3/2/17 Senate Hearing on Wireless Technology and Spectrum Policy

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1:22:30–1:25:55 — Senator John Thune, R-South Dakota

Thank you, Mr. Chairman and I appreciate the subcommittee having this hearing and putting together such an excellent panel. I just want to say how much that I appreciate the work you all do, connecting people across the country from remote rural areas to cities, to each other and to the world, and providing education, entertainment, and public safety services which contribute greatly to the economy and to the quality of life of every American. You all drive the innovation and investment that has made the United States a leader in advanced wireless technology. Our job in congress is to make sure that consistent with our National Security and the public welfare obligations the market has access to spectrum and that the industry is not unduly burdened when getting the spectrum into service. This committee reported out a bill here recently called the Mobile Now Act that makes a down payment on that obligation. It would make available 255 MHz of prime spectrum, both in licensed and unlicensed, in the next three years, but that is really just the beginning.

To meet America’s demand for mobile broadband, it is estimated that the wireless industry will need more than 350 MHz of new licensed spectrum by 2019. The Mobile Now Act would direct the FCC and NTIA to study the potential for the commercial service in a number of additional spectrum bands, but having access to spectrum is only a part of the challenge. It would take years and tremendous investment to deploy new wireless services and so the bill also streamlines the process of applying for easements, rights of way and leases for Federally managed property and establishes a shot clock for reviewing those applications, which we think is something that is essential. The Mobile Now Act would also establish a national broadband facilities asset database, listing federal property that could be used by private entities for the purpose of building or operating communications facilities.

I am hoping we can get the bill passed and look forward to the full Senate acting on that in the coming weeks and am very much focused on working with our colleagues on this committee and the entire Senate and the House in making the next payment toward America’s wireless leadership and I just have one quick question I want to ask and I will direct this to Mr. Bergman. The widespread deployment of small cells is a massive undertaking for companies and also for state and local officials. Are there opportunities for companies and government officials to work collaboratively and to streamline the approval process so that it focuses only on sitings that raise significant deployment issues?

1:26:00–1:27:17 — Scott Bergmann, VP, CTIA-The Wireless Association

Thank you, chairman Thune. We certainly commend you and ranking member Nelson and the committee for the work on Mobile Now and that focus on infrastructure is tremendously important as we look to lead in that race to 5G and certainly small cell deployment is an absolutely critical part of that equation. Our companies are looking to deploy hundreds of thousands of small cells to deliver that high-capacity service. Being able to move quickly is something that will reduce the costs and enable us to move faster.

Right now today there are challenges both with the locals zoning process and, as you mentioned, with federal agencies, so we would certainly appreciate this committee’s attention to finding opportunities to right size that process so that we exclude small cells where appropriate that are the size of a pizza box or a lunch box. I don’t think anyone thinks it’s a process that applies to a 200-foot tower should apply, when you are putting a lunch box on top of an existing building.

So we would love to work with you to try to find opportunities to speed those deployments. In the end what this will mean is $275 billion of investment and 3 million jobs, so it’s a real priority.

00:30–03:30 — Senator Roger Wicker, R-Mississippi

Good morning, on behalf of my friend, Senator Schatz, I am glad to convene the first session. Welcome to you all. As we know, in today’s connected world the demand for spectrum increases with every new technology. Spectrum is the lifeblood of this connectivity, improving lives of people around the globe.

Our discussion of spectrum policy today comes on the heels of this committee’s approval of the Mobile Now Act. Under Chairman Thune’s leadership, we have taken a significant bipartisan step toward freeing up spectrum for the next generation — and people should silence their devices. With the approval of this legislation, I hope to see Senate passage of the bill in the near future.

Our discussion of spectrum policy should continue. With the rapid growth and the use of mobile devices and the Internet of Things, demand for spectrum will only increase. Spectrum for mobile broadband is giving rural America the tools and resources it needs. Applications that utilize mobile broadband provide the means to deliver quality health care in the most remote corners of our states and transmit real-time data for improved crop production on our farms.

Satellite services are providing television, broadband and Earth observation for a variety of applications. Next Gen TV has the potential to deliver better emergency services and ultimately save lives. This is particularly important to states like Mississippi that can be situated in the paths of hurricanes, tornadoes and other natural disasters.

