July 13, 2012

Good morning, Chairman Walden, Ranking Member Eshoo, and members of the Subcommittee. It is an honor to appear before you today in the company of my new colleagues at the Federal Communications Commission. I also would like to thank Chairman Genachowski, Commissioner McDowell, Commissioner Clyburn, and the FCC
staff for the warm and generous welcome I received when I was sworn into office with Commissioner Pai just two months ago.

Let me begin by noting that there is no sector of the economy more dynamic than communications. By some measures, communications technologies account for one-sixth of the economy in the United States. They support our commerce, connect our communities, and enhance our security. They help create good jobs. By unlocking the
full potential of broadband, they will change the way we educate, create, entertain, and govern ourselves.

But communications technology is changing at a brisk pace. Laws and regulations struggle to keep up. So it is important that the FCC approach its tasks with a healthy dose of humility. At the same time, I believe that there are enduring values in the Communications Act that must always inform our efforts.

First, public safety is paramount. Congress directed the FCC to promote the safety of life and property in the very first sentence of the Communications Act. The Middle Class Tax Relief and Job Creation Act builds on this principle with its framework for a nationwide network for first responders. Just last week in Washington we were
reminded how vulnerable we are without access to communications. Weather-related power outages across the region brought life to a halt, as wireless towers and 911 centers failed too many of us. Now the FCC must begin an investigation. It must search out the facts—wherever they lead—and apply the lessons we learn, so that our networks are more resilient, more secure, and more safe.

Second, universal service is essential. No matter who you are or where you live, prosperity in the twenty-first century will require access to broadband. The FCC’s ongoing efforts to promote broadband deployment and adoption are built on this simple truth. But I believe the principle of universal service goes further. It incorporates the
direction from Congress and this  Committee in the Twenty-First Century Communications and Video Accessibility Act, which has helped the FCC expand digital age opportunity to 54 million Americans with disabilities.

Third, competitive markets are fundamental. Competition inspires private sector investment. It is the most effective means of facilitating innovation and ensuring that consumers reap its benefits.

Fourth, consumer protection is always in the public interest. Communications and media services are growing more complex and becoming a more substantial part of household budgets. It is vitally important to get consumers the information they need to make good choices in a marketplace that can be bewildering to navigate. Here the FCC, working with industry, has made strides, including with its new bill shock initiatives. But going forward, the FCC should strive to make the data it produces more useful for consumers and make the complaint process more responsive to their needs.

In the months ahead, the FCC will have no shortage of challenging issues to address. Let me highlight one: the growing demand for spectrum. The statistics vary, but are undeniably striking. In the next five years, mobile data traffic will grow between 16 and 35 times.

But let me start by traveling back. For nearly two decades, the FCC’s path-breaking spectrum auctions have led the world. The agency has held more than 80 auctions, issued more than 36,000 licenses, and raised more than $50 billion for the United States Treasury.

In the Middle Class Tax Relief and Job Creation Act, Congress provided the FCC with authority to hold a new kind of auction—incentive auctions—to facilitate the voluntary return of spectrum from commercial licensees and promote its reuse. I am confident that with the right mix of engineering and economics, the agency can once
again serve as a pioneer. It should strive to do so in a manner fair to all stakeholders. I

also believe that with a concerted effort, the FCC can identify ways that guard bands can support new and innovative unlicensed services, contributing billions to our economy. But I do not believe that incentive auctions alone will meet our spectrum challenge. The equation here is simple. The demand for airwaves is going up. The supply of unencumbered airwaves is going down. This is the time to innovate. We must put American know-how to work and create incentives to invest in technologies—geographic, temporal, and cognitive—that multiply the capacity of our airwaves. We also must find ways that reward federal users when they make efficient use of their
spectrum and provide real incentives for sharing or return when their allocations are underutilized.

It is an exciting time in communications. The issues before the FCC are not easy. But the rewards of getting them right are tremendous—they will grow the economy, create jobs, and enhance our civic life.

Thank you for the opportunity to appear before you today. I look forward to working with you, and I would be happy to answer any questions you might have.

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