[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
REPURPOSING THE C-BAND TO BENEFIT ALL
AMERICANS
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON COMMUNICATIONS AND TECHNOLOGY
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
OCTOBER 29, 2019
__________
Serial No. 116-73
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the Committee on Energy and Commerce
govinfo.gov/committee/house-energy
energycommerce.house.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
43-721 PDF WASHINGTON : 2021
-----------------------------------------------------------------------------------
COMMITTEE ON ENERGY AND COMMERCE
FRANK PALLONE, Jr., New Jersey
Chairman
BOBBY L. RUSH, Illinois GREG WALDEN, Oregon
ANNA G. ESHOO, California Ranking Member
ELIOT L. ENGEL, New York FRED UPTON, Michigan
DIANA DeGETTE, Colorado JOHN SHIMKUS, Illinois
MIKE DOYLE, Pennsylvania MICHAEL C. BURGESS, Texas
JAN SCHAKOWSKY, Illinois STEVE SCALISE, Louisiana
G. K. BUTTERFIELD, North Carolina ROBERT E. LATTA, Ohio
DORIS O. MATSUI, California CATHY McMORRIS RODGERS, Washington
KATHY CASTOR, Florida BRETT GUTHRIE, Kentucky
JOHN P. SARBANES, Maryland PETE OLSON, Texas
JERRY McNERNEY, California DAVID B. McKINLEY, West Virginia
PETER WELCH, Vermont ADAM KINZINGER, Illinois
BEN RAY LUJAN, New Mexico H. MORGAN GRIFFITH, Virginia
PAUL TONKO, New York GUS M. BILIRAKIS, Florida
YVETTE D. CLARKE, New York, Vice BILL JOHNSON, Ohio
Chair BILLY LONG, Missouri
DAVID LOEBSACK, Iowa LARRY BUCSHON, Indiana
KURT SCHRADER, Oregon BILL FLORES, Texas
JOSEPH P. KENNEDY III, SUSAN W. BROOKS, Indiana
Massachusetts MARKWAYNE MULLIN, Oklahoma
TONY CARDENAS, California RICHARD HUDSON, North Carolina
RAUL RUIZ, California TIM WALBERG, Michigan
SCOTT H. PETERS, California EARL L. ``BUDDY'' CARTER, Georgia
DEBBIE DINGELL, Michigan JEFF DUNCAN, South Carolina
MARC A. VEASEY, Texas GREG GIANFORTE, Montana
ANN M. KUSTER, New Hampshire
ROBIN L. KELLY, Illinois
NANETTE DIAZ BARRAGAN, California
A. DONALD McEACHIN, Virginia
LISA BLUNT ROCHESTER, Delaware
DARREN SOTO, Florida
TOM O'HALLERAN, Arizona
------
Professional Staff
JEFFREY C. CARROLL, Staff Director
TIFFANY GUARASCIO, Deputy Staff Director
MIKE BLOOMQUIST, Minority Staff Director
Subcommittee on Communications and Technology
MIKE DOYLE, Pennsylvania
Chairman
JERRY McNERNEY, California ROBERT E. LATTA, Ohio
YVETTE D. CLARKE, New York Ranking Member
DAVID LOEBSACK, Iowa JOHN SHIMKUS, Illinois
MARC A. VEASEY, Texas STEVE SCALISE, Louisiana
A. DONALD McEACHIN, Virginia PETE OLSON, Texas
DARREN SOTO, Florida ADAM KINZINGER, Illinois
TOM O'HALLERAN, Arizona GUS M. BILIRAKIS, Florida
ANNA G. ESHOO, California BILL JOHNSON, Ohio
DIANA DeGETTE, Colorado BILLY LONG, Missouri
G. K. BUTTERFIELD, North Carolina BILL FLORES, Texas
DORIS O. MATSUI, California, Vice SUSAN W. BROOKS, Indiana
Chair TIM WALBERG, Michigan
PETER WELCH, Vermont GREG GIANFORTE, Montana
BEN RAY LUJAN, New Mexico GREG WALDEN, Oregon (ex officio)
KURT SCHRADER, Oregon
TONY CARDENAS, California
DEBBIE DINGELL, Michigan
FRANK PALLONE, Jr., New Jersey (ex
officio)
C O N T E N T S
----------
Page
Hon. Mike Doyle, a Representative in Congress from the
Commonwealth of Pennsylvania, opening statement................ 1
Prepared statement........................................... 3
Hon. Robert E. Latta, a Representative in Congress from the State
of Ohio, opening statement..................................... 6
Prepared statement........................................... 7
Hon. Bill Johnson, a Representative in Congress from the State of
Ohio, prepared statement....................................... 8
Hon. Frank Pallone, Jr., a Representative in Congress from the
State of New Jersey, opening statement......................... 9
Prepared statement........................................... 10
Hon. Greg Walden, a Representative in Congress from the State of
Oregon, opening statement...................................... 11
Prepared statement........................................... 13
Hon. Anna G. Eshoo, a Representative in Congress from the State
of California, prepared statement.............................. 92
Witnesses
Ross J. Lieberman, Senior Vice President, ACA Connects-America's
Communications Association..................................... 14
Prepared statement........................................... 17
Answers to submitted questions............................... 147
Jeff Campbell, Vice President, Government Affairs, Cisco Systems,
Inc............................................................ 26
Prepared statement........................................... 28
Answers to submitted questions............................... 149
Deborah S. Collier, Director of Technology and Telecommunications
Policy, Citizens Against Government Waste...................... 30
Prepared statement........................................... 32
Answers to submitted questions............................... 152
James B. Frownfelter, Chairman and Chief Executive Officer, ABS
Global......................................................... 42
Prepared statement........................................... 44
Answers to submitted questions............................... 154
Phillip Berenbroick, Policy Director, Public Knowledge........... 49
Prepared statement........................................... 51
Answers to submitted questions............................... 156
Submitted Material
Letter of October 28, 2019, from Mr. O'Halleran, et al., to Ajit
Pai, Chairman, Federal Communications Commission, submitted by
Mr. O'Halleran................................................. 94
Letter of October 29, 2019, from Tim McCleese, Vice President,
Legislative Affairs, Aerospace Industries Association, to Mr.
Pallone, et al., submitted by Mr. Doyle........................ 96
Letter of October 28, 2019, from Grover Norquist, President,
Americans for Tax Reform, to subcommittee members, submitted by
Mr. Doyle...................................................... 98
Letter of October 29, 2019, from Peter Pitsch, Executive Vice
President, Advocacy and Government Relations, C-Band Alliance,
to Mr. Doyle and Mr. Latta, submitted by Mr. Doyle............. 100
Report of Citizens Against Government Waste, ``The Race to 5G:
Protecting Taxpayers through Spectrum Auctions,'' by Deborah
Collier and Thomas Schatz, submitted by Mr. Doyle.............. 109
Blog post of October 7, 2019, ``Analyzing Plans To Reallocate C-
Band for Deployment,'' by Will Rinehart, American Action Forum,
submitted by Mr. Latta......................................... 122
Blog post of October 25, 2019, ``Progress on the C-Band,'' by
Joan Marsh, Executive Vice President of Federal Regulatory
Relations, AT&T, submitted by Mr. Latta........................ 136
Press release of October 28, 2019, ``C-Band Alliance Proposes to
Clear 300 MHz of Spectrum for Nationwide 5G Deployment,'' C-
Band Alliance, submitted by Mr. Latta.......................... 138
Ex Parte Submission, GN Docket No. 18-122, October 28, 2019, C-
Band Alliance, submitted by Mr. Latta.......................... 140
Fact sheet, ``C-Band Alliance Proposes Clearing 300 MHz of C-Band
Spectrum,'' C-Band Alliance, submitted by Mr. Latta............ 143
Letter of October 29, 2019, from Steve Pociask, American Consumer
Institute, et al., to Mr. Walden and Mr. Latta, submitted by
Mr. Latta...................................................... 145
REPURPOSING THE C-BAND TO BENEFIT ALL AMERICANS
----------
TUESDAY, OCTOBER 29, 2019
House of Representatives,
Subcommittee on Communications and Technology,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to notice, at 10:01 a.m., in
room 2322 Rayburn House Office Building, Hon. Mike Doyle
(chairman of the subcommittee) presiding.
Members present: Representatives Doyle, McNerney, Clarke,
Loebsack, Veasey, Soto, O'Halleran, Eshoo, Butterfield, Matsui,
Welch, Schrader, Cardenas, Pallone (ex officio), Latta
(subcommittee ranking member), Kinzinger, Bilirakis, Johnson,
Long, Flores, Brooks, Walberg, Gianforte, and Walden (ex
officio).
Staff present: AJ Brown, Counsel; Jeffrey C. Carroll, Staff
Director; Parul Desai, FCC Detailee; Evan Gilbert, Deputy Press
Secretary; Waverly Gordon, Deputy Chief Counsel; Tiffany
Guarascio, Deputy Staff Director; Alex Hoehn-Saric, Chief
Counsel, Communications and Consumer Protection; Jerry
Leverich, Senior Counsel; Dan Miller, Senior Policy Analyst;
Phil Murphy, Policy Coordinator; Joe Orlando, Executive
Assistant; Alivia Roberts, Press Assistant; Michael Engel,
Minority Detailee, Communications and Technology; Margaret
Tucker Fogarty, Minority Legislative Clerk/Press Assistant;
Theresa Gambo, Minority Financial and Office Administrator;
Peter Kielty, Minority General Counsel; Tim Kurth, Minority
Chief Counsel, Consumer Protection and Commerce; Kate O'Connor,
Minority Chief Counsel, Communications and Technology; Evan
Viau, Minority Professional Staff Member, Communications and
Technology; and Nate Wilkins, Minority Fellow, Communications
and Technology.
Mr. Doyle. The Subcommittee on Communications and
Technology will now come to order.
The Chair now recognizes himself for 5 minutes.
OPENING STATEMENT OF HON. MIKE DOYLE, A REPRESENTATIVE IN
CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA
Thank you, all of you that are here today, and thank you to
the witnesses that are appearing before us today. Today, our
subcommittee is holding an important legislative hearing
entitled ``Repurposing the C-Band to Benefit All Americans.''
The C-band is a block of spectrum currently used by
satellite companies for the long-distance distribution of cable
and broadcast video programming like NBC, ESPN, and HBO, as
well as audio programming, like NPR and LDS radio. More than
100 million Americans receive content every day that is
distributed through this band.
More than 2 years ago, the C-band satellite providers began
to suggest that they could relinquish a portion of the band in
exchange for incentive payments and that, in turn, the spectrum
could be used for 5G mobile wireless. In the wake of the
incentive option, it is good to see incumbent spectrum right
holders come forward and offer to work with the Government to
free up spectrum. I think that tells us that the incentive
model can work.
However, a number of these incumbent satellite companies
have come together to propose a private transaction in the band
whereby they sell the rights to spectrum they didn't purchase
and that they keep the lion's share of the profits and that
they may--may--give some of the money back to the U.S. Treasury
on a voluntary basis.
There is a lot about this proposal that is deeply
concerning. I have seen a number of reports that suggest that
auctioning this spectrum could raise $60 billion or more. This
spectrum is so valuable because it will be essential for our
Nation's deployment of 5G services. It has the capacity and the
propagation characteristics to usher in a newer era of
innovation and economic opportunity. We need to get this right
because this is a precious natural resource, and the way this
spectrum is deployed in the marketplace will determine our
Nation's wireless future.
That is why, last week, I introduced H.R. 4855, the
Clearing Broad Airways for New Deployment Act, or the C-BAND
Act, along with my colleague Subcommittee Vice Chair Doris
Matsui, who is a leader on this issue and with whom I have been
working closely, along with our colleagues Congressman Bill
Johnson and Congressman Greg Gianforte.
This legislation would require the FCC to hold a public
auction to sell between 200 and 300 megahertz of C-band
spectrum. It would require the Commission to protect incumbent
C-band-dependent users who rely on this service to provide
millions of Americans with video and radio services, and it
requires the Commission to clear this spectrum and sell it
within 3 years. This legislation would also create a golden
opportunity to raise revenue and pay for many of our shared
priorities.
We can fix problems we have talked about for a decade,
colleagues, such as rural broadband deployment, which I know is
near and dear to my colleagues Mr. Johnson and Mr. Gianforte. I
know they care deeply about that. Rural telehealth, public
safety communications, Next Generation 9-1-1, digital
opportunity and inclusion and closing the digital divide--we
have the opportunity with this legislation to address these
critical needs.
Colleagues, we are never going to get an opportunity like
this again. If we do nothing and tell our constituents that we
gave away $60 billion to a handful of foreign satellite
companies and left the folks back home high and dry, this is
something the American people are never going to forget. And no
member of this committee or in the House of Representatives
ever, ever talk about the need to do rural broadband deployment
when this is our first and only chance to have a pay-for. So
this is an important piece of legislation.
As I said, there is no other sources of revenue to do this.
How often in this committee have we talked about
infrastructure, about broadband deployment, and the 800-pound
gorilla in the room has always been, how are we going to pay
for it? Well, this is a way to pay for it.
Now, on our panel today, we have a broad group, some for,
some against this private or public auction. I don't normally
associate myself with the Taxpayer Protection Alliance or the
Citizens Against Government Waste. I checked my rating. It is 7
percent. I suspect some of you guys over there have a little
higher rating than I do with Citizens Against Government Waste.
But I will tell you what, I am happy to have them testifying
here today.
At the Senate Appropriations hearing 2 weeks, Mr. Williams,
president of the TPA, described the CBA plan for a private sale
was one of the top 10 taxpayer rip-offs he has ever seen, up
there with the bridge to nowhere.
The C-band legislation we have introduced is a win-win for
everyone. It will ensure that the band is auctioned in a
transparent and accountable fashion that results in the maximum
return for the American people.
It also ensures that incumbent services that over 100
million Americans rely on continue to operate and are protected
through the transition. And, finally, it gives us the
opportunity and the ability to address critical needs in our
country and close the digital divide.
I encourage all of my colleagues to support the C-BAND Act,
and I look forward to today's discussion on this important
issue.
[The prepared statement of Mr. Doyle follows:]
Prepared Statement of Hon. Mike Doyle
Thank you all for being here today, and thank you to the
witnesses for appearing before us.
Today the subcommittee is holding an important legislative
hearing entitled ``Repurposing the C-Band to Benefit All
Americans.''
The C-band is a block of spectrum currently used by
satellite companies for the long-distance distribution of cable
and broadcast video programming like NBC, ESPN, and HBO--as
well as audio programming like NPR and LDS radio. More than a
hundred million Americans receive content every day that is
distributed through this band.
More than 2 years ago, C-band satellite providers began to
suggest that they could relinquish a portion of the band in
exchange for incentive payments, and that in turn the spectrum
could be used for 5G mobile wireless.
In the wake of the incentive auction, it is good to see
incumbent spectrum rights-holders come forward and offer to
work with the Government to free up spectrum. I think that
tells us that the incentive model can work.
However, a number of these incumbent satellite companies
have come together to propose a private transaction in the band
whereby they sell the rights to spectrum they didn't purchase,
and that they keep the lion's share of the profits, and that
they may--MAY--give some money back to the US Treasury on a
voluntary basis.
There is a lot about this proposal that is deeply
concerning.
I have seen a number of reports that suggest that
auctioning this spectrum could raise $60 billion or more.
This spectrum is so valuable because it will be essential
for our Nation's deployment of 5G services.
It has the capacity and propagation characteristics to
usher in a new era of innovation and economic opportunity.
We need to get this right, because this is a precious
national resource, and the way this spectrum is deployed in the
marketplace will determine our Nation's wireless future.
That is why last week, I introduced H.R 4855, the Clearing
Broad Airwaves for New Deployment Act or the C-BAND Act, along
with my colleagues Subcommittee Vice Chair Doris Matsui, who is
a leader on this issue and with whom I have been working
closely, Congressman Bill Johnson, and Congressman Greg
Gianforte.
This legislation would require the FCC to hold a public
auction and to sell between 200 and 300 megahertz of C-band
spectrum.
It would require the Commission to protect incumbent C-
band-dependent users who rely on this service to provide
millions of Americans with video and radio services.
And it requires the Commission to clear this spectrum and
sell it within 3 years.
This legislation would also create a golden opportunity to
raise revenue and pay for many of our shared priorities.
We can fix the problems we have talked about for a decade--
such as rural broadband deployment, which I know my colleagues
Mr. Johnson and Mr. Gianforte care about, rural telehealth,
public safety communications, Next Generation 9-1-1, digital
opportunity and inclusion, and closing the digital divide.
We have the opportunity with this legislation to address
these critical needs.
Or we can do nothing and tell our constituents we gave away
$60 billion to a handful of foreign satellite companies and
left the folks back home high and dry.
That doesn't sound like ``America first'' to me!
There are no other sources of revenue on the horizon to pay
for these priorities, and as we have talked about time and time
again, these are not problems private-sector actors have an
incentive to address on their own.
Now, I don't normally associate myself with the comments of
groups like the Taxpayer Protection Alliance or Citizens
Against Government Waste, which I am happy to see is testifying
here today.
But at the Senate Appropriations hearing w weeks ago. Mr.
Williams, the president of TPA, described the CBA plan for a
private sale as one of the top ten taxpayer rip-offs he has
ever seen--up there with the ``bridge to nowhere''!
The C-band legislation we have introduced is a win-win for
all Americans. It will ensure that this band is auctioned in a
transparent and accountable fashion that results in the maximum
return for the American people.
It also ensures that the incumbent services that over a
hundred million Americans rely on continue to operate and are
protected through a transition.