Unlicensed spectrum offers opportunities for businesses of all sizes to innovate and continue to fuel the vast expansion of the Internet of Things. Although innovation demands more efficient spectrum use, innovation will also be what solves the problem of limited spectrum. We are here today to talk about the value of spectrum to the economy. We are here to talk about what we have learned from the FCC’s recent spectrum auctions and how unlicensed spectrum is a vital piece to the puzzle. I also hope our discussion will encourage a focus on the future of spectrum policy and set the stage for this committee to look at ways to address spectrum demand.

I would like to welcome all of our witnesses and I will introduce them in a moment after we have turned to an opening statement from our colleague, Mr. Schatz.

03:30–07:35 — Senator Brian Schatz, D-Hawaii

“Thank you for convening the hearing and our witnesses. Spectrum is the invisible infrastructure that has become the on-ramp to access the internet. Thanks to mobile and wireless technologies people can read the news, transfer money, watch shows, video chat with a doctor — all from their mobile device.

In a very short time, these technologies have transformed our lives. With new 5G wireless networks and the internet of things, demand for spectrum will continue to grow. The value that that spectrum delivers to the economy is hard to overstate, as we will hear from the witnesses today, Spectrum generates new investments, facilitates innovation, supports job growth across a range of industries.

Advancements in mobile and wireless clearly benefit consumers and most industry sectors but have also revolutionized citizen engagement in politics transformed news and enhanced public safety. Although the focus of today’s hearing is on the economic benefits of commercial spectrum, it is vital to point out that the federal government also has critical spectrum needs for national security, transportation, weather forecasting and a wide range of other government services. We must continue to work with the agencies to ensure that they have the spectrum resources they need now and in the future. We should build on the successes of the spectrum relocation fund to make it more attractive for agencies to vacate or share bands with more commercial users, where that is possible.

Since we can’t create more spectrum, we need to be more creative in how we manage competing spectrum needs. I am confident that Industry will find innovative ways to make better use of the bands that they have. But we also need to find a balance between the competing public and private sectors’ needs for more terrestrial and satellite capacity and the need to have adequate spectrum available for both licensed and unlicensed uses.

Spectrum policy has been a priority for this congress and this committee which has passed the Mobile Now Act which would make more licensed spectrum available and facilitate the deployment of the infrastructure for 5G. The Mobile Now Act also includes a bill that would require the government to develop a national plan for unlicensed spectrum. While a lot of attention is on how to make new frequency available for the licensed bands, we also need a clear plan to support continued innovation in the unlicensed bands. These shared bands have become an affordable way for people to get online.

Consumers benefit, technology companies benefit and ISP’s benefit from unlicensed spectrum. I trust the committee will continue to work with the agencies and stakeholders to make more bands available to commercial users over the coming weeks and months.

While we do that, though, we have a responsibility to ensure people of all walks of life especially in rural, isolated and hard to reach areas across the country have access to wireless broadband services. To pursue new spectrum opportunities, every stakeholder must be an effective partner in this conversation. A fully staffed FCC lead by a chairman and four commissioners is, therefore, critical to accomplishing these goals. I am appalled that the White House withdrew all pending nominations for Federal commissions. That is an unnecessarily provocative act. The administration should defer to congressional leaders on both sides of the aisle on nominees for these commissions, as has been the norm. Of specific relevance to this committee is Commissioner Rosenworcel’s nomination. She has been a leader on spectrum policy and a strong advocate for consumers. I hope the White House will renominate her and the Senate will keep its commitment to confirm her as we should have done a year ago. Thank you, Chairman Wicker for initiating this important discussion and I look forward to the witnesses testimony.”

08:35–09:00 — Roger Wicker, R-Mississippi

We have votes at the top of the hour, but we want to be respectful of the time and preparation of our witnesses, so it is the Chair’s intention to proceed on with the testimony and members will simply proceed in and out during the two votes that will begin at the top of the hour.

9:15–13:55 — Scott Bergmann, VP, CTIA

Good morning, chairman, ranking member, and members of the subcommittee. On behalf of the CTIA, thank you for the opportunity to speak about the significant economic contributions of the U.S. Wireless industry. The power of Wireless at transforming how we live and work in every community across the country and in every sector of the economy and we are about to have breakthrough with 5G, the next generation of Wireless.

