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95–528 PDF 2015

S. HRG. 113–679 

AN EXAMINATION OF COMPETITION IN THE 

WIRELESS MARKET 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ANTITRUST, 

COMPETITION POLICY AND CONSUMER RIGHTS 

OF THE

COMMITTEE ON THE JUDICIARY 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

WEDNESDAY, FEBRUARY 26, 2014 

Serial No. J–113–51 

Printed for the use of the Committee on the Judiciary 

( 
(II) 

COMMITTEE ON THE JUDICIARY 

PATRICK J. LEAHY, Vermont, Chairman 

DIANNE FEINSTEIN, California 

CHUCK SCHUMER, New York 

DICK DURBIN, Illinois 

SHELDON WHITEHOUSE, Rhode Island 

AMY KLOBUCHAR, Minnesota 

AL FRANKEN, Minnesota 

CHRISTOPHER A. COONS, Delaware 

RICHARD BLUMENTHAL, Connecticut 

MAZIE HIRONO, Hawaii 

CHUCK GRASSLEY, Iowa, Ranking Member 

ORRIN G. HATCH, Utah 

JEFF SESSIONS, Alabama 

LINDSEY GRAHAM, South Carolina 

JOHN CORNYN, Texas 

MICHAEL S. LEE, Utah 

TED CRUZ, Texas 

JEFF FLAKE, Arizona 

CAROLINE HOLLAND, Chief Counsel and Staff Director 

BRYSON BACHMAN, Republican Chief of Staff 

SUBCOMMITTEE ON ANTITRUST, COMPETITION POLICY AND CONSUMER RIGHTS

AMY KLOBUCHAR, Minnesota, Chairman 

CHUCK SCHUMER, New York 

AL FRANKEN, Minnesota 

CHRISTOPHER A. COONS, Delaware 

RICHARD BLUMENTHAL, Connecticut 

MICHAEL S. LEE, Utah, Ranking Member 

LINDSEY GRAHAM, South Carolina 

CHUCK GRASSLEY, Iowa 

JEFF FLAKE, Arizona 

CRAIG KALKUT, Democratic Chief Counsel 

BOYD MATHESON, Republican General Counsel 
(III) 

C O N T E N T S 

STATEMENTS OF COMMITTEE MEMBERS 

Page 

Klobuchar, Hon. Amy, a U.S. Senator from the State of Minnesota ................... 1 

Lee, Hon. Mike, a U.S. Senator from the State of Utah ...................................... 3 

Leahy, Patrick J., a U.S. Senator from the State of Vermont, prepared statement ...................................................................................................................... 40 

WITNESSES 

Witness List ............................................................................................................. 39 

Milch, Randal S., Executive Vice President and General Counsel, Verizon 

Communications Inc., New York, New York ..................................................... 6 

prepared statement .......................................................................................... 42 

Ham, Kathleen O’Brien, Vice President, Federal Regulatory Affairs, T-Mobile 

USA, Inc., Washington, DC ................................................................................. 8 

prepared statement .......................................................................................... 50 

Spalter, Jonathan, Chair, Mobile Future, Berkeley, California .......................... 10 

prepared statement .......................................................................................... 65 

Graham, Eric B., Senior Vice President, Strategic Relations, C Spire Wireless, 

Ridgeland, Mississippi ......................................................................................... 11 

prepared statement .......................................................................................... 83 

Layton, Roslyn, Ph.D. Fellow, Internet Economics, Center for Communication, 

Media, and Information Studies, Aalborg University, Denmark ..................... 13 

prepared statement .......................................................................................... 99 

Wood, Matthew F., Policy Director, Free Press, Washington, DC ....................... 15 

prepared statement .......................................................................................... 104 

QUESTIONS 

Questions submitted by Senator Klobuchar for Randal Milch ............................ 116 

Questions submitted by Senator Klobuchar for Kathleen Ham .......................... 117 

Questions submitted by Senator Klobuchar for Jonathan Spalter ...................... 118 

Questions submitted by Senator Klobuchar for Eric Graham ............................. 119 

Questions submitted by Senator Klobuchar for Roslyn Layton ........................... 120 

Questions submitted by Senator Klobuchar for Matthew Wood .......................... 121 

Questions submitted by Senator Franken for Randal Milch ............................... 122 

Questions submitted by Senator Franken for Kathleen Ham ............................. 123 

Questions submitted by Senator Franken for Eric Graham ................................ 124 

Questions submitted by Senator Franken for Matthew Wood ............................. 125 

ANSWERS 

Responses of Randal Milch to questions submitted by Senators Klobuchar 

and Franken ......................................................................................................... 126 

Responses of Kathleen Ham to questions submitted by Senators Klobuchar 

and Franken ......................................................................................................... 130 

Responses of Jonathan Spalter to questions submitted by Senator Klobuchar . 135 

Responses of Eric Graham to questions submitted by Senators Klobuchar 

and Franken ......................................................................................................... 137 

Responses of Roslyn Layton to questions submitted by Senator Klobuchar ...... 139 

Responses of Matthew Wood to questions submitted by Senators Klobuchar 

and Franken ......................................................................................................... 142 

(1) 

AN EXAMINATION OF COMPETITION IN THE 

WIRELESS MARKET 

WEDNESDAY, FEBRUARY 26, 2014 

U.S. SENATE, SUBCOMMITTEE ON ANTITRUST, 

COMPETITION POLICY, AND CONSUMER RIGHTS, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 10:04 a.m., in 

Room SD–226, Dirksen Senate Office Building, Hon. Amy 

Klobuchar, Chairman of the Subcommittee, presiding. 

Present: Senators Klobuchar, Lee, and Flake. 

OPENING STATEMENT OF HON. AMY KLOBUCHAR, A U.S. 

SENATOR FROM THE STATE OF MINNESOTA 

Chairman KLOBUCHAR. All right. We are calling this hearing to 

order. Thank you, everyone, for coming today and for getting 

through the weather. We consider this minor weather in our two 

States. But it is good to see everyone here. And also someone told 

me Ben Affleck is testifying in another hearing, so we consider you 

guys our Ben Afflecks. Okay? Just remember that. Right, Mike? 

Exactly. 

Thank you for being witnesses. Thank you to everyone here. This 

hearing highlights an industry that impacts consumers across the 

country and will continue to change the way that we communicate 

for years to come. 

Mobile phones have revolutionized the way we talk to each other. 

Today more than 90 percent of adults—and I remember doing this 

a few years back, and it was not even that high. More than 90 percent of adults own a wireless phone, and that does not even count 

all the teenagers out there with cell phones, or in the case of my 

family, multiple cell phones when they lose their cell phone. And 

today, two in five U.S. homes have a mobile phone but no landline. 

Mobile devices are not just telephones anymore. In fact, young 

people today probably do not even remember when cell phones only 

made calls. People depend on their smartphones to conduct their 

everyday lives. Smartphones are the primary way for 34 percent of 

users to access the Internet, for everything from telehealth to education to Words with Friends. And they are consuming a voracious 

amount of data to the tune of 1.2 gigabytes per user per month last 

year. That is double the amount from 2012, and that number will 

only grow. 

That is why we need to make sure consumers are able to reap 

all of the benefits that come from robust competition: lower prices, 

high-quality service, innovative devices, and an abundance of 

choice. 
2 

Antitrust has a role to play in this market. As Thurgood Marshall wrote for the Supreme Court, our antitrust laws and the competition that they promote are ‘‘the Magna Carta of free enterprise.’’ 

The competitive landscape in the wireless industry has gone 

through remarkable changes since the 1990s when I was in private 

practice focusing on communications law. Just 10 years ago, consumers had six national wireless carriers and a variety of regional 

carriers to choose from. As a result, aggressive competition led to 

declining prices and the rollout of new services and new devices. 

In 2005, the number of nationwide carriers went down to four 

when Cingular merged with AT&T and Sprint acquired Nextel. In 

2007, the iPhone was unveiled and revolutionized the way people 

interact with their mobile phones. In 2011, AT&T and T-Mobile attempted to further consolidate the industry until the Justice Department stepped in and blocked the merger and the parties ultimately abandoned the merger. 

Recently, T-Mobile has re-emerged as the maverick it had been 

before the proposed AT&T merger with its ‘‘Un-carrier’’ emerging 

markets, which offers consumers free international data roaming, 

reimburses them for early termination fees, and eliminates longterm contracts. T-Mobile has also boosted its spectrum holdings by 

acquiring MetroPCS. 

Last year, Sprint was acquired by Japanese-based SoftBank, a 

transaction that was promoted as providing Sprint with capital and 

expertise needed to deploy its national LTE network. Sprint also 

took full control of Clearwire. 

AT&T is expected to close an acquisition later this year to acquire Leap Wireless. Verizon bought a large swath of spectrum 

from several cable companies and more recently sold a block of unused spectrum worth $3 billion to T-Mobile. And regional carriers 

like C Spire continue to expand and offer more and more consumers their competitive 4G LTE service. 

A lot has changed in the fast-moving industry, and yet some 

things remained relatively constant. AT&T and Verizon are still 

the dominant wireless providers, accounting for roughly 68 percent 

of all subscribers. But anyone that watched the Super Bowl knows 

from the ad campaigns going on that there has still been some vigorous competition, especially in recent months, which is why this 

hearing is so timely. 

So now is a good time to assess the future outlook for competition and consumers. We need to ask important questions. Are we 

seeing the kind of competition we would expect from a competitive 

market? Are we seeing price wars, competing offers to try to acquire each other’s customers, and new and innovative services and 

choices that differentiate competitors? What barriers to competition 

remain, and what challenges do competitive carriers face? 

What should we be mindful of as we consider spectrum and other 

policies impacting competition or further consolidation in the wireless market, such as a potential Sprint/T-Mobile merger? 

Wireless carriers and their partners innovate and compete on a 

variety of levels, so we expect to see them trying to win over new 

customers on everything from Internet speeds to a variety of service plans and the latest handset features to cutting-edge applica-
3 

tions, including safety and security features that will help stem the 

tide of mobile phone theft. As you know, I am particularly interested in this area, as we have seen an exponential increase in cell 

phone thefts across the country. One in three burglaries are now 

the result of cell phone stealing, and I have legislation on this. But 

the focus is to, of course, reduce these kinds of thefts by actually 

reducing the value of the phone to the thieves by allowing consumers with new technology to keep their own private information 

on the cloud but turn it off for the thief that steals their phone. 

When we think about competition and antitrust enforcement in 

this area, we need to acknowledge that the mobile world is quickly 

evolving. For example, just last week, Facebook bought the mobile 

phone instant messaging service WhatsApp for $19 billion. New 

ideas, products, and services are being unveiled this week at the 

Mobile World Conference in Barcelona, Spain. So you guys got the 

short end of the stick, huh? 

[Laughter.] 

But just because technology is moving at a swift pace, the antitrust laws are no less applicable. The wireless industry is a hotbed 

for new technology, and by ensuring a fully competitive market, we 

will foster innovation and ensure that consumers will be the ones 

to pick the winners and losers. 

So today we will hear from witnesses who will paint the current 

picture of competition in the wireless industry and inform us about 

what Congress should take into account when considering wireless 

policy and future mergers in the industry. 

Again, I thank the witnesses, and I turn it over to my Ranking 

Member here, Senator Lee. 

OPENING STATEMENT OF HON. MIKE LEE, A U.S. SENATOR 

FROM THE STATE OF UTAH 

Senator LEE. The Dirksen Building really is a nice destination 

even when compared to Barcelona, but I will not say more than 

that. 