And finally it gives us the opportunity and the ability to
address critical needs in our country and close the digital
divide.
I encourage all my colleagues to support the C-BAND Act and
I look forward to today's discussion on this important issue.
Mr. Doyle.And I see that Mr. Walden and Mr. Pallone are
here. And before I recognize our subcommittee chair, I want to
recognize Mr. Pallone for a brief statement.
Frank.
Mr. Pallone. Well, I just wanted to say that I was not
happy to hear that Mr. Walden was retiring. He called me
yesterday and told me. And I know that he is going to listen to
me about the issue, but--he never does anyway. No, I am
kidding.
But I just wanted to say, Greg, that it is just--I mean,
obviously, we are still here for another--I don't know--16
months or whatever it is. But you have just been outstanding in
terms of, you know, your principles and what you stand for and
fighting for the things that you believe in, but at the same
time, always willing to work with us.
Because I think you said many times that the main thing is
to see if we can get some legislation passed and if we can come
to an agreement. Failing that, then, you know, we can fall back
and, you know, say what our positions are and if we disagree.
But you are always--always--reaching out to the other side of
the aisle and trying to think of ways that we can actually
accomplish things for the American people.
And I just wanted to commend you for that and say that, as
much as I regret the fact that you announced your retirement,
we will still work together over the next year or so and beyond
as well.
So I yield back.
Oh, I yield to the gentlewoman, yes.
Ms. Eshoo. Thank you for yielding, Mr. Chairman.
I echo your sentiments. Greg left a message for me
yesterday. My heart sank when I listened to it and then read
the reports. We have had and continue to and I think always
will have a wonderful friendship and mutual regard for one
another. And you have practiced that, Greg.
So, you know, we celebrate what you have accomplished, we
celebrate the person that you are, and I am just glad that we
have--what--15, 16 months to go together. So let's cook up some
new stuff and get it done.
But Greg served as the chairman of this subcommittee, and I
was the ranking member. And we are talking about auctions
today. On our watch, we did a gigantic one when no one even
recognized that a penny would be raised.
So there are opportunities. But you have represented your
party, obviously, to the best of your ability. But I think you
are going to be remembered as a person of integrity, a real
patriot, and that you have always been value added to the House
of Representative.
Thank you.
Mr. Doyle. Greg, I just want to say that you--all of the
Members on this side of the aisle hold you in high regard, and
we have tremendous respect for how you have chaired the
committee when you were the chair. And I want to say, on a
personal level, that it has been a pleasure to work with you.
And I think this should require a vote of the committee before
you can retire.
Mr. Walden. We had that vote. My wife won. And by the way,
it was unanimous between the two of us.
Mr. Doyle. 0K. Would you like to say anything before I
recognize the ranking member?
Mr. Walden. Just take a second. We have got important
witnesses and work to do here. But it has been a great joy and
privilege to serve with all of you and some who aren't here at
this subcommittee certainly as well.
And this is a wonderful institution. Sometimes it gets a
little rocky. Sometimes it gets a little off the rails, but it
is the best around. And it is about the people. And the great
staff we all get to work with, they are all family. I think the
hardest thing for me yesterday was breaking the news to my
personal staff and then my district staff. And by the time I
got up here to the committee staff, I was pretty much a
blubbering mess.
But it is a great committee. We all know that. And we have
had a lot of fun together. And it is interesting, we are
talking auctioning spectrum one way or another here today. As
Anna knows--and we fought that battle--CBO told us the AWS-3
spectrum was never going to happen, never auctioned, gave us a
zero for the score. It sold for $40 billion, which, by the way,
makes this subcommittee and our full committee probably the
biggest single payer down of debt because the extra proceeds
all went to buy down the national debt. So you can put that in
your brochure, if needed, with your bad Citizens Against
Government Waste score to overcome that.
No, it has been a great privilege and joy. And with all of
these wonderful comments today, whenever my memorial service
actually does get scheduled sometime, you don't have to come
now, you know.
But thank you. I yield back.
Mr. Doyle. The gentleman yields back.
The Chair now recognizes Mr. Latta, our ranking member of
the subcommittee, for 5 minutes.
Mr. Latta. Mr. Chairman, if I could, just on a point of
personal privilege, before my time starts, if I can just also
thank Greg for his great service to this committee and the
House. He had great trust in me when he was the chairman of
this subcommittee, when I was his vice chair, and then also
having me as one of the subcommittee chairs in the last
Congress. And I will never forget it. So I really appreciate
your leadership and your friendship. And best of luck to
everything to come. So thank you very much.
OPENING STATEMENT OF HON. ROBERT E. LATTA, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OHIO
Well, Mr. Chairman, thank you very much for holding today's
hearing, and thank you very much to our witnesses for being
here for our second hearing on C-band spectrum. It is very
important for us to consider that before us today.
The FCC has signaled an intent to show progress on C-band
in the near future, which will make critical mid-band spectrum
available to 5G. However, a debate lingers on the best path
forward to serve the public interest and encourage U.S.
leadership in 5G.
In a world with a greater innovation and a growing appetite
for wireless technology, an equation for making new spectrum
available has become increasingly challenging. While
bipartisan, market-based principles have led us well over the
last two decades, it is important not to rest as other
countries continue to feel free to continue adding additional
spectrum for commercial use.
Taking bold steps have led us to success in the past like
we saw in 2012 when we pioneered a new reverse auction, the
fruits of which are now being deployed in low-band 5G spectrum.
I am pleased to have worked with Chairman Doyle on the
SHARE Act to facilitate a system for Federal users on how to
better share their spectrum and thus optimize its use, but
there is an impending need to clear more spectrum now.
That brings us to today's topic, how to clear C-band
spectrum for 5G deployment from willing sellers. Without
question, when it comes to more technically, legally, and
economically complex spectrum bands like this one, we should be
encouraging industry and the FCC to work together on innovative
approaches to spectrum management that serves the public
interest.
In today's legislative hearing, we will discuss a
bipartisan proposal on this important swath of spectrum. But I
understand there are other views on the committee from both
sides of the aisle.
To be clear, all of these views have merit. Each provides
an important stakeholder perspective from the terms of current
occupants and users of C-band to how to best expedite its
clearing so that it may quickly be deployed.
As our witnesses know, and will hopefully help us better
understand today, there are several complex issues that present
challenges for clearing C-band spectrum for mobile wireless
service. We must consider the technical steps necessary to
protect the incumbent programming services, how to best get
cleared spectrum into the hands of those who will deploy it,
how to ensure a fair and transparent process, how to promote
participation of small rural users, and how to avoid costly
court challenges that put a strain on U.S. 5G leadership at a
time when our economic and national security interests are in
the balance.
Our main objectives, no matter the approach, should be to
get the spectrum to market quickly, fairly, and transparently.
With very few legislative days left in this session, time
is running out to legislate the type of detail that was
necessary to unlock the spectrum identified in the 2012
Spectrum Act. However, there is clearly a role for Congress to
play in ensuring the public interest is served through
effective spectrum policy and its related revenues.
I look forward to hearing more about those issues from our
panel today. And, again, I want to thank our witnesses for
being here.
[The prepared statement of Mr. Latta follows:]
Prepared Statement of Hon. Robert E. Latta
Welcome to the second subcommittee hearing on C-band
spectrum and thank you to the witness panel for being here
today.
The FCC has signaled an intent to show progress on C-band
in the near future, which will make critical mid-band spectrum
available for 5G. However, a debate lingers on the best path
forward to serve the public interest and encourage U.S.
leadership in 5G. In a world with more innovation and a growing
appetite for wireless technology, the equation for making new
spectrum available has become increasingly challenging. While
bipartisan, market-based principles have led us well over the
last two decades, it's important not to rest as other countries
continue to free additional spectrum for commercial use. Taking
bold steps have led us to success in the past like we saw in
2012 when we pioneered a new, ``reverse'' auction--the fruits
of which are now being deployed in low-band, 5G spectrum.
I'm pleased to have worked with Chairman Doyle on the SHARE
Act, to facilitate a system for Federal users on how to better
share their spectrum and thus optimize its use, but there is an
impending need to clear more spectrum now. That brings us to
the topic today--how to clear C-band spectrum for 5G deployment
from willing sellers. Without question, when it comes to more
technically, legally, and economically complex spectrum bands
like this one, we should be encouraging industry and the FCC to
work together on innovative approaches to spectrum management
that serve the public interest.
In today's legislative hearing we will discuss a bipartisan
proposal on this important swath of spectrum, but I understand
there are other views on this committee from both sides of the
aisle. To be clear, all these views have merit, and each
provides an important stakeholder perspective from the terms of
current occupants and users of C-band to how to best expedite
its clearing so that it may be deployed quickly.
As our witnesses know, and will hopefully help us better
understand today, there are several complex issues that present
challenges to clearing C-band spectrum for mobile terrestrial
wireless service. We must consider:
the technical steps necessary to protect incumbent
programming services,
how best to get cleared spectrum into the hands of
those who will deploy it,
how to ensure a fair and transparent process,
how to promote participation of small, rural
users, and
how to avoid costly court challenges that could
put a strain on U.S. 5G leadership at a time when our economic
and national security interests are in the balance.
Our main objectives--no matter the approach--should be to
get this spectrum to market quickly, fairly, and transparently.
With few legislative days left this year, time is running
out to legislate the type of detail that was necessary to
unlock the spectrum identified in the 2012 Spectrum Act.
However, there is clearly a role for Congress to play in
ensuring the public interest is served through effective
spectrum policy and its related revenues. I look forward to
hearing more about those issues from the panel.
Thank you again to our witnesses for being here, and with
that I yield the remainder of my time to my friend from Ohio,
Mr. Johnson.
Mr. Latta. And, at this time, I want to yield the remainder
of my time to my friend, the gentleman from Ohio, Mr. Johnson.
Mr. Johnson. Well, thank you. Thank you to my colleague for
yielding.
And to Chairman--or used to be Chairman Walden, thank you
for all your leadership. And I have enjoyed working with you.
It is a sad day to hear the news that you are leaving.
Well, look, this is a very important hearing today. The
question is not whether this important mid-band spectrum should
be repurposed but what process the FCC should use to transition
C-band spectrum from satellite to terrestrial wireless
broadband use, enabling 5G services, and importantly, greater
broadband deployment to rural areas.
As a lead sponsor of the C-BAND Act, it is clear that I
prefer the FCC conduct a public auction. In my view, this would
enable a transparent and competitive process and ensure the
taxpayers are the primary beneficiary from any auction or sale
of this national resource.
I am hopeful that today's hearing will provide a thoughtful
discussion on all of the FCC's options for repurposing C-band
spectrum. I am particularly interested in hearing what
resources Congress could provide the FCC to best enable a fast
and efficient release of this vital mid-band spectrum in
addition to how best the spectrum can be used to meet the needs
of rural America.
It is important that we get this right. A timely and
competitive process is critical, as is the accountability and
transparency provided by an FCC-led effort.
And, with that, I thank you for the time, and I yield back.
[The prepared statement of Mr. Johnson follows:]
Prepared Statement of Hon. Bill Johnson
Thank you, Chairman Doyle and Ranking Member Latta for
holding today's important hearing.
The question is not whether this important mid-band
spectrum should be repurposed, but what process the FCC should
use to transition C-band spectrum from satellite to terrestrial
wireless broadband use--enabling 5G services and--importantly--
greater broadband deployment to rural areas.
As a lead sponsor of the C-BAND Act, it's clear that I
prefer that the FCC conduct a public auction. In my view, this
would enable a transparent and competitive process, and ensure
the taxpayers are the primary beneficiary from any auction or
sale of this national resource.
I'm hopeful that today's hearing will provide a thoughtful
discussion on all the FCC's options for repurposing C-band
spectrum. I am particularly interested in hearing what
resources Congress could provide the FCC to best enable a fast
and efficient release of this vital mid-band spectrum, in
addition to how best this spectrum can be used to meet the
needs of rural America. It's important that we get this right;
a timely and competitive process is critical, as is the
accountability and transparency provided by an FCC-led effort.
Thank you, and I yield back.
Mr. Doyle. The gentleman yields back.
The Chair now recognizes Mr. Pallone, chairman of the full
committee, for 5 minutes.
OPENING STATEMENT OF HON. FRANK PALLONE, Jr., A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Pallone. Thank you, Chairman Doyle.
Today, we are discussing how to reallocate the C-band in a
way that benefits all consumers and helps us invest in
connecting more Americans to better technology.
C-band spectrum is essential mid-band spectrum that can be
used to speed up our efforts to implement new wireless
technologies. Currently, the spectrum is underutilized, but it
is not unused. Right now, in fact, it hosts satellite services
that provide important services across the country, including
the delivery of news and entertainment content to rural
America.
In July, we had a hearing to discuss the country's spectrum
needs where we discussed C-band at length, and we heard from a
group of satellite service providers called the C-Band
Alliance. The Alliance advocated for taking the lead and
selling the spectrum privately to wireless carriers of their
choosing and then made the argument that a private sale may
make the spectrum available for 5G faster than a public auction
would.
I don't think that is necessarily true. And what is more,
the proceeds from that sale would mostly go to the foreign
satellite companies that make up the Alliance. Their recent
offer to make a voluntary payment to the Treasury from their
multibillion-dollar private sale raised novel enforcement and
transparency issues.
And this would be an unprecedented departure from the way
Congress has instructed the FCC to reallocate spectrum in the
past. Under the Communications Act, we required the FCC to run
auctions that provide revenues to the Treasury, which is
critical to ensuring the American people benefit from these
auctions, and the revenues could go a long way in helping us
invest in high-speed broadband in unserved and underserved
areas and next generation 9-1-1 as we do in the LIFT America
Act. Some estimates indicate the C-band auction could yield as
much as $60 billion to fund those priorities.
A public auction conducted by the FCC would also ensure
that the process is fair, transparent, and competitive. And,
furthermore, the FCC has the experience and the expertise to
carry out this auction. After all, it has conducted over a
hundred public spectrum auctions that have already earned $120
billion.
So, last week, Chairman Doyle and Representatives Johnson,
Matsui, and Gianforte introduced the C-BAND Act, which would
require the FCC to conduct a public auction of the C-band. I
will let them explain it, but this bipartisan effort is a
powerful step towards using our public airways to benefit all
Americans. We can't afford a delay in making this important
spectrum available for 5G, and we can't afford to give away
billions of dollars that could be used for improving public
safety and connecting Americans to broadband.
[The prepared statement of Mr. Pallone follows:]
Prepared Statement of Hon. Frank Pallone, Jr.
Today, we are discussing how to reallocate the C-band in a
way that benefits all consumers and helps us invest in
connecting more Americans to better technology. C-band spectrum
is essential mid-band spectrum that can be used to speed up our
efforts to implement new wireless technologies.
Currently, this spectrum is underutilized but it is not
unused--right now, in fact, it hosts satellite services that
provide important services across the country, including the
delivery of news and entertainment content to rural America.
In July, we had a hearing to discuss the country's spectrum
needs where we discussed C-band at length, and we heard from a
group of satellite service providers called the C-Band
Alliance. The Alliance advocated for taking the lead in selling
the spectrum privately to wireless carriers of their choosing.
They made the argument that a private sale may make the
spectrum available for 5G faster than a public auction would. I
don't think that's necessarily true, and what's more, the
proceeds from that sale would mostly go to the foreign
satellite companies that make up the Alliance. Their recent
offer to make a voluntary payment to the treasury from their
multibillion-dollar private sale raise novel enforcement and
transparency issues.
This would be an unprecedented departure from the way
Congress has instructed the FCC to reallocate spectrum in the
past. Under the Communications Act, we required the FCC to run
auctions that provide revenues to the Treasury, which is
critical to ensuring the American people benefit from these
auctions. And the revenues could go a long way in helping us
invest in high-speed broadband in unserved and underserved
areas and Next Generation 9-1-1 service, as we do in the LIFT
America Act. Some estimates indicate the C-band auction could
yield as much as $60 billion to fund those priorities.
A public auction conducted by the FCC would also ensure
that the process is fair, transparent, and competitive.
Furthermore, the FCC has the experience and the expertise to
carry out this auction--after all, it has conducted over 100
public spectrum auctions that have already earned $120 billion.
Last week, Chairman Doyle and Representatives Johnson,
Matsui, and Gianforte introduced the C-BAND Act, which would
require the FCC to conduct a public auction of the C-band. I'll
let them explain it, but this bipartisan effort is a powerful
step toward using our public airwaves to benefit all Americans.
We can't afford to delay making this important spectrum
available for 5G, and we cannot afford to give away billions of
dollars that could be used for improving public safety and
connecting Americans to broadband.
Mr. Pallone. And, with that, I would like to yield the 2
and a half minutes left to Representative Matsui.
Ms. Matsui. Thank you very much.
And I would also like to say to Mr. Walden, the ranking
member, how much I appreciate working with him on the full
committee and the subcommittee and look forward to completing
the work ahead. So thank you very much.
Thank you, Chairman Doyle, for holding this important and
timely hearing on repurposing the C-band. As the United States
works to establish itself as a world leader in 5G and beyond, I
remain committed to advancing policies that would promote
better utilization of spectrum to meet the growing demand for
wireless services and strengthen our economy.
I am pleased to join Chairman Doyle and Representatives
Johnson and Gianforte in introducing the C-BAND Act. This bill
is an important part of discussion about the future of 5G and
represents bipartisan agreement that the FCC must pursue an
open and transparent auction process that respects American
taxpayers.
The C-BAND Act would build on the progress of my WIN 5G
Act, which will help ensure the U.S. wins the race to 5G and
beyond while also making needed investments in rural broadband.
