The sad thing was the war of 1812 when everything was burned. Then they had to start piecemeal since then and every president who came didnt like what was there in the state have auctions in the square. Then every president could change the decor if they wanted once president grant had the blue room pilot and Chester Arthur had at robins egg blue and finally that was all stopped at the time of Theodore Roosevelt in 1902. This week on the communicators we focus on the future of television. Former fcc chairman Julius Genachowski and former fcc commissioner Robert Mcdowell followed by our discussion with congress and greg walden chairman of the house subcommittee on communications and technology. We are anna lindhs gate that is absolutely shifted and there are areas of the statutory scheme where it makes sense to look at it and say are those keeping up with the changes in the marketplace . Fundamentally having this kind of competition programming innovation access by new players to consumers and access by the traditional players to viewers in new ways. Obviously what is happening on tablets is amazing. What is starting to happen in the living room is very exciting we are in just an incredible time when it comes to the delivery of the programming to consumers. There are issues. We heard the commission both of us did from distributors who are concerned about the cost of programming and consumers are concerned about the cost of programming so thats an issue the commission and congress will need to continue to look at. But i do think this is an area where the glass is halffull at least because we are seeing exciting new competition and creativity in this part of the landscape. I would say the glasses overflowing. I think its terrific time to the consumer in the market and probably like the exchairman i look at this market through the eyes of my kids. I have three young kids and what are their Consumption Habits and they have more choices than any human beings in history in terms of what is there and conduits too so its a very positive marketplace right now. I i think a lot needs to be revised to reflect that. The fcc has released zero authority to forbear from regulation in the video realm and i think Congress Needs to help us out with that but to help the fcc out. Subsequently, but also in all areas that we have these stovepipes if you are Offering Services over copper repair theres coax to cable and another over the air and get another in the marketplace has converged well beyond that. These are 80yearold concepts we need to move on but Congress Needs to initiate a rewrite as soon as possible. The video world is going through enormous change. I think a huge paradigm change right before our eyes. With the 21 decision on the case where it can basically download the single off aaron put it up on the internet and say thats okay. That has huge consequences potentially. So that area doing that just a limited basis in one market talking about expanding to get satellite providers thinking well, now we can get around to retransmission and we will do that. You have a Cable Company that says we will look at that too and all of a sudden the whole Business Model and marketplace is getting tossed around pretty rapidly. Host you also mentioned the aereo decision. Whats your decision . I was surprised by the decision. Im an old radio broadcaster so im not a tv guide but i look at that. Thats it descriptor in the marketplace sort of like disruptions arent bad. Necessarily this one really has to think much bigger consequences as people are beginning to read into it. To piggyback off of that as aereo has progressed through the courts and others like fox talking about cooling the response how does that play on capital . I think thats all part of the discussion because at some point producers rogue ramming has to have a way to get paid or you arent going to have programming. A lot of that has been through the various Financial Arrangements among the providers and tv stations in all of those very complicated mishmash of laws and rules and legacies and all. If that goes away and someone is taking your product and putting it up on cable for free basically then all of a sudden you probably have to look at paging and that is what they were carefully saying at the n. A. B. And of course its sort of let up every switch board in the telco world. But i think he didnt say they were going to but i think this is the point im making is you have everybody sitting back going wait a minute what just happened here was aereo and what does that mean . Does that mean i get transfer fees and what do we do with contracts and if youre the local broadcast provider what does that mean . I dont think we know all the implications. The 21 decision in one court doesnt make this formal everywhere. Host in that same n. A. B. Speech you said you are not convinced retransmission consent means reform bullet this time. That is true but most of these agreements have been reached now. We want to marketplace that works. That is my fundamental philosophy whether its broadcast Cable Wireless world i want a competitive marketplace and i want the marketplace to work at it i dont want government coming in unless the market place fails and so here you have most of these regions especially consent agreements that have now been signed. I think virtually all of them arent some of them are now extended out four years or eight years. So the market place has worked in that respect and i think that is a more efficient way to deal with this than to get into a ratesetting body and who is going to get paid what for what . I mean that to me is not agile nor a good way to go. Host what do you think of john mccains reelection of the a la carte bill . You know there is a lot of talk about the pros and cons of all a card. Its certainly some of the cable