Mine is one of those homes where you can find both cell phones 

and a landline. I am still not sure why we have the landline. It is 

one of those things that we have been reluctant to part with. It 

seems irresponsible, almost, as a citizen not to have a landline, 

even though we never, ever use it. My wife refers to it as ‘‘the line 

that people use to call us that we do not want to talk to.’’ 

[Laughter.] 

A few years ago, my son, James, commented, when he could not 

find his phone, ‘‘You know, someone really should invent a phone 

that is connected to the wall with a wire that cannot be removed 

so you cannot lose it.’’ I told him, ‘‘That has been used in the past, 

but no one wants it.’’ 

Today’s hearing focuses on competition in the wireless market, 

and our Subcommittee’s hearings often address the competitive 

state of a particular industry or market, but in some ways today’s 

hearing is unique because, as it is presently constituted, the wireless market is, in fact, very competitive. Indeed, looking back a decade or two, there are perhaps few industries in which the benefits 

of competition are more readily apparent and pronounced than in 

the present-day wireless market. 
4 

Many of us attending or watching this hearing can remember a 

time when mobile phones were still something of a novelty, and 

perhaps all of us can remember the time when a cell phone was 

little more than that. It was just a phone. Today smartphones are 

ubiquitous, and they do so much more than allow us just to make 

phone calls. 

In fact, within a few years, a majority of Americans will access 

the Internet, primarily not through a computer but through a mobile device. These rapid developments are in large part the result 

of forces of competition. Consumers in the wireless market have 

benefited from competition not just in the form of low prices, but 

also in the form of high-quality service, which is the product of innovation and which leads to more innovation. 

Consumer demand has pushed carriers to offer better, faster 

service on better, faster devices. In the last 20 years alone, carriers 

have paid more than $50 billion for spectrum and have invested 

well over $300 billion in infrastructure. As the Department of Justice noted last year in its comments to the FCC regarding spectrum, ‘‘Competitive forces have been a central driver of innovations 

that have enabled wireless carriers to expand capacity and improve 

service quality.’’ 

The wireless market is, thus, in many ways a success story that 

illustrates what can happen when government stays its regulatory 

hand and allows the free market to respond productively to consumer demand. To again quote the Department of Justice, ‘‘Competition generally represents the best method of ensuring that consumers receive low-price, high-quality products and services, greater choice among providers, and important innovation.’’ 

Today we have got the opportunity to discuss the government 

policies that may best ensure that consumers and the wireless industry continue to enjoy the benefits of robust competition. As spectrum is the lifeblood of the wireless industry and a scarce resource 

administered by the government, some of our discussion will understandably center on that topic. With data use exploding each year 

within the United States, carriers are aggressively seeking spectrum to fulfill demand. 

Indeed, to the extent the wireless industry has consolidated, the 

need for spectrum may go a long way toward explaining that trend. 

Although the Federal Government has taken some steps to free up 

available spectrum for commercial use, I believe additional steps 

can and should be taken in this regard. Particularly where the government is holding low-frequency spectrum for non-military use, a 

careful evaluation of measures that may allow for some of that 

spectrum to be made available for commercial use may be extremely beneficial and may forestall additional attempts at consolidation. 

Some have expressed concern that a carrier may seek to accumulate spectrum for anticompetitive purposes. Although the foreclosure value of spectrum makes such an outcome theoretically possible, we must be careful to ground any antitrust analysis in the 

facts of specific transactions. Absent evidence that a carrier is 

hoarding spectrum or otherwise seeking spectrum for a purpose 

other than to serve its customers, it is at best premature to assume 
5 

that a carrier’s desire to purchase additional spectrum is itself 

anticompetitive. 

Particularly in light of the increasing demand for spectrum, it 

seems likely that all carriers will, for legitimate commercial purposes and very legitimate reasons that have everything to do with 

the desire to compete in a competitive marketplace, continue to 

seek additional spectrum. In that scenario, competitive forces and 

market valuation will best allocate spectrum to its most efficient 

and highest-value use. 

I have also heard concerns expressed regarding the competitive 

state of other aspects of the mobile device ecosystem, including the 

market for operating systems. For example, I have heard concerns 

expressed regarding the potential for a company with market 

power to leverage that power to limit competition in mobile services. I have likewise heard concerns expressed from small carriers 

regarding the availability of the latest and best mobile devices. 

These are important considerations as we take account of the competitive state of the wireless industry as a whole. 

Throughout our consideration of all these issues, we must keep 

our focus on protecting competition and not protecting competitors. 

By carefully evaluating the evidence and applying rigorous economic analysis, we can continue to ensure the best outcomes for 

consumers. 

I look forward to hearing from our witnesses today, and I thank 

them for coming. 

Chairman KLOBUCHAR. Well, thank you, Senator Lee. 

I would now like to introduce our distinguished witnesses. 

Our first witness is Mr. Randal Milch. Mr. Milch is executive 

vice president and general counsel of Verizon. Previously he was 

associate general counsel at Bell Atlantic, which merged with GTE 

to form Verizon in 2000. 

Our second witness is Ms. Kathleen O’Brien Ham. Ms. Ham is 

vice president for federal regulatory affairs at T-Mobile. Before 

going to T-Mobile, Ms. Ham was at the FCC for 14 years and 

served in a number of top policy positions, including Deputy Chief 

of the Wireless Telecommunications Bureau. 

Next we will hear from Mr. Jonathan Spalter. Mr. Spalter is the 

chairman of Mobile Future. Prior to joining Mobile Future, he 

founded the independent investment research company Public Insight. Mr. Spalter also served as the Associate Director of the U.S. 

Information Agency during the Clinton administration. 

The next witness will be Mr. Eric Graham. Mr. Graham is senior 

vice president for strategic relations for C Spire Wireless. Prior to 

joining C Spire in 2007, he practiced law in Jackson, Mississippi, 

with a focus on public policy, consultation, and public utilities regulation. 

Then we will be hearing from Ms. Roslyn Layton. Ms. Layton 

studies Internet economics at the Center for Communication, 

Media, and Information Technologies at Aalborg University in Denmark. She has worked with many companies in the IT industry on 

digital marketing software, Web analytics, platforms, disruptive 

technologies, and Web development services. 

Our final witness will be Mr. Matthew Wood. Mr. Wood is the 

policy director of Free Press. Prior to joining Free Press, Mr. Wood 
6 

worked at the public interest law firm Media Access Project and in 

the communications practice groups of two law firms in Washington, DC. 

Thank you all for appearing at our Subcommittee’s hearing to 

testify. I now ask our witnesses to rise and raise their right hand 

as I administer the oath. 

Do you affirm that the testimony you are about to give before the 

Committee will be the truth, the whole truth, and nothing but the 

truth, so help you God? 

Mr. MILCH. I do. 

Ms. HAM. I do. 

Mr. SPALTER. I do. 

Mr. GRAHAM. I do. 

Ms. LAYTON. I do. 

Mr. WOOD. I do. 

Chairman KLOBUCHAR. Thank you. We will start with Mr. 

Randal Milch. 

STATEMENT OF RANDAL S. MILCH, EXECUTIVE VICE PRESIDENT & GENERAL COUNSEL, VERIZON COMMUNICATIONS 

INC., NEW YORK, NEW YORK 

Mr. MILCH. Chairman Klobuchar, Ranking Member Lee, thank 

you for the opportunity to testify, and I would request that my 

written testimony be entered into the record. 

Chairman KLOBUCHAR. It will be entered in the record. 

Mr. MILCH. Thank you very much. 

U.S. consumers are benefiting from a fiercely competitive and 

deeply innovative wireless market. That is a key driver for our national economy and for maintaining America’s competitive edge in 

the global economy. 

Normally I would not burden you with numbers, but the numbers here are impressive. 

First, on the competitive standpoint, the market is indisputably 

characterized by massive investment, falling prices, and deep rivalry. This is a competitive market by all of these measures. 

Capital investment is truly staggering. As Senator Lee noted, in 

2013 America’s wireless carriers invested more than $34 billion in 

their networks, and since 2001, it is $300 billion in capital investment in the United States, and that is not including the investment in spectrum that was made. 

Lately, this investment has centered on our 4G LTE networks 

across the board. This was a big bet that Verizon first made in 

2008, announcing it was going to go to 4G LTE. And since that investment, all major carriers and regional carriers as well have 

started investing in 4G LTE, which has been a major transformation in the industry. 

Because of that kind of investment by all carriers, the United 

States has almost 300 million wireless broadband subscriptions, 

and that is more than double that of any other country in the 

world. And these broadband subscriptions can provide mobile 

broadband speeds that are comparable to wireline alternatives. 

This has been a bright spot in the economy. The wireless industry 

has gained almost 1.6 million new jobs from 2007 to 2011, and that 
7 

is at the same time when, unfortunately, total U.S. private sector 

jobs fell by 5.3 million. Our industry generated almost $200 billion in economic activity 

during the same period, and the projection for continued investment is staggering as well. Over the next five years, it is estimated 

that there will be more than $1 trillion in additional investment in 

economic growth—I am sorry, in economic growth and will create 

almost 1.2 million new jobs. 

The results are a great deal of choice for consumers: nearly 200 

facilities-based carriers in the United States, more than any nation 

in the world; more than 90 percent of U.S. consumers have a choice 

of three or more wireless carriers; there are over 300 different 

handsets available to U.S. consumers from a variety of manufacturers; and by 2017, 87 percent of connected device sales will be tablets and smartphones, and these are devices that did not exist even 

exist more than a handful of years ago. And they would not exist 

without mobile broadband networks. 

At the same time, prices are falling. From 2008 to 2012, as data 

usage skyrocketed, data prices plummeted 93 percent, dropping 

from 46 cents a megabyte to only three cents a megabyte. And from 

2005 to January 2014, the wireless CPI, Consumer Price Index, fell 

10 percent while the overall CPI for all items increased almost 19 

percent. 

All this investment and choice has led to U.S. consumers using 

far more mobile services than their international counterparts. 

This is a well-known fact that we have some real experts on the 

panel who can probably be more evocative on this than I am. 

Let me turn, though, to the deep rivalry among the carriers. As 

Chairman Klobuchar noted, you look at the Super Bowl ads, you 

look at the ads in any newspaper, there is a huge amount of effort 

to attract new customers and attract customers away from other 

carriers. For instance, in nine months alone, from January to September 2013, telecom companies spent almost $7 billion in advertising. That is an 11-, almost 12-percent increase over the same period in 2012. And as we know, this is a period when other consumer segments’ advertising spend was decreasing. The wireless 

market was increasing. 

There is a great deal of additional benefit beyond the economic 

benefit to the Nation from this effort. We believe, and we are trying 

to lead the way, in ensuring that mobile broadband helps answer 

questions and our deepest problems in the health care area by the 

use of distance medical usage and allowing the transmission securely of MRIs and X-rays. In education, in STEM, this is a great 

effort where Verizon and others are launching programs to ensure 

that mobile technology is embedded and utilized well in the classroom. 

There are a few issues that we should address. Privacy and security are very important as mobile devices become more and more 

embedded in our everyday lives. This is an area that we believe deserves the greatest attention from the carriers and from policymakers. And we believe it is an area where carriers will strive to 

differentiate from one another as part of the competitive process. 

Finally, spectrum, spectrum, spectrum—the lifeblood of our industry. We need to ensure both that there is a supply, continued 
8 

supply of spectrum, as Senator Lee noted, from parts of the government where it is underutilized at the current time and coming up 

with an auction process and other processes of having that spectrum being made for commercial use, processes that are fair and 

neutral and encourage all carriers to invest. And, finally, a robust 

secondary market for spectrum is very important. 