The approach contained in these bills is an important part of
ensuring this valuable public resource is made available--5G--
quickly, equitably, and transparently.
Our FCC-led public auctions have been successful in
bringing spectrum to market. I am concerned that the Commission
may be pursuing alternatives to public auctions that would
field proceeds to private parties, rather than taxpayers, and
trigger time-consuming legal challenges. That is why I recently
sent a letter to Chairman Pai reiterating my belief that the
Chairman does not have the authority to conduct a private
auction of the C-band and must use the auction authority
provided by Congress through an FCC-led public auction.
Abandoning this proven model could lead to protracted
litigation, causing unnecessary delays in making this 5G
spectrum available and shortchange the American taxpayer.
I would like to thank the witnesses here today for
appearing before this committee, and I look forward to this
very important discussion about the future of C-band.
And, with that, I yield back to the chairman.
Mr. Doyle. The chairman yields back?
Mr. Pallone. I yield back.
Mr. Doyle. The chairman yields back.
The Chair now recognizes Mr. Walden, ranking member of the
full committee, for 5 minutes for his opening statement.
OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OREGON
Mr. Walden. Well, good morning, Mr. Chairman.
And thanks, again, to all of you for your very kind and
generous comments.
I want to welcome our witnesses today to this hearing.
Before diving into the debate over how to best clear up a
portion of the C-band and 5G deployment, I want to emphasize
the goals I believe every Member here shares.
First, the process must lead to auction revenues and
spectrum allocations benefiting Americans in all parts of our
country. I think we can agree to that.
Second, we must preserve spectrum for those that are
reliant on the current C-band services now and into the future.
Third, we must take interference concerns into account when
redeploying spectrum. I think that is essential.
And, fourth, we should seek to make this critical mid-band
spectrum quickly available for 5G.
Fifth, this process should not overlook the opportunity to
also facilitate resources for connecting rural communities with
broadband and upgrading our emergency call centers to Next
Generation 9-1-1, all without any deficit spending. So, to your
point, Mr. Chairman, there is a pay-for here that we can all
see, and we have a lot of work to do in the country.
So, lastly, the process has to be fair, open, and
transparent.
So, with that in mind, I know there are differences of
opinion from our various stakeholders of how the FCC may
proceed. And I would expect the Commission is taking a hard
look at weighing the ramifications of each option.
To further facilitate that public conversation and to
ensure our discussion moves to the next level without ceding
the point on an auction mechanism, I am pleased to see a
legislative proposal for today's hearing.
Mr. Chairman, as I have said since the very first hearing
you chaired, we remain committed to working with you to find
bipartisan solutions. And I think we have proven that on both
sides with passage of the robocall legislation and soon moving
on the broadband mapping and supply-chain-related measures.
Those are both important, and we are making progress on those.
And now I think we all know there is this little one that still
begs for us to get involved and solve. The court kind of ruled
in kind of--and I won't say net neutrality, but eventually we
might get to that one, too. But that is a little more
problematic.
With that said, we all agree we must make this critical
mid-band spectrum available, and do so quickly. If we are
questioning on how the Commission may act, then I think we have
an obligation to clear that up so the FCC has clear direction
from us on how to accomplish our shared goals. If there is a
concern over the timeframe it would take to complete a public
auction due to outdated software that can't run multiple or
complex auctions, then we should take up authorizations for the
FCC and NTIA so they have state-of-the-art tools for their
respective spectrum management roles going forward.
Let me raise another point that bears review. In our recent
legislative hearing on the supply chain bills, we heard from
our witnesses about the stark competitive implications for
trusted equipment vendors and the pressures they face to lower
prices, especially to appeal to rural providers in hard-to-
reach areas, like places in my district in Oregon.
While those bills are important for addressing our current
frame network vulnerabilities and understanding future risk, we
can do so significantly more through market incentives to give
rural providers options that may be more cost-competitive. That
can only happen when trusted vendors have a market for mid-band
equipment, and we know that freeing up C-band holds the key in
that regard.
If we don't, there could be potentially serious long-term
implications for the trusted vendors we rely upon now.
So, to put an even finer point on it, our failure will
worsen the digital divide for rural constituents who can
benefit the most from propagation aspects in mid-band spectrum
that could come online.
We are all Americans. I know we can work together to beat
the command-and-control markets dictated by some countries to
protect and expand their homegrown vendors' base for world
dominance. That is a big statement. So, on this and other
priorities I outlined, we would be remiss to let this
opportunity pass by.
Please see Chairman Pai's commitment to deliver this mid-
band spectrum to market fairly, transparently, and
expeditiously, and I look forward to a thoughtful discussion
today on how to achieve our common goals.
With that, Mr. Chairman, I thank you again and look forward
to working with you.
I yield back. Before I do, just so the committee knows, we
have got another subcommittee I have to go to as well, but I
will be bouncing back and forth.
So, again, thank you very much for participating in our
witness panel, and I yield back.
[The prepared statement of Mr. Walden follows:]
Prepared Statement of Hon. Greg Walden
Thank you, Mr. Chairman. I want to welcome our witnesses to
this hearing.
Before diving into the debate over how to best clear a
portion of the C-band for 5G deployment, I want to emphasize
the goals I believe every Member here shares:
First, the process must lead to auction revenues
and spectrum allocations benefiting Americans in all parts of
our country.
Second, we must preserve spectrum for those that
are reliant on the current C-band services now and into the
future.
Third, we must take interference concerns into
account when redeploying the spectrum.
Fourth, we should seek to make this critical mid-
band spectrum quickly available for 5G.
Fifth, this process should not overlook the
opportunity to also facilitate resources for connecting rural
communities with broadband, and upgrading our emergency call
centers to Next Generation 9-1-1 (NG911)--all without any
deficit spending.
Lastly, the process must be fair, open, and
transparent.
With that in mind, I know there are differences of opinion
from various stakeholders on how the FCC may proceed, and I
would expect the Commission is taking a hard look at weighing
the ramifications of each option. To further facilitate that
public conversation, and to ensure our discussion moves to the
next level without ceding the point on an auction mechanism,
I'm pleased to see a legislative proposal for today's hearing.
Mr. Chairman, as I have said since the very first hearing
you chaired, we remain committed to working with you on finding
consensus solutions. This subcommittee can be a haven for
bipartisan solutions, where we don't let the politics of the
day determine outcomes for sound policy. I have first-hand
experience from sitting where you are that spectrum policy has
been an area for such bipartisanship. I believe House passage
of robocall legislation, and us moving soon on broadband
mapping and supply-chain-related measures are further testament
to that.
With court decisions begging us to solve one particular
issue that has thus far vexed this subcommittee, my hope
remains that with this we can demonstrate our ability to reach
sound, bipartisan solutions again and solve this issue for
good.
With that said, we all agree that we must make this
critical mid-band spectrum available--and do so quickly. If we
are questioning how the Commission may act, we have an
obligation to clear that that up, rather than direct fire at
Chairman Pai, so the FCC has clear direction from us on how to
accomplish our shared goals. If there is a concern over the
timeframe it would take to complete a public auction due to
outdated software that can't run multiple or complex auctions,
we should take up reauthorizations for the FCC and NTIA so they
have state-of-the-art tools for their respective spectrum
management roles going forward.
Let me raise another point that bears review. In our recent
legislative hearing on the supply-chain bills, we heard from
our witnesses about the stark competitive implications for
trusted equipment vendors, and the pressures they face to lower
prices, especially to appeal to rural providers in hard to
reach areas like my district in Oregon. While those bills are
important for addressing our current network vulnerabilities
and understanding future risk, we can do significantly more
through market incentives to give rural providers options that
may be more cost-competitive. That can only happen when trusted
vendors have a market for mid-band equipment, and we know that
freeing up C-band holds the key in that regard. If we don't,
there could be potentially serious, long-term implications for
the trusted vendors we rely on now.
To put an even finer point on it, our failure will worsen
the digital divide for rural constituents who can benefit the
most from the propagation aspects of the mid-band spectrum that
would come online.
We are all Americans, and I know we can work together to
beat the command-and-control markets dictated by some countries
to protect and expand their home-grown vendor base for world
dominance. So, on this and other priorities I outlined, we
would be remiss to let this opportunity pass us by. I'm pleased
to see Chairman Pai's commitment to deliver this mid-band
spectrum to market fairly, transparently, and expeditiously,
and look forward to a thoughtful discussion today on how to
achieve our common goals.
Thank you.
Mr. Doyle. I thank the gentleman. The gentleman yields
back.
The Chair would like to remind Members that, pursuant to
committee rules, all Members' written opening statements shall
be made part of the record.
So I would now like to introduce our witnesses for today's
hearing.
First, Mr. Ross Lieberman, senior vice president, ACA
Connects-America's Communication Association. Welcome.
Next, Mr. Jeff Campbell, vice president, government affairs
technology policy, with Cisco. Welcome.
Ms. Deborah Collier, director of technology and
telecommunications policy, Citizens Against Government Waste.
Welcome.
Mr. James Frownfelter, chairman and chief executive
officer, ABS Global. Welcome, sir.
And, finally, Mr. Phillip Berenbroick, policy director with
Public Knowledge.
We want to thank all of the witnesses for joining to us
today. We look forward to your testimony.
At this time, the Chair will now recognize each witness for
5 minutes to provide their opening statement.
Before we begin, I would like to explain our lighting
system. In front of you is a series of lights. The light will
initially be green at the start of your opening statement. It
will turn yellow when you have 1 minute remaining. Please start
to wrap up your testimony at that point. And when the light
turns red, your time has expired.
Mr. Lieberman, you are recognized for 5 minutes.
STATEMENTS OF ROSS J. LIEBERMAN, SENIOR VICE PRESIDENT, ACA
CONNECTS-AMERICA'S COMMUNICATIONS ASSOCIATION; JEFF CAMPBELL,
VICE PRESIDENT, GOVERNMENT AFFAIRS, CISCO SYSTEMS INC.; DEBORAH
S. COLLIER, DIRECTOR OF TECHNOLOGY AND TELECOMMUNICATIONS
POLICY, CITIZENS AGAINST GOVERNMENT WASTE; JAMES B.
FROWNFELTER, CHAIRMAN AND CHIEF EXECUTIVE OFFICER, ABS GLOBAL;
AND PHILLIP BERENBROICK, POLICY DIRECTOR, PUBLIC KNOWLEDGE
STATEMENT OF ROSS J. LIEBERMAN
Mr. Lieberman. Thank you.
And we, too, were saddened by your announcement of your
retirement, Congressman Walden. The members of ACA Connects
have appreciated your leadership on so many vital
telecommunications issues that affect them.
So thank you for the opportunity to share ACA Connects'
ideas on how to reallocate C-band spectrum for 5G, protect
consumers, and deliver broadband for all Americans.
We appreciate Chairman Doyle, Representatives Gianforte,
Congressman Johnson, and Congressman Matsui, for introducing
the C-BAND Act, a bipartisan bill that includes many elements
that are essential to achieving these goals.
Today, C-band satellites are the best way for ACA Connects
members to receive the cable programming networks that their
customers demand. The C-band works especially well for rural
operators because nationwide satellite transmissions that
originate from studios in New York City and Los Angeles can
reach their remote systems.
Over time, our members have invested over hundreds of
thousands of dollars in their--per cable headend to use the C-
band. While large cable operators are switching to fiber as
their delivery path for video programming, this is not an
affordable option for many ACA Connects members today.
So who are ACA Connects members? They are people like Patty
Boyers, president of BOYCOM in Poplar Bluff, Missouri, who I
assume you remember from her colorful and compelling testimony
before this subcommittee in June. Most of our members, like
her, are family businesses, with fewer than 10 employees and
fewer than 1,000 customers who operate in small towns and rural
areas. These are the very communities that broadband mapping
and other rural broadband initiatives are intended to help.
So how would these communities fare if the FCC repurposed
300 megahertz of C-band and packed existing users into what
remains, as the satellite industry's C-Band Alliance proposes?
Simply put, without a fiber alternative, our members and their
customers will be stuck with higher prices to use a less
reliable C-band that is more prone to interference and unable
to meet future demands.
Lacking any details, the CBA outlined its plan only
yesterday evening.
But it is clear that ACA Connects members would need to
execute a grueling series of tasks, installing filters,
repointing dishes, and replacing dozens or even hundreds of
pieces of equipment in each of their 2,000-plus headends. It
would be all pain and no gain. That sure doesn't sound like a
win for rural America.
ACA Connects shares the committee's goal in making 5G a
reality, but we must be careful to avoid imposing real harms on
rural Americans in the process.
So is there a way to clear C-band spectrum that avoids
these harms? The answer is yes. ACA Connects and its allies
have a plan that would clear 370 megahertz of the band. Our 5G
Plus Plan would do this by migrating video traffic off the C-
band and onto fiber, enabling small and rural operators to
upgrade to the next generation technology that is already
becoming the standard for larger operators.
Auction proceeds would cover all transition costs,
including to deploy 120,000 fiber route miles to connect the
rural systems that will need it. This would deliver a
tremendous economic boost to rural America and help close the
digital divide.
To boot, the 5G Plus Plan would clear more spectrum than
other proposals, and it would do so in the same timeframe in
which others have proposed clearing a far less amount.
The 5G Plus Plan also protects consumers. The plan would
use a public auction to reallocate C-band spectrum and bring in
tens of billions of dollars to the U.S. Treasury. The satellite
industry, by contrast, has proposed a legally unsound private
sale from which they could reap a windfall of $60 billion or
more, without spending a single penny on rural broadband.
Surely, auction proceeds are better spent on new fiber
infrastructure and other public benefits for Americans.
Indeed, our 5G Plus Plan presents a rare opportunity to
deliver a triple win for America: new spectrum for 5G, greater
connectivity in rural areas to close the digital divide, and
substantial revenue for the Treasury.
In closing, I appreciate the opportunity to be here today
on behalf of ACA Connects. We know we are just the small
businesses in rural America in this debate. But our members
and, most importantly, their customers in rural America have a
great deal at stake.
Thank you, and I look forward to your questions.
[The prepared statement of Mr. Lieberman follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Doyle. Thank you, Mr. Lieberman.
Mr. Campbell, you are recognized for 5 minutes.
STATEMENT OF JEFF CAMPBELL
Mr. Campbell. Mr. Chairman, Ranking Member Latta, and
members of the committee, thank you for the opportunity to
testify this morning on the topic of how to transition a key
part of the 3 gigahertz band from one commercial use to
another.
Cisco is a San Jose, California-based company that produces
a wide range of technologies that address both the needs of
service providers, government, and private enterprise. Cisco
CEO Chuck Robbins has called 5G a step change in networking
technology, but one that requires additional spectrum
allocations. Cisco believes that the 3 gigahertz band should be
opened as promptly as possible.
For several years, Cisco has been involved in the effort to
open mid-band spectrum for terrestrial mobile services. Early
on, we took the view that the private-auction approach held
promise as a faster mechanism than any other transition
mechanism available to the FCC, and we urged its consideration.
To be clear, we are not wedded to any particular mechanism
for the transition of spectrum from one use to another. We do
believe that, historically, Government-led spectrum transitions
have been tremendously difficult and slow, and that in the case
of 3 gigahertz, the United States needs to put a priority on
dispatching this work at a faster clip.
Why do we believe this? Well, one reason is consumers.
Cisco has forecast that the mobile services traffic will rise
fivefold through 2022, reflecting both continued use of
powerful 4G networks and the initial deployment of 5G networks
and devices. A lesson learned here: If you build it, they will
come.
But a less obvious reason is that national economic
interests are also at stake, to the level of potentially
affecting our GDP. Unlike previous mobile technologies, 5G
technology for the first time makes possible a ubiquitously
available set of wireless capabilities that can make our
economy work better by facilitating operations that are data-
driven and more efficient. In some cases it enables a wireless
solution where one does not exist, while in others it makes a
wireless solution easy to utilize relative to existing
solutions.
For example, today you can automate the timing of traffic
signals and change the timing from a central control room. But
without having data about the density and speed of traffic, how
do you make informed decisions about how to set the timers?
There is no wireless technology available today that would give
you that data. But 5G will.
A farmer today can use existing sensor technology and Wi-Fi
to create critical data about his or her crops and soil
conditions, but that requires spending some portion of the
workweek managing the farm's IT. What if the farm were
blanketed by 5G and the same data is delivered to the farmer
from his service provider?
Or what if a trucking company that specializes in food
distribution wants to monitor its vehicles comprehensively for
route efficiency, refrigeration temperature, and time spent
loading or unloading? There is no single technology today that
can perform all of those functions. However, 5G could.
Three gigahertz spectrum is important to 5G, because
spectrum is available in bands wide enough to address these and
many other use cases. The spectrum is capable of being deployed
across wide areas. It goes through walls, and it can be
deployed in small cells to enable dense coverage.
That is why the speed of this transition is important.
Networks built on 3 gigahertz spectrum can flexibly address the
many use cases that networks will need to support.
We must recognize that the business applications for 5G do
not exist today for the most part. They have to be defined, and
the networks must be configured to support them. That is a big
challenge for the mobile industry, so there is a lot to learn.
The sooner that service providers and businesses can get to
work defining these new services, the better our economy will
run. That means spectrum must get into the hands of people who
will build 5G networks with it.
Other nations are moving quickly, very quickly, recognizing
this dynamic as one that could boost their prospects globally
or leave them behind. At best, a Government-run auction would
likely occur sometime in 2021, and the C-band bill puts this
date sometime in 2022. That compares to the CBA's view that it
could run an auction by mid-2020.