providers like the notion. Im not sure its the panacea that many think it is that suddenly can just pick the shows you want. You still have the whole tier 1 requirement locally where the broadcast signals through there and then you go above that. So there i dont know if he is talking about getting rid of that and again you wonder what that does to the pricing model and to the wide range programming thats out there. There is the tradeoff that says with the Current System you get a lot more programming that frankly maybe consumers wouldnt want it but frankly wouldnt exist otherwise. There wouldnt be the consumer demand probably for it and it gets bundled them and this bad and the other thing. So i think you have to be very careful. That would be an interesting disruptor in the market and something that would be great another say what you disaster. Evil would know what theyre getting into and suddenly you have a home much bunch more splits sports programming. Host youre watching the communicators on cspan in this week our focus is the future of television as we continue we will hear from chet kanojia of aereo and gordon smith present of the association of broadcasters. We then speak with Michael Powell president of the National Cable and telecommunications association. Guest when we think of aereo aereo as a really new way of thinking about how people are going to consume television in the future. Its an on line platform which is direct to consumers and people can get access today to live broadcast television along with their dvr device without a cable connection just using the internet for the price of 8 a month. Host this is over the air broadcast channels that people can get through aereo . Guest thats correct. Host what am i holding in my hand here . Guest that is the foundational piece of the aereo microantenna. Think about it as how you used to have over the air antennas in the past. They were large. We miniaturized them so it allows technologies through and part of miniaturizing them is so we can build hundreds of thousands of these things into a small room and by doing that we can allow a cloudbased implementation of how consumers can capture a signal which is really the big innovation here. The Cloud Technologies allow us to lower the cost down very dramatically, lower barriers to the consumers vary significantly because suddenly you dont need boxes or cables or courts. You just go on line and sign up and you have access to thats actually antenna. Host what is it made out of . Guest its actually copper. Host is that all there is . Is there a chip in here or anything . Guest thats the front end of it and theres a whole host of signal Processing Technology that is on a circuit or and the equipment looks like a telecommunications equipment. Host are their cable channels that are part of aereo service . Guest we are working with limburg television as a partner and that seems to have done very well. Its sort of coincides with their view that televisions evolution is going to be what i call deep libraries. By that i mean things that are not timesensitive that can be libraries and in fact they are. If you go to netflix or amazon or any number of these on line libraries you have a tremendous amount of content. We think people wont live for things that are relevant and unscripted so it tends to be sports news and large reality shows and special events and things of that nature. We focus on news is the first category that we think we can open this platform up to and allow these consumers have access to Different Things so that is it. Host what is your response when broadcasters say you are stealing their signal . Guest you know at some point you have to call it what it is. Its namecalling because when three federal courts express an opinion that is Illegal Technology and its consistent with what congress intended its difficult for me to sort of look at it any other way except as namecalling or mischaracterization. The fact of the matter is this content is paid for by the consumers in advertising spectrum. I think its worth clarifying that area technologies applied to free broadcast. It is not applied to cable content or cable channels. When we work with the cable channel for example them bloombergs case its a Productive Partnership where we enter into a commercial relationship with them. So its difficult for me to even answer the question why when you are required to program to consumers interests. A consumer has a right to an antenna and whether they buy the antenna from radioshack or they buy it from aereo is not relevant. We have consistently established the length of the wire that connects the antenna to your dvr and your Television Set isnt a matter of debate. Whether you live in an Apartment Building where you have a 50foot wire versus a 10foot wire how is that any different . Guest i would respond this way. It is true the Second Circuit is not a luminary in junction against broadcasters so the case proceeds and yesterday on the merits in the ninth circuit a case called the aereo killer the ninth Circuit District Court held that it was in fact identical facts. They held it was a violation of the documents of that happened yesterday. Ultimately this will have to be decided i suppose by the Supreme Court but the principle is simply this. If you want to put out our stuff you want to grab it in charge someone for it then theres the copyright issue. If aereo doesnt want they just want to provide the service and not charge for them may have a better case but ultimately when you take someone elses property and use sallet you owe them for it. You should negotiate for it and thats the requirement of the law and eventually the courts will decide on this. Certainly the market will. As Television Broadcasting becomes more and more mobile it used to be ubiquitous. Broadcasting was a big