Let me close simply by saying Verizon is honored every day to 

serve 100 million customers around the country, and we attempt 

to do justice to the investment that our shareholders have allowed 

us to make, the trust that our customers put into us every day, and 

to keep alive the innovative spark that is furthering the mobile industry. 

Thank you. 

[The prepared statement of Mr. Milch appears as a submission 

for the record.] 

Chairman KLOBUCHAR. Thank you very much. 

Ms. O’Brien Ham. 

STATEMENT OF KATHLEEN O’BRIEN HAM, VICE PRESIDENT, 

FEDERAL REGULATORY AFFAIRS, T-MOBILE USA, INC., 

WASHINGTON, DC 

Ms. HAM. Thank you. Good morning, Chairwoman Klobuchar, 

Ranking Member Lee, and Members of the Subcommittee, and 

thank you for inviting me to testify on the subject of wireless competition. My name is Kathleen Ham, and I have been the vice 

president of federal regulatory affairs for T-Mobile since 2004. 

T-Mobile is headquartered in Bellevue, Washington, employs 

more than 38,000 Americans, and offers nationwide wireless voice 

and data services to individual, business, and government customers. We are the fourth largest wireless carrier in the U.S., serving approximately 47 million subscribers. 

Since the spring of 2013, T-Mobile has been transforming itself 

into a more competitive force in the wireless market—the ‘‘Un-carrier.’’ We have implemented a series of initiatives to address perennial customer pain points, including eliminating the annual service 

contract, allowing more frequent handset upgrades, providing free 

unlimited international data and text roaming, and paying the 

early termination fees for consumers who switch from another national carrier to us. 

T-Mobile has been growing fast in comparison to the other wireless companies. A year ago, we had virtually no 4G LTE network. 

Today our LTE network covers over 200 million people and is still 

growing. 

We added more than 4.4 million new subscribers in 2013, including 1.6 million in the fourth quarter. That was our third consecutive quarter with more than a million net customer additions, representing a significant turnaround from a year earlier. 

Despite its popularity with consumers, T-Mobile faces a number 

of fundamental challenges that put at risk its ability to maintain 

its disruptive presence in the marketplace. Our subscriber base is 

still nowhere near that of AT&T or Verizon, and their great numbers give these carriers significant access to capital and economyof-scale advantages. Our smaller scale yields lower profit margins, 
9 

smaller cash flows, and greater challenges in funding capital expenditures and bold, disruptive innovations. 

By contrast, our larger competitors have substantial economy-ofscale advantages in such critical areas as equipment purchasing, 

handset rollout, business financing, the acquisition of backhaul and 

roaming services, and national brand advertising. The funding requirements needed for this business, exacerbated by the lack of 

scale relative to the big two, remain a major competitive challenge 

to T-Mobile going forward. 

As discussed in our written testimony, T-Mobile faces other challenges the U.S. policymakers can impact, including securing access 

to roaming at commercially reasonable rates to interconnection 

with the other major carriers as we move to an all-Internet protocol 

world and to backhaul from our cell sites, especially outside of 

major metropolitan areas. 

One extremely important issue for wireless carriers is low-band 

spectrum. The broadcast incentive auction represents a critical moment for the wireless industry that will influence the structure of 

the market for years to come. Like our wireless industry competitors, we believe that Congress and regulators should do all they 

can to encourage widespread broadcaster participation so that as 

much spectrum as possible can be released for wireless broadband 

services. 

In addition, there is a general consensus among mobile carriers 

that the FCC should adopt a band plan for the incentive auction 

that maximizes the amount of paired spectrum available for licensed wireless broadband services, and we have worked closely 

with our industry colleagues, including Verizon, in pursuing that 

goal. 

Finally, T-Mobile strongly believes that the FCC should adopt 

reasonable spectrum aggregation limits to ensure that the two 

dominant wireless carriers do not foreclose smaller competitors 

from acquiring low-band spectrum in the auction, as the Department of Justice has warned could happen. 

Spectrum below one gigahertz is especially critical. It offers superior building penetration and broader coverage than the higher 

spectrum T-Mobile currently uses. Reasonable spectrum aggregation limits have been applied in the United States and around the 

world. In fact, it was the FCC’s decision to put reasonable limits 

on PCS spectrum concentration that led to the development of real 

competition and mobile services in the late 1990s. The mobile industry would look vastly different today if the FCC had not ensured a procompetitive distribution of spectrum in the PCS auctions. 

As the ‘‘Un-carrier’’ in the wireless market, T-Mobile is providing 

new options for consumers tired of high prices and low levels of innovation. Heightened competition means better service and more 

options and leads to a virtual cycle of innovation and adoption, 

with consumers as the ultimate beneficiaries. We all want this industry to be competitively vibrant, aggressively innovative, and 

economically healthy for years to come, and decisions we make now 

will determine whether that shared vision becomes a reality. 

Thank you, and I look forward to your questions. 
10 

[The prepared statement of Ms. Ham appears as a submission for 

the record.] 

Chairman KLOBUCHAR. Thank you very much. 

Mr. Spalter. 

STATEMENT OF JONATHAN SPALTER, CHAIR, MOBILE 

FUTURE, BERKELEY, CALIFORNIA 

Mr. SPALTER. Chairman Klobuchar and Ranking Member Lee, it 

is a pleasure to be here before the Senate Committee. I am Jonathan Spalter, chair of Mobile Future, and I am pleased to join you 

today from the solar vortex of the San Francisco Bay area. 

Chairman KLOBUCHAR. Very funny. From the polar vortex to the 

solar vortex. That is pretty good. 

Mr. SPALTER. My organization proudly represents innovators 

across the mobile ecosystem, those who build apps, networks, devices, and those who also leverage wireless technologies to improve 

their communities. 

This morning, we have heard and we will hear some compelling 

national data about the choices available to millions of U.S. wireless consumers, but I would like to tell the exciting story of American mobile competition through the eyes of actually just one of 

these customers—my brother-in-law, Jason Gu. 

Jason has lived in the town of Plymouth, Minnesota, for the past 

eight years. Plymouth, of course, is the lovely home town of our esteemed Chairwoman. Jason lives there with his wife, Jill, and they 

share their home with two mobile experts—their teenage daughters. 

Now, Jason and his family regularly drive past the AT&T and 

the T-Mobile stores, just located three blocks apart on Vicksburg 

Lane. Six miles away, at the Ridgedale Mall, they can shop at Best 

Buy Mobile, at AT&T, Century Link, T-Mobile again, and Shock 

City Cellular. Across the street is Verizon. Down a few blocks on 

Wayzata Boulevard is Sprint, and the nearby Target offers prepaid 

phones from no less than seven competing brands. And the local 

Walmart offers the chain’s Family Mobile Plan alongside service 

from six additional providers. 

Now, that is a lot of choices, not just of providers but also of devices, operating systems, apps, and service plans, and it really is 

creating tremendous value. We know that the price per megabit for 

mobile broadband has been declining by more than 93 percent in 

just five years. And with this abundance of choice and competition, 

Plymouth has a lot in common with communities across our Nation, including, Senator Lee, those in your home State of Utah and 

those that your family and your son, James, enjoy in Alpine. And 

every company in this space competes and innovates in an ecosystem where truly the only certainty is disruption. Just ask 

Facebook CEO Mark Zuckerberg in Barcelona, who, as you mentioned, Senator Klobuchar, found nearly 19 billion good reasons to 

like the free text service WhatsApp. And this is just the latest and 

most powerful reminder that formidable new rivals can emerge in 

the blink of the eye or the snap of a chat. 

Or ask Cisco CEO John Chambers. He sees just around the corner 50 billion devices connecting to the Internet of things, creating 

a $2 trillion global industry. This is the competition we must win. 
11 

The so-called Internet of things encompasses everything from the 

fitness monitors on our wrist to the thermostat we adjust from our 

phone, right up to the very edge of science fiction, for example, 

Google’s pursuit of essentially wireless contact lens that can register blood levels, and the wireless sensors my 10-year-old daughter 

has to implant in her body twice a week to manage her Type 1 diabetes. 

Who knows what exciting new business opportunities or new entrants or new life-saving wireless technologies will emerge next? 

But what we do know is that the appetite of consumers and the 

vision of innovators should guide the mobile future, and it would 

be pure folly for anyone, especially for government, to try to predict 

or to prescribe future market architecture. 

In the Bay Area where I reside, technology companies have 

adopted an approach we call ‘‘minimal viable product,’’ or MVP for 

short. The idea is keep products simple, ship them quickly, and listen very, very carefully to your customers. And in many ways, this 

same MVP approach has successfully guided our Nation’s wireless 

policy for two decades now, making our mobile ecosystem, I believe, 

the envy of the world. 

So for the sake of Jason’s family, and American mobile families 

everywhere, I truly do hope that past will be prologue, for if so, 

with a dash of humility and restraint in how we design our products and our policies, I am confident that an even greater phase of 

our Nation’s mobile future lies yet ahead. 

Thank you very much. 

[The prepared statement of Mr. Spalter appears as a submission 

for the record.] 

Chairman KLOBUCHAR. Thank you. 

Mr. Graham. 

STATEMENT OF ERIC B. GRAHAM, SENIOR VICE PRESIDENT, 

STRATEGIC RELATIONS, C SPIRE WIRELESS, RIDGELAND, 

MISSISSIPPI 

Mr. GRAHAM. Good morning, Chairwoman Klobuchar and Ranking Member Lee, and thank you for the opportunity to be here 

today on behalf of Cellular South, who now provides C Spire Wireless service. Our company has been in the wireless business for 

over 25 years, beginning in the late 1980s in the era of the duopoly, 

when there were only two providers in each market nationwide. We 

continued through the era of competition, which was marked by the 

introduction of PCS spectrum licenses, where new operators seemingly sprang up overnight, giving customers a dizzying array of 

choices for their carriers, driving innovation, and spurring competition in a way that has not been seen since. 

Following that era of competition, we entered the decade of the 

2000s and began the era of consolidation, where we saw the remnants of Ma Bell begin to reconstitute themselves into the wireless 

Twin Bells—Verizon Wireless and AT&T Mobility. It has carried 

through today into this era of stratification, where we have two nationwide operators with roughly 100 million subscribers. We have 

a couple of metropolitan operators in that 40- to 60-million subscriber range. Below that we have a super-regional operator, and 
12 

then 100 or so regional and rural, primarily rural, operators 

throughout the rest of the country. 

If you think back over the last four or five years, there have not 

been that many innovations purely in wireless for the customer. 

There have been apps that have come on. There have been maybe 

different devices that the customer does not necessarily touch every 

day. But think of the form factor of the phone that you use today. 

It is relatively unchanged from what it was four or five years ago. 

If our industry metrics were viewed through the lens of another 

industry, I do not think we would be quite as comfortable as we 

are saying that wireless is competitive. So let us take a moment 

and think about the aviation industry in the United States. 

Consider if in airline travel in the United States the two largest 

airlines controlled 70 percent of the domestic passenger traffic. 

Consider that these airlines also had the market power not only to 

demand but to receive exclusive access to the latest and greatest 

jets, keeping them out of the hands of their competitors. 

Further consider that these airlines have the ability to dictate 

the terms on which connecting passengers could access their 

routes, charging exorbitant rates that bear virtually no relation to 

the cost of transporting that passenger or operating that jet. 

Let us layer on top of that the government’s desire to introduce 

more capacity into that market through opening up new gates at 

airports across the country, and position these two airlines with 

the power to absorb 100 percent of that capacity under the rationale that eventually they will need it, whether they need it today, 

but certainly with the motivation there that they could foreclose 

competitors from having that capacity. 

I do not think that we would be willing to sit by and let the airline industry operate like that, unfettered and with a purely handsoff approach. I certainly do not believe we would call that a ‘‘competitive industry’’ nor a ‘‘healthy industry.’’ 