5G will add trillions of dollars to the economy and three million new jobs from 333 in Tupelo to nearly 3,500 in Honolulu. We need this committee’s continued leadership to deliver more spectrum and modernize infrastructure siting policies. The Wireless industry today is a powerful contributor to the U.S. Economy. Our members have invested over 300 billion dollars over the last ten years and are responsible for more than 4.6 million jobs. Consumers and businesses continue to adopt mobile broadband with data traffic increasing more than 25 times since 2010 and expected to increase by another five times by 2021.

America’s Wireless industry stands ready to invest another $275 billion to deliver 5G networks that will be faster, more responsive and connect more devices. 5G will enable a new generation of smart communities and unlock the Internet of Things. It will unleash innovation and growth in industries across our economy, from energy, health care and public safety and transportation. With MHealth, smart grids and self-driving cars, 5G will unlock trillions of dollars of economic benefits and help save thousands of lives. The U.S. has been the global leader in 4G/LTE deployment and we’re poised to lead in 5G but the Global competition is fierce. China, JapaN, South Korea and the EU are all in the chase, making spectrum available. streamlining siting and investing.

The keys to U.S. Leadership are sound spectrum and infrastructure policies. Licensed spectrum is a key input in mobile networks and a powerful creator of economic growth and jobs. Fortunately, Congress and the FCC has taken bipartisan steps to make spectrum available for Wireless. Now, more work remains to enable 5g leadership. Let me highlight a few steps that the committee can take.

First, we must ensure timely access to new spectrum made available through the 600 MHz incentive auction. The auction will deliver 70 megahertz of spectrum for licensed mobile broadband and 14 MHz for unlicensed use. It raised $19.6 billion making the second largest FCC auction ever. We support a seamless repacking process and are committed to working collaboratively to achieve the FCC’s 39-month schedule so that 5G is not delayed.

Second, the FCC’s decision to dedicate high band spectrum to mobile services is also critical. The FCC can enhance those rules by making targeted reforms and by acting on the additional 18 Gigahertz of spectrum identified in the Mobile Now Act.

Third, we appreciate this committee’s continued attention to the spectrum pipeline. It takes on average 13 years to re-allocate spectrum for Wireless use. This underscores the need to start today. Policymakers should continue to review federal use of spectrum and consider ways to incentivize agencies to use spectrum more efficiently.

Finally, we must modernize our nation’s infrastructure siting policies so that Wireless networks can be deployed rapidly and efficiently. Current Federal, state, local and tribal siting practices were designed to review large cell towers, not the small cells that will be essential for 5G. Small cells are far less intrusive. The size of a pizza box or a lunch bock and will be deployed by the hundreds of thousands. We can remove barriers to deployment by addressing burdensome local permitting, ensuring access to rights of way, and poles, with costs and fees that are reasonable and cost-based. Modernizing our historic preservation and environmental review processes and directing agencies to speed deployment on Federal lands and properties. With a continued focus on spectrum and infrastructure, we will be able to ensure Wireless providers can continue to invest, create jobs and lead the world in 5G. Thank you and I look forward to your questions.

13:58–14:05 — Roger Wicker, R-Mississippi

At this point, our ranking member of the full committee has a unanimous consent request.

14:05–14:17 — Bill Nelson, D-Florida

To insert my comments into the record on this extremely important subject and thank you Mr. Chairman and ranking member of the subcommittee for holding this hearing.

14:17–14:25 — Roger Wicker, R-Mississippi

Without objection, the remarks will be inserted at the appropriate place in the record. Thank you, Senator and our next witness is Mr. Roger Entner. Sir, you are recognized.

14:25–19:15 — Roger Entner, Founder, Recon Analytics

Good morning, Chairman Whitaker, and ranking member Schatz, and members of the subcommittee. My name is Roger Entner and I am the founder or Recon Analytics, a Telecomm research consulting firm with a focus on wireless. Today, I am here to discuss research into the effect that the US Mobile Wireless industry has on the U.S. economy and to highlight the importance of Federal government continuing to free up additional spectrum to support 5G and future network evolutions.