In short, the value of an auction is that it puts a useful
resource in the hands of those who will generate great economic
activity from it, and that is what boosts national economies
and competitiveness. Auction proceeds capture headlines but are
dwarfed by the underlying benefits of putting spectrum to
productive use. And in the case of 5G technologies in the 3
gigahertz band, there are national competitive interests at
stake which we believe mitigate moving expeditiously.
Thank you very much.
[The prepared statement of Mr. Campbell follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Doyle. Thank you, Mr. Campbell.
Ms. Collier, you have 5 minutes.
STATEMENT OF DEBORAH S. COLLIER
Ms. Collier. Thank you.
Mr. Chairman, Ranking Member Latta, and members of the
committee, since its inception in 1984, CAGW has been in the
forefront in the fight for efficiency and accountability in
government. With more than 1 million members and supporters
nationwide, CAGW has helped save taxpayers $1.3 trillion
through the implementation of Grace Commission findings and
other recommendations over the last 35 years.
The organization's mission reflects the interest of
taxpayers and covers a wide variety of issues. The sale of
Federal assets, including spectrum, has been a part of CAGW's
agenda for many years.
The widespread use of wireless 5G will dramatically change
mobile communications across the Nation and lay the groundwork
to support new technical innovation in communications,
healthcare, transportation, and the Internet of Things.
However, for 5G to be most effective, spectrum must be
available in high-band, mid-band, and low-band ranges. Mid-band
has unique properties that allows data signals to travel
through a larger range of spectrum, and its wide channels
provide for high-speed data transfers, making it a sweet spot
for 5G deployment.
Access to mid-band spectrum has been more difficult to
achieve, in part because of the number of incumbent users
already in the spectrum range.
The focus of this hearing is the C-band spectrum for 3.7 to
4.2 megahertz. This 500 megahertz of prime mid-band spectrum is
currently accessed by satellite owners, video content
providers, and satellite phone service providers, to name a
few, all across the country. They access this through a full-
band, full-arc access, which allows for the transmission of
data signals between satellites and Earth stations. Therefore,
it cannot be licensed for 5G communications until the Federal
Communications Commission reallocates the band for licensed
flexible use. Every Earth station and satellite accessing this
band receives authorization from the FCC to transmit data
through this spectrum, but authorization to access the spectrum
does not constitute ownership. The only clear ownership within
the band is that of the taxpayer, as represented by the U.S.
Government.
In April 2019, CAGW published a report, ``The Race to 5G:
Protecting Taxpayers Through Spectrum Auctions.'' I ask that
this report be included, along with my written testimony, for
the record.
Mr. Doyle. Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Ms. Collier. The underlying legal authority for an FCC
auction of spectrum is found in section 309(j) of the
Communications Act of 1934. Section 309(j)(c) provides for--and
I quote--the ``recovery for the public of a portion of the
value of the public spectrum resource made available for
commercial use and avoidance of unjust enrichment through the
methods employed to award uses of that resource.''
As noted by FCC Chairman Ajit Pai during the October 17th
hearing in his testimony before the Senate Appropriations
Subcommittee on Financial Services and General Government, the
agency is required by law to deposit all proceeds generated
from a spectrum auction into the Treasury, unless Congress
specifies use of the proceeds for other purposes.
For example, Subcommittee Chairman John Kennedy has
proposed using proceeds from the C-band spectrum auction to
provide additional funding for broadband deployment in rural
America. There will be costs associated with vacating portions
of the C-band spectrum, including installing new hardware and
reconfiguring thousands of affiliate reception sites to
accommodate more efficient encoding, compression, and
modulation technologies. An auction of C-band spectrum has a
potential value of between $11 billion and $60 billion,
depending on exactly how much spectrum is made available for
sale.
CAGW appreciates the introduction of H.R. 4855, the C-BAND
Act, which clearly designates the FCC as the only appropriate
entity for reallocating this spectrum for broadband internet
access services and conducting a public auction of the
spectrum.
Since the beginning of the discussions over C-band, CAGW
has maintained that it is a public asset and only the FCC has
the authority to reallocate an auction of this spectrum for
flexible terrestrial use.
Again, thank you for the opportunity to testify, and I look
forward to any questions you have.
[The prepared statement of Ms. Collier follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Doyle. Thank you, Ms. Collier.
Mr. Frownfelter, you are recognized for 5 minutes.
STATEMENT OF JAMES B. FROWNFELTER
Mr. Frownfelter. Chairman Doyle, Ranking Member Latta, and
distinguished members of the subcommittee, I am Jim
Frownfelter, chairman and chief executive officer of ABS
Global.
Earlier in my career, I was president of PanAmSat, the
company responsible for privatizing the satellite industry, and
then president at Intelsat when the two companies merged in
2006.
I am here today speaking for my company, ABS, and two other
small satellite operators, Hispasat and Claro. We call
ourselves the small satellite operators, or SSOs, representing
three of the current eight satellite operators who are licensed
to serve the United States using C-band.
We have invested collectively about $750 million to build
and deploy advanced satellites with C-band payloads designed to
serve the U.S. market.
From the beginning of the FCC proceedings, we have
supported repurposing C-band spectrum for 5G terrestrial
services in a reasonable and balanced way.
We believe the FCC, or Congress, should repurpose 300
megahertz of C-band for 5G by using off-the-shelf compression
technology, which we believe can be done in 18 to 36 months;
permit a transparent and efficient private-sector auction under
FCC rules that fairly and equitably compensate all FCC-licensed
satellite operators whose C-band spectrum use rights will be
reduced; mandate multibillion-dollar payments to the Treasury
from such an auction; and, finally, to set forth financial
incentives for U.S. Earth station operators to install the
compression equipment in a timely manner, thus facilitating a
fast C-band transition, maximizing the amount of frequency
spectrum to be repurposed, and expediting rollout of 5G
services.
Some have argued that C-band spectrum should simply be
taken from satellite operators without compensation and
auctioned. Confiscating spectrum rights in this way would not
only be a disaster for us, it would be a disaster for
investment in all wireless services. As we sit here today,
companies are investing billions of dollars in new global
satellite networks and in new 5G terrestrial networks. But they
do so only because they have confidence that the FCC won't
simply take their licenses away.
If the FCC or Congress simply confiscates our spectrum
rights, that confidence would be irrevocably shaken, with, I
assure you, a disastrous impact on future investment.
It is also important to emphasize that the impact on future
investment will be felt even, as the CBA has proposed, if you
simply confiscate the spectrum rights of companies that did not
earn U.S. revenues in 2017.
Take my company, ABS. My colleagues and I acquired it in
2010, intending to transform it from a regional satellite
operator into a global one. To be a global player, which is
required to be a successful satellite services provider today,
coverage of the United States is essential. So we designed a
satellite that was built by Boeing and launched by SpaceX,
specifically to serve the United States. We spent almost a
quarter of a billion dollars seeking and receiving an FCC
authorization to use C-band in April of 2017.
How can someone reasonably argue, after we spent almost
$250 million on this satellite that was designed to serve the
United States, after we did everything required to obtain an
FCC authorization, and after we finally received that
authorization, that most of our spectrum can be confiscated
simply because we didn't illegally build a revenue base prior
to receiving that authorization in 2017? Why would we, or
anyone else for that matter, invest that kind of money in
reliance on U.S. law and FCC rules ever again?
The SSOs have active, valid FCC authorizations. They have
invested a fortune in reliance on FCC rules and have done
everything right. We hope that the FCC and Congress will do
right by us, too.
Thank you for your time, and I look forward to answering
your questions.
[The prepared statement of Mr. Frownfelter follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Doyle. Thank you, Mr. Frownfelter.
And, finally, Mr. Berenbroick, you are recognized for 5
minutes.
STATEMENT OF PHILLIP BERENBROICK
Mr. Berenbroick. Thank you.
Chairman Doyle, Ranking Member Latta, and members of the
subcommittee, thank you for the opportunity to testify about
how to best repurpose the 3.7 to 4.2 gigahertz band, otherwise
known as the C-band.
It is critical that Congress and the Federal Communications
Commission ensure the public airwaves are used efficiently and
in ways that best serve the public interest.
I am the policy director of Public Knowledge, a nonprofit
public-interest organization that advocates for free expression
and public access to information, affordable communications
tools, and creative works. PK has a long track record working
with the Energy and Commerce Committee and the FCC on spectrum
policy issues. Our advocacy aims to increase public access to
the public's airwaves, encourage innovative, efficient use of
spectrum that advances the public interest in wireless
communications and promotes procompetitive spectrum policies to
ensure broadband is affordable and accessible for all.
Public Knowledge is a member of the broad-based public-
interest spectrum coalition that includes national consumer,
civil rights, education, rural broadband, and social justice
organizations, and we are also a member of the Broadband Access
Coalition, a coalition of rural broadband providers, equipment
manufacturers, technology companies, and consumer and public-
interest groups that support more efficient use of the C-band
to help close the digital divide.
Public Knowledge supports repurposing portions of the C-
band for wireless use. To this end, Public Knowledge supports
the bipartisan, commonsense legislation introduced last week by
Chairman Doyle, Representatives Johnson, Matsui, and Gianforte.
H.R. 4855, or the C-BAND Act, promotes the speedy repurposing
of C-band spectrum for the deployment of next-generation 5G
networks, protects incumbent users and their customers, and
ensures reallocation of C-band licenses occurs via public
auction that will serve the public interest and that--that
proceeds significant revenues that can be used to benefit the
public.
Reallocation of the C-band has the potential to efficiently
put all 500 megahertz of C-band spectrum to use for mobile and
fixed wireless service. To be clear, the benefits of any
reallocation of the public's airwaves in the C-band must flow
to the public. Repurposing portions of the C-band for wireless
broadband use presents unique opportunities to advance multiple
goals simultaneously.
First, unleash hundreds of megahertz of mid-band spectrum
for next-generation mobile broadband networks; second,
dramatically upgrade efficient use of the C-band in ways that
spur more widespread availability of high-speed fixed wireless
broadband in rural and other unserved and underserved areas;
and, third, recoup tens of billions of dollars for the Treasury
that could then be allocated to provide substantial benefits to
the public, such as closing the digital divide.
First, the FCC should modify C-band spectrum licenses under
section 316 of the Communications Act, to permit flexible use
of the spectrum and hold a public auction of those licenses,
using its authority under section 309(j) of the act. This
public auction is what is prescribed by the C-BAND Act.
This process is the fastest, proven, and legal approach
available for the Commission to free up significant C-band
spectrum for 5G deployment. A public auction process would also
ensure there is transparency for the public and auction
participants, prevent collusion and anticompetitive conduct,
reduce the risk of a failed auction, and make certain that
auction revenues can be put to work to serve the public
interest.
With specific regards to speed, a traditional FCC ascending
clock auction could be scheduled quickly. The Commission should
also set a date certain by which the repack of C-band
incumbents would occur, which would create certainty for when
the auction portions of the C-band will be made available for
new licensees to commence deployment.
Second, the Commission should promote point-to-multipoint
fixed wireless operations in the C-band. Fixed wireless
services can help close the digital divide by using
underutilized spectrum to reduce the economic barriers to
deploying in rural areas.
Fixed wireless services could operate in the repacked upper
portion of the C-band without harmful interference to
incumbents and would bring high-speed fixed wireless broadband
to tens of millions of households.
Finally, proceeds from the public auction of C-band
licenses could be allocated by Congress to address priorities,
such as deploying high-speed fixed broadband to unserved and
underserved areas. This proposal has a dual benefit. It would
make fixed high-speed broadband accessible in communities that
currently lack access. It would also provide the necessary
fixed backhaul that 5G and future generations of wireless
networks will need, improving the economic conditions for
deployment in communities that are otherwise unlikely to see 5G
service for the foreseeable future.
Again, the C-band represents unique win-win-win opportunity
for policymakers.
Thank you for the invitation to testify here today. I
welcome the opportunity to answer your questions.
[The prepared statement of Mr. Berenbroick follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Doyle. OK. Thank you to all of the witnesses for your
opening statements.
We are going to now move to Member questions. Each Member
will have 5 minutes to ask questions of our witnesses. And I
will start by recognizing myself for 5 minutes.
Mr. Frownfelter, under the CBA proposal, your company, ABS,
and other small satellite operators in the C-band would
potentially stand to receive no incentive or relocation funds
from a private sale, and you would be required to relinquish
access to the same spectrum rights as CBA members.
Is that correct?
Mr. Frownfelter. That is correct.
Mr. Doyle. Thank you. Let me follow up.
If the FCC approves that CBA plan and you are hung out to
dry, do you think it is likely that you or other affected SSOs
will sue the FCC?
Mr. Frownfelter. Yes, I do.
Mr. Doyle. Thank you.
Mr. Berenbroick, do you think lawsuits from ACS or other
SSOs, or to be honest, from any of the other parties impacted
by a private sale, will slow the process down? Don't you think
that any of the imagined benefits of a private sale disappear
pretty quickly when you think of the mountain of lawsuits that
would pile up from this $60 billion giveaway?
Mr. Berenbroick. Yes, Congressman, I think--or Chairman--I
think that is right. You know, I think the--you know, as Mr.
Frownfelter mentioned, you are likely to see litigation, you
know, if the FCC authorizes the CBA proposal.
Secondly, the FCC simply doesn't have the authority under
the Communications Act to delegate its authority to run an
auction to a private party. So, yes, you will see litigation,
and that will dramatically slow down the perceived benefits of
the CBA plan.
Mr. Doyle. Mr. Lieberman, if CBA was responsible for
facilitating a transition in the C-band, what recourse do your
members have if CBA makes mistakes? For instance, would your
smaller members--like Ms. Boyers, who testified before our
committee--would she need to call Luxembourg to get tech
support? I mean, who would be accountable?
Mr. Lieberman. This is a big problem with the CBA plan. I
mean, I would first say that the C-band plan is 3 pages at this
point, for an FCC that wants to adopt this in December. So we
really have no details whatsoever.
They have discussed the plan with small cable operators not
at all. We have not had a single conversation. They have not
come to us and said, ``This is what it is going to mean for
you.'' So, to be honest, we don't really know what it is going
to mean, but I do know that they have a strong incentive to do
it on the cheap because whatever they don't give to us means
that their foreign--you know, foreign investors get to keep
that money.
Mr. Doyle. Ms. Collier, how profound a waste do you think
it would be if the Government simply allowed a small handful of
foreign satellite companies to walk away with potentially $60
billion for something they don't even own? And what kind of
opportunity is Congress missing if we don't try to use that
revenue to address pressing national needs, like deploying
broadband, funding public safety, or closing the digital
divide?
Ms. Collier. If the CBA is allowed to sell this spectrum
and retain all of the proceeds, the taxpayer is not going to
see 1 cent out of this. They claim that they are going to give
a voluntary contribution, but what is that? A dollar, $10,
$100, a million dollars? There is a potential for $60 billion
here that would be walking away from this country.
This funding, portions of which could be used to reimburse
the cost of, you know, making the transition to cable
operators, and other users of this spectrum. For the cost of
the transition, part of the proceeds could be used for
deploying rural broadband, expanding our 9-1-1 system, and
doing further development in bridging that digital divide that
we are also focused on. We wouldn't have that opportunity if
the CBA was permitted to sell this spectrum.
Mr. Doyle. Thank you.
I am going to yield back my remaining 46 seconds and yield
to my good friend from Ohio, Mr. Latta, for his questions.
Mr. Latta. Well, thank you, Mr. Chairman.
And, again, thanks to our witnesses for being here today
and your testimony.
Mr. Frownfelter, if I could begin my questions with you.
What is the range of the FCC's legal options for enforcement
mechanism to ensure private or hybrid approach meets its
conditions for the public interest, such as money going to the
taxpayers, transparency on process, or how the licenses--or the
license sizes would end up?
Mr. Frownfelter. Yes, sir. We have proposed for the FCC
what we consider to be a neutral third way of approaching the
overall auction process.
As I mentioned in my opening statement, we are advocating a
private sale with governance, guidelines, and oversight by the
FCC to make sure that that process is transparent. And we do
that because we think that is the quickest way to get us to 5G.
But the proceeds from that auction, we believe, should be
distributed across three different tranches. The first tranche
is to incentivize U.S. Earth station operators. These are
teleports, cable headends in rural facilities that connect our
satellite capacity to the end user and incentivize them to
install the latest technology and compression equipment so that
we can quickly transition the C-band, free up the maximum
amount of spectrum to be repurposed for 5G, and to expedite the
rollout of 5G services.
The second tranche, which we have advocated from the
beginning of this process, said a significant amount of the
proceeds would be mandated by the FCC to go directly to the
U.S. Treasury. In discussions that we have had with your staff
on the Hill over the last couple of months, and as we have
reported back to the FCC, we think the right amount is about 25
percent of the proceeds to go directly to the Treasury.
It is important to point out that, through the combination
of these two tranches, depending on how much frequency spectrum
is reallocated, 40 to 45 percent of the proceeds would
immediately be reinjected back into the U.S. economy.
And then the final tranche would be distributing what we
call our distribution and scoring model, which is a fair and
equitable distribution system that would compensate the
existing licensees for the modifications that would occur to
their license and to compensate them for the capital that they
have deployed and the loss of potential future revenue. And all
eight licensees would be compensated in a fair and equitable
manner.
From our perspective, this approach gets you to 5G the
fastest. And doing it in a fair and equitable way, where we are
recognizing all of the constituents, including the U.S.
taxpayers, we minimize the potential for litigation and give us
the best chances of rolling out 5G as soon as possible.
Mr. Latta. OK. Thank you.
Mr. Berenbroick, what are your thoughts? My understanding
is, from your testimony, you support a public auction. But do
you think it is possible to do a private approach that has
these important conditions attached?
Mr. Berenbroick. Thank you for the question, Ranking Member
Latta.