Yet when we transfer that to wireless, my fear is that we have 

become too complacent and too comfortable in a world where the 

largest two operators have 70 percent of the wireless subscribers 

and in 2013 combined to account for 86 percent of the industry’s 

earnings. The largest two have routinely demanded and received 

exclusivity agreements to be the only provider of particular devices 

in the market, keeping them out of the hands of their competitors. 

They dictate the terms on which roaming customers can access 

their networks, typically at exorbitant rates that have little to no 

relationship to the cost of providing service for those customers. 

We have heard this morning already the statistic that data costs 

three cents a megabyte. I can assure you rural and regional operators seldom get a rate that approaches three cents a megabyte for 

data roaming. 

Let us layer on top of that now the government’s interest in introducing more spectrum that our industry desperately needs, and 

consider that the largest two operators have not only the ability 

but certainly the motivation to absorb nearly all of that capacity, 

not only in the most attractive markets but markets across the 

country, under the rationale that if we do not need it now, we will 

certainly need it later. Well, later means that competitors are fore-
13 

closed from having access to that spectrum today when we need it 

now. 

So I would submit to you that as we sit here today, we are in 

a world where the wireless industry is stratified between the largest two national operators, two metropolitan operators, and a collection of smaller operators who need procompetitive policies to assure us that, as we move forward, we will have access to those inputs to the business that let us serve your constituents and customers who have come to depend on us. 

Thank you again for the invitation to be here this morning and 

be a part of this panel, and I look forward to exploring these and 

other issues with you. 

[The prepared statement of Mr. Graham appears as a submission 

for the record.] 

Senator LEE [presiding]. Thank you. 

Ms. Layton. 

STATEMENT OF ROSLYN LAYTON, PH.D. FELLOW, INTERNET 

ECONOMICS, CENTER FOR COMMUNICATION, MEDIA, AND 

INFORMATION STUDIES, AALBORG UNIVERSITY, DENMARK 

Ms. LAYTON. Good morning. Thank you for the opportunity to 

share my testimony on competition in America’s wireless market, 

and a special thank you to Caroline Holland and Kayla Johnson of 

Senator Klobuchar’s office who did a lot of work to pull together today’s session. 

My name is Roslyn Layton, and I am a Ph.D. fellow at the Center for Communication, Media, and Information Studies in Copenhagen, Denmark. I am also a visiting fellow at the American Enterprise Institute, and I am a vice president of Strand Consult, an 

independent consultancy to the mobile industry. 

As an American who lives in Europe and studies the international wireless market, I hope to provide an international perspective. Senator Lee and Senator Klobuchar, I believe that we 

share the same goals. We want all Americans to enjoy the benefits 

created by the wireless markets, the networks, the devices, the 

services, and the applications. And, in addition, we want Americans companies, especially those that create American jobs in the 

mobile ecosystem, to win in the global economy. So I have three 

points today in relation to these goals. 

First of all, competition comes from the level of technology, not 

from the number of competitors. 

Second, Americans get value for money when it comes to mobile 

products and services. 

And, finally, that America’s mobile ecosystem and its digital export economy is highly dependent on mobile operators’ investments 

in infrastructure. 

So my first point: Competition comes from the level of technology, not from the number of competitors. 

We can examine wireless competition by looking at technology 

development in mobile standards, in infrastructure facilities, in 

services, handsets, operating systems, and platforms. But, unfortunately, I can only talk about one example today. 

As Senator Klobuchar so pointed out already, consumers are increasingly using their mobile subscriptions to access competing 
14 

communication services. They are also called over-the-top or OTT 

services. And the example that we have seen of late is the text 

messaging service WhatsApp, which Facebook purchased for $19 

billion. 

With over one billion users, Facebook is actually the world’s largest communications provider. It is a wireless platform where people 

communicate by voice, text, and data, and at $175 billion, Facebook 

has a larger market cap and a larger market share than any mobile provider in America. I think Mr. Graham certainly points out 

a number of things about mobile market concentration, but if we 

look at Internet companies, their industry is more concentrated in 

terms of the number of competitors. So while $19 billion is a staggering sum, four times this amount 

is lost by the mobile industry worldwide as users are switching 

from the services they can get from their mobile provider to the 

over-the-top services. This is a classic example of the innovator’s dilemma and demonstrates that the bigger a mobile provider grows, 

so do the incentives for the upstart to disrupt its revenues. This 

suggests to me that the market can better discipline than any regulator. 

And it is because of this competition in the wireless market that 

Americans get value for their money with mobile products and 

services. Americans use five times more voice and twice as much 

data than Europeans. The current next-generation mobile standard 

4G LTE is available to 97 percent of Americans but only 26 percent 

of Europeans. 

The mandated low prices that you have heard about in Europe 

come at a high long-term cost. Europeans are being shortchanged 

on the future because operators there cannot afford to invest in investments in next-generation networks. So in practice in Europe, 

you may have one mobile network being shared by 20 or more resellers. They are frequently owned by the incumbent. So this is not 

meaningful competition as we have here in the United States 

where different facilities are actually competing, and we can certainly see this now with new efforts in nomadic WiFi also competing for mobile subscriptions. 

If we measure the value that consumers have gotten over time 

and the improvement in the capability of the mobile ecosystem, it 

has been a dramatic improvement. To get the equivalent of an 

iPhone 20 years ago, you would have had to spend $3.5 million. 

Today your mobile provider subsidizes your handset as part of your 

subscription. 

I want to make a special point for the Chairwoman because I 

know she cares very much about mobile services being affordable 

and available, especially for the citizens of her State. In my own 

home State of Florida, we have many Minnesotans who come to 

Florida for the winter and seniors from across America. And I 

think as Mr. Spalter so eloquently described, in Plymouth, Minnesota, the marketplace has a mobile product that suits every 

budget and every person. 

There is one thing we can do to improve the affordability and 

availability of mobile, and that is to remove the barriers at the 

local level for deploying mobile infrastructure. In my studies, I 

have found that mobile operators often pay four times the market 
15 

rate to secure the rents to deploy their mobile mass and toward. 

If we want to have mobile in rural areas, we need to reduce these 

barriers. 

I come to my last point. America’s mobile ecosystem and its digital export economy is highly dependent on operators’ investments 

in infrastructure. Facebook’s business model is predicated on mobile operators making fundamental investments in infrastructure 

so they can reach their users. As Mr. Milch so much described 

about the many tens of billions of dollars that the wireless providers are making, altogether Americans got an investment of $75 

billion in networks last year, this means that Americans who are 

just four percent of the world’s population enjoy one-quarter of the 

worldwide broadband investment. This is twice the rate per capita 

as Europeans. 

Of the world’s 25 Internet companies in terms of market cap, 15 

come from the U.S. and just one from the EU. This means that Europeans and others around the world are using American-made mobile operating systems, handsets, search engines, social networks, 

and mobile apps. In fact, America’s digital goods and services sent 

abroad, over $350 billion annually, are now our third largest category of exports. If our wireless networks were not up to speed, 

there is no way we would realize these numbers today. 

America’s wireless market is highly competitive, consumers get 

value for money, and investment in infrastructure by America’s 

mobile providers supports a vibrant mobile ecosystem and a digital 

export economy second to none. 

[The prepared statement of Ms. Layton appears as a submission 

for the record.] 

Chairman KLOBUCHAR [presiding]. Thank you. 

Mr. Wood. 

STATEMENT OF MATTHEW F. WOOD, POLICY DIRECTOR, FREE 

PRESS, WASHINGTON, DC 

Mr. WOOD. Chairman Klobuchar and Ranking Member Lee, 

thank you for the chance to testify today on the topic of wireless 

competition. My name is Matt Wood, and I am the policy director 

at Free Press, a nationwide, nonpartisan nonprofit with 700,000 

members. Free Press works for media and technology policies in 

the public interest, like promoting affordable wireless access for everyone, because these communications tools are so vital for our free 

expression, our democracy, and our economy. 

The wireless market today does show some signs of improved 

competition, especially when compared to some other telecom sectors. Positive steps taken by DOJ and the FCC, like blocking the 

T-Mobile/AT&T merger and encouraging divestiture in the Verizon/ 

SpectrumCo deal, were grounded in the law and common sense, 

and we have seen good outcomes from those decisions. 

Still, the FCC has not done quite enough to follow Congress’ command to promote economic opportunity and competition. So the 

FCC must do more about concentration in the wireless market, 

which qualifies as highly concentrated still today under DOJ guidelines. 

Verizon and AT&T exercise significant market power. That leads 

to the loss of untold billions of dollars in consumer surplus per 
16 

year. A few facts and figures show the impact of this type of concentration on a wireless market that is still top-heavy. 

For instance, AT&T and Verizon have more than 68 percent of 

wireless subscribers, as you noted, Chairman Klobuchar, but they 

rake in more than 82 percent of the entire industry’s profits. 

Verizon alone enjoys nearly 50 percent of the industry’s earnings. 

With Sprint and T-Mobile, those four companies control 98 percent 

of the country’s wireless customers. This type of concentration is 

bad for consumers. 

For example, many customers today pay more for plans worse 

than they had when smartphones first came on to the scene. In 

2008, for example, an AT&T iPhone customer could buy 450 voice 

minutes, 200 text message, and unlimited data for $60 per month. 

Today she would pay $95 for a plan with unlimited voice and texts 

but just two gigabytes of data. That is a 58-percent rate hike for 

a comparable plan, and Verizon’s similar plan is little better at $90 

per month rather than $95. 

Wireless customers also shell out an absurd amount for the devices that they buy once you know what they pay back for these 

so-called subsidies that some carriers still offer. Compared to budget carrier plans with the same allowances on voice, text, and data, 

that $95 per month AT&T customer might pay an extra $1,200 

during the course of a two-year contract, swamping the $450 phone 

subsidy. In reality, that is not a subsidy. That is a loan, at rates 

that would make a payday lender blush, with an annual interest 

rate of 120 percent. 

The FCC and Congress also must act to give people more control 

over these tools we use to stay connected, because when people can 

do more with the devices they buy, their service choices go up and 

their prices go down. Unlocked phones that actually work with and 

roam on to other carriers’ networks increase competition by letting 

customers move around. The bill sponsored by so many Members 

of the Senate was a welcome spur to the FCC’s unlocking measures 

last year, and your Smartphone Theft Prevention Act is welcome 

news for consumers who pay so much to replace these stolen devices to the tune of $30 billion per year. 

Devices should not take away customers’ freedom to take their 

business elsewhere, and that is why we need these steps. Neither 

should spectrum imbalances that stem from AT&T and Verizon’s 

status as early spectrum recipients. Rather than focusing solely on 

the upcoming incentive auction, though, Free Press has asked the 

FCC to restore sensible spectrum limits for all spectrum holdings. 

The FCC should not and cannot keep anyone out of this upcoming 

incentive auction, but the agency should recognize the superior 

value and coverage afforded by the low-band spectrum that will be 

on the auction block. 

There are other imbalances, too, in addition to spectrum, based 

on AT&T and Verizon’s legacy as wireline monopolies. On one of 

those, the FCC needs to move ahead at last on special access and 

correct assumptions made nearly 15 years ago, because these mistakes still harm wireless customers and competition today. AT&T 

and Verizon can and do raise the cost of wireless alternatives by 

overcharging their rivals to carry traffic from the tower back to the 

network. 
17 

Last, but certainly not least, the FCC must open more spectrum 

for unlicensed uses like WiFi and other innovations. A study this 

month estimates that unlicensed contributed almost $230 billion to 

the U.S. economy in 2013 alone. New entrants and licensed carriers alike use WiFi to benefit consumers. 