First, a quick overview of the U.S. mobile industry. In 2015, Americans spent 2.9 trillion minutes talking on their mobile phones, sent 1.9 trillion text messages, 218 billion pictures and used 9.6 trillion megabytes of data. U.S. Wireless Network Operators have constructed over 307,000 cell sites. From 2000 to 2015, U.S. Network operators have spent $77.8 billion to buy spectrum and have invested $423 billion to build out and to expand the capacity and speed of the networks.

Competition in the U.S. mobile industry is intense. Two weeks ago, Verizon reintroduced its unlimited plan with HD video and in less than four days competitors matched and tried to beat the offer. Just today, AT&T launched another new pricing plan. 97.9 percent of Americans can choose from three network base operators and 93.4 percent can choose from four operators plus more than a dozen virtual operators — the mobile industry’s equivalent of over the top competitors.

How does this relate to jobs? The mobile industry, directly and indirectly, supports seven million jobs in the United States. These jobs are a function of the amount of investment the companies spend to build the networks, operate the networks, advertise the networks and services and otherwise work with a wide variety of vendors to create and sustain what we know as the American mobile consumer experience and the US. Wireless industry.

As a result, the mobile industry contributed $194.8 billion in GDP in 2014. The app/mobile content market is a $36 billion industry whose very existence is dependent on the ubiquitous, fast mobile broadband network American companies have built. Companies like Uber, Lyft and AirBnB would be unthinkable without the direct and immediate connections and data flows the mobile network gives them and their customers. Together, these three companies alone are valued at $98 billion. To say the U.S. mobile industry is one of the driving factors to create new jobs and businesses the digital economy is an understatement.

But there is no guarantee the industry will be able to support the kind of exponential demand for mobile networking that a fully connected networked economy is expected to meet. From 2008-2015, mobile data usage increased 643 fold and growth is expected to continue unabated. Today in the internet of things it is the newest frontier for wireless and has implications for improvements in manufacturing, healthcare and transportation.

There is not a sector in our U.S. economy that will not be improved by access to fast mobile broadband networks. Deploying new spectrum is the most effective and quickest way to provide more capacity. meet the tsunami of demand, and ensure the industry can continue to drive the economic growth and new job creation. Consider, every ten megahertz of deployed licensed spectrum creates $3.1 billion in GDP and 100,000 new jobs. The Mobile Now Act is a great next step in the journey to clear more spectrum, but as demand for mobile services is increasing, the need for spectrum is increasing as well.

My suggestions for policymakers are few, but specific. First, licenses should be allocated in larger channel sizes. 5G deployments need at least 20 by 20 megahertz channels, ideally in low, medium, and high frequencies. Second, 5G deployments need access to cleared spectrum, for which providers have exclusive use. Third, is to help streamline the approval process for new and existing cell sites. Thank you again for the opportunity to testify at this important hearing. I look forward to answering your questions.

19:20–24:35 — Dave Heiner, VP, Microsoft

Chairman Wicker, ranking member Schatz, and members of the subcommittee — thank you for inviting me to testify. My name is Dave Heiner and I am Microsoft’s Vice President of Regulatory Affairs. I am pleased to have the opportunity to speak with you today about the critical importance of the unlicensed spectrum to the U.S. Economy. We all use unlicensed spectrum every day, without giving much thought. If you unlock your car with a key fob or open your garage door with a remote, or make a hands-free call in your car, you are using unlicensed spectrum. If you have a fitness tracker, you are connecting to your phone with unlicensed spectrum and, of course, we all use Wi-Fi every day. PCs, laptops, tablets, mobile phones, game consoles, smart TVs, thermostats, webcams, lighting systems and countless other devices connect to the internet and one another with unlicensed Wi-Fi spectrum.

This success story is no accident. Congress and the FCC had great foresight decades ago in opening up spectrum to unlicensed use. Today, unlicensed spectrum is powering the nation’s internet economy. We can see it all around us. For example, most U.S. homes have a Wi-Fi connection. Away from home, there are 94 million public Wi-Fi hot spots around the world and that is projected to grow to more than 500 million by 2021. People want Wi-Fi wherever they go and they want it for all of their many devices.

As of 2015, the industry had shipped more than ten billion Wi-Fi enabled devices. All of this means, of course, that the unlicensed spectrum is very heavily utilized. In fact, according to a report from Cisco, in the U.S., 55% of total internet traffic is carried over a Wi-Fi network. By comparison, just 3.4% of internet traffic is carried by licensed mobile networks. This flood of traffic has translated into enormous economic growth. As detailed in my written testimony, a recent study estimated that by this year, unlicensed spectrum would contribute nearly $50 billion to the GDP and $547 billion in economic surplus annually.