To be honest, given that the private-auction proposal is
relatively unprecedented--it is an untested, unproven model--I
don't know what sort of public-interest protections and
oversight the FCC can exercise through to that process.
A traditional public auction ensures there is transparency,
accountability, accounts for competition issues, a diverse
range of bidders and auction participants get a seat at the
table. We think those are critical pickup interest protections
and benefits.
There is no way to account for that in a private auction.
It is--there is complete uncertainty.
Mr. Latta. Well, thank you very much. Mr. Lieberman, if we
go to the public option route with an option under section
309(j), what is the legal recourse for satellite operator
incumbents to challenge the modification of the license?
Mr. Lieberman. There is a process that is available to them
to challenge it and if they have concerns with what the FCC has
done.
Mr. Latta. Thank you. Mr. Campbell, we are focused today on
getting license spectrum cleared for 5G, but as a cochair of
the Wi-Fi Caucus, I am aware that we also need that unlicensed
spectrum to reap the full benefits of the next-generation
mobile network. Would you explain how Wi-Fi fits into the race
to 5G?
Mr. Campbell. Yes, Mr. Latta. Wi-Fi is an important
complement to 5G. Currently if you think about most of the
mobile use that goes on, actually occurs more on Wi-Fi than on
the licensed networks. About 68 percent of current mobile
traffic is actually carried by Wi-Fi. And so it is a
complement.
So, when you are in a Wi-Fi signal area, most devices will
switch to Wi-Fi. Wi-Fi is now moving on to a new generation of
Wi-Fi called Wi-Fi 6, which, think of it as 5G for Wi-Fi, which
will have many of the same features as 5G.
And so we are looking to a point where devices that move
between Wi-Fi and 5G will be able to provide the same kind of
functionality to the users, and we need to make sure in these
spectrum discussions that we are thinking of spectrum for both
5G and for Wi-Fi going forward.
Mr. Latta. Well, thank you very much. Mr. Chairman, my time
is expired, and I yield back.
Mr. Doyle. The gentleman yields back. The Chair now
recognizes Mr. McNerney for 5 minutes.
Mr. McNerney. I thank the chair.
I thank the witnesses for your testimony this morning.
Mr. Berenbroick, in your testimony, you noted that, quote,
``the C-band spectrum is essential for 5G deployment. I think
that is pretty well understood,'' unquote. Given the importance
of this band, we must use the time-tested methods of allocating
the spectrum in the way that is transparent and fosters
competition.
Has there ever been a private auction of spectrum approved
by the commission in a way described by the C-Band Alliance?
Mr. Berenbroick. No, Congressman, not that I am aware of.
It is an entirely untested, unproven proposal.
Mr. McNerney. Could allocating the C-band using an
untested, private sale slow down 5G deployment because of legal
challenges?
Mr. Berenbroick. Yes, Congressman. I think--you know, we
discussed earlier, the litigation risk is significant. And that
could in itself delay the process.
But, you know, frankly, I think, as Mr. Lieberman alluded,
you know, the C-band proposal, the current version of it was
just filed last night, and it is all of three pages. And they
also have not updated their proposal for how the auction would
work. When the FCC took comment on that auction proposal over
the summer, it was panned as overly opaque, as complex, as
creating significant risk of auction failure. That, you know,
auction failure would delay availability of 5G licenses as
well.
So litigation risk is one risk of delay, but simply put,
the auction design and the untested nature of this proposal
also creates significant delay risk.
Mr. McNerney. Thank you. Ms. Collier, I know the FCC has
strong experience and proven expertise in conducting auctions.
Is there an entity that has as much experience as the FCC when
it comes to conducting auctions?
Ms. Collier. As far as spectrum auctions, no. The FCC has
been conducting these auctions since 1994, 102 spectrum
auctions under their belt, more than $120 billion to the U.S.
Treasury. This is quite a record. And they recently completed
in 2017 the broadcast incentive auction, which has to be one of
the most complex auctions of spectrum to date.
Mr. McNerney. Has the C-Band Alliance conducted any
auctions to date?
Ms. Collier. No.
Mr. McNerney. Mr. Lieberman, under the private-sales model,
if the transition gets off track and problems arise, who would
the Earth station operators turn to?
Mr. Lieberman. It is not clear. And the CBA and satellite
industry have had experience with repointing and installing
filters, but never before has the satellite industry been
involved in swapping out equipment of the scope that they are
proposing today, and we think it is prone to failure and
certainly delay.
Mr. McNerney. Thank you.
I recently introduced the Digital Equity Act, with
Representatives Lujan and Clarke. This legislation would
establish two Federal grant programs to close the gap in
broadband adoption and digital literacy.
We need to be proactive about closing these gaps. 5G has
the risk of widening the digital divide. Combined, the two
grant programs in my legislation would cost a little over $1
billion over the 5 years.
Mr. Berenbroick, could this auction revenue be used to pay
for funding authorization of the Digital Equity Act?
Mr. Berenbroick. Yes, Congressman, it could.
You know, I think the auction is projected to, depending on
what is made available, to raise upwards of, you know, up to
about $50 billion. So, yes, the Digital Equity Act, which I
think is, you know, funded at $1.25 billion, could easily be
funded.
Mr. McNerney. Thank you.
Ms. Collier, I am going to ask about something you said,
that licenses do not signify ownership. Could you expand on
that a little bit?
Ms. Collier. It is more that authority to operate in a
space does not constitute ownership. The C-band spec--and this
is very unique to the C-band spectrum--the C-band spectrum, by
its very nature, is rather open access to those that are
authorized to use it. Where it is full band, full arc, meaning
that a satellite company and the Earth stations have access to
the entire 500 megahertz of spectrum, so that they can point
their dishes to the best satellite to get the best signals.
A license usually is a partitioned section of spectrum, and
that is something that is bought and sold through these
spectrum auctions, like the mobile broadband, or the mobile
licenses that telecommunications providers purchase through the
auctions. They bought these licenses, and then they can sell
them on the secondary market. Because of the very nature of a
full arc, full band, nobody has ownership of license to a
particular portion of that spectrum.
Mr. McNerney. Right.
Ms. Collier. Everybody has equal access.
Mr. McNerney. Thank you. My time is expired, Mr. Chairman--
--
Mr. Doyle. Yes.
Mr. McNerney [continuing]. As you have noticed. I yield
back.
Mr. Doyle. The gentleman yields back. The Chair recognizes
Mr. Walden.
Mr. Walden. The subtle hand on the gavel.
Thank you, Mr. Chairman, and I want to thank our witnesses.
Mr. Lieberman, I want to start with your proposal, which
calls for a public auction of 370 megahertz of C-band spectrum.
Under this proposal, all the parties would be compensated for
their transition costs, including the cost to deploy 120,000
new miles of fiber. And as you know, I represent some pretty
challenging geographical areas for deployment.
Do you believe that the auction will bring in the revenue
necessary to cover the cost of deploying this additional fiber?
And I worry about the timeline. That is a lot of miles.
Mr. Lieberman. The estimate for the fiber deployment is 6
to 7 billion dollars. The auction proceeds are expected by, for
instance, New Street Research, to raise $50 billion. I don't
think we are going to have a problem raising enough money.
Mr. Walden. And we never have a problem spending it. So how
confident are you this new funding would be complementary to
existing or proposed programs like CAF II, the World Digital
Opportunity Fund, USDA's Reconnect Program, and potentially
others, and how do you envision tracking the money to ensure it
is all being used efficiently?
Mr. Lieberman. Well, our plan, first of all, calls for no
overbuilding.
Mr. Walden. Good.
Mr. Lieberman. So the total amount of fiber that would be
necessary is 420,000 fiber route miles in order to transport
the programming over it; 300,000 of that fiber route miles
already exists in the ground. So we would be just leasing IOUs
or doing--you know, using that.
It is the 120,000 fiber route miles that are probably going
to a few cable systems in your market that don't have that.
Mr. Walden. And I will hear from them if we don't get it
right. Mr. Frownfelter, I know you have held some senior
positions with some of these satellite companies, and given
your expertise on how satellites operate, how confident are you
that satellite operator incumbents could transition 300
megahertz of spectrum in a timely manner in a private-auction
approach?
Mr. Frownfelter. Thank you, sir. I am very confident. In
fact, as Mr. Berenbroick just mentioned, last night the CBA
issued a new ex parte filing and a new proposal to the FCC,
where after careful discussion and consideration with the
broadcasters and the U.S. teleports throughout the United
States, they are now signing up for transitioning 300 megahertz
of spectrum, using advanced compression technology.
The first 120 megahertz, particularly at urban population
centers, would be done in 18 months, and the entire United
States done in 36 months. The main difference between their
proposal and ours is that they do not incentivize the Earth
station operators, they don't incentivize these rural
communities to implement the latest technology at each of their
facilities, which the SSOs have been advocating for from the
very beginning of this process. And we believe that if you
incentivize them, you could actually get this done in a much
faster timeframe than even the CBA is projecting from last
night.
Mr. Walden. OK. Another question to you. Does the law
permit this private approach, specifically in referring to
section 309(j)(6)(e), which clarifies that the Commission try
other means besides auctions, like negotiations, to make
spectrum available?
Mr. Frownfelter. Well, sir, I am an executive, not a lawyer
but----
Mr. Walden. That is two of us. I am not burdened with a law
degree either, but----
Mr. Frownfelter. But from our perspective, we are not
adamantly against a public auction, but we see two potential
issues. I think one is speed of execution. We think based on
past history, it is very difficult to argue that a private
auction wouldn't be faster, potentially much faster than a
public auction.
And second, as I indicated in my opening statements, you
know, when we look at the proposals, including the bills that
were submitted last Friday, what we don't see is any
compensation for the incumbent licensees for modifications to
the existing licenses, and we think that sets an awful
precedent going forward that would impact future investment in
wireless services.
So in our proposal we have put together what we think is a
very fair and equitable compensation for all of the
constituents, including those Hearst station operators,
teleports, cable headends in rural communities, in order to
effectuate 5G rollout as quickly as possible and minimize the
potential for litigation.
Mr. Walden. All right. Thank you. Mr. Lieberman?
Mr. Lieberman. Yes, it is bold for the satellite industry
to be saying that it can be done quick when the majority of the
work is going to be having to be done by smaller cable
operators and having to do it in 3 years.
And I can tell you that their incentive to do it fast is
not going to exist. Their priority is providing broadband
services to their customers, not switching out a whole bunch of
equipment in order to be left with a C-band that is less
reliable, less capable, and less affordable. So I think we need
to take that into account: who is going to be doing the work.
Mr. Walden. Thank you, Mr. Chairman. Thank you all.
Mr. Doyle. The gentleman yields back.
The Chair now recognizes Mr. Soto for 5 minutes.
Mr. Soto. Thank you, Mr. Chairman. At stake here is a lot--
5G, nearly $60 billion, and a whole host of different proposals
on how to address this. I wanted to start by asking Mr.
Lieberman, has there been any precedence for a private auction,
as been proposed by some on the panel, in the past with regard
to other spectrum?
Mr. Lieberman. None. Completely novel, subject to legal
challenge.
Mr. Soto. Mr. Frownfelter, would you agree with that, or
has there been precedence before?
Mr. Frownfelter. I would agree with that, sir.
Mr. Soto. OK. It would be great to hear from each of you
just a bit on what infrastructure is going to be required.
Let's say we sell all this bandwidth, and we are developing 5G
across the Nation. What is the basic infrastructure we are
going to need?
And we will start with you, Mr. Lieberman, and we will go
across the panel.
Mr. Lieberman. For cable operators, it is going to
essentially be replacing hundreds of pieces of equipment in
their headends, because the CBA proposal is suggesting that
they should use a higher compression.
In their headends today, they have equipment for the
current compression. So they are going to have to replace that
out, and it is not going to be able to be done all at once. It
is going to have to be done in sequences.
Mr. Soto. Thank you. My time is limited. Thank you.
Mr. Campbell, what needs to be done to deploy 5G, what type
of infrastructure?
Mr. Campbell. For the 5G portion of this, we are looking
at, you know, radio towers, replacing that. We are going to
have a lot of small cells as well, which you can think of as
similar to Wi-Fi type devices that will be in denser areas to
get higher deployments. And then all those things need to be
connected by high speed, you know, physical connections,
whether it is--probably fiber, but other methods in order to
connect them back to the internet for them to work most
effectively.
Mr. Soto. Ms. Collier, would you agree with that? What do
we need to get to 5G?
Ms. Collier. Yes. I am not an engineer, so I am not sure
the----
Mr. Soto. Just generally.
Ms. Collier. But in general, as I noted in my testimony,
there are going to be costs associated with transitioning to
help the companies that are involved do more efficient
encoding. They are going to need compression and modulation
technology changes. They need to add in more advanced computing
technology just to deploy into the new regions that they are
being pushed into.
Mr. Soto. Thank you.
Mr. Frownfelter, what is going to be required of us to get
to 5G should all the auction be done already?
Mr. Frownfelter. I agree with Mr. Campbell's statements,
but I do disagree with what Mr. Lieberman had to say. Having
been the president of PanAmSat, and I think more relevant than
privatizing the satellite industry, we were the company that
built and rolled out the current C-band service in the United
States from scratch.
And in 2001, we had to dramatically expand that service
because of the imminent rollout of HD. And to do so, we had to
package complete antenna systems, required new foundations to
be laid at all of these teleports and Earth stations. We had to
ship them, and each of these teleports, and even in the rural
areas, had to install each of these antennas in order to expand
the system significantly. That effort is extensively more
complicated than what we are talking about here in terms of
upgrading equipment to the latest compression technology.
And even back then, when we didn't have the communication
capability of web pages and the internet, we were able to
complete that entire process across much more Earth stations
than we have today in the United States. We were able to
complete it in 3 years.
Mr. Soto. Thank you, Mr. Frownfelter. My time is limited.
Thank you.
Mr. Berenbroick.
Mr. Berenbroick. Briefly, you know, Mr. Campbell is
absolutely right. You need--for 5G deployments, not only do you
need the licensed spectrum, but you also need significant,
fast, fixed broadband networks for backhaul in the low-income
communities and urban areas. And in rural and exurban
communities, we don't have that fix to backhaul that is
available that can support 5G speeds.
Secondly--Mr. Campbell alluded to this earlier too--you
need significant swaths of unlicensed spectrum. You need
unlicensed spectrum channels that are wide enough to support
offload from 5G networks. We don't have that right now.
Mr. Soto. Well, thank you all for enlightening us. You
know, it is going to be complicated. It is going to take all of
your help. It doesn't look like one particular area of this
industry is going to be doing this on its own.
And so that is very helpful as we are looking to have a
collaborative way to get to 5G, and thank you all for your
testimony.
Mr. Doyle. The gentleman yields back. The Chair now
recognizes Mr. Kinzinger for 5 minutes.
Mr. Kinzinger. Thank you, Mr. Chairman. I will add to the
missing Greg stuff. However, we all get to move up one, so----
Mr. Walden. Yes, everybody to my left is happier about
this, because they move up in seniority, so.
Mr. Kinzinger. We will miss you, though.
Mr. Walden. What was that guy's name again, from Oregon?
Mr. Kinzinger. Waldsman? I forget. But thank you.
We have a difficult issue before us in C-bands, obviously
pretty much the only game in town in terms of ensuring ample
mid-band spectrum available for the deployment of 5G. It is
highly valuable, and there is a multitude of stakeholders that
need accommodating, not the least of which are the American
taxpayers. So we will get right to it.
Mr. Campbell, you have stated that repurposing the spectrum
is in our national security and economic interests. I have a
real focus on security policy, international affairs, and I
actually think this committee intersects quite well with that,
so I can appreciate that point. Can you expand a bit more on
the importance of moving quickly? And where does the U.S. stand
in comparison to Europe and China?
Mr. Campbell. Well, I think it is very important to
recognize that technology is as important to national security
as many of the traditional things we think of when we think of
our defense. And we need to have the most advanced technology,
both in the information world but in every other part for a
very strong and secure national defense. That means maintaining
world-class networks. That means being at the forefront of all
new technologies as we develop them. We have been pretty good
at that for quite some period of time.
But we look at a situation like this, where we are looking
at mid-band spectrum for 5G, and the Europeans are moving
swiftly on this, the Chinese are moving on this, other east
Asian nations as well. If we don't make spectrum available in
this space, we are not going to be operating in the optimal
space as quickly as others.
Mr. Kinzinger. Well, let me add to that, and then I will
let you continue with that, but I also have a follow-on to
that, because I think we take for granted a lot of the times
that we are technology leaders. And so we can slow things down
here, because we forget that there is really good competition
out there.
So if other nations leap ahead, doesn't that mean that
foreign equipment manufacturers can also find themselves well
ahead, and further, for instance, if Chinese manufacturers are
among those surging and gaining outsized market share, what
does that mean for the national security posture of the U.S.
and our allies?
Mr. Campbell. Well, that can be very challenging for our
country, and we have to make sure that we are at the forefront
of all the technologies on this front. A 1-year or a 2-year
delay in this process, you know, sometimes people think, oh, it
is just a year. In the technology world, a year is a
generation. And we really have to be up there as quickly as we
can, which is why when we look at this question of what to do
with this spectrum, we are very concerned about the speed at
which we bring things to market as being much more important
than worrying about the immediate Treasury impact. Because the
economic impact is so much larger than the Treasury impact----
Mr. Kinzinger. So I remember when I was 18, I had visited
Germany, and everybody had these cell phones that I guess the
cool thing was texting at the time. It was new to me. And
Europe was really leading in kind of cell technology, and then
we have caught up obviously and are in the position we are in
because of that ability for our companies to breathe and move
quickly.