Wireless competition today does show some signs of life, and that 

is due in part to smart intervention by antitrust authorities and 

the FCC. Competition has improved because of, not in spite of, 

well-timed oversight. That is why the FCC must prevent spectrum 

concentration, promote unlicensed use of spectrum, and put people 

in control of their wireless devices. 

Thank you very much, and I look forward to your questions. 

[The prepared statement of Mr. Wood appears as a submission 

for the record.] 

Chairman KLOBUCHAR. Thank you. Thank you to all of you. 

I think one of the themes of this hearing has been some competition that we have been seeing in just the last few months, and I 

think that followed the breakdown of the proposed AT&T and TMobile merger. We could see from the ads we have referenced that 

T-Mobile has emerged as an aggressive competitor. Last quarter, it 

acquired 896,000 consumers from its competitors, no doubt a result 

of the promotions and the offerings. 

We have seen Verizon and AT&T respond with price cuts. In 

fact, just yesterday, AT&T announced it would drop the cost of 

calls to North America and give customers to its mobile share plans 

unlimited international text messages for free. 

Mr. Wood, do you think that the level of competition we are seeing today is sufficiently benefiting consumers? 

Mr. WOOD. Well, I think some of those facts and figures show 

that it is not good enough yet, it is not effective enough yet to really discipline the prices that consumers pay, especially for the biggest two carriers, and that by making sure all carriers have access 

to these critical inputs like affordable roaming rates, special access 

that is not under the control exclusively of AT&T and Verizon, and, 

of course, spectrum, that we will see more benefits for consumers 

from this competition rather than the top-heavy market we still 

have today. 

Chairman KLOBUCHAR. Ms. Ham, yesterday T-Mobile announced 

fourth quarter losses. Is T-Mobile’s aggressive discounting and efforts to win over new consumers sustainable? And is T-Mobile in 

this competitive mode for the long term? 

Ms. HAM. Well, T-Mobile is the little engine that could. We come 

from the position of number four in the marketplace, and in the 

last year we have been very aggressive. But that comes at a cost, 

and as I noted in my testimony, we have scale disadvantages to the 

larger two. And over time, whether that is sustainable, I think, is 

something that we will have to see in time. But I think, you know, 

right now we are doing our darnedest to compete, but the scale disadvantages, the costs, the investment that is needed in this industry are very real and something that we have to contend with. 

Chairman KLOBUCHAR. Mr. Graham, is C Spire able to provide 

the same kind of vigorous competition where you operate? What 

unique challenges do you face? 
18 

Mr. GRAHAM. Well, we are able to provide competition in a number of areas in our specific markets, but our struggles stem from 

the fact that even though we have just a little bit less than a million subscribers these days, when the Leap transaction closes, we 

will be the sixth largest operator in the country. As I said, there 

are two nationwide operators with approximately 100 million subscribers each and the scale that that brings. There are two metropolitan operators with 40 to 60 million subscribers and the scale 

that that brings. Just ahead of us sits United States Cellular at 

about 5 million subscribers, and then it is us and 100 others smaller than us, sixth, seventh, eighth on down. 

And so what we struggle with is ensuring that we have a clear 

pathway to the latest devices, that we have certainty of access to 

roaming on nationwide networks or networks in other parts of the 

country, and access to spectrum. Given those three things, we will 

compete with anybody, as we have for 25 years. In our market, we 

compete with the largest four operators every day, and quite honestly, in most of those markets we win. The way that we lose is 

when we lose access to those critical inputs to our business. 

Chairman KLOBUCHAR. Thank you very much. 

In a speech a few weeks ago, the Assistant Attorney General for 

the Antitrust Division, Bill Baer, said that competition in the wireless industry is ‘‘driving enormous benefits in the direction of consumers.’’ He went on to indicate that at this time it would be hard 

to make the case that reducing the number of nationwide wireless 

competitors from four to three would be good for consumers. 

Mr. Wood, again, there have been reports citing talks between 

Sprint and T-Mobile about a potential combination. Do you have 

concerns about further consolidation in the wireless market? I 

think I know the answer. And why is having at least four national 

wireless networks important for consumers not only in the prices 

but also for things like service billing practices and cell phone 

unblocking? 

Mr. WOOD. Thank you, Senator. My reputation precedes me. 

[Laughter.] 

Mr. WOOD. We do have some concerns, although I do think I 

have to say that not only is the jury still out on this potential deal, 

it has not even been called yet because it is still speculation at this 

point in time. Obviously antitrust, as we all know, protects competition and not competitors, but the claim that reducing the number of competitors will increase competition is one that deserves a 

lot of scrutiny, in our opinion. So we think going from four to three 

and that Justice found that that was not appropriate in the AT&T/ 

T-Mobile deal, the deal can be considered, but we think that it likely would lead to a reduction in competition because you would have 

three national carriers with basically the same number of subscribers and not the same kind of disruption and maverick potential we see today from someone like T-Mobile. 

Chairman KLOBUCHAR. Ms. Layton, in your testimony you state 

that competition comes from the level of technology, not the number of competitors. Would two wireless carriers be sufficient to sustain a competitive ecosystem under your analysis? What do you 

think works? 
19 

Ms. LAYTON. Definitely. You can certainly see competitive markets with only two players, and I would say a great example is look 

at the Internet companies today. Look at our market for search engines. Essentially everyone uses Google. We have heard of Bing 

and Yahoo, and they are there trying to offer their services. 

But, for example, what Google competes on is to constantly outdo 

itself. How can it continue to make a more innovative experience? 

So I, in principle, do not have any problem with seeing fewer carriers, and it is certainly the—you talk about the Mobile World Congress. My colleagues from my company are there today, and what 

they are talking about is consolidation across all the countries of 

the world where the third and fourth carrier want to merge. It is 

very difficult to be the third and fourth carrier, and let alone down 

the line, certainly as Mr. Graham has explained. So no problems 

with having more consolidation. 

Chairman KLOBUCHAR. Mr. Milch, any views on what the optimal number of carriers is? Do not say one. 

[Laughter.] 

Mr. MILCH. No, Senator Klobuchar, I do not have any views. 

[Laughter.] 

Chairman KLOBUCHAR. Okay. I just want to turn to this spectrum issue. One essential element for competition in the wireless 

industry is, of course, spectrum. Some of you have brought that up. 

And in a filing with the FCC last year, the Justice Department 

Antitrust Division pointed out that spectrum is a scarce resource 

and key input from mobile wireless. Especially important is access 

to what is known as low-band spectrum that can travel greater distances and penetrate walls and reach consumers inside buildings 

and homes much better than high band. 

Ms. Ham, Mr. Graham, could you explain the importance of access to low-band spectrum for your companies to be able to compete 

in the wireless market? 

Ms. HAM. Yes, thank you. Low-band spectrum, as you note, has 

unique propagation benefits. You think about your television set 

and your ability to watch it indoors. As more and more consumers 

want to watch things indoors and use data indoors, having that 

type of spectrum as part of your portfolio, I think, is very important to compete. 

This is why T-Mobile has been very aggressive in the proceedings 

at the FCC on this upcoming auction. This auction, as I indicated, 

is really important to the future structure of the market. Right now 

AT&T and Verizon overwhelmingly have the majority of that spectrum, about 80 percent of it, as noted by the Department of Justice. 

T-Mobile recently entered into an agreement, which is pending before the FCC, to acquire some low-band spectrum. That gets us 

about half a footprint, and it gets us about an additional six megahertz averaged nationwide—I mean not nationwide, but over only 

half the country. 

So we are going to be interested in more of that coming up. That 

auction is going to be, I think, very important to ensuring that, you 

know, there is a leveling of the playing field out there, that everybody has an opportunity to get access to low-band spectrum. 
20 

Chairman KLOBUCHAR. Mr. Spalter, what do you think the consequences for competition of having so much low-band spectrum 

controlled by two companies’ low band? 

Mr. SPALTER. Let me say, Senator, that I think that as the market evolves and as consumer needs are increasingly defined, all carriers need to be able to conform their networks and their spectrum 

needs to address consumers where they live and to address their 

needs. 

I do not believe that there should be any special weight given to 

spectrum below one gigahertz. We know, as Ms. Ham has just said, 

that T-Mobile is acquiring spectrum assets in the secondary market 

below one gigahertz. We know that there are other competitors 

that are seeking spectrum above one gigahertz. 

Fundamentally what we need to figure—what we need to put 

into our calculations are consumers’ needs regarding the spectrum 

that they require in communities and the geographies that they 

live. And carriers for technical and operational reasons need to be 

able to have the flexibility to be able to acquire spectrum assets 

and use those spectrum assets, both above and below one 

gigahertz, to best meet those needs. 

Chairman KLOBUCHAR. So then you agree with the DOJ’s assessment when the head of the Antitrust Division talked about how regional carriers lack that spectrum they need, the low band, to keep 

their services competitive and called on the FCC to, in fact, institute auction rules that guard against excessive aggregation of spectrum? 

Mr. SPALTER. You know, I believe that the Spectrum Act was 

very clear in making sure that the auctions that are going to be 

conducted by the FCC catalyze systemic competition and not privilege one competitor or advantage one competitor’s business plan 

over another. I believe that the fundamental principle of open auctions available to all competitors, both for commonsense reasons 

but also for the benefit of American consumers, is the appropriate 

policy architecture for developing and designing spectrum auctions 

as they have proven to be in virtually every other kind of economic 

model for auctions that we understand. 

Chairman KLOBUCHAR. Okay. Well, I have—Mr. Graham, do you 

want to respond? Then I am going to—— 

Mr. GRAHAM. I would, if I might address the low-band spectrum 

question. You can argue spectrum a number of ways, but you cannot change the physics of spectrum, and it is clear low-band spectrum propagates better and travels further than high-band spectrum. And it is a fallacy to believe otherwise. It propagates better 

in buildings, and it penetrates vegetation better than high-band 

spectrum. It is indisputable. And so low-band spectrum will always 

have a higher value than high-band spectrum will for that very 

reason. 

I mentioned that our business has been—our company has been 

in the wireless business for over 25 years, so we have some of the 

original cellular licenses at 850 megahertz, which is low-band spectrum. We also have PCS licenses, higher-band spectrum, in a number of our markets. And if I were to show you a map of our licenses 

and overlay—or, excuse me, if I were to show you a map with pinpoints where we have customers, I would not have to tell you 
21 

where we have cellular spectrum and where we have PCS spectrum. You would see the greatest concentration of customers is in 

the areas where we have low-band spectrum. The signal is better, 

and the coverage is better. And as Verizon spends millions of dollars showing everyone on TV, the map matters. The coverage matters. 

Chairman KLOBUCHAR. All right. Well, when I am in the next 

round, I am going to ask you guys about the cell phone theft issue 

and the technology there, but I will now turn it over to Senator 

Lee. 

Senator LEE. Thank you, Chairman Klobuchar. 

I want to pick up on the spectrum issue. I will start with Mr. 

Milch. You know, as you know, a lot of people have expressed concern about the fact that we have got the two largest carriers who 

have acquired a lot of spectrum, and some have expressed concerns 

about this, suggesting that by buying it up, in buying it up, they 

could be motivated by a desire to box out others, that this acquisition of spectrum could serve as a kind of natural restriction on 

entry helping to keep the two largest carriers in place as the incumbent big carriers. 

In your view, what is the likelihood that a carrier could or would 

acquire spectrum for this purpose, for the purpose of excluding others rather than for the purpose of using it? 

