent of U.S. wireless subscribers
now use data-hungry smartphones. With increased consumer demand comes increased demand
for spectrum – a finite resource that is in short supply.

In the past six months, we have made considerable progress toward meeting this demand
and making spectrum available for wireless broadband – from establishing the ground rules for
the first-ever Incentive Auction, to promoting spectrum sharing, including allowing more
unlicensed use. Underlying all of this work, as a baseline to how and why we do what we do,
continues to be my favorite mantra: Competition, Competition, Competition.

Incentive Auction
Few FCC policies have generated as much attention as the upcoming Incentive Auction.
Such attention is warranted. This first-in-the-world auction could revolutionize how spectrum is
allocated. By marrying the economics of demand with the economics of current spectrum
holders, the Incentive Auction will allow market forces to determine the highest and best use of
spectrum, while providing a potentially game-changing financial opportunity to America’s
broadcasters.
Getting the Incentive Auction right will be a tremendous challenge. The Commission has
to create a marketplace that enables us to buy spectrum, re-band it, and then re-sell it, and to do
these three things simultaneously. I’ve likened the auction to a Rubik’s Cube, with a big
difference being that you can’t pull up a How-To-Solve-The-Incentive-Auction video on
YouTube.
The FCC staff has been working tirelessly to design the auction ever since Congress
authorized it in February 2012. Last week, the Commission adopted a Report and Order that set
out the ground rules for the auction.
The Commission will make additional decisions to implement details pertaining to the
Incentive Auction in the coming months as we prepare for this historic auction in mid-2015. But
reaching this stage is a major accomplishment, and was only possible thanks to the outstanding
work of public servants from across the FCC.
I am also committed to taking actions to encourage broadcaster participation, which is
essential to the auction’s success, including providing more information about the auction
timeline and potential opening bid amounts.
Mobile Spectrum Holdings
The Commission is not only committed to making available more spectrum for mobile
broadband, it is also committed to promoting competition in the mobile marketplace. That’s
why, in conjunction with the launch of our Incentive Action rulemaking in September 2012, the
Commission initiated a proceeding to update our mobile spectrum holdings policies. Last week,
the Commission adopted a reasonable, balanced Report and Order updating those policies to
ensure a healthy mobile marketplace with clear rules of the road for spectrum aggregation. In
particular, the Order will help ensure competitive access to “low-band” spectrum that we will
make available in the Incentive Auction, which is better suited for transmitting wireless
communications over long distances and through walls.
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Our new approach to mobile spectrum holdings is pro-consumer and aimed at fostering a
competitive marketplace with many providers capable of offering Americans a choice of
comparable services no matter where they live. Our approach is pro-innovation and investment,
offering wireless providers additional certainty about the rules of the road. And our approach is
pro-public safety – waiving the spectrum aggregation screen when carriers partner with FirstNet
and ensuring that our public safety broadband network will be fully funded.
H Block
One of the most notable developments of the past six months is that the spectrum pipeline
has re-opened. In February, the Commission concluded its first major auction of mobile
broadband spectrum since 2008, repurposing 10 MHz in the so-called H-Block. The
Commission succeeded in putting this spectrum to work in the marketplace and raised more than
$1.5 billion, much of which will be put to use toward the deployment of FirstNet’s nationwide
public safety broadband network. I applaud Commissioner Clyburn for her wisdom and
leadership in scheduling this auction for January 2014 and the FCC staff for their successful
execution.
AWS-3 Auction
This March, the Commission adopted a Report and Order establishing service rules for
AWS-3, which moves us closer to holding an auction for 65 megahertz of spectrum in
November. Yesterday, the Wireless Bureau released a Public Notice setting the start date and
proposing the reserve price for the auction. This auction represents a step forward in spectrum
policy. Some of the spectrum being auctioned is already available in the Commission’s
inventory. But 40 megahertz of the spectrum to be auctioned is used nearly exclusively by
federal agencies today.
A long, candid and purposeful discussion among federal and commercial users about
how to enhance spectrum efficiency through both clearing and sharing has brought us to this
point. I commend NTIA, DOD, DOJ, and the White House for their leadership in enabling
commercial use of the 1755-1780 MHz band. NOAA has shown important leadership through
its efforts to help make the 1695-1710 MHz band available for commercial use. And I commend
the Members of this Subcommittee for your leadership, including your convening of informal
roundtable meetings, which have been instrumental in keeping our collective efforts focused on
encouraging communication, overcoming obstacles and achieving real results.
Unlicensed Use (5 GHz)
The Commission is working to make available not only licensed spectrum, but unlicensed
spectrum, which has enabled breakthrough innovations like Wi-Fi and Bluetooth.
In March, the Commission adopted an order to take 100 MHz of unlicensed spectrum at 5
GHz that was barely usable – and not usable at all outdoors – and transform it into spectrum that
is fully usable for Wi-Fi. This is a big win for consumers who will be able to enjoy faster
connections and less congestion, as more spectrum will be available to handle Wi-Fi traffic.
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As contemplated by the Middle Class Tax Relief and Job Creation Act, the Incentive
Auction Report and Order adopted rules to permit unlicensed use of technically reasonable guard
bands required to protect licensed services in the new 600 MHz band, in addition to Channel 37
and remaining TV White Spaces. This action will make available a significant amount of low-
band spectrum for unlicensed use, much of it on a consistent, nationwide basis.
We are actively participating in ongoing efforts with the Department of Transportation
and industry to resolve technical issues in the ITS band currently used for vehicle-to-vehicle
communications and with the Defense Department to resolve issues in a band used for military
radar. Resolving these issues could make 195 MHz of spectrum available for broadband. We
hope and expect parties to engage productively, and we will be watching closely.
Citizen’s Broadband Service (3.5 GHz)
Incentive auctions are not the only game-changing spectrum policy innovation being
advanced by the Commission; spectrum sharing has similar potential to transform spectrum
management. Last month, the Commission took another significant step toward turning the
spectrum sharing concept into reality, adopting a Further Notice of Proposed Rulemaking to
enable innovative spectrum sharing techniques in the 3.5 GHz band. Our three-tiered spectrum
access model, which includes federal and non-federal incumbents, priority access licensees, and
general authorized access users, could make up to 150 MHz of spectrum available for wireless
broadband use