Let me also ask you, you obviously know the C-Band Alliance
has proposed the private auction, which we have been talking
about, as the mechanism to facilitate the sale. While your
company, Cisco, is not part of the C-Band Alliance, you have
stated that your top priority is getting it started and finish
as quickly as possible, and you support the CBA's plan because
you feel it is the fastest mechanism.
But let's hypothesize that the FCC determines that the best
mechanism is something that more closely resembles a public
auction, but they incorporate a lot of the provisions to
streamline compliance with the Administrative Procedures Act,
expediting the procurement of auction software and generally
cut redtape away.
Setting aside that this is a hypothetical and that Congress
would likely need to approve most or all of these, would you
then support this type of a modified public auction, and do you
feel it adequately expedites proceedings while appropriately
balancing public interest?
Mr. Campbell. We would support any process that would move
towards a faster resolution of transitioning the spectrum, and
if that is the fastest--that is why we are not ideological
about this. We think moving the spectrum is more important than
anything here, and therefore, if through congressional action
we can speed this process, that would be great. If the FCC can
speed this process, that would be great.
One aspect that ought to be considered too, in looking at
this question of a private auction or not, is that it does send
signals to other current licensees that in other bands that are
going to need to be transitioned for other uses in the future,
that there might be some incentives for them to work
cooperatively to want the transitions to happen. I mean, this
worked in the TV band very effectively in the past, and I think
we want to make sure that we make sure there are both carrots
and sticks in this process.
Mr. Kinzinger. So I think to close I will just say this. I
think, you know, obviously this hasn't been done before, and we
don't know what this ends up looking like in finality, but I
think it is really important for us, Mr. Chairman, to discover
these kind of different options as we rethink government and
how we do things.
So with that, I will yield back.
Mr. Doyle. The gentleman yields back. The Chair now
recognizes Ms. Matsui for 5 minutes.
Ms. Matsui. Thank you very much, Mr. Chairman. Now, as
Congress moves toward a solution for the C-band, I believe we
need a comprehensive approach that advances 5G while also
making investments that will strengthen rural broadband. My Win
5G Act would establish a new rural broadband deployment fund to
be used by the commission to expand rural broadband access with
proceeds generated by the auction.
Mr. Lieberman, moving forward, do you support the inclusion
of a rural broadband deployment fund to support investments in
rural broadband infrastructure? And that could be a yes or a
no.
Mr. Lieberman. Yes.
Ms. Matsui. Ms. Collier, my Win 5G Act also includes a
provision to explore reallocating the 3.4 to 3.5 megahertz
band. Do you support efforts like this to make additional
federally held spectrum available for commercial use?
Ms. Collier. We do support reallocating spectrum for 5G
deployment. We are still looking at your proposal, the Win 5G
Act. But we haven't determined how----
Ms. Matsui. Certainly.
Ms. Collier [continuing]. What our position is.
Ms. Matsui. You are looking at it. That is fine.
Ensuring that the maximum amount of spectrum in the C-band
is made available for 5G, while respecting the needs of
incumbent users, should be a shared principle in our approach
to this issue.
My Win 5G Act includes incentives to maximize the amount of
C-band spectrum thus ultimately made available. A commission-
led public auction as required by the C-BAND Act will help
ensure that the market, not private actors, will dictate the
amount of spectrum made available.
Mr. Berenbroick, do you have concerns that the operators of
a private sale may not have an incentive to maximize the amount
of spectrum that is ultimately made available for 5G?
Mr. Berenbroick. Thank you for the question. Yes. I think
there are some concerns that the overriding incentive of
satellite providers seeking to have a private auction is
maximization of revenue that they would intend to told onto,
rather than the broader public----
Ms. Matsui. Well, what do you believe is a minimum amount
of C-band spectrum that will need to be made available in order
to have a meaningful impact on the deployment of 5G?
Mr. Berenbroick. So, Congresswoman, we have not taken a
position on the amount that needs to be made available, but
what we have taken a position on is that what is made available
should optimally, it would be auctioned in a single tranche and
that there would be auction rules in place that promote
competition and access to that spectrum by a diverse range of
bidders and small businesses.
Ms. Matsui. OK. In the recent testimony before the Senate
Appropriations Committee, Chairman Pai reiterated that the C-
band spectrum in question is ultimately a public resource as
owned by the American people. It is my belief that, above all,
we should be striving to provide the benefits of this taxpayer-
owned resource of the American public. I have significant
concerns that the Commission may be pursuing alternatives to
public auctions that could divert proceeds from American
taxpayers to private corporations.
Ms. Collier, are there any guarantees under a private-sale
model that would ensure that operators return the maximum
amount possible to the U.S. Treasury? That could be yes or no.
Ms. Collier. No.
Ms. Matsui. OK. Do you believe that the FCC has the
necessary authority to establish safeguards under a private
sale regime?
Ms. Collier. A private sale is unprecedented.
Ms. Matsui. OK.
Ms. Collier. You know, the entire idea that the FCC is
going to abdicate its authority to a private entity to sell a
public resource is mind-boggling.
Ms. Matsui. OK. All right. While we are discussing the
deployment of 5G here today, we must not forget that there are
still millions of Americans caught on the wrong side of the
digital divide. Our focus on 5G cannot come at the expense of
real students, businesses, doctors, and farmers that still need
reliable, high-speed broadband. As I mentioned, my Win 5G Act
would establish clear guarantees that auction proceeds are used
to help support the deployment of rural broadband
infrastructure.
Mr. Berenbroick, in addition to the C-band proceeds, what
role could a rural deployment fund play in expanding and
strengthening broadband networks in rural areas in future
auctions?
Mr. Berenbroick. Thank you for the question. So, you know,
in addition to the C-band revenue, a rural fund could ensure
that there are fixed broadband capabilities in rural
communities that can serve as the fixed backhaul that is
necessary for next-generation 5G and future generations of
wireless networks.
Ms. Matsui. OK, fine. Well, I have run out of time, so I
yield back. Thank you very much.
Mr. Doyle. The gentlewoman yields back. The Chair now
recognizes the gentleman from Ohio, Mr. Johnson, for 5 minutes.
Mr. Johnson. Thank you, Mr. Chairman, and again, this is a
critically important hearing. You know, here are the facts.
One, we have a public asset: wireless spectrum. And two, we
have spectrum licenses which under the Communications Act does
not confer a property right.
And the issue is how best to transfer those licenses. It
should not come as a surprise that my focus is on how to
leverage a valuable asset to deliver broadband to unserved
rural communities like the ones I represent in eastern and
southeastern Ohio.
Last week, I saw a CNBC report suggesting half of the
United States could have 5G coverage by sometime next year.
This is good news, and it is critically important that America
leads the world in 5G deployment. I am an IT guy with nearly 40
years in the industry. I know how important it is that we
capture the high ground on 5G, so that the Chinese and the
Russians and others that might think that they can beat us
there don't do that. So I am all behind 5G deployment.
However, I am focused on the other half right now who
probably won't have 5G after next year and many of whom do not
have basic broadband access even today. The lack of broadband
is hollowing out communities throughout rural America.
Communities like, again, I represent in eastern and
southeastern Ohio.
If we don't solve that problem over the next 20 years,
there is not going to be a rural broadband problem to solve,
because people aren't going to live there. They are going to
leave. You know, I have grown tired and weary of the talk. I
have been dealing with this now for 9 years. It is time for
some action, and I am committed to fighting to solve this basic
infrastructure need in rural communities, to keep them alive,
and to bridge the digital divide. There is ingenuity and
creativeness that exists in the people of rural America. There
is intellectual capital there that is untapped. It is alive in
these small communities, and it comes from self-sufficiency,
family, and knowing your neighbors.
This uniquely American way of life is at risk if we do not
connect these rural communities to broadband, high-speed access
very soon. So, Ms. Collier, of the two plans before the FCC,
which makes the most impact and commitment to investing in
rural broadband? And explain your answer, please.
Ms. Collier. There is actually more than just two plans
before the FCC. However, it is our view that in order for----
Mr. Johnson. Well, public auction versus private sale.
Ms. Collier. Oh, public auction--clearly the public auction
is going to provide the most revenue for the taxpayers, and
that can be assigned by Congress to bridge that digital divide.
I am from rural Ohio, near the very region you represent,
sir, and I know firsthand the difficulty for those communities
to access broadband. So getting money into the the Treasury and
Congress allocating funding to help bridge those communities
that don't have service, and there are a lot out there that do
not have service at all. Some people are still on dial-up in
rural Ohio. And so----
Mr. Johnson. And some don't even have that.
Ms. Collier. And some don't even have that, right. So
getting that, the funding available, I think the public
transparent auction process that the FCC has time and again
proven worthwhile is the best option.
Mr. Johnson. OK. Mr. Berenbroick, do you have any
suggestions on what additional tools or resources Congress can
provide the FCC to ensure a faster process for releasing this
C-band spectrum?
Mr. Berenbroick. That is a good question. I think the C-
BAND Act is a good step in that direction. You know, the C-BAND
Act specifies to the FCC to stop dithering and to move forward
with a public auction process. This is what the commission
should have done more than a year ago. The FCC has clear and
straightforward authority to modify licenses and to auction
those licenses under section 309(j). It should do that, and it
should do it now.
Mr. Johnson. OK. All right. Thank you, Mr. Chairman, I
yield back.
Mr. Doyle. The gentleman yields back. The Chair now
recognizes Mr. O'Halleran for 5 minutes.
Mr. O'Halleran. Thank you, Mr. Chairman. First of all, I
want to follow up on Mr. Johnson's statements and say I agree
with each and every one of those. My frustration has only been
for about 3 years versus his 9, but it is the same exact
frustration for rural America. And we are going to lose a lot
of people out of there. We are losing our children from rural
America as we speak, because they don't have access to this
type of technology.
For holding today's--I thanked the chairman for that
already. I am committed to helping rural communities maximize
their potential in order to achieve the goal. Access to fixed
and wireless broadband is necessary. And a potential spectrum
union of this magnitude, auction of this magnitude, has the
potential to help bridge the digital divide. I strongly believe
in accountability and transparency, to the public.
I am concerned that proposals regarding the C-band auction
would allow for a privately run sale. Spectrum auction
authority is a responsibility delegated to the FCC under
section 309 of the Communications Act. And any deviation from
the current law would invite litigation and could limit
transparency to the public.
There is no doubt this auction is complicated. However, the
FCC should lead the charge towards 5G innovation, rural
broadband development, and ensuring users of the C-band are
protected, not by private satellite companies.
Mr. Lieberman, my district is one of the most rural and
underserved in the country. In the FCC's 2019 broadband and
deployment report, only 39 percent of rural Arizona has
standard internet access. Most of that's in my district. One of
the C-band proposals submitted to the FCC--could you comment on
how these plans offer an accountability and promote the public
interest? And you had mentioned earlier that it is only three
pages long.
You know, I get--I have to answer questions sometimes with
more than that on a minor issue. So I can't imagine how this is
representative of what good government should be doing.
Mr. Lieberman. Well, first, let me say that I appreciate
your comments about rural America and the lack of broadband
connectivity and the problem that it is causing for it and as
well Congressman Johnson. I mean, my members live and work in
these areas. They are providing service there. They are taking
their limited money and plowing it right back in there to
provide service to these customers as best they can, and there
are challenges to doing so.
And that is why, when we looked at this proposal for
clearing spectrum, we said, ``Is there a way that we can clear
as much spectrum as possible and as well provide fiber to the--
do fiber deployments to the areas where these cable operators
would need to have an alternative source for the C-band?''
And that is where we came up with the 5G Plus Plan. It
would--because you don't have--people have to understand, 5G
isn't just the spectrum. You need the fiber backhaul to go with
it, and that is the real deficiency when it comes to the CBA
plan. It is just the spectrum. Rural America will be still left
behind the times having this capacity, having this spectrum
without having the fiber backhaul, and our plan would provide
that.
Mr. O'Halleran. Well, actually, it will increase the gap.
Mr. Lieberman. Oh, absolutely.
Mr. O'Halleran. Tremendously, I think.
Mr. Lieberman. I mean, I will just say it. This CBA plan is
going to result in a major loss of investment from rural areas
to urban areas, from small businesses to large businesses, and
from U.S. taxpayers to----
Mr. O'Halleran. I need to move on to my next question.
Mr. Lieberman. Yep.
Mr. O'Halleran. Ms. Collier, in your testimony, you
highlight the potential 5G technology that could be realized
with more mid-band spectrum made available to the industry,
while also highlighting the FCC's recent track record. How
would a privately run sale be inclusive of small carriers,
seeking to bid for licensees to serve rural communities?
Ms. Collier. This is a huge concern about the CBA plan, is
that it is not transparent. We don't know who is going to be
providing the bids into their sealed-bid auction. We don't know
if small carriers are going to be able to compete for this
spectrum.
Mr. O'Halleran. My time is running short. You have said
enough. Mr. Chairman, I would like to enter into the record a
letter to the FCC signed by eight members of this committee,
dated October 28th, 2019.
Mr. Doyle. Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Mr. Doyle. The gentleman yields back. The Chair now
recognizes Mr. Long for 5 minutes.
Mr. Long. Thank you, Mr. Chairman, and I think that
everyone realizes the goal here today of the hearing is to get
5G done and get it done right, and get it done as soon as
possible.
That is kind of--you know, I was a professional auctioneer
for over 30 years before I came to Congress, and auctioneers
are used to doing things fast. And, you know, I think to cut to
the chase, that is kind of, you know, we all should acknowledge
that that is what we are here for today.
And, Mr. Campbell, what could the impact be to the American
economy and the American taxpayers the longer it takes for
wireless carriers to acquire spectrum and use it to deploy 5G?
Mr. Campbell. Well, it is, you know, it is hard to quantify
in actual numbers, but it is enormously significant that we are
talking about a generational shift here in mobile technology,
from 4G to 5G, that is incredibly important to the
competitiveness of all of our economy, because everyone's going
to be using this.
And we shouldn't just think about it as, you know,
consumers watching videos on their phones, which of course they
will do, but it is also going to affect the efficiency of
manufacturing, of mining, and energy industries, of
agriculture, all across the whole economy here.
And so if we are slow to get this, it is going to impact
our GDP growth over time, and that hits the Treasury in
actually a much more significant way over time than one single
auction.
Mr. Long. There are 435 Congressmen, when we have a full
complement of Congressmen, so let's say 435. And with the
opioid crisis, 435 of the Congressmen will swear to you that
their congressional district has the worst opioid problem in
the country.
And I think that about 95 percent of those folks would
swear to you that their rural areas suffer the most from not
having 5G. And I am glad that you brought up agriculture,
because that is something that people don't realize how much
the farmers depend on good access, and 5G would, you know,
greatly augment that situation.
Not to mention the kids in rural communities being able to
do their homework and being able to not have to drive out to
McDonald's or Starbucks or wherever, 20, 30, 40 miles away just
to be able to do their homework like kids that live in the
urban areas.
Mr. Campbell, staying with you here. The United States is
in, as we have heard several times today, a global race to 5G
with other industrialized nations, China among them, of course.
And we all want to make sure we put our country in the best
possible position to win this race. Are there other countries
already utilizing the 3 gigahertz band?
Mr. Campbell. Yes. In Europe, China, other parts of Asia,
all in this band, which is a reason why we need to act
expeditiously here.
Mr. Long. So there are several currently?
Mr. Campbell. Yes.
Mr. Long. OK. And with that, Mr. Chairman, I yield back.
Mr. Doyle. The gentleman yields back. The Chair now
recognizes Mr. Welch for 5 minutes.
Mr. Welch. Thank you very much, Mr. Chairman, and I thank
you and my colleague Ms. Matsui and my Republican colleagues
who are sponsoring your legislation.
Mr. Frownfelter, I want to talk to a little bit. Faster is
better than slower, right? That is what----
Mr. Frownfelter. Yes.
Mr. Welch. OK. So I am going to go back to you, Mr.
Campbell. You were just talking about faster versus slower, I
mean, there is no reason, if there is agreement and consensus,
that we can't have a public auction faster rather than slower,
right? Mr. Campbell?
Mr. Campbell. Oh, yes, in theory.
Mr. Welch. Well----
Mr. Campbell. But as of today, you know, we are talking
about a public auction in 2022, and, you know, look, I am not
here to say that the CBA proposal is the best plan or anything
like that.
Mr. Welch. No, I want to----
Mr. Campbell [continuing]. Considered when they said that
think that in 2020.
Mr. Welch. Let me go back. All right. Cisco is, you know, a
fantastic company, and you are going to be a big part of this,
obviously, and you have been indicating faster is better than
slower. I think we all agree with that. But having the money
from a public asset go to private gain, do you have any
argument that that makes any sense?
Mr. Campbell. Well, look, we think that obviously there
needs to be significant money that goes to the Treasury from
any transition like this.
Mr. Welch. Yes, but we have got to--let's get real here.
All right? When ``significant'' is undefined, what do you think
the outcome's going to be? That is a serious question. So this
is not la-la land here.
Mr. Campbell. The FCC, if they go down this path, is going
to have to make those determinations, and we think that they
can and will----
Mr. Welch. Well, the CBA proposal is vague, right? They do
the selling, and they get the money, and then they decide how
much they want to give to rural America through the Treasury.
Am I wrong on that, Mr. Chairman?
Mr. Campbell. As I said, look, we are not defending
specifically that plan, but we think that we should consider
all the options, including those that would provide fast----
Mr. Welch. All right. Here is what would be terrific. It
would be for you to give concrete recommendations how we could
proceed faster rather than slower. Because I think all of us
here would want to do that.
