Transcripts For CSPAN2 The Communicators 20110307 : vimarsan

this week on the communicators, a discussion about issues relating to broadcasters with gordon smith, president and ceo of the national association of broadcasters. host: we re pleased to welcome back to the communicators, gordon smith, president and ceo of the national association of broadcasters, former senator from oregon, of course. senator smith, the nab is meeting in town right now in washington this week. what is your message to capitol hill when you meet with legislators? guest: well, there are three big issues that we re facing. there are many issues beyond that, but the ones of constant concern in congress are spectrum allocation, retransmission consent what broadcasters are paid for for their content and, of course, on the radio side is the whole performance royalty issue and how we reconcile mutual dependence of radio e and performers. they need us, we need them, and their market was broken by the internet. people don t buy music anymore, and that s unfortunate. but we don t want to break radio in trying to resolve this. host: has free television been broken by the internet? guest: no, because of retransmission consent just as cable and satellite argued for payment of their produced content, we asked for the same consideration that when they take our content and put it through their pipes or bounce it off their satellites, we feel like we re owed something, and i think it s important to remember that of all the programming that americans watch, in the majority it is broadcast content. people like to watch things live, and they like the super bowl, they like baseball, they like 24, the office. all of these things are expensive to produce, and we believe we re deserved to be paid for that so we can keep broadcasting in the very best of content. host: well, a republican commissioner of the fcc, robert mcdowell, and the republican chairman of the energy and commerce committee, fred upton, have both said when it comes to retransmission that the government should not be regulating between broadcasters and cable television. do you agree with that? guest: well, i do, and i think the proof is that while there is the rare interruption, the truth of the matter is 99% of these negotiations are, are settled without interruption and on a market basis. and that works better than the government getting involved in trying to urge a mar outcome or a particular outcome or a particular price. government doesn t usually do that very well, so we think the proof is in the pudding, and it s working. it works for cable when they get paid for their content, it works for broadcasting as well, so what is broken shouldn t be fixed. host: is it helpful to your organization that the republicans took the house back in 2010? guest: you know, our issues are not republican and democrat. our issues are about the american people. the news, weather, sports, emergency information that they want to watch, and i find friends on both sides of the aisle. the fact of a divided government is, gives you lots more procedural hurdles to utilize if you need to and to stop bad things, but i don t, you know, when i serve inside the u.s. senate served in the u.s. senate, i think i was viewed as a constructive conservative, and i count many, many friends on the democratic side of the aisle. so now that my ban on lobbying has been removed, i have found regardless of party the reception of me back on the hill has been warm and wonderful. and it doesn t matter whether it s republican or democrat. host: also joining us here on the communicators is jonathan make who is the assistant managing editor for communications daily. host: thanks for having me. do you get concerned by what you mentioned, the procedural hurdles between the commission on one side which is, of course, controlled by democrats as is the white house and then the republican congress, and are we seeing in areas other than net neutrality which is the big concern right now among telecommunications issues, are we seeing that seep into broadcast issues, spectrum, retransmission consent? guest: well, undoubtedly, you know, sure, if i wanted to be a partisan, i d like everything my way. but the truth of the matter is our history shows that some of our worst decisions are when you have one party domination. those are the ones that end up costing us a great deal of money, and usually produce unintended consequences. so divided government gives you an opportunity to fully vet ideas. it does slow down the process, but our the founders of the american government with malice aforethought made it hard to make law, and i think that that s a good thing. and so as frustrating as it is to watch on c-span sometimes, republicans and democrats don t seem to be able to agree on the time of day. it still produces a better result and when it comes to broadcast issues, it is helpful to us to have an extra check and balance as between the chambers to make sure that our concerns which are very much, are very important to the american people, that they are fully considered before big decisions are made that may have lasting and damaging consequences. host: now, the fcc, the federal communications commission, which is voting today on an issue about retransmission consent very near and dear, as you mentioned, to your members, they don t have, if you will, so many hurdles toward enacting regulations, not law. do you get concerned there especially with them examining this system which you and your members feel shouldn t be examined to begin with? are you concerned about the threat of overregulation of industry in general and your industry in particular? guest: of course we re concerned. and the truth of the matter is, for example, net neutrality which we don t have a dog in that fight, but that is something where the d.c. circuit court of appeals has said a unanimously without respect to party, they don t have the authority, the statutory authorization, to impose that. but they went ahead anyway, and they re