Mr. MILCH. Senator Lee, thank you. To directly answer your 

question, I find the prospect, while theoretically interesting and 

certainly an alarmist talking point, to be vanishingly small. Capital 

dollars are very dear to everyone in a capital-intensive industry, 

and the notion that you are going to stockpile something that is so 

capital-intensive and not get a return on it is ridiculous. I think 

that it is very unlikely as a matter of fact. 

You know, I think that there is an example that is worth nothing, so we have noted—there has been noted a number of times— 

that Verizon has a substantial position in low-band spectrum, the 

700 megahertz spectrum. We bought that at an auction, and I 

would point out in that auction we did not out-muscle T-Mobile for 

that spectrum, for instance. They did not participate. 

So the decisions that companies make about what they need for 

spectrum at a particular time influenced their future abilities, and 

they may pay more later, they may pay less later, there may be 

new things that are available later, like the 600 megahertz—600 

band that is coming up for the incentive auction. 

I think that the notion that while there is the physics, as Mr. 

Graham points out, about the propagation characteristics of lowband spectrum, that does not necessarily equate to value. The 

value that a carrier sees in any particular band of spectrum depends on what they need at the time, whether they need to have— 

do they need to have a widespread footprint? Do they need to fill 

in? I mean, just last—just yesterday, the T-Mobile CTO made it 

very clear that their strength is extremely strong in urban areas, 

which I believe have a lot of buildings in them, based on the density of their network and our spectrum position in the mid-band. 

So that was what their CTO said yesterday. They added that when 

they get the MetroPCS spectrum, which is in the AWS band, which 

is higher-band spectrum, they are going to be able to bring that 
22 

across and will continue to add spectrum in the AWS band and 

were in a good position and a great position. 

So I think that a lot of this depends on what you need at the 

time. That is what is valuable to you as a carrier in buying spectrum. 

Senator LEE. Okay. Thank you. 

Let us turn to Ms. Layton. I understand you have done a lot of 

work studying the wireless markets, both within the U.S. and in 

Europe. I was wondering what you could tell us about your study, 

what you can glean from your understanding of the European wireless market, what that can tell us here, particularly what you can 

tell U.S. policymakers and regulators in the United States that 

might be helpful from your understanding of Europe. 

Ms. LAYTON. Sure. Well, thank you for that question. I think that 

we have had a 10-year natural experiment with what we might call 

a European approach and an American approach—the American 

approach, which is a technology-neutral, market-led approach to 

the wireless market, and that has been shown to win. Now, I think 

if you ask around the United States, people will not say that, but 

if you ask Europeans, they will definitely say that. And if you go— 

right now Europeans have been involved in a three-year effort to 

create a digital signal market led by Neelie Kroes, who is the vice 

president for digital life. And I think probably she, more than anyone, has talked about the successes of the United States. This is 

largely motivated by Europeans who know they are missing out. 

They are not winning in the Internet economy. There are only 

pockets of next-generation access networks in Europe. They do not 

have the wide footprints that we have here. You know, she is pointing out how carriers can cover the entire United States. There is 

no carrier in Europe who can do that. There are 28 layers of 

telecom regulation. Operators cannot consolidate across different 

states in Europe, so this makes it very difficult. 

I think there is one more example that I might want to share, 

which is that there is a model of a kind of managed-access competition where you have an incumbent provider who will resell services. And I think—you know, the Europeans took the approach of 

if they could control the reselling and control the end-user prices 

that this would be fair. But the problem is, if you are the network 

owner, any investment you make in your network, if you have to 

give it to your competitors, it is really a disincentive for you to invest. 

So that is what we find going on today, and, you know, I will just 

give you very quick numbers to keep this in mind. Ten years ago, 

the EU accounted for one-third of the world’s broadband investment. That number has fallen to less than one-fifth today. It has 

absolutely plummeted. And, interestingly, in the United States we 

have maintained our level of investment at one-fourth of the 

world’s total. Even though the whole pie in the world has been increasing—China is coming online, other nations are investing in 

their networks—we have maintained our level. 

So, you know, as far as that goes, the writing is on the wall. I 

definitely would say it is challenging if you read the media, lots of 

reports about, you know, U.S. is falling behind. But if you are in 
23 

Europe today, there is no one in Europe who says, you know, Europe is beating the U.S. on these things. 

Senator LEE. Right, and we have achieved that because we have 

maintained competition in part because we have allowed the government to stand back enough to allow competition to exist and 

continue. 

In your testimony, your written testimony, you note how quickly 

technological markets can develop, and the impact that creative destruction can have on an industry. They can change the makeup 

of an industry very, very quickly in unexpected ways and in ways 

that often inure to the benefit of consumers. 

Can you give us some examples of how creative destruction can 

operate in this market and how it could benefit consumers? 

Ms. LAYTON. Sure. Well, ‘‘creative destruction’’ is a very loaded 

term. I think it is an important part of our—it comes from 

Schumpeter, is an important part of our idea of innovation. Just 

my own personal example is, you know, my office in Copenhagen, 

we are in the former headquarters of Nokia. They had an R&D center with 2,000 people, and Nokia actually used to make more 

phones than Apple and Android put together. They invented the 

smartphone. But nobody knows that because Apple is the one who 

brought the iPhone, and finally we could understand what a 

smartphone was. 

So Nokia was a company that did not really know how to mar- ket, and it was bought by Microsoft for about $6 billion. It is less 

than an app company today. But the interesting part about the creative destruction from that perspective is, you know, my university 

took over that R&D location, and so now they are—Nokia itself is 

trying to redeploy in different areas and working in networks and 

in mapping. 

But in terms of the United States, we are no strangers to this 

idea of creative destruction. It is certainly a challenge right now for 

the mobile industry where the revenues that they have depended 

on in voice and text message, those are disappearing. They know 

that they are not coming back, and they have to try to find a way 

to be interesting and relevant for their customers. And if you are 

in Silicon Valley, you can definitely make a cooler app than, you 

know, a number of mobile providers can do. 

So that itself is a more potent form of a competition than anyone, 

you know, sitting in Washington or in a regulator can say we are 

going to make you, operator, do this or that. The marketplace is 

exerting the discipline. 

Senator LEE. Thank you. 

Mr. Spalter, you note that there is an important role that economies of scale can play in many industries, and in this industry in 

particular. How do you balance that role, taking into account the 

benefits to the consumer that can flow from economies of scale 

against the corresponding risk of one or more businesses becoming 

too big and playing too prominent a role in a particular market? 

Can those two interests be balanced? 

Mr. SPALTER. I do believe, Senator, that those interests can be 

balanced, and I think that the record shows that consumers have 

voted conclusively that our market is benefiting not only the evolution in innovation that they are enjoying, but also the kinds of 
24 

question of services that mobile consumers in a wide variety of 

guises have been experiencing. 

One of the reasons that we can actually achieve this equilibrium, 

this balance between scale and also ensuring that market harm 

does not take place, is because we have a vital and functioning 

Federal Communications Commission and its Enforcement Division 

that has a number of safeguards and a number of remedies at its 

disposal to address market harm. It also has a number of tools at 

its disposal to ensure on a case-by-case basis that specific issues 

with regard to—including the question of spectrum, can be evaluated on a transaction and on a case-by-case basis. 

I think that that approach, a muscular and nimble Federal Communications Commission that has a long checklist of tools at its 

disposal to prevent market harm, is a bulwark against any excesses and has proven to be in the past and will continue to be in 

the future. 

Senator LEE. Thank you. 

Thank you, Chair. 

Chairman KLOBUCHAR. Thank you very much. 

Senator Flake. 

Senator FLAKE. Well, thank you. Sorry for arriving late. You 

have plowed a lot of this ground before, so please indulge me. 

Ms. Layton, talking about the Europe—all the research that you 

have done there, I find it very interesting, because the perception 

is that they are way ahead of us. That is what we hear all the 

time. But in terms of—and that may be the case in terms of number of users. What is the number of smartphone uses in Europe, 

generally, compared to the U.S.? I have not seen that comparison 

in what you have done. What is that? 

Ms. LAYTON. Well, I think maybe to get to your larger point, it 

is an interesting question. You know, why is it persisting in the 

United States, this idea that Europe is somehow doing better? I 

think that that is really the interesting question. And I think a lot 

about that myself. I am actually doing a study of media bias here 

in the United States, and it is interesting. I think it is difficult as 

a Member of Congress or member of the public to really understand, because even the leading publications in the United States— 

New York Times, Wall Street Journal—print contradictory information every day, on the same day. So it is interesting that certain 

journalists will have an opinion and look for whichever information 

to try to support that. 

But what I would definitely say is that there is an industry in 

trying to create a fear about America’s falling behind. And I remember this back in the 1980s when it was all about Japan is taking over America, go destroy your Nissan. Then it was India. Then 

it was China. And now it is broadband. 

So there is a whole industry about books and selling magazines 

and whatnot to try to make us afraid. And I think the ulterior motive is to get the government to take over broadband. There is a 

general fear that the market cannot do the job. There is a distrust. 

There is a dislike of companies to earn a profit for a service that 

is provided to people who they happily pay for. 

So in that respect, I think it is unfortunate that we have facts 

that are maybe manipulated one way or the other. 
25 

Senator FLAKE. Okay. Usually the measure that is used in order 

to justify greater government intervention is investment in basic 

research, coverage, or whatever else. Mr. Milch, you mentioned in 

your testimony that the level of investment per person here is significantly higher than it is in Europe. What are those figures? 

Mr. MILCH. Senator Flake, as I said earlier, you know, last year alone the wireless carriers invested $34 billion in their networks, 

which is four times more per subscriber than anywhere in the 

world. So I do not have to break it down country by country, but 

as a general overall world level, that is about four times. And since 

2001, that investment is $300 billion in their networks. So it is one 

of the characteristics, I believe, of a competitive market that you 

have this huge wealth of investment in the infrastructure in order 

to compete, and if there were no competitive urges, there were no 

competitive requirements, carriers would not spend so much of 

their capital, so much of their shareholders’ capital, in constant investment in networks and in spectrum. 

Senator FLAKE. All right. Mr. Spalter, what are your views 

there? Would we likely see more investment in broadband coverage 

and research if we had greater government involvement? If you say 

that the FCC has an all-ready toolbox to go over this, is that—do 

we need to tip the balance in that direction? 

Mr. SPALTER. Senator, thank you. I think it is both wise public 

policy and good economic sense for policymaking to proceed as I 

had mentioned with restraint and with humility regarding the evolution of America’s dynamic mobile innovation sector. The last 20 

years have shown us conclusively that this approach has engendered more, not less, investment in our infrastructure and innovation, both at its core and at its edges—— 

Senator FLAKE. I am sorry. Back up for a second. When you say 

‘‘this approach’’ that we have? 

Mr. SPALTER. Of regulatory restraint, regulatory humility, the 

idea that we should not be prescriptive in viewing future market 

problems that have not yet developed, but acknowledging that this 

is one of the world’s most dynamic marketplaces. It is changing all 

the time. It requires intensive continued and sustained resilience 

of investment and innovation so that consumers, who really should 

be at the core of all of our consideration here, can continue to benefit, as they have in the United States and as they will continue 

to benefit if we can hew to an approach of, as I had mentioned, 

minimally engineering and not over-architecting our laws and regulations and assumptions about how this market is going to evolve 

or how it should evolve. Let consumers be in the driver’s seat in 

this regard. 

Senator FLAKE. Well, thank you. I have to run to another meeting, but I just want to say in general, in this industry and elsewhere, we have benefited where the government treads as lightly 

as possible and lets the private sector innovate as long as there is 

competition. And if you look at the level of investment that is going 

in right now, it would seem that we have struck a better balance 

than some other countries have. So I hope that that continues. 