tv in your living room and now its pretty much on every device that you can have. That is going to create a Real Investment problem on return on investment problem for aereo as a Business Model. Guest another Technology Creating headaches for broadcasters is the dish hopper and broadcasters recently lost their temp to get it to luminary in junction there. It allows basically consumers to skip commercials. Some folks have haps broadcasters will have to figure into their retransmission fee request if they lose that case. Can you give us your sense of where you think thats going . Guest i think if it does not violate copyright than it probably and most certainly does violate contract and so it then becomes an issue of the hopper is just broadcast content, not a cable content. So its something of real concern to us. Its not for a consumer. Its for them. Its for dish because they dont allow people to block out their ads, just hours. So you know at the end of the day i think all of my members when it comes to doing content deals with dish, they are going to have to either invest past action and they probably have damaged that they can seek but as for the future of means you better have a Different Number in mind when you want to go she ate retransmission consent with dish. Guest well i think if i were answering that question i would say follow the technological trends that are transforming all of the digital businesses. The first that i would probably observe is the dramatic shift from hardware to software centered systems. The minute you were able to do more in software rather than proprietary hardware i think the full creativity of Software Engineering comes into play. I think thats common to television. You have to ask the consumer what is the tv experience of my home and they will talk about it walks that sits on their credenza above their tv and they will talk about a remote control. They will talk about the things that they dont like about it to be perfectly candid but increasingly the functions that those devices serve are going to be able to him be migrated into software rather than proprietary hardware equipment and i think you will get faster innovation cycles so a company like time warner or comcast can innovate overnight, not over the course of a hardware replacement and i think that when you do that you start inking about the other great trend we have seen ushered in by a mobile and app environment. You will be able to see minuets of software that are able to deliver kind of new and intriguing experiences taking advantage of the premium content we love but also with the powerful informatiinformati on pipe that we are able to marry with that and i hope to Creative Minds that will combine to create really revolutionary new kind of televisions. Host jeff bewkes of time warner predicted that most channels like hbo subscriptionbased. You will be able to watch almost all a cart. Guest people say that. Host he didnt say a la cart. Guest i didnt think that he would. That means many Different Things to many different people. What it means which i think is correct is that people will have a very time anywhere at anytime devised approach to their television experience. My life as a child of Appointment Television and my show is on at 7 30 and im angry with my mother because we are out shopping and if we dont get back in the next 20 minutes am going to miss it on not going to by the way have any ability to catch up to it or see it again. I can remember that anxiety. I need to get home to see my show. No child today has that experience first of all already but the new dimension thats going to come and that is the devices. More than just the traditional set up in the home the ability to get to all of these other things which is why you see people talking about software and ip meaning if i can begin to speak the language of all Computing Devices and i can begin to port my experience to all Computing Devices, that will give the consumer dramatically more power to choose time, place and manner. I love homeland. I havent seen sundays episode aired ive heard people talk about it but im picking and choosing when i want to see it that i was busy last night so i didnt watch it last night gave terry the redskins were on monday night and i would much prefer to see that than to do this but tonight on the slower night i might watch it tonight and that is what a dvr does for me. When you start to have the ability to command contact more fully as we were just talking about things will look a lot more like that. What i dont necessarily agree with, i think people still love discovery. I dont mean just the channel. I mean the ability to find surprises. Every month or every year i giggle a little bit about some show that people are suddenly talking about that i dont think you could have ever imagined choosing. If you came to me and said i want you to choose honey booboo or the show with the or a student Food Channel Network i dont think if i had to predetermined that was my preference i would have ever picked it. But the ability to stumble on them or to hear people talking about them and letting me go into an environment and go kind of dabbling around in that and suddenly finding i sort of like honey booboo and now i ching it, still think thats a huge part of the American Television experience and i think it gets sold short when we technoecstatic talking about anytime anywhere now and i think a lot of americans love the enjoyment of escapism and passivity and being able to kind of rome around finding things they didnt know were there. Television advertising is a great thing to a degree but its always been an odd thing. Through Proctor Gamble you run in ad. Its hard for me to know how much the ad worked. You ran it and some Creative Group says we did a great job and you love the looks of it. You ru