What we want, like Mr. Gianforte, in his State, incredibly
rural, that is the truth here. And as the chairman said in the
beginning, we have got some money that may finally allow us to
get rural America out. And by the way, I just ask a question
for anybody.
At a lot of these private auctions, the companies bid and
they have some minimal obligation through the FCC to start
spreading it out to all the customers in the bidding area. But
it is a big area, so they essentially slice off the rural areas
and they make their big money in the urban areas. We are
getting hammered constantly.
So what is the position people have about having these
auctions be smaller so that the companies that bid on them
actually are going to implement the build-out in those rural
areas?
Mr. Lieberman?
Mr. Lieberman. Well, there is no plan right now for how
that auction is going to occur. The CBA has put together
something that has been widely panned, and there has been
nothing further in the record to describe how its public
auction would occur, and it would likely result in some of--the
concerns that you are raising are real risks without knowing
what it would be.
Mr. Welch. Well, you know, I think we should start as a
committee with Ms. Collier, who says, ``Why waste this money
that belongs to the public?'' I mean, thank you for your work
in saying the obvious.
And second, we have got a consensus here. We want to build
out in rural America. That affects us, red State, blue State,
red district, blue district.
And three, we have got to have this on the level and learn
from experience, where the winner of the auction is actually
going to serve all of the people in the auction area that the
bidder won.
Does anyone disagree with that?
Sir?
Mr. Berenbroick. Yes, I think that is exactly right. I
think one issue, you know, especially with mid-band spectrum,
the propagation of that spectrum is going to be such that
smaller license sizes are actually optimal, which would
actually go toward solving the problem you are alluding to.
Licensees could acquire licenses and then serve almost all of
their license area, rather than, you know, having a very large
license area, in which they only serve population centers.
Mr. Welch. Well, I want to thank all of the witnesses.
Mr. Chairman, our colleagues, we have an opportunity
finally to do something good for all of our communities,
because they all need it. And they will figure out how best to
use it.
So anything, Mr. Campbell, you can suggest to help us move
along with the FCC and get it done sooner rather than later, I
think every one of us wants that, but I think we also want the
public to get the benefit, and we want rural areas to get the
service.
I yield back.
Mr. Doyle. The gentleman yields back. The Chair recognizes
Mr. Flores for 5 minutes.
Mr. Flores. So thank you, Chairman. I want to thank the FCC
and Chairman Pai for their work and the administration to close
the digital divide to cut bureaucratic redtape and to continue
bringing more spectrum to the market.
It is my hope that, as the Commission moves forward with
plans to repurpose the C-band, that they will do so in a way
that represents taxpayer interest, that they ensure adequate
levels of oversight and transparency in the auction process,
that they protect incumbent broadcaster programming customers,
and that they secure sufficient commitments to the U.S.
Treasury.
And now for my questions. This follows up on a line of
questioning from Chairman Doyle with respect to satellite
companies suing the FCC. I would like to ask each of you
witnesses if they or their stakeholders would likely pursue
litigation if the FCC undertook an approach arbitrary to the
position,
Starting with Mr. Lieberman, would your organization pursue
litigation if the FCC went opposite of your position?
Mr. Lieberman. We are going to see what the FCC does, and
we will decide on what the best approach is.
Mr. Flores. OK. Mr. Campbell?
Mr. Campbell. No.
Mr. Flores. OK. Mr. Frownfelter?
Mr. Frownfelter. We would look to see what the FCC would
come up with and then make a determination.
Mr. Flores. OK. And I guess for the sake of fairness, I
need to ask Ms. Collier. I am assuming you would, but----
Ms. Collier. No. No, we don't typically engage in
litigation.
Mr. Flores. OK. Mr. Berenbroick?
Mr. Berenbroick. I think we would look at whatever the FCC
comes up with to determine whether the Commission operated
appropriately within its legal authority and then make a
decision.
Mr. Flores. OK. But so there could be a possibility for
your organization. OK.
Mr. Frownfelter, having spent a considerable amount of time
in the satellite industry, I am sure that you are well versed
in logistical operational challenges that follow potential
repurposing of spectrum. As you know, Congress had to step in
to correct a few logistical issues during the TV broadcast
incentive auction repack. One of those changes involved a
provision that I had authored as part of RAY BAUM'S Act, to
ensure that stations received compensation for the cost of the
repack.
Since we are shifting into a different technological space,
what sort of logistical or operational challenges might arise
from satellite operators' perspective when moving to a
different frequency?
Mr. Frownfelter. Sir, are you asking if you moved out of C-
band into a different frequency?
Mr. Flores. Correct, yes.
Mr. Frownfelter. I think that it would be a very long
process. We had talked about changes would have to be made at
all of the Earth station operators with teleports and rural
facilities and so forth. So you would be looking at changing
out all of the antennas and potentially a significant amount of
the equipment, depending on what frequency band you were
shifting to.
Today we do provide KU band services over the United States
as well, and there is available spectrum there where some of
the services could be transitioned over a significant amount of
time. They could be transitioned to those frequencies.
But in terms of providing services that are consistent with
what is provided today in C-band, I don't believe there would
be enough spectrum in KU band to fulfill all of that and the
existing services. You would have to look at a new band that is
currently not utilized by commercial satellite operators in the
United States in order to meet all of the demand.
Mr. Flores. OK. And what steps would satellite operators
need to take in order to mitigate interference for your
customers?
Mr. Frownfelter. Interference from other satellite
operators? I am sorry, can you clarify the question, sir.
Mr. Flores. Well, if the C-band is repurposed to other
uses, what sort of logistical challenges would your--what would
your--what would satellite operators need to do in order to
mitigate interference for your customers?
Mr. Frownfelter. I see. So, from our perspective, you would
be looking at, you know, expansion of additional satellites,
billions of dollars of investment in order to transition those
services over from C to KU band. And you would also be looking
at, you know, significant amounts of investment throughout all
of these terrestrial facilities.
Mr. Flores. OK. Ms. Collier, I appreciate the great work
that your organization does. You have done a great analysis of
this particular issue. Have you all stepped back from the
forest to look at if there was any sort of a hybrid public
approach--you know, a hybrid between a public auction and a
privately facilitated transaction? Is there anything that we
need to be doing in terms of thinking out of the box like that?
Ms. Collier. We haven't really looked at a hybrid approach,
per se. One thing that we do need, that Congress and the FCC
needs to be coherent on, is that there are currently incumbent
users, both are stations and satellites, that are not all part
of the CBA Alliance that need to be ensured that their
interests are protected even through the transition.
So there is going to be costs associated with the
transition, and there needs to be a way for them to pay for
those transition costs.
Mr. Flores. OK. All right. I have another question----
Mr. Doyle. The gentleman's time is expired.
Mr. Flores [continuing]. For the record. Thank you.
Mr. Doyle. I thank the gentleman. You want to enter
something into the record?
Mr. Flores. I have a question for the record, but I will do
that later.
Mr. Doyle. OK. I thank the gentleman. The CShair recognizes
Mr. Veasey for 5 minutes.
Mr. Veasey. Mr. Chairman, thank you very much. I wanted to
specifically ask about the auction format, and maybe, you know,
Mr. Berenbroick or Mr. Lieberman or Ms. Collier could answer
the questions that I have for me.
I wanted to sort of talk about the framework of putting
together an objective private auction, because I know that
there has been a lot of discussion about that, whether we
should have one that is public or private. And is it possible
to put together something that is fair and transparent as far
as a private auction is concerned when there are already
alliances that have sort of been formed with the foreign
investors, with the foreign satellite operators, with some of
the players that are involved in this?
Because I think that the most important thing is, we want
to make sure that we are yielding everything that we can from
the taxpayers' standpoint. You want it to be able to be
deployed as quickly as possible. And just wanted to just maybe
sort of get one of your opinions on that.
Ms. Collier. First off, this is a public resource. It is a
public asset. Even FCC Chairman Ajit Pai said a couple weeks
ago, this is a public asset. You cannot have a secondary
private entity taking on the role of the FCC in selling a
private asset--or a public asset. It is just not something that
I believe can legally be done.
You know, section 309(j) is very clear on this. It is the
FCC's responsibility and the FCC's role to conduct auction of a
public asset, namely spectrum.
Mr. Veasey. The C-Band Alliance is saying that they could
deploy this technology as quickly as, I want to say, maybe 18
months, if they were to be able to go through the framework of
a private auction. And what sort of time frame are we talking
about, if it were to be a public auction?
Ms. Collier. You know, I am not even sure that they can
deploy that in 18 months, because if it is a private auction
that is finally determined by the FCC, we have heard from the
other witnesses here today that there are going to be some
legal ramifications to that and delays caused by court cases.
So, you know, I don't see a private auction taking any less
time than a publicly held, transparent, Federal Communications
Commission-held auction.
Mr. Veasey. Mr. Berenbroick?
Mr. Berenbroick. Thank you. You know, the C-Band Alliance's
proposal, you know, and I think the claim that they can, you
know, make some of the spectrum available within 18 months,
that is sheer conjecture. You know, those are claims based on
an unprecedented auction proposal, an untested model, an entity
that has never run a spectrum auction before. So I think we
take those claims with a grain of salt.
Additionally, you know, there are significant public-
interest oversight responsibilities the FCC has when it runs an
auction--transparency, accountability, promoting competition,
ensuring that small businesses and diverse bidders are able to
participate. Those benefits are all compromised by taking the
FCC out of the process.
This is an entirely unprecedented proposal, and there is no
track record for this working. There is no track record for
this serving the public interest.
Mr. Veasey. Yes. So in your opinion, there is really no
possible path to put together the framework possible to make it
transparent and fair for the public the way that you are
talking about if it were done under the structure of a private
auction?
Mr. Berenbroick. Yes. I think in order--the benefits of
speed that CBA has claimed, the best way to get those benefits
with the public-interest benefits we usually see from a public
auction is for this committee and for the Congress to weigh in
and push the FCC to move quickly in a public auction.
Mr. Veasey. OK. Mr. Campbell, I know that you have been
sort of objective and haven't had a lot on this. I was just
curious, do you have any opinions on it whatsoever, as far as
my question is concerned, about just a private auction being
able to have the substance of having something fair and
transparent?
Mr. Campbell. Well, I think that, you know, any private
auction that would occur would be under the auspices of FCC
rules and controls, because you are going to have to change the
licenses and issue licenses. So it is not like it is going off,
you know, on the side.
It is going to be more akin to transferring existing
licenses and, you know, if you are a radio station or
something. You know, people have private transactions. They
must be approved by the regulator to transfer the license, and
there are things that are overseen in that. And I think we
could see the same thing in this situation if there were a
private auction.
I am not sure that one or the other is the perfect way to
do this. I just think that we need to focus on which is going
to provide the spectrum and make it available for use the
fastest.
Mr. Veasey. All right.
Mr. Doyle. The gentleman's time is expired. The Chair
recognizes the gentleman from Florida, Mr. Bilirakis, for 5
minutes.
Mr. Bilirakis. Thank you, Mr. Chairman. I appreciate it.
And I will follow up on Mr. Kinzinger's questions with
regard to South Korea and China. The last time we had a hearing
involving mid-band spectrum, I brought up an issue recently
published--an article published about South Korea making moves
to serve 90 percent of its population with 5G by the end the of
the year.
Now another recent article shows the progress our
competitors are making. The Korea Herald published an article
last week entitled ``South Korean mobile carriers attack global
market with 5G tech,'' unquote.
This article references the international partnerships
South Korea is making in 5G. And last Friday, a Bloomberg
article reveals that China is going to begin offering 5G
services in Beijing starting November 1st, with a goal of
reaching 340 cities by 2020. We are on the path where Asia will
set the global standards on 5G networks.
Mr. Lieberman and Mr. Frownfelter, if the plan you endorse
was approved by the FCC, how would that get us back on a path
to beating our international competition?
You can start first.
Mr. Lieberman. The 5G Plus Plan that we have proposed calls
for a market-by-market clearing of 370 megahertz, far more than
the CBA plan, and does it on a market-by-market basis. So in
urban areas, we can clear--where fiber is already available, we
can do it in 18 months. For the rest of the country, where only
a modest amount of fiber would be needed, would be done in 3
years. And in the rural areas that are harder to reach, where
5G is going to take longer to get to anyway, it would be 5
years. We think it is very much consistent with the rollout
that is going to happen with 5G, and you get the added benefits
of 370 megahertz.
Mr. Bilirakis. All right.
Sir, would you like to respond to--yes, just give me your
position on this. Where do you----
Mr. Frownfelter. Yes, so our position is that we need to
incentivize your station operators to integrate the latest
compression technology in order to maximize the amount of
spectrum that can be repurposed in the fastest amount of time.
And by putting together a framework for a plan that equally
compensates, or appropriately compensates on an equitable and
fair basis, all of the constituents, we believe that we can
roll out the plan in 18 to 36 months and to do so in a way that
minimizes litigation and gets us to 5G rollout as quickly as
possible and reestablishes the United States as the leader in
wireless technology in the world.
Mr. Bilirakis. All right. Very good.
Mr. Lieberman, whatever proposal the FCC releases this
year--public, private, or a hybrid of the two--what is the best
way to ensure that small, rural, and regional provides can
complementary--oh, actually, competitively bid on spectrum?
Mr. Lieberman. Well, the rules have to be fair. It has to
be smaller blocks that can be bid upon so that smaller entities
can have a chance at bidding on licenses in their areas. If it
is just three blocks of a hundred nationwide, it is just going
to go to the largest wireless providers.
Mr. Bilirakis. OK. Mr. Frownfelter, do you have anything
else to add with regard to that?
Mr. Frownfelter. No, sir, I don't.
Mr. Bilirakis. OK. Thank you very much.
I yield back, Mr. Chair.
Mr. Doyle. The gentleman yields back.
The Chair now recognizes Ms. Eshoo for 5 minutes.
Ms. Eshoo. Thank you, Mr. Chairman.
And thank you to the witnesses. I apologize for not being
here for a good part of the hearing. There is another one
taking place downstairs.
But this is a big issue. I was here to hear the chairman
make his opening statement about what this spectrum represents,
that the airwaves are an asset that are owned by the American
people. Maybe we should say that 10 times, you know, louder and
louder each time to make the point. And that it is really
through us representing the people that we provide various
entities, you know, the right to use these airwaves.
I think that--and I don't know if this has already been
covered, but maybe Mr. Berenbroick, can you give us just a
little bit of history about how the current users of the C-band
got the rights to use the C-band? Did they pay for the rights
to use the C-band, you know, through an auction? Did they buy
these rights from others?
I think that we need to get to the heart of how--I don't
really find it defensible that these belong to the American
people and that we are having a debate about whether we just
hand it over to someone or that we have a public process,
because we represent the people of our country. I mean, it is
really kind of a 101 in democracy.
But can you give us just a little history on it?
Mr. Berenbroick. Sure, Congresswoman. Thank you.
Ms. Eshoo. Excuse me. I understand once someone uses
something, has something, and they are in that lane, they are
going to fight like hell to keep it. But I think that we need
to get back to the basics, what is fundamental here.
So go ahead.
Mr. Berenbroick. Sure. So, in previous generations, the FCC
often allocated spectrum for broad use for a specific purpose.
So think of, for instance, fixed satellite service in the C-
band or DSRC in the 5.9 gigahertz band.
You know, here, the existing operators don't have
individual licenses. They have access to the entire 500
megahertz of the C-band. And I think, you know, if you project
forward and you think about spectrum policy going forward in
the future, you know, whether it is using spectrum more
efficiently for sharing, for unlicensed use, or for clearing
and auctioning, the precedent set here by allowing users that
were essentially given, you know, spectrum for free, to demand
windfall payments to give up some of the rights in the
spectrum, when they admittedly could be using it more
efficiently, is going to make it difficult for the FCC----
Ms. Eshoo. Did they pay for the rights to use the C-band?
Mr. Berenbroick. No, they did not.
Ms. Eshoo. OK. We could have just--just said yes or no.
To Ms. Collier, who is going to put our--has already
prepared the chairman's first brochure for his reelection on
this, some comment that the FCC--I mean, some people say that
the FCC auctions are going to take--they take an average of 13
years. And your written testimony cites more recent examples.
What do you think is the fair number in this?
Ms. Collier. You know----
Ms. Eshoo. There is always such exaggeration at both ends,
right?
Ms. Collier. Right.
Ms. Eshoo. What is it, do you think?
Ms. Collier. It varies by auction, the type of auction, the
complexity of the auction. And I think that gets forgotten in
the whole dialogue.
Ms. Eshoo. So would this be complex?
Ms. Collier. This is going to be a little bit more complex.
Ms. Eshoo. Uh-huh. So what does that mean in terms of time?
Ms. Collier. In terms of time----
Ms. Eshoo. A little bit more time?
Ms. Collier. A little bit more time.
Ms. Eshoo. A little bit more time for a little bit more
complex, yes.
Ms. Collier. Well, you know, I mean----
Ms. Eshoo. I mean, like how----
Ms. Collier. It was interesting listening to the hearing a
couple of weeks ago at the Senate, where this same dialogue
happened with Senator Kennedy and Chairman Pai. And it came
down to a period of 3 years that could conceivably be a doable
auction for the C-band.
Ms. Eshoo. Well, I think, given that answer, Mr. Chairman,
3 years with a potential of 60 billion bucks, we are talking
real money here, even though we are Federal representatives,
really this is--this is a lot of money.
And I don't think anyone should forget that, as we have
talked and wrung our hands over for years and years about rural
broadband, e9-1-1, all of the PSAPs--what the price tags are
for those, with less than that full amount that is projected--
we could pay for all of that and have money left over. So I
hope with it we are going to be really very smart here and do
the right thing.