B. Broadband Investment and Competition

The private sector must play the leading role in extending broadband networks to every
American. That’s why the FCC is committed to removing barriers to investment and to lowering
the costs of broadband build-out. Google has developed a checklist for cities that want to
participate in their Google Fiber project of steps that can be taken to ensure easier access to
existing infrastructure and to make construction speedier and more predictable. The FCC should
be asking similar questions about our own rules, cutting red tape wherever possible.
Promoting competition is another critical tool for spurring investment in broadband
infrastructure. For many parts of the communications sector, there hasn’t been as much
competition as consumers and innovation deserve. Given the high fixed costs and consequent
scale economies, this isn’t especially surprising. But that makes it all the more important that we
knock down existing barriers to competition and avoid erecting new ones. We must use all the
tools at our disposal to encourage competition wherever it is possible. One place where it may
be possible to encourage competition is municipally-owned broadband systems. I understand
that the experience with community broadband is mixed, that there have been both successes and
failures. But if municipal governments want to pursue it, they shouldn’t be inhibited by state
laws that have been adopted at the behest of incumbent providers looking to limit competition. I
believe the FCC has the power – and I intend to ask the Commission to exercise that power – to
preempt state laws that ban competition from community broadband.
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III.

PROTECTING THE NETWORK COMPACT

Changes in technology may occasion reviews of our rules, but they do not change the
rights of users or the responsibilities of network providers. This civil bond between network
providers and users has always had five components: access, consumer protection,
interconnection, public safety and national security. The Commission must protect the Network
Compact.