The public availability of unlicensed spectrum is important to Microsoft because our customers depend on connectivity to reach our services. Our business strategy is mobile first, cloud first. What that means is enabling customers to use any connected device to access internet services running in massive data centers which we call the cloud. Our products like Windows and Office used to be stand-alone programs, but no more. Today, they are always connected, enabling new features and being continuously updated with security and other improvements.

In recent years, we have developed a new platform called Azure to enable anyone to build and deploy cloud services, accessible via the internet. Cloud computing is taking off because it offers tremendous economic efficiencies but the cloud is wholly dependent upon connectivity and the unlicensed bands are the workhorses that enable it. For example, our telemetry shows that 98% of Windows 10 devices are connected to Wi-Fi and nearly half of the all data that comes onto and off those devices flows over the Wi-Fi connection.

Of course, unlicensed spectrum is more than just Wi-Fi. The Bluetooth connections that we are all familiar with operate on unlicensed spectrum, as well. The Internet of Things depends upon unlicensed spectrum and TV white space’s technology which carries the promise of bringing broadband to rural communities depends upon unlicensed spectrum, as well. The unlicensed bands have spurred these and many other innovations because they provide immediate access to shared spectrum resources with low barriers to entry and light regulation.

In closing, I would offer two suggestions to promote optimal use of spectrum. First, Congress should advance a balanced spectrum policy that includes both licensed and unlicensed spectrum, as is done in the Mobile Now Act, which we support. Second, through this act and others, policy makers should look for additional opportunities in the low, mid and high frequency unlicensed bands to help satisfy every growing demand. Thank you again for allowing me to testify. At Microsoft, we look forward to working with you to promote optimal spectrum policy.

24:40–28:35 — Pat Laplatney, President, Raycom Media

My name is Pat Laplatney and I am the President and CEO of Recon media, where I oversee 60 broadcast television stations, stretching from Hattiesburg to Honolulu, as well as a number of production and digital media properties. I am testifying today on behalf of the National Association of Television Broadcasters and its 1,300 full-powered television stations that serve communities across the country with free locally focused programming. I appreciate you inviting me here to speak about the upcoming voluntary upgrade that broadcasters across the country and other parts of the World are making to the next generation television standard, ATSC 3.0. In a world where broadband access is an expectation on par with electricity and water and social media is ubiquitous, the importance of local broadcasting and the trusted news coverage it affords is paramount.

Through next-gen TV, broadcasters will deliver all of this along with the most watched programming to your constituents in new and exciting ways. So what is next-gen TV? Next-gen TV is a crystal clear, ultra high-def picture that enhances the broadcast viewing and listening experience. Next-gen TV is more effective emergency alerting capabilities that will save more lives. Next-gen TV integrates the best of broadcast and broadband to offer interactive content such as drop-down menus of sports scores and movie information. Next-gen TV enables access to broadcast television through smart phones and tablets, ensuring that our local stations content is available virtually anywhere, any time and through any platform that viewers desire.

Finally, next-gen TV is spectrally efficient, meaning it offers more channels for free with the same amount of spectrum. No expensive cable bill or data plan is required. Simply put, next-gen TV will enhance the ability of local broadcasters to impact the communities we serve. The recent broadcast coverage of the tragic tornado in Hattiesburg, Mississippi and the hurricanes on the big island of Hawaii provide ample evidence of the potential viewer benefits that next-gen TV will afford. Through my stations’ wall-to-wall coverage, next-gen TV would have enable more and better emergency services, including enhanced alert alerting, interactive menus of hyper-local detail and the potential for mobile access had cellular signals failed.

A broad coalition including public and commercial broadcasters, consumer electronics manufacturers and public safety advocates has petitioned the FCC to allow our stations to conduct a voluntary market-driven transition to this new next-gen TV standard. After several months, the FCC unanimously approved a notice of proposed rule-making last week. Broadcasters stand willing and ready to make necessary investments in our infrastructure to enable an upgrade to next-gen TV. We simply need the FCC to quickly finalize these rules in order to move forward. We applaud the FCC for its work to date and we encourage the Committee to stay engaged.