trying round two on that. so when i see that, yes, i m nervous that there may be a tendency to go beyond what is allowed under statute. but that s why we have a judiciary under article iii of the constitution. but my hope is that the fcc will act in accordance what they have already said publicly and that they don t have the statutory authority to impose binding arbitration or some new system that puts the government s thumb on the negotiation and tries to force a particular outcome. they are rightly concerned, as we are, about making sure there s notice, that there s good faith, that the parties are earnestly engaged in resolving what the market price ought to be. and so i hope that they abide their own comments in the past and stick to the law and produce regulations consistent with the law. host: in a recent letter to the chairman of the committees who were in charge of the issues that you face, the energy and commerce committee and the commerce committee in the senate, you talked about spectrum hoarders. guest: that s right. host: and who are the spectrum hoarders in your view and what should be done about that? guest: first of all, i would say in answering to that people should remember that i was on the senate commerce committee when we did the analog to digital transition, and broadcasters gave up nearly a third of the spectrum that they had in the analog age. we gave it up for wi-fi purposes. the ink s hardly dry on the bill, and already the demand is we need more. we find in pronouncements to shareholders, for example, of time warner, recently of clearwire, these they re admitting to having tremendous amounts of unpurposed spectrum and have even used that it s a good, a good economic value. call it hoarding if you want, but it is spectrum that is there, and it has not been deployed and spectrum that we already gave up. we think it s a reasonable thing before you take more to at least deploy what you have. host: are the broadcasters hoarding or sitting on unused spectrum? guest: well, the broadcasters were given, you know, what we have left and what is being proposed is to take an additional 40% of our spectrum. if that is done and if that amount, we re very concerned. and what your viewers need to understand is the difference between broadcast spectrum the way we utilize it and the way wireless uses it is that when we use it, we re one our transmission is one to everyone in a demographic area. it s very efficiently used. when you look at the way wi-fi does it, if i send you a vid crow on my iphone, it s me to you. it s one to one. it takes a tremendous amount of bandwidth. the truth is, we re in the video business. they want to be in the video business. video s what creates the congestion. no one does it more efficiently than we do, and there s probably if you took all of broadcast spectrum, there probably isn t enough spectrum in the universe to manage one to one video on every mobile device in the wi-fi/broadband world. so we think that our transmission is efficient and is actually essential because we do it for free, and they ll charge you a fee. and free is better than a fee. particularly when you consider that the people who rely on the old-fashioned way of receiving television over the air, some say it s 10%, some say it s 17 %. let s say it s 14%. that s roughly 42 million americans who rely exclusively on over the air. and there is a cord-cutting phenomenon. people are rediscovering digital tv over the air has tremendous variety and the best quality. and people are saying what else i need i can get over the internet. so the number of people relying on over the air is going up, it s not going down. and the way we do video is more efficient than the way anyone else does it. host: now, on spectrum and the interplay between the capitol hill and the federal communications commission you have had your members were just in town, these are local tv and radio stations lobbying their members of congress, often their senators about the issues that are important to them. with some of the feedback you got, did that have anything to do with, say, concern from legislators about what the fcc is lining up to do which is to what s call repack, to make the tv channels closer to each other, make the bands smaller which is something the commission can do on its own, it does have authority from congress to do that? so what was their feedback about this plan? is. well, what we for your viewers sake, what they should know is the fcc doesn t have the authority to just take our spectrum and put up an auction. that requires an act of congress. what they do have, as you point out, is the ability to place you within your allocation called repacking. our concern is that the repacking, they say that the sale or the auction will be voluntary. but our hope is to keep voluntary voluntary so that if you don t volunteer to go out of business, that you re not placed in an inferior band, that you don t lose multicasting which is your foreign language stations, your religious stations, your minority stations, things which add value in the six megahertz each channel has. we don t want to lose the future of mobile television which in this city of washington, d.c. you can get if you have a little antenna on your ipad, a little it ll be in stores soon. you can watch live local tv on your ipad or other mobile devices. these are, these are tremendous innovations. these are innovations that we, the broadcasting, promised the commerce committee that i stat on that that i sat on they could do. they spent billions of dollars doing it, and now they re saying, well, but we re going to repacquiao. if you re repack you. if you re repackaged with inferior channels, you lose those innovations. you lose multicasting, you lose mobile. you lose what was promised. and broadcasters detrimentally relied on the word of of congress when they gave back a third of their spectrum in order to be able to develop out their segment. host: so what do members of congress that your members have spoken to feel about