I appreciate the testimony and look forward to continuing the 

discussion. 

Chairman KLOBUCHAR. Thank you very much, Senator Flake. 
26 

I was going to focus here now on the Smartphone Theft Prevention Act and the work that is going on technologically to try to reduce theft of the cell phones. I introduced this bill with Senators 

Mikulski, Blumenthal, and Hirono, and the bill calls on the wireless carriers and manufacturers to offer a technical function to 

their consumers that would wipe their data and render the device 

useless to thieves, therefore devaluing its resale value. We have a 

situation, as I mentioned, where one out of three burglaries now 

in the country are cell phone-related. We have seen that all over 

our State. I know Senator Mikulski has seen it in Maryland, especially in the transit system, and part of that is because the cell 

phones are fetching between $100 to $500 on the international 

market. 

The fact is that the thieves know a few people might have turned 

on their iPhone 5 function which allows them to basically wipe the 

data, but still store—it wipes—it allows the owners of the phone 

their own right to wipe the data, but keep the data on the cloud 

for their own use but not the thieves’ use. But right now what is 

happening is the thieves see value in this, of course, because of the 

market value, because of the fact that they have actually a functioning phone when they sell it to someone on the black market, 

that they actually have a phone that has stuff in that they can use, 

not necessarily the data but the phone is ready to go. And one of 

the reasons we introduced this bill was to try to push other carriers 

to find this technology. 

I guess I would start with Mr. Milch. Verizon has stated publicly 

that it has no objection to a secure kill-switch type application that 

is free to consumers and secure. Are you actively as a company engaging with device manufacturers on possible solutions for Verizon 

so they can offer it to their customers? 

Mr. MILCH. Thank you, Senator Klobuchar. Yes, of course we are 

doing that. We believe that this is—to any extent that our customers are put in danger or could have their phone taken from 

them—I recently had a theft in my own family of a cell phone, and 

it is quite alarming to everyone. And we were lucky that in this 

instance we could turn it into a brick, and we could turn it into 

a brick from a foreign country where we happened to be at the 

time. 

We are eagerly awaiting secure and free kill-switch capabilities 

from other phone manufacturers. This is both a manufacturer and 

an operating system issue. We believe that it is important, as with 

the Apple ability, that it is free, and we are very, very concerned 

that it is also secure. We do not want an instance where it is a 

hackable kill switch. We have spoken before of our children and 

their phones. I can only imagine that that would be a delightful 

thing to be able to do to one of their friends’ phones if they could 

do it. So I think that it is—or former friends’ phones if they could 

do it. 

So it is very important, and we are actively engaged with both 

app developers and manufacturers to encourage them to bring forward these options. 

Chairman KLOBUCHAR. Yes, and I think that there has been 

something out there about how well they could all be hacked. Apple 

developed this for a reason. They saw it as a good thing to have 
27 

on the phones. It protects consumers, and it also is something that 

gives them a competitive edge, clearly. And so for people that say, 

well, this should never be done because it only could be used by 

hackers or that somehow the government is going to be getting 

ahold of it, the whole idea here is to allow individual private users 

to actually protect their own data. 

Mr. Wood, would you agree that consumers are calling for more 

security functions on their phones in light of this exponential increase in cell phone thefts and that carriers and manufacturers 

need to listen to these demands? 

Mr. WOOD. I would agree, and I think that is the key, is giving 

people the tools that they want to use, not necessarily saying, 

‘‘Here, you have to take this application because we, the carrier, 

have decided that you should have it.’’ 

Chairman KLOBUCHAR. Well, yes, but remember that this would 

still be a choice for them to do—— 

Mr. WOOD. Oh, of course. I think that is the key, and that is 

what your bill is aiming toward, is giving people that choice if 

there has been some road block in between them and getting access 

to an app that will do that securely and cheaply and easily. 

Chairman KLOBUCHAR. Okay. Anyone want to add anything? Ms. 

Ham. 

Ms. HAM. Yes, I would just say that we share your goals. T-Mobile has been very active in this area as well. We are also part of 

the GSMA global IMEI Data base, where stolen devices are listed 

on a centralized data base in an effort to prevent their use in another carrier’s GSM LTE network. 

I would also add that we load on all of our phones an application 

called ‘‘Lookout’’ that enables the customer to locate, lock, and wipe 

their phone, and that comes free to the customer, and that is something that we are doing now. 

Chairman KLOBUCHAR. Okay. Very good. 

Mr. Graham. 

Mr. GRAHAM. I would add that we are supportive of the concept 

also, but, again, we come to that stratification problem where, 

when you get to carriers our size and below, we do not have the 

ability to require manufacturers to preload that onto their phones. 

You mentioned that Apple does offer it. It is a competitive advantage for Apple and for those who can offer that product. 

So to the extent Verizon or anyone else develops that with device 

manufacturers, it will not reach customers in rural areas if those 

devices, that app, that feature is exclusive to the largest operators. 

It is the same problem we run into, just from a different perspective. 

Chairman KLOBUCHAR. Okay. Well, thank you. I appreciate what 

you have all said here, and I think you know the reason we introduced this bill is just we feel that this has been taking too long, 

and the problem is just mounting, and the bill is supported by the 

Major Cities Police Chiefs as well as a number of Attorneys General from across the country, including New York, the district attorney in San Francisco, and other places. 

You mentioned rural, Mr. Graham, so I think that is a good 

segue into some of these issues. Looking at each carrier’s nationwide map, you can see tremendous gaps in coverage in rural areas. 
28 

I have talked about this mostly at Commerce Committee hearings 

on which I also serve. And I have a bill with Senator Fisher, Deb 

Fisher, the Rural Spectrum Accessibility Act, which would 

incentivize wireless carriers with larger quantities of spectrum to 

coordinate and work with carriers serving predominantly rural 

areas in order to expand coverage into our rural areas. 

I know Verizon has its Rural America Program, which is already 

working in parts of rural America. Mr. Milch, since your company 

has already started partnering with rural carriers, would you agree 

that rural carriers need to be part of the wireless market to make 

sure that consumers, no matter where they live or work, that they 

are able to connect with their families to contact first responders 

and to do business via wireless devices? 

Mr. MILCH. I certainly do agree with that, Senator Klobuchar. I 

think that we are eager to have as many rural customers as urban 

customers, indeed, and Verizon is probably the largest rural carrier 

there is in America. And we have extended that capability by, as 

you said, our Rural America Program where we have over 20 

agreements with rural wireless operators to bring the benefits of 

our LTE spectrum, our 700 spectrum there. 

The networks cover 2.2 million people as of today and more than 

58,000 square miles, and over 300,000 people use them every day 

to do exactly what you said, connect with their loved ones and utilize mobile broadband. 

So we are eager to continue that program with rural carriers. It 

is a cooperative program where we supply the spectrum and we assist them in building out the network in their footprints. And we 

are eager to continue that program. 

Chairman KLOBUCHAR. Well, as you know, 34 percent of 

smartphone users use wireless almost exclusively to access the 

Internet, including many in rural areas. Mr. Graham, how is the 

600 megahertz spectrum block of particular use to serving rural 

America and the demand for mobile broadband? Can you touch on 

the importance of interoperability requirements and if there should 

be rural buildout requirements for spectrum licensees who purchase spectrum in the upcoming auction? 

Mr. GRAHAM. Sure, I would be happy to. Thank you for the question. 

Let us back up to the 700 megahertz auction for just a moment, 

because I think it highlights the problems—or the potential that 

was there, the problems that came after it, and what we hoped for 

the 600 megahertz auction, 700 megahertz being low-band spectrum, with spectrum that we acquired, we acquired the licenses 

throughout our operating footprint and beyond, and intended to deploy service, deploy LTE service throughout our footprint in rural 

areas, primarily in Mississippi, which, as we all know, is always in 

the bottom rankings when you look at the poorest of States in the 

country. 

What we were unable to do, though, was deploy that service, the 

reason being there were separate bands created for that lower 700 

megahertz spectrum that allowed AT&T to take its spectrum licenses and deploy, while those who got spectrum licenses in another part of that band were unable to deploy our spectrum. And, 

indeed, it was only under the leadership of interim Chairwoman 
29 

Clyburn at the FCC that we reached an interoperability agreement 

that will finally allow that spectrum to be put to use. 

We talked already about how that spectrum propagates so much 

better than mid-range or high-band spectrum. If we repeat the 

same mistakes in the 600 megahertz space, then rural America will 

once again be left hoping for services that are available to their 

brothers, sisters, cousins in urban areas but are unavailable in 

their areas because their spectrum does not—the spectrum covering that area is not interoperable in the larger ecosystem of devices. 

Chairman KLOBUCHAR. Okay. Thank you. I will turn it over to 

Senator Lee. 

Senator LEE. Thank you very much. 

Mr. Graham, in your testimony you express some significant concerns about contracts for data roaming and for backhaul. Can you 

tell us a little bit more about those concerns, where they are rooted, and let us know if you have any evidence that data roaming 

and backhaul contracts are not reasonably available in the marketplace? 

Mr. GRAHAM. I cannot get into the specifics of data roaming rates 

because, unfortunately, those are protected under NDA in the data 

roaming agreements themselves. In fact, I believe we are prohibited from even saying who our data roaming partners are in most 

cases. 

But what I can tell you is that the rates that were cited earlier 

in an opening statement of three cents a megabyte, what customers 

pay, I can assure you that the data roaming rates that operators 

like C Spire sees are multiples of that. Three cents is not something that we see from those large—the Twin Bells, the wireless 

Twin Bells. 

On backhaul, wireless towers are, of course, connected back to 

the switch that routes traffic, either by a wireline connection, either copper, these days fiber, or occasionally microwave connections 

that eventually hit a wireline connection and go back to that 

switch. 

Generally small operators are restricted to the incumbent Bell 

for that backhaul service, who, of course, have affiliated wireless 

companies these days. This became such a problem for us roughly 

10 to 12 years ago that we created our own backhaul company. It 

is C Spire Fiber, and it has provided backhaul to us where they 

could build for years now. We are actually leveraging that and beginning a fiber-to-the-home initiative. But it was such a problem 

that we had to create our own company and invest that money in 

order to build our own backhaul. 

I am not sure a public company could do that. I think a public 

company would probably be punished by Wall Street for a move 

like that. But we are privately held. Our owners take a long-term 

view of our business and knew that it was in the best interest, and 

10 years ago that was a difficult call to make. 

I can tell you that there have been a number of instances where 

we have gone to the incumbent Bell provider for backhaul services 

looking for a fiber connection to backhaul traffic from our tower 

back to the switch, and though fiber runs to that location where 

we are collocated on a tower, we are given a number of excuses on 
30 

why it could take months for us to get that faster backhaul connection and why we have to sit on typically a T1 or bonded T1 connections to backhaul that traffic to our switches. 

Senator LEE. So in some cases, you have been effectively excluded, and that is one of the reasons why you—— 

Mr. GRAHAM. Either delayed or excluded. The need was immediate, so in that sense, excluded; but delayed, certainly. 

Senator LEE. Okay. Mr. Wood, in your testimony you state that 

the demand for licensed spectrum may be overstated, and you advocate for more unlicensed use of spectrum. Can you tell us a little 

bit about how this would work and how this would allow carriers 

to better accommodate the increased demand for data in the coming years? 

Mr. WOOD. Sure. Thank you, Senator. Glad to do it and thank 

you for the question. 

We have seen, I think in the last 10 years alone, a dramatic shift 

in the conversation about unlicensed. Without impugning their motives, I think 10 years ago or so, carriers thought of unlicensed as 

some kind of threat to them, and today they use it as a valuable 

part of their own portfolio to decrease congestion and more efficiently handle their own customers’ traffic. You might have seen 

yourself when you try to download some apps from the Internet or 

from an apps store, it will say, ‘‘Please switch to WiFi. That will 

be better for you’’—and, frankly, better for the carrier as well. 