A. Universal Service

Universal service and accessibility are two cornerstones of the FCC’s mission.
Considering that access to broadband is increasingly necessary for full participation in our
economy and democracy, this goal is more important than ever. Our universal service programs
remain essential to ensuring consumers have access to technology – whether that’s at the home,
at work, in schools or libraries, or when seeking assistance from a rural healthcare clinic. The
Commission must ensure that our programs keep up with the changing technologies, are well-
managed and efficient, while limiting waste, fraud and abuse. And we must of course make sure
that the infrastructure supported by the Commission is available to ALL, including low-income
Americans, individuals living on Tribal lands, and individuals with disabilities. What most of us
take for granted on a daily basis, should be available to all.
Supporting Infrastructure in Rural America – Connect America Fund (CAF)
While the private sector must play the leading role in extending broadband networks to
every American, there are some areas where it doesn’t make financial sense for private
companies to build. That’s why the Commission modernized our Universal Service Fund to
focus on broadband, establishing the Connect America Fund. Already, the Connect America
Fund has made investments that will make broadband available to 1.6 million unserved
Americans.
Just last month, the Commission voted to move forward with Phase II of the Connect
America Fund. In addition to the great work of the Wireline Competition Bureau in finalizing
the Connect America Fund cost model, the Commission decided a number of outstanding issues
to enable the Commission to move forward later this year with CAF Phase II. The result will be
another 5 million Americans getting access to broadband for the first time. Recognizing that
broadband speeds offered to consumers in urban areas continue to increase, one open issue we
are going to look at is whether we should increase the minimum downstream speed requirement
for those entities that receive Connect America support. The statute requires rural Americans to
have access to services that are reasonably comparable to services in urban areas. I am cognizant
of the fact that we must make sure that we do not stand idly by and allow a new digital divide to
open up in rural America as urban and suburban areas increasingly gain access to gigabit
connections.
The Commission’s action last month also took several steps to improve the climate for
broadband investment in areas served by incumbent rate-of-return carriers. First, as I promised I
would do in this same seat last December, we eliminated the Quantile Regression Analysis
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(QRA) benchmarks rule because it was not serving its intended purpose. Second, in a Further
Notice of Proposed Rulemaking, we proposed to establish a Connect America Fund for rate-of-
return carriers and sought comment on how to support the deployment of broadband-capable
networks by rate-of-return carriers within the current budget for the program.
Related to the actions taken in April, I am also pleased to report that in January the FCC
initiated an experiment to inform our policies to build next-generation networks in rural
America. We invited American enterprises, communities and groups to tell the FCC whether
there is interest in constructing high bandwidth networks in high cost areas, and to tell us how it
could be done. We issued an invitation, and the response has been astounding. To date, we have
received more than 1,000 expressions of interest from all parts of the country. Proposals have
come from rural telephone companies, from rural electric co-ops, from cable and wireless service
providers, from Tribal entities, from communities, and more. The proposals are varied, and
geographically and technologically diverse, yet all have a common theme. They are expressions
of a desire to deliver better, more robust Internet access service; to deliver faster speeds to
communities in rural areas. Later this summer we intend to establish a budget and selection
criteria, and to invite formal rural broadband experiment proposals which will be very
informative as the Commission moves forward with efforts to connect all Americans to robust
broadband networks.
IP Transition
The move from the circuit-switched networks of Alexander Graham Bell to the new
networks of the Internet Revolution is all around us – with expanded deployment of fiber, with
new forms of wireless, with bonded copper and coaxial cable. These transitions – plural – are a
good thing because IP networks are more efficient, which can enable better products, lower
prices, and massive benefits for consumers.
But so far, the transitions are all about the voluntary adoption of new supplemental
services. Now, America’s largest telecommunications providers have said that they want to
engage in a very different kind of transition – they want to turn off their legacy networks. This is
a momentous pivot point in the history of our networks. We want providers to deploy next
generation networks, and we want consumers to be able to enjoy the benefits of those next
generation networks. The best way to make sure that happens is to protect the core values that
have defined the relationship between network operators and those who use the networks –
competition, consumer protection, public safety and national security, and universal access.
Protecting and promoting those values is the surest path to successful transitions.
With that in mind, this past January, the Commission unanimously adopted an Order
inviting service providers to propose voluntary experiments designed to assess how the transition
to IP impacts network users and initiating targeted experiments. We have already begun
receiving submissions for experiments, which are important steps in the Commission’s effort to
determine how the IP transition can be conducted in a manner that preserves the enduring values.
We are examining those submissions and working with the providers that filed them to make
sure that these experiments will provide useful data to help inform our decision-making.
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B. Consumer Protection