Before I conclude, I want to highlight one issue currently before Congress that does pose challenges to viewers’ ability to enjoy the benefits of next-gen TV: successful completion of the broadcast incentive auction. As the auction winds its way to completion, one thing is certain. The broadcast industry will end up with less spectrum. So the ability of those non-participating stations to repack successfully into a smaller broadcast band without viewer disruption is critical. To that end, I want to thank the committee leadership, Senators Brand and Schatz, as well as the co-sponsors Senators Blumenthal, Blount, Fischer and Udahl for the work on draft legislation that ensures broadcasters will have adequate time and resources to successfully repack following the close of the incentive auction. Your legislation will make certain that no consumer will lose access to their broadcast service, as a result of the repack. It is just this certainty that investment in next-gen TV requires. Thank you. I look forward to answering your questions.

28:40–32:40 — Tom Stroup, President, Satellite Industry Association

Chairman Wicker, ranking member Schatz, members of the subcommittee, I am Tom Stroup, president of the Satellite Industry Association. Since its creation over 20 years ago, SIA has been the unified voice of the U.S. Industry on policy, regulatory and legislative issues, affecting the satellite business. Like the other industries represented on the panel today, the satellite industry supports hundreds of thousands of jobs and generates billions of dollars in revenue. Beyond strictly financial metrics, however, I would encourage the subcommittee to consider that our way of life depends on the benefits we receive from satellite base surfaces and applications.

Satellites, providing truly ubiquitous coverage that enables communications, earth observation and position navigation and timing services, have transformed how we communicate, how we map, navigate and see our world, how we produce food and energy, conduct banking, predict weather, perform disaster relief, ensure national security and so much more. Of course, delivering these diverse services to a broad range of customers is only possible because of our ability to access spectrum.

Satellites have long played a central role in distributing virtually all television content to American viewing audiences. In particular, live events like breaking news and sports depend on the point to multi-point coverage and high service quality that satellites provide. Communication satellites also provide connectivity to business networks, mobile platforms like commercial craft and maritime vessels as well as directly to household consumers.

Satellite broadband, a high-quality and cost-effective solution is playing an increasingly important part in addressing the digital divide across the United States, including in the most rural and remote areas of the country, where it remains uneconomical for terrestrial services to build. Today, the commercial satellite industry has approximately two million customers enjoying high quality broadband services. With the addition of multiple, high throughput high-speed broadband satellites this year, we expect the prevalence of broadband services by satellite to increase rapidly.

It is also important to mention the critical nature that satellites provide to our safety and national security. Satellites are often the only means of communicating after a natural disaster. Furthermore, they enable our military to project power in the air, on land and at sea. To cite just one example, satellite communications enable agile connectivity and efficient mission control for remotely-piloted aircraft, carrying out critical missions abroad.

Let me turn to innovation and growth. Even as demand for spectrum is increased, the satellite industry has developed ways to use this limited natural resource more efficiently. High throughput satellites rely on frequency-reuse and spotbeam technology to produce increased output factors upwards of 20 times that of traditional satellites, meeting FCC benchmark broadband speeds. The industry has seen similar increases in the capacity of its systems. Hundreds of new high throughput, non-geostationary satellites will soon provide additional high speed capacity at low latency levels. Existing high throughput satellites already support the delivery of 3G and 4G services and in the future, satellite fleets will part of a system architecture that delivers new 5G, IoT and intelligent, connected transportation services to consumers.

Advances in commercial remote sensing satellites are also occurring at a rapid pace. SIA member companies are launching satellites that can view and sense the earth across multiple spectral bands at unparalleled spatial resolutions and with unprecedented global coverage and revisit rates. Data from the U.S. remote sensing operators are building new markets based on geospatial data from agricultural to business intelligence to weather prediction. Of course, all the breakthroughs we have seen because of satellite technology should not be taken for granted. They depend upon our industry’s ability to access spectrum. In order for our industry to sustain and meet the growing demand for satellite services, we encourage regulators to continue to allocate sufficient spectrum for satellite use. Together, we have an opportunity to address the digital divide, meet the growing needs of U.S. consumers, ensure our country’s safety and national security and do so in a manner that utilizes spectrum most efficiently.