WASHINGTON, D.C. – Representative Edward J. Markey (D-MA), Chairman of the House Telecommunications & the Internet Subcommittee, this morning held the second in a series of oversight hearings focusing on the management and functioning of the Federal Communications Commission (FCC)and the views of all five of the Commissioners.

The following is the Chairman’s full opening statement:

Statement of Chairman Edward J. Markey
House Subcommittee on Telecommunications and the Internet
Oversight Hearing on Federal Communications Commission
July 24, 2007

Good Morning. I want to thank the 5 Commissioners of the Federal Communications Commission for testifying this morning, in particular the Chairman, who has had recent eye surgery which has inhibited his ability to read. We appreciate your willingness to come and answer questions.

The Commission has several important issues with which it is wrestling. For instance, the Commission has the central role to play in the overall digital television transition and we look forward to working with the Commission on this matter. The Commission is also contemplating whether to adopt or modify recommendations from the Federal-State Joint Board on Universal Service. The recommendations in my view risk putting equitable, comprehensive reform out of reach yet again. I hope the Commission will choose to tackle this issue forthrightly and more broadly because the temporary measures proposed by the Joint Board are anti-competitive and ultimately, anti-consumer.

I also want to mention the special access proceeding and I want to commend the Chairman for quickly putting this issue out for renewed comment. I want to commend Commissioners Copps, McDowell, and Adelstein for their recognition of the need to reach a resolution of this proceeding on a timely basis, ideally this September.

And also looming at the Commission are several forbearance petitions. These petitions seek widespread relief of obligations that incumbent carriers have to discharge for competition policy. The effect of granting these petitions would be to usurp congressionally-enacted statutes in a sweeping manner. I have great concerns about the effect on competition and consumers that these petitions pose and I trust the Commission will weigh the public interest carefully when considering whether to grant or deny these petitions.

Finally, the Commission must soon establish rules for the upcoming auction of valuable frequencies which will become available for other uses when broadcasters relinquish them as part of the digital television transition.

I want to commend Chairman Martin for proposing in his plan for this so-called “700 Megahertz auction” a beachhead for consumer choice and innovation in the wireless marketplace. Creating a platform for entrepreneurial activity and investment is vital in this sector.

In context, Chairman Martin’s plan is quite modest. It does not propose requiring existing wireless licensees, who serve over 200 million consumers today, to permit openness for wireless applications or allow consumers to switch from carrier to carrier and take their phone with them. Neither does the Chairman’s proposal encompass such consumer-friendly and innovation-fostering service rules for the entirety of the 700 Megahertz auction.

Rather, it is a proposal covering roughly one-third of the spectrum to be auctioned. Frankly, I would prefer the Commission went further in order to better unleash the disruptive nature of market forces into the wireless device and applications market, but the Chairman has clearly made a good start to open things up.

And this new openness is desperately needed. The problem today is that for millions of consumers the term “mobile phone” has become an oxymoron. It isn’t really mobile because you can’t take it with you when you switch carriers. Moreover, exorbitant early termination fees also make consumers feel trapped. This scenario undermines Congressional and Commission policy. Today, millions of consumers pay monthly fees on their wireless bills for number portability. What is the point of charging consumers for the ability to take their phone numbers with them if they can’t take their new $500 phone with them too?

I mentioned at our last hearing that this inability fosters a Hotel California-type wireless service: “You can check out anytime you like, but you can never leave….”

As the Commission proceeds on this matter in the coming week or so, it should be guided by the law Congress enacted for the auction process. The objectives in the law underscore that Congress knew that simply throwing more spectrum into the marketplace by selling it to the highest bidder does not, in itself, create the greatest value for consumers.

Moreover, absent sufficient competition, the sale of more licenses for additional spectrum does not, in itself, mean innovative new services and gadgets will necessarily arrive for all consumers, in all neighborhoods, or arrive in timely fashion.

The Commission has a rare opportunity to promote consumer choice, foster innovation, re-inject competition into the wireless marketplace, and advance the deployment of broadband services and applications. I look forward to working with all of you toward achieving these objectives.

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