The “public interest” is what we always refer to when discussing why the Commission
does what it does. As I have said before, I view my role as Chairman to be an advocate for the
American people as we work to achieve the goals I have outlined above. I have often stated that
the best consumer protection is competitive choice. I also believe a multi-stakeholder process
where industry rapidly adopts processes and procedures can be faster and more nimble than the
regulatory process. But, at certain points, having regulation is necessary.
Protecting and Preserving the Open Internet
For over a decade, the Commission has struggled with the idea of net neutrality. There
has been a bipartisan consensus, starting under the Bush Administration with Chairman Powell,
on the importance of an open Internet to economic growth, investment, and innovation. But
today we do not have any rules in place to protect the open Internet. In January, the U.S. Court
of Appeals for the D.C. Circuit ruled that the Commission has the legal authority under Section
706 of the Telecommunications Act of 1996 to craft enforceable rules to preserve a free and open
Internet as a level-playing field for all Americans. I immediately set the Commission on a path
to do just that, committing to putting in place enforceable rules by the end of the year. And in
April, I circulated specific proposals to my fellow Commissioners in a Notice of Proposed
Rulemaking.
Last week, the Commission adopted that Notice of Proposed Rulemaking, beginning the
process of crafting rules to protect and promote the open Internet. The focus of the proposals we
put forward and the questions we ask in this Notice is on maintaining a broadly available, fast
and robust Internet that serves as a platform for economic growth, investment, innovation, free
expression, and competition. I believe that the Section 706 framework set forth by the Court of
Appeals in Verizon is sufficient to give us the authority to adopt and implement robust rules that
will accomplish this goal. At the same time, the Notice we adopted asks whether the best path
forward is under Title II. The entire purpose of an NPRM is to give Americans the ability to
express themselves and provide analysis and guidance.
I look forward to a broad and thoughtful debate on the record. We have specifically
created a means by which Americans who may not otherwise participate in an FCC proceeding
can make their voice heard through our new Open Internet email address: openinternet@fcc.gov.
And to ensure sufficient opportunity for broad public comment, we have provided for a comment
and reply period that will give everyone an opportunity to participate.
Cell Phone Unlocking
Consumers who fulfill the obligations of their mobile phone contracts should be able to
take device to a network of their choosing without fear of criminal liability. In December, the
FCC secured an industry commitment to adopt voluntary industry principles for consumers’
unlocking of mobile phones and tablets. The voluntary agreement sets out six unlocking
principles regarding postpaid and prepaid devices, transparency, notice to consumers, response
7


time and deployed military personnel. We will continue to monitor to ensure that agreement
terms are being met for consumers.
This voluntary deal is an excellent example of what I call the “regulatory see-saw:” the
more industry acts to meaningfully regulate itself, the less that has to be done by FCC.
Cell Phone Kill Switch
Mobile devices today offer amazing opportunities – the iPhone in my pocket has more
computing power than the lunar module that got our astronauts to the moon. But these devices
are also increasingly a target for criminals, creating a risk not just to property, but to physical
well-being. Consider, for example, that 50 percent of all robberies in San Francisco involve the
theft of smart phones, and a quarter of all robberies involving cell phones in San Francisco
involve guns and knives.
In 2012, Chairman Genachowski launched the PROTECTS Initiative, a series of
practical, meaningful solutions to discourage cell phone theft by preventing re-use. Last month,
CTIA announced the Smartphone Anti-Theft Voluntary Commitment. Under this commitment
the nation’s largest wireless carriers agreed to offer a free anti-theft tool that is preloaded or
downloadable to devices. These are constructive steps that should help, but we need to do more.
Deterring thefts of mobile devices is a multi-faceted challenge that requires close
coordination with law enforcement, carriers, handset manufacturers, consumers, resellers, and
the international community. For this reason, next month we will be convening a workshop at
the FCC to discuss real, practical consumer-oriented technical solutions that build on the FCC’s
previous efforts and the recent CTIA anti-theft commitments. Working together, I am confident
we can solve this problem.