this proposition? guest: i think without respect of republican or democratic registration they re interested in keeping voluntary voluntary. so in exchange for an option which we support voluntary. that s freedom. let s be very, very careful of any repackaging plan that could take away what broadcasters are providing to the american people. host: and in a recent hearing at the energy and commerce committee, longtime energy and commerce chairman, now member, representative john dingell, asked fcc chair. julius genachowski about the auction process. you re going to have a you re going to have a voluntary spectrum auction. how is it going to be voluntary if it, if there is pressure which is placed on the hoarders of the spectrum by the commission? because the auctions themselves would rely on market incentives, allowing the market to set a price for existing owners of licenses to make the choice between continuing what they re doing or transferring the license in exchange for the, for the offer from the auction. sounds kind of like a bank holdup to me. you hold a gun at the teller s head, and we say you know you are going to voluntarily give me this money, and if you don t, i m going to shoot you in the brains. only if free market is a bank holdup. i want you to know, i have some dark suspicions on this matter. host: senator smith. guest: i agree with congressman dingell, and, again, we support voluntary, but we are very concerned of the details. the old adage, the devil s in the details? it really is in the details of repackaging which really is just forced relocation, perhaps into a lower power band which would degrade the broadcast signal. we don t want that. and i would point out one more thing. we produce a content, we send it out, we don t control the receivers that are made by the consumer electronics people. some of these are of such poor quality that part of what they need to do is to improve the quality of receivers so that there isn t the interruption, so that there is degeneratival efficient digital efficiency, and that ll resolve a good deal of the problem. host: senator, would you agree that the spectrum auction is inevitable, and if so, would you give a percentage of how much the broadcasters would be willing to the guest: well, i don t know where they came up with needing another 120 megahertz when we nearly gave that much up two years ago. i don t know what the, why that number comes out of broadcasting. so somewhere between there and zero, you know, there ll be some broadcasters who are underwater economically who will gladly agree to go out of business for a market fee. that said, there are a lot of people in broadcasting who are profitable, who employ lots of people and produce the best content, and the content that we all rely on locally for our news, weather, sports and more than information. there s just no substitute when it comes to those things. host: but no percentage? guest: i wouldn t want to presume that. the way i describe it, though, is what you really have when you re talking about this is a regional broadband problem. it s primarily los angeles, chicago and new york. and what you have is a national broadband solution. and my feeling is why should people in kentucky have to have their stations potentially degraded so that you can get a faster app download in new york city? i mean, come on. let s be fair. that s really what it s coming down to. host: now, on the spectrum proceeds whatever the revenue split between the treasury and the incumbents, broadcast holders might be, there s also some tension between the house republicans, especially the freshman who are very much focused on debt reduction and cutting the budget and then, obviously, broadcasters need to maximize their share of the proceeds. does that concern you at all? guest: it does deeply because, i mean, i hear the fcc saying this is going to be a market, and congress will allocate to broadcasters money to go out of business or to be repackaged. but when you, you know, my concern as a former legislator is when you, when you stack up these issues where you re putting let s say it s 27, $33 billion on the table, some say more, i just remember that in a paygo environment which is the budget environment that s across the street spectrum auctions where every legislator pays for everything. so when you put billions on the table, there s a lot of claimants. and where will broadcasters fare? so i ve said to those in broadcasting who may want to volunteer, make sure the check clears before you let go of your spectrum. host: is there any reason to think that this time this auction might be different than some of the previous auctions, some of which have raised $20 million? guest: we re talking about potentially two different auctions. one is called the d block which relates to public safety. we support that. host: dedicated? guest: dedicated or however the will of the congress, whether you sell it commercially and then use those commercial assets to build out the public safety network, that s one way to do it. the other way is to, is to, um, give it to public safety and then go to the auction number two which is where we d get it. and then we become the pay forker for building out the public safety network. either way, we support whatever congress will do to make sure that there is interoperability when it comes to public safety issues. but that said, we re concerned that there s a rush without even a thorough inventory of what s out there, who has it, how s it being used, what kind of audience does it, you know. we see a world of broadband and broadcast. some see a world where broadcast goes away, and we think that s a huge mistake. because i m not sure i know how the internet and wi-fi would do all for the american people that broadcasting does. it does many wonderful things, but it doesn t do what broadcasting does. host: is there too too much,n your view, focus on wireless in this country today? guest: it s the, it s the cool thing right now. it s hip. i mean, and i love of the