So the numbers, I think, are always growing and always changing, a little bit uncertain as to the present snapshot at this very 

moment, but I think the estimates now are that something like 37 

percent of all U.S. wireless traffic from smartphones goes over a 

WiFi connection already. And by smartly combining licensed and 

unlicensed, we can have a more efficient system and a more affordable system for everybody because it is not really an either/or 

choice. It is something that both new entrants and licensed carriers 

make use of already today. 

Senator LEE. Thank you. I appreciate that. 

Let us go back to Mr. Graham for a minute. In your testimony 

you indicate that the wireless industry went through a period of 

over a decade of effective competition, but has since shown some 

signs, some indicia of perhaps returning to kind of a duopoly, a duopoly kind of arrangement. Some have suggested that this might 

be the product of some unfair competition, or others have suggested 

that it might just be the product of very good, sound business decisions by a couple of carriers who, as a result of their good business 

decisions, have achieved more prominence in the industry. 

If it is the latter, that is to say, if, in fact, the two largest carriers have achieved that much market share simply as a result of 

sound business decisions, wouldn’t there be some pretty profound 

implications to our adopting policies that would, in effect, punish 

those carriers for those sound business decisions? 

Mr. GRAHAM. Let me restate the question to make sure I understand it. 

Senator LEE. Yes. 

Mr. GRAHAM. Under an assumption where sound business decisions led to the growth of the two largest carriers, would policies 
31 

that restricted—or that promoted competition then punish them for 

sound business practices? 

Senator LEE. Yes. Would policies that were designed to diminish 

their market share, in other words, so they have achieved some 

market share, and if you start from the presupposition that they 

achieved that market position as a result of sound business decisions, does that present a dilemma for us as policymakers if we are 

asked to do something specifically designed to undermine their position? 

Mr. GRAHAM. Right. I think it would be difficult to justify any 

policies that would specifically take away market share, intervention by the government to pull market share away. 

Having said that, I think the country prospered when Judge 

Greene broke up Ma Bell years ago. At this stage we saw so much 

consolidation, unfettered consolidation, which is what led to the 

size of Verizon Wireless and AT&T Mobility these days. It was not 

a decade of beating others in the market. It was a decade of buying 

others in the market, which conceivably had no limits until AT&T 

tried to go for the one that was too big, acquiring T-Mobile. 

If you look back to what happened in 2008 when Alltel was acquired, that sort of closed that period of consolidation. There have 

been a couple of others—MetroPCS and Leap Wireless Cricket. But 

I think we could clearly see it has been consolidation, it has been 

acquisition of companies, not acquisition of customers, that has led 

to this stratification in the industry these days. 

Senator LEE. Okay. Thank you. 

Mr. Spalter, I was wondering if we could get you to respond to 

Mr. Graham’s answer to the question I asked two questions ago 

about backhaul and data roaming. Do you have any particular response to his point about the lack of availability of contracts in this 

area? 

Mr. SPALTER. In 2011 the FCC, working closely and in good cooperation with the American carrier community, evolved a set of 

protocols, a set of very clear principles regarding data roaming, 

which included provisioning recourse, a set of very clearly etched 

tools that are available to any competitor to be able to go to the 

FCC and bring issues of concern to the FCC. 

As far as I am concerned, as far as I understand, Senator, I am 

not aware of any such complaints that have been brought, and the 

system that has been architected on a voluntary basis by industry 

participants working with the FCC seems to be working quite well. 

There is an adage, sir, that, ‘‘If it ain’t broke, don’t fix it,’’ and 

I think in this regard there is some wisdom to that. 

Senator LEE. Thank you. 

Mr. Graham, do you care to respond? 

Mr. GRAHAM. Yes, if I might. We actually went through that 

process, so we did not—there are two ways you can do this. One 

is the official filing of a complaint, and then there is also sort of 

a mediation process, an unofficial process that you can go through. 

We tried this actually with another panelist, went through the mediation process, and although data roaming rates were able to become somewhat more rational, rational in this respect is relative. 

And it does not take away from anything I have said earlier about 
32 

the three-cent figure that was cited being anything realistic that 

our customers would see. 

Senator LEE. You went through this with another panelist whom 

you are not going to mention. 

[Laughter.] 

Senator LEE. We will leave folks to guess. 

Ms. HAM. It was not us. 

[Laughter.] 

Mr. SPALTER. If I could just also just comment, you asked about 

backhaul and special access. One of the exciting features of this dynamic marketplace that we are experiencing is the evolution and 

the continued advancement of technology standards in the generations of technologies consumers are being able to use, and that includes the actual technical means for backhaul. We are transiting 

to a next generation of much higher capacity and much higherspeed backhaul facilities based on the ethernet. The existing special access regime, 95 percent of that marketplace still covers 1.5 

megabit per second speeds, which is actually even slower than 

plain old telephone service. Universal service funds would not even 

provision speeds at that level. 

I think the policy focus going forward should be to migrate beyond legacy regimes and legacy networks and legacy approaches, 

and thinking about creating abundance and creating advancement 

by focusing our efforts in the transition toward better, faster, quick, 

more scalable technology, that should be the policy focus. 

Senator LEE. Okay. I am over time, but I see Mr. Wood is itching 

to—— 

Mr. WOOD. Well, just to the special access point, we are all for 

more abundance, but this has been a 15-year struggle in some 

ways. The FCC actually largely deregulated special access in 1999 

based on the promise of—not actual competition but the promise of 

competition from MCI and from AT&T before it was acquired by 

SBC. And so you asked about evidence that it is harming competition. There are reams of evidence, but the FCC is still in data-gathering mode here about a decade and a half later. So the FCC definitely does have some tools at its disposal, and we think sometimes 

it has been too slow to use them, not to try to structure the future 

in any way that Mr. Spalter or I would not like, but to make sure 

that carriers have access to these crucial inputs they need to provide service to their own customers. 

Senator LEE. Mr. Milch. 

Mr. MILCH. Thank you. I, too, am very interested in the details 

of the mediation between C Spire and Free Press, which would be 

very interesting. 

[Laughter.] 

Mr. MILCH. I just want to make two points on this. 

Number one, Verizon has over 50 data-roaming agreements in 

existence right now. If C Spire were uncomfortable with the rates, 

it could have always taken the formal route. It did not. It made a 

business decision that it was going to move forward on the rates 

that it got. 

As for backhaul, this is a burgeoning business for us, but it is 

a very competitive business for us. We see significant entry by the 

cable companies into this very business of providing backhaul and 
33 

providing special access. We are eager and try to look every day to 

make sure that we provide our backhaul customers with the best 

service we can provide them. And we are eager for the FCC to complete its data gathering. I, too, agree that it has taken a long time 

for them to gather the data. The data they have not yet been able 

to gather is the one from the competitive providers of backhaul 

services. So when that data is in, we are looking forward to seeing 

it as well as everyone else. Hopefully there will be significant response to their requests, and we will be able to see what the true 

lay of the land is on the competitive backhaul issue. 

Thank you. 

Senator LEE. Thank you. 

Thank you, Madam Chair. 

Chairman KLOBUCHAR. Thank you. I was actually going to ask 

some questions on special access, but you pretty much covered the 

landscape. I will maybe follow up with a few in writing, so I guess 

I will have to turn to something less interesting: the Comcast/Time 

Warner merger. 

That was a joke. 

[Laughter.] 

Okay. Last year, Americans consumed double the amount of 

monthly data than they did in 2012, and demand is expected to increase as more video is available online. With four nationwide carriers, consumers have meaningful competition for wireless 

broadband, although we are always concerned about that competition and believe that we need to keep it strong. 

Now, this is in stark contrast to fixed broadband where a large 

number of American consumers have only a cable company to 

choose from. Competition for broadband connectivity will be one of 

the central focuses, as you know, of our examination of the 

Comcast-Time Warner cable merger in the hearing coming up 

shortly. 

I guess, Mr. Wood, I will start with you. As more and more consumers use their phones and wireless tablets in a way to connect 

to the Internet, do you view wireless service as a substitute for 

fixed broadband provided by cable, DSL, or fiber, such as Verizon? 

Mr. WOOD. I would say it is an alternative, but not a perfect substitute, especially when you talk about the prices people pay and 

the caps they have typically faced from their wireless providers or 

at least from some wireless providers. DSL may be slower than 

some LTE offerings today, but in general, wireless is still slower 

and then more expensive, especially once you take into account potential overages for doing the kinds of things most people expect 

to be able to do easily with their home broadband connection. 

Chairman KLOBUCHAR. Mr. Graham, C Spire has invested in 

building fiber networks to compete with local cable and DSL. Do 

you view your wireless service as competing with fixed broadband? 

Mr. GRAHAM. If you look purely at Internet connectivity, I think 

eventually wireless will be able to compete with broadband. But 

today when most people look for the fastest broadband connection 

they can find, they want to pair that with video. Eventually we will 

reach the point where consumers take their video content over the 

top. That is probably roughly the time that wireless technology will 

hit speeds that consumers expect today out of their broadband con-
34 

nection. Until that time, I do not think wireless could be a true 

substitute or competition for landline broadband connection by 

fiber or, in some cases, even by cable. 

Chairman KLOBUCHAR. Mr. Milch, Verizon Wireless offers a 

wireless broadband Internet product called ‘‘home fusion 

broadband.’’ It markets home fusion in FIOS markets as an alternative FIOS Internet. Do you view Verizon Wireless substitute as 

a substitute for fixed broadband? 

Mr. MILCH. We believe that home fusion, which is a great product and is available not only in the FIOS areas but all across our 

footprint—Verizon Wireless sells it wherever it can. We do believe 

that it is a valuable substitute in some circumstances. In other circumstances it is probably better thought of as an alternative. The 

marketplace is quite varied, so you have to look not only at what 

the competitive alternatives are in a particular geography as well 

as what the needs of the customer are. 

Customers in some geographies would not want to pay for the 

extra costs of getting broadband, wired broadband to their homes, 

particularly if those homes were only being used for certain parts 

of the year or not—there would be high fixed costs and other costs. 

So I think that it is a valuable alternative depending on the circumstances of the customer and of the competitive status in a particular geography. 

I also believe that looking forward there will be, as there always 

are, technological advances that will increase the speed and lower 

the costs per unit of broadband, wireless broadband, as it has been. 

There will be advances in compression technologies. There will be 

advances in all sorts of technologies that will probably increase its 

competitive force in more circumstances than are currently—where 

it currently is a competitive, a real competitive alternative. 

Chairman KLOBUCHAR. Okay. Anyone want to add anything to 

this subject? 

[No response.] 

Chairman KLOBUCHAR. Okay. Another question for you, Mr. 

Milch. In 2009, Verizon sent a letter to Congress noting a commitment to limit exclusivity agreements with regard to competitive 

carriers. Can you reaffirm that commitment? And will Verizon continue to work to ensure that market share will not dictate access 

for smaller carriers to the latest devices? 

Mr. MILCH. Our commitment that we made in our July 17, 2009, 

letter to then-Senator Kerry remains fully in force. We have limited 

any exclusivities that we have to the six months for all manufacturers and all devices, and there are, you know, a score of handsets 

that are in this program right now. 

I would say, if I could, that—it might be a bit heretical— 

exclusives have served a significantly pro-consumer purpose, I believe, in the marketplace. I do not believe—it is not clear to me 

that if AT&T and Apple had not agreed to an exclusivity relationship for the original iPhone whether there would have been the