C. Public Safety

Public Safety is one of the primary and essential missions of the Commission, and it
cannot be left behind in this technological revolution. Consumers rightfully expect to be able to
reach emergency responders, and those responders need to be able to locate those in need, as
well as be able to communicate between themselves. The Commission has taken steps toward
these goals.
Text-to-911
In certain circumstances, such as domestic violence or kidnapping situations, texting 911
may be the only practical way to get help. In almost all circumstances for people who are deaf or
hard-of-hearing, texting is the primary means for reaching out for emergency assistance. But, as
hard as it may be to believe in 2014, most Americans still can’t reach 911 via text.
This January, the Commission adopted a policy statement that all text providers should
support text-to-911, and a Further Notice that proposes that this be accomplished by the end of
2014. The Further Notice includes proposals that would allow industry voluntary agreements to
8


fit into rules in order to keep regulatory action in this area at a minimum. To that end, I am
heartened by the fact that the four nationwide wireless carriers recently reported that they have
met their commitment to be ready to deliver text-to-911 to any requesting PSAP within their
service territories. But we still need to be ready to act if others in the marketplace fail to deliver
on this critical public safety effort, and our proposal gives us the flexibility to do just that.
E-911/Location Accuracy
Our E911 location accuracy rules were written when wireless phones were a secondary
means of communication, and were mostly used outside. Today, more and more consumers use
wireless phones as their primary means of communication, and more and more 911 calls are
coming from wireless phones, from indoors. In February, the Commission adopted a Further
Notice of Proposed Rulemaking to modify our E-911 location accuracy rules to reflect the new
realities of the ever-increasing mobile world.
The proposals are simple – when wireless customers call 911, the location information
delivered to the PSAPs must be delivered to the PSAP as accurately and expeditiously as
possible regardless of whether the call is made from inside a 50-story high-rise or outside at a
public park. Consumers already have that expectation when it comes to the commercial apps
they use every day – if Google Maps can find them in a mall within a couple of meters, 911
should be able to find them, too. I look forward to reviewing the record that is generated by this
Notice, and moving quickly to adopt rules.

IV. MAKING NETWORKS WORK FOR EVERYONE

The value of our communications networks come from what they enable. How networks
enable a 21st century educational system, enable the expansion of capabilities for Americans
with disabilities, and promote diversity, localism and speech are basic underpinnings of the
FCC’s responsibilities.

A. E-Rate Modernization

E-rate has been a very successful program for almost twenty years, connecting nearly all
schools to the Internet. But it’s time to modernize the program. The nature of connectivity in
schools and libraries has changed dramatically in recent years. What was once provided through
a 33.6K dial-up modem now demands high-speed broadband and in-class WiFi. Yet despite the
clear need for speed, only about half of the E-rate’s funds today go for broadband connectivity.
And far less than half of E-rate funds is used for the kind of 100 mbps and higher speeds
necessary for today’s learning environment. Most disturbing in an era when WiFi is at every
burger joint and coffee shop, is how the E-rate program is not helping to put WiFi in all
classrooms.
Technology has changed; the needs of schools and libraries have changed; how E-Rate
funds are distributed, however, has not. We are in the midst of a rulemaking to address and
correct this reality, with a focus on three proposed program goals: (1) ensuring that schools and
libraries have affordable access to modern broadband technologies that support today’s digital
9


learning tools and techniques; (2) ensuring E-Rate funds are distributed more equitably and cost-
effectively; and (3) streamlining the administration of the E-rate program. While the details of
E-rate modernization remain in flux, the goals are clear. For modernization to be successful, the
updated program must be:
 Focused on delivering faster -speeds to schools and libraries and WiFi
throughout;
 Predictably funded and future-proofed;
 Fiscally responsible and fact-based; and
 Friendly to use.
The Commission is currently developing an order to modernize the program consistent
with these goals. As the Commission prepares to take such action, I am pleased to report that
steps have already been taken by Commission staff to speed the E-rate application review
process. Our streamlining efforts have already yielded E-rate funding commitments for Funding
Year 2014 that are four times as much as our first commitment wave last year. Even more
importantly, these commitments include over $400 million in funding for broadband requests.
That’s six times more broadband funding than we had processed at this point last year. Put
another way: over $350 million in additional early broadband funding. These funding
commitments are going to allow schools and libraries across the country to bring higher speeds
to their students and patrons beginning July 1.

B. Accessibility

Closed Captioning Quality Standards
Reliable and consistent access to news and information for deaf and hard-of-hearing
communities is not a luxury, it is a right. In February, the Commission adopted rules in February
to provide standards for better quality closed captioning on TV programming. Members of the
deaf and hard-of-hearing community, alongside industry—NCTA, NAB, and MPAA—stepped
up to the plate to help craft a set of rules that moves us toward improving captioning quality,
while also assuring that vital news and other types of programming provide captioning. This is a
good example of not only the value of public-private collaboration, but also how FCC actions
directly impact the lives of Americans living with disabilities.

C. Media Ownership

Promoting competition, localism, and diversity within the media marketplace is a
centerpiece of our democracy. For many years, the Commission has applied limits on ownership
concentration in order to achieve these goals. I am committed to ensuring that the Commission
has the data that we need in this evolving marketplace to ensure those limits are appropriate and
well-placed. Having said that, we have an on-going responsibility to enforce our rules, including
to close loopholes and to ensure that those who play by the rules are not disadvantaged.
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Quadrennial Review
This March, the Commission initiated the quadrennial review of its media ownership
rules to determine if they need to be modified to serve the public interest, building on a record it
has amassed over the years. I am committed to completing this review and having final
recommendations by June 2016.
Past reviews have resulted in court remands, and the Commission is exploring how best
to craft rules that can survive judicial review. We are also reviewing diversity issues to see how
best we can promote a diversity of voices, including women and minorities. We have also
invited comment on elimination of the existing radio-TV cross-ownership rule; and modification
of the existing Newspaper-Broadcast Cross-Ownership prohibition.
Joint Sales Agreements
While our quadrennial review is underway, our existing rules remain in place. In March,
the Commission closed a loophole in our attribution rules for TV Joint Sales Agreements (JSAs)
that had been exploited by some to circumvent our local TV ownership limitation. By
prohibiting arrangements that have the full effect of common ownership – by stations’ own
admission in their SEC filings – we will protect viewpoint diversity and competition goals. We
have also been clear to point out, however, that where we find that an agreement serves the
public interest, we will waive our rule and do so through an expedited process. We recognize the
Subcommittee’s particular interest in ensuring that broadcasters found to be out of compliance
with our rules have sufficient time to unwind the arrangements, and we look forward to working
with you as these rules go into effect. I would also note that the new rules apply only to JSAs,
not Shared Services Agreements (SSAs). The Commission sought additional comment on how
to define SSAs and whether to require disclosure.
Retransmission Consent
Congress created the retransmission consent regime over 20 years ago. Since that time,
we have witnessed significant changes in the marketplace and been able to observe how parties
have operated in the process, while cable prices have steadily risen. Congress intended TV
stations would negotiate retransmission consent agreements on their own. Increasingly, though,
stations in a local market that are separately owned have banded together to negotiate for
retransmission consent fees, even though they otherwise would compete against each other for
those fees.
In March, the Commission adopted new rules to prohibit joint retransmission consent
negotiations by same market TV stations that are both ranked in the Top 4 in order to level the
playing field and to potentially keep such agreements from unfairly increasing cable rates for
consumers. I recognize that the Subcommittee has taken similar action as part of the STELA
reauthorization process, and appreciate your support for these common sense reforms.
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V. PROMOTING OPERATIONAL EXCELLENCE

I will close with the topic that I started with back in December, because it remains a
priority – to both you on this Subcommittee, and to me personally – not to mention that all of
which I have mentioned above relies on it: Process Reform. In order to keep up with the rapid
pace of change in the industries that we oversee, we must hold ourselves to a high standard to be
as agile, efficient, and transparent as possible.
In January, a Staff Working Group presented a Process Reform Report to the
Commission as an important first step, and we sought comment from the public on the
recommendations that were identified within that Report.
As we review the record developed, we are moving forward with changes to streamline
how the Commission functions so we are better able to serve the entities we regulate, as well as
the American public. Some of the more visible activities include the use of a Consent Agenda at
Commission meetings to facilitate quick action on non-controversial items that require a
Commission vote, a shift to all-electronic distribution of documents, and the elimination and
modification of outdated rules. Addressing some of the other recommendations involve more
time and resources – such as streamlining license processing and reworking our consumer
complaint process. In particular, we need to upgrade our IT infrastructure; we have more than
200 relic IT systems that are costing the agency more to service than they would to replace over
the long term. But I believe these investments are essential and will payback in dividends with
the increased efficiency gained.

VI. CONCLUSION

Again, thank you for having me here today. As I noted in December, my goal is to have
an open and productive relationship with the Subcommittee members as we work together to
address the challenges – and opportunities – in the 21st Century telecommunications and
communications marketplaces.
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