internet. and i love my mobile devices. but i want to be able to watch live television on my mobile devices too. so when my wife says we ve got to meet somebody for, you know, at a restaurant and i m watching the game, she can drive, and i can watch it on the way. just a personal example. but i think that the world has to include broadcast in a very healthy manner in order to serve the telecommunications needs of the american people. host: a couple of your former colleagues up in the senate have introduced a spectrum inventory bill. nab supported? guest: in fact, if you proceed with an auction without a credible inventory, perhaps by the gao, i m just not sure that this will be done in a thoughtful and careful enough way where unintended consequences and damage is done. it s hard to reverse. again, we just did this two years ago, and now they re saying, never mind, let s do it again. we understand there s a problem. we with volunteer to be a part of the solution. but we think our four principles not taxing us for it, letting us innovate, keeping mobile and multicasting these are very important and not diminishing our reach in our demographic areas. those four principles, if they re abided, we volunteer to help. we don t volunteer to be rolled. host: you mentioned the gao, the government accountability office, and is it your concern that if someone else were to do it, say the ntia which is an agency in the commerce department that handles spectrum issues, that there could be, if you will, a conflict of interest between federal spectrum users and what the administration and the fcc want? why is it that the gao should do it? guest: well, it s a credible it s an accounting office that doesn t have any preconceived conclusion, and i think that s an important one. the president, you know, we support universal wi-fi. that s fine. but, please, understand where they talk about it as rural connectivity, i m sorry, there s not a spectrum shortage in rural oregon where i m from. there never will be. the problem is an urban problem. and so we re just simply saying as you fix the urban problem, don t damage the broadcast signal for rural places which in some congressional districts, about 40% of the people defend on over-the-air television and don t have satellite or cable. and, remember, when you hear people say it s only 10%, who are those 10%? they tend to be the economically disadvantaged. and one in three spanish households depends s collusively on over the air. exclusively on over the air. so when you start throwing a number, understand it s the elderly, the economically disadvantaged. we think they shouldn t be rolled just because there are really nice new devices out there that urbanites need more access and faster downloads for. host: we only have a few minutes left with our guest, gordon smith, so let s look at a couple different issues, if we could. indecency. when you were in the senate, if i recall correctly, you voted for a tenfold increase in the fines that broadcasters should pay guest: i did. host: for indecency. guest: and i m so glad that didn t come up when they hired me. but, yes host: but now that they ve hired you, what s your position? guest: well, broadcasters aren t in the indecency business, and i tell broadcasters, you know, as frustrating as it is, as much as we value our first amendment rights, it is actually something that appealed to me in taking this job, that broadcasters had the higher standard. most consumers, most viewers don t know whether they re watching cable content or broadcast content. but notwithstanding the occasional fleeting expletive or the ward rope malfunction wardrobe malfunction, as a general rule broadcasters are trying to comply with the indecency rules. but sometimes we get confused with cable. host: well, the other night, oscar night, there was a expletive that got blipped out by melissa leo, i believe it was, supporting actress. if that hadn t been delayed, should abc have had to pay a fine? guest: well, they would have paid a fine, and, frankly, when you have a show like the oscars which is broadcast content and you have lots of young people watching it, you know, it is the judgment of the american people s elected representatives that we gotta be careful with the public airwaves. and that s why i m thankful that in resolving the tension between the freedom of speech and the decency standards that apply differently in every community that there are technological fixes like time delays, 15, 5-second delays so you can bleep this stuff out. and it s a tension i have to live with representing broadcasters, but it is also the feeling of the leaders of congress, our lawmakers, and we will comply. host: couple other bits of association news this week, the npaa named a new chairman after about a yearlong search and, also, the same week nab announced that it is absorbing ms tv which was the spectrum, longtime spectrum association. so i ll kind of double-barrel that. number one, what would your advice be for your former colleague, chris dodd? he has some of the same corporate parents as your group has, and secondly, how is that going to help your spectrum message? guest: well, first of all, my friend, my former colleague and now my colleague still, chris dodd, doesn t need any advice from me. he s a very able man. he s a wonderful one of my favorite colleagues in the senate was chris dodd. we didn t vote the same very often, but i just think that he s going to do great because he has those natural skills, and it ll be a pleasure to work with him on many issues that we share in common. as for mstv, we re simply responding to the wishes of our board and their board, many of which are the same individuals who are looking for some economies of scale, but also in an increase in the focus on technology. and so we re, we think with a unified voice, with a budget that is sufficient to be visionary and help our members develop out their space with new offerings in the digital age within our spectrum that we expect that, and we and it