Thank you all for your testimony, what you do. I didn't get
to all of you, to argue with some, congratulate others. You are
wonderful to come and be instructive to us.
Mr. Doyle. The gentlelady's time has expired.
Ms. Eshoo. Thank you, Mr. Chair.
Mr. Doyle. The Chair recognizes Mrs. Brooks for 5 minutes.
Mrs. Brooks. Thank you, Mr. Chairman, and thank you very
much for holding this very important hearing.
I am one of the cofounders of the 5G Caucus, along with
Representative Debbie Dingell from Michigan. But I also
represent Indianapolis, and it is the home of actually Indiana
5G Zone, which is a hub--it is led by Purdue University, and it
is focused on testing and developing 5G-enabled technologies.
It is an R&D center.
But as I have talked to them about what they need, they
have stressed with me the importance of the C-band. And so this
argument--the hearing today is critically important, and the
speed in which we move, I think everyone agrees, is critically
important.
I am curious, Mr. Campbell, how does the U.S. compare with
particularly the European countries in how they made mid-band
spectrum available? I don't think comparing with China is
necessarily very fair in how they make mid-band, but how about,
you know, countries--democracies? How have they made mid-band
available for 5G? Because, as we have heard, they are ahead of
us right now, I believe.
Mr. Campbell. Right, right. I think, you know, we do have
to recognize that we have in the U.S. a more intensive set of
licenses and uses, including government uses, of spectrum than
probably any other country on Earth. So we are going to run
into these challenges more and more as we look into new bands
to do things, including this band, where we have incumbent
users that have to be--whose problems must be addressed before
we can repurpose the spectrum.
But Europe has definitely focused on this band, and they
are moving forward, and they are going to have it available.
And I think, you know, rather than wringing our hands on the
fact that we have a challenge in making ours available, we just
need to focus on how we are going to get there as quickly as we
can. Because it is a competitive issue in terms of our ability
to compete with----
Mrs. Brooks. Absolutely agreed. How did they make it
available?
Mr. Campbell. They didn't have----
Mrs. Brooks. How did the EU----
Mr. Campbell. They didn't have the same incumbent users we
have in the space.
Mrs. Brooks. OK. So they just made it available?
Mr. Campbell. I think they had some users they had to deal
with. I am not fully knowledgeable on that topic, but they had
an easier time in the transition on this.
And we are going to face this in other bands in the future,
and we had better utilize as many tools as we can get in our
toolbox to repurpose spectrum when we can.
Mrs. Brooks. So we have heard so much about rural issues,
and actually a large part--and a huge part of Indiana is rural.
But given the need to encourage rural broadband, are there some
encouragements, Mr. Campbell, that the FCC could incorporate
into its order to make a private sale--if the private sale is
the option that moves forward--much more rural friendly?
Mr. Campbell. Yes. The FCC could put the same obligations
on the private sale that they could put on the public auction.
So you could end up with the same result on that front, vis-a-
vis build-out requirements and issues like that.
Mrs. Brooks. Mr. Frownfelter, as far as making sure that
the license sizes--we have heard about this--are the
appropriate size, both the megahertz available and the
geographic licensing areas, what incentives do satellite
operators have in that private approach to ensure everyone has
a fair chance, as well as what is the FCC's role in making sure
it is carried out? I don't think anyone ever answered the
enforcement question.
Mr. Frownfelter. I am not sure I am the right person to
answer that question, but I think it----
Mrs. Brooks. Why not?
Mr. Frownfelter. Because from--it is part of the auction
process. And from the satellite operators' perspective,
depending on what percentage of the proceeds they get, they are
going to be looking to optimize those proceeds, as would any of
the processes, you know, resulting from the auction.
So, as was mentioned earlier, I think in order to
incentivize and make sure that we have appropriate spectrum
available in our world communities, we need to make sure that
we have small amounts of spectrum that are auctioned.
Mrs. Brooks. Any further comment on that question from
anyone else?
With that, I yield back.
Mr. Doyle. Gentlewoman yields back.
The Chair recognizes Mr. Cardenas for 5 minutes.
Mr. Cardenas. Thank you very much, Chairman Doyle and
Ranking Member Latta.
One of my colleagues just said about us making smart
decisions here. I hope we are capable of that. And when I was
just listening to my friend, Congresswoman Brooks, I was
thinking, yep, she is one of the smart ones. I really enjoy
working with you, and I am going to miss you as a colleague.
I think that everyone in this room today does want to see
the U.S. succeed in its deployment of 5G technology, but as
usual, everyone has their own priorities.
However, I think that overall I am glad to see that a lot
of consensus is that the best way to make sure that that
happens is with the transparent auction of this critical
spectrum. Fair and open and transparent process is what
everybody deserves.
In addition to that, I believe that the FCC-led process to
reallocate mid-band spectrum would maximize the amount of mid-
band spectrum that will ultimately be made available, all the
while maximizing the amount of revenue generated to help fund
key priorities, to make sure Americans get the connectivity
they need and deserve.
Mr. Lieberman, in your written testimony you note how
important it is that a public auction of the C-band protect and
make whole the C-band-dependent users. I understand most of
those users provide television programming, which I can tell
you is important in my household and my district to my
constituents. Can you elaborate on why keeping the C-band-
dependent users whole is so important?
Mr. Lieberman. Well, these are small businesses that have
spent a lot of money on their businesses in order to provide a
good service to their customers, particularly in smaller
markets in rural areas, and it seems to me like, if the
resource that they were relying on is going to be made less
reliable, less capable, and less affordable, then they should
be made whole.
And so, as part of reimbursements, instead of forcing them
onto this lesser C-band, what our proposal is, is that they get
fiber so they can transport it that way. And that would
actually provide a benefit for rural America in terms of not
only for just getting video deployment, but it would also be
available for 5G, it would be available for schools, hospitals,
libraries, businesses. I mean, it is--really creates the win-
win that I think Congress and the FCC should want.
Mr. Cardenas. You just mentioned schools, libraries,
hospitals, businesses.
Mr. Lieberman. Yep.
Mr. Cardenas. So suffice it to say that this is a very
important matter to the future activity, knowledge, healthcare
of all of America.
Mr. Lieberman. I mean, there are a lot of places in America
that don't have fiber connectivity of the size and capacity
that can support institutions. And so, by providing a
reimbursement for like 10-gigabyte pipes to these cable
operators so they can transport video over it, that could also
be used to provide additional services in those communities.
Mr. Cardenas. Although this may seem like gobbledygook to
most Americans, talking about fiber and C-band and spectrum and
things of that nature, but at the end of the day, is this
something that Americans have already become accustomed to when
it comes to these kinds of technologies in their day-to-day
life?
Mr. Lieberman. Which technologies are we talking about?
Mr. Cardenas. Just in general. Do people use phones in
their day-to-day life? Small businesses, do they depend on the
internet for their success, et cetera?
Mr. Lieberman. Yes, most definitely.
Mr. Cardenas. And all that we are talking about today does,
in fact, effect the future of all of that kind of activity?
Mr. Lieberman. Oh, absolutely, absolutely. I mean, we have
to find a way to provide all areas of the country with the same
kind of connectivity, and that is where we think the CBA
proposal is short in that regard.
Mr. Cardenas. So, at the end of the day, the issue that we
are talking about today, is it important that we do it well
versus just maybe--I feel it in a way where let's just see what
happens.
Mr. Lieberman. Well, look, speed is very important. I can
understand that. I am sympathetic. But there are other factors
that need to be considered in terms of that, is how much money
is going to be raised from it, what other purposes could that
money be used for, and what is the difference in time between
public and private versus the amount of money that would be
raised? We think that a public is in the best interest of the
American public.
Mr. Cardenas. So somebody mentioned a few minutes ago that
public and private use and purposes in America is a bit
dynamic. But that dynamic environment, it is kind of good,
right, that we do have that dynamic, give and take between
public and private use of these kinds of resources?
Mr. Lieberman. Yes, certainly, absolutely.
Mr. Cardenas. Thank you, Mr. Chair. My time has expired. I
yield back.
Mr. Doyle. The gentleman's time has expired.
The Chair recognizes Mr. Walberg for 5 minutes.
Mr. Walberg. Thanks, Mr. Chairman.
And thanks to the panel for being here today.
It is important that a public or private auction be
designed and run openly and fairly, one that maximizes the
involvement of entities in 5G deployment utilizing spectrum and
benefiting more consumers.
I am particularly focused on would-be bidders and
purchasers and their confidence that auction design, bidding
rules, and license sizes have not been set to favor any one
entity. Safeguarding competition and transparency is essential
to ensuring a competitive process and fully optimizing our
spectrum resources.
Mr. Frownfelter and Mr. Lieberman, if Congress isn't
satisfied with any authority to modify or transfer licenses,
couldn't Congress authorize a version of the private sale and
impose whatever conditions it would like on the process
regarding transparency, donations to the Treasury, or any other
condition?
Mr. Frownfelter. Yes, sir, that is my understanding, that
Congress has the ability to make sure that the FCC process, if
it moves forward in private sale, is transparent and meets the
guidelines and expectations of this subcommittee and the
Congress in general.
Mr. Walberg. So it has that power and ability.
Mr. Lieberman, would you agree?
Mr. Lieberman. Congress has that authority. I would say,
though, that one of the benefits of Congress actually
authorizing a private auction would be that they can then use
that money that would be raised to meet their objectives that
Congress seeks.
Mr. Walberg. OK. Mr. Frownfelter, speed to market is
essential in discussing repurposing C-band. In a private
auction, how do you foresee the FCC's role, and do you believe
it is important that they are involved throughout the process
of transitioning C-band?
Mr. Frownfelter. Yes, sir, absolutely. I think it is
absolutely critical that the FCC establishes the appropriate
guidelines and supervision over the entire auction process,
even in a private sale. And it is important that that process
is done in a transparent way so that we mitigate any potential
litigation and it is conducted in a fair manner.
Mr. Walberg. Mr. Lieberman, your plan calls for no
overbuilding in the construction of the 120,000 miles of new
fiber. Hopefully some of that will come to my house.
Can you talk about exactly how it will prevent overbuilding
in relation to the Federal programs?
Mr. Lieberman. Sure. The criteria on receiving the funds
would be that, if you have fiber available to you of sufficient
capacity, that you wouldn't be eligible for support. You would
still get money, because you would still need to lease what's
available, but this isn't about overbuilding.
My members have the same--I have members without fiber
connectivity, I have members with fiber connectivity, which is
their own--they don't want overbuilding any more than anybody
else. This is not to waste money. This is to actually provide
an alternative to using the C-band, which is to deliver the
programming over fiber.
Mr. Walberg. OK. To follow that up, how do you foresee our
efforts to improve our Nation's mapping capabilities, working
alongside with this new fiber build-out?
Mr. Lieberman. Well, the fiber that we are talking about is
not fiber to the home.
Mr. Walberg. Right.
Mr. Lieberman. This is going to be the backbone fiber that
goes from major data centers to cable operator headends. So
there is not really any program today that it is providing that
level of connect--that is funding that. There have been in the
past, as part of the BTOP program under the ARRA, but not
today. It would actually work well with the USF programs and
the RUS programs, because it would go to funding of
connectivity that no funding is going to.
Mr. Walberg. OK. Thank you.
I yield back.
Mr. Doyle. The gentleman yields back.
And last, but certainly not least, one of the original
cosponsors the H.R. 4855, Mr. Gianforte, you are recognized for
5 minutes.
Mr. Gianforte. Thank you, Mr. Chairman. Thank you for
holding this important hearing.
I represent Montana. Getting broadband into rural Montana
is critically important for all of the reasons we have
discussed here today.
5G will come to rural America when different bands of
frequencies are put to good use. The C-band provides the right
mix of capacity and coverage that will enable network operators
to deploy in rural America. Reallocating C-band is complex, as
we talked about, because the spectrum has many current users
and many others interested in acquiring it.
That is why I joined with Chairman Doyle, Representative
Johnson, and Representative Matsui in introducing the C-band
Act. Our bipartisan bill requires the FCC to hold a public
auction promoting a transparent and open process while
preventing a private spectrum sale that could benefit foreign
entities.
The proceeds from the public auction can be used for
critical priorities, including expanding reliable broadband
coverage to close our digital divide.
For the past quarter-century, the FCC has successfully
designed and run spectrum auctions that have brought more than
$122 billion in revenues for the American taxpayer.
I believe only a public auction designed and led by the FCC
guarantees that the taxpayers will get the benefit of these
sales. Only a public auction provides the guarantees of
fairness and transparency that ensure bidder confidence in the
auction procedures and outcomes. And only a public auction
ensures that smaller carriers, including the rural entities in
my district and new entrants, have a fair shot at bidding.
Ensuring this public confidence is necessary to maximize
participation in the auction and maximize taxpayer benefits.
As we have discussed today, we also have to make sure that
the districts that are auctioned off are small enough to ensure
buildout in these areas, a problem we face in our State, with
population centers being covered and many farms and ranches not
being covered, which prevents them from using newer
agricultural technology.
Ms. Collier, given the track record of success and the
obviously taxpayer benefits of an FCC-led auction--we have
talked about this today--but just comment on why the FCC should
be leading this process.
Ms. Collier. The FCC is the only entity with the legal
authority to conduct a spectrum auction. If they wanted to
abdicate that, they would have to ask Congress for permission
to abdicate that authority for a private sale. So legally they
are the only entity who can do this, and they have proven
through the last--since 1994--that they have the ability and
the teamwork to conduct these spectrum auctions. You know, they
are well experienced at this.
Mr. Gianforte. OK. While I normally believe the private
sector can do things more quickly and more efficiently than
government, in this instance a private sale could end up
delaying the rollout of this spectrum. Could you just comment
on how that would occur and why?
Ms. Collier. Well, first off, there could be legal
challenges to a private sale. It just is one of those things
that is so unprecedented that so many interested parties that
are currently incumbents in the spectrum may say, ``Hey, wait a
minute, we are getting shut out, we are being forced out
without any recompense by these satellite operators.''
Mr. Gianforte. OK. And I would like--and the last question
I have--I have just over a minute. I am particularly interested
in rural buildout. As we craft this legislation, forget about
public/private here for a second.
What provisions can we put in the legislation that would
ensure that we get better buildout in rural America? And that
is open to anybody on the panel.
Mr. Lieberman. I will start with that.
I think you should--I think that those that are using the
C-band that are going to be impacted by the clearing should
have the option to get that--the same content via fiber. If we
would do that, that would provide the fiber connectivity that
Montana is lacking.
Mr. Gianforte. Good.
Yes?
Mr. Berenbroick. Thank you, Congressman.
One of the barriers to deployment of 5G technologies in
rural America is the lack of sufficient fixed network
infrastructure. So what you could do--and this is similar to, I
think, what Mr. Lieberman and the ACA are proposing--is that
funds repurposed--or revenues from the C-band auction could
then go towards deployment of fixed networks in areas that are
unserved and underserved.
Mr. Gianforte. And I have seven seconds. Anybody have a
quick comment?
Good.
Well, with that, I yield back, Mr. Chairman.
Mr. Doyle. The gentleman yields back.
The Chair requests unanimous consent to enter the following
into the record: A letter from the Aerospace Industries
Association, a letter from Americans for Tax Reform, a letter
from the C-Band Alliance, a report from Citizens Against
Government Waste, a blog post by the American Action Forum on
behalf of Mr. Latta, a statement from AT&T Public Policy on
behalf of Mr. Latta, a press release from the C-band Alliance
on behalf of Mr. Latta, an ex parte letter from the C-Band
Alliance on behalf of Mr. Latta--got a lot here--a fact sheet
from the C-Band Alliance on behalf of Mr. Latta, and a letter
to Reps Walden and Latta from the American Consumer Institute,
American Enterprise Institute, Competitive Enterprise Institute
Heritage Action for America, Lincoln Network and R Street
Institute on behalf of Mr. Latta.
Without objection, so ordered.
I want to thank all of the witnesses for their
participation in today's hearing.
I remind Members that, pursuant to committee rules, they
have 10 business days to submit additional questions for the
record to be answered by the witnesses who have appeared. I
would ask each witness to respond promptly to any such
questions that you may receive.
At this time, the subcommittee is adjourned.
[Whereupon, at 12:30 p.m., the subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]
Prepared Statement of Hon. Anna G. Eshoo
The allocation of access to finite airwaves is a core duty
of the Federal Communications Commission (FCC) and always has
been. In fact, the history of this duty traces back to the
Radio Act of 1912. We should cherish this history. Since the
FCC started allocating spectrum through auctions in the 1990s,
our spectrum auctions have become the envy of the world. This
history and our present reality are based on the idea that the
airwaves belong to the American people. The owners of this
spectrum, the American people, decided through their
Representatives to allow for auctions that benefit the public
interest.
Like many public policy questions, one important lens
through which we should view the questions in front of us today
is that of economics. There are tens of billions of dollars at
stake here--up to $60 billion, according to current estimates.
This is a lot of money. It's enough to pay for nearly every
American to have access to broadband and Next Generation 9-1-1.
The FCC estimates that $40 billion in broadband infrastructure
investment would lead to 98 percent of Americans having access
to broadband speeds. The National Highway Traffic Safety
Administration and the National Telecommunications and
Information Administration estimate that deploying Next
Generation 9-1-1 countrywide costs between $9.5 and $12.7
billion.
I appreciate the novel ideas proposed for clearing the C-
band, and I commend the FCC for taking actions to expediently
make spectrum available for 5G. While the auction process can
always be improved, I'm convinced that the public interest is
best served by holding a public auction of C-band spectrum. I
look forward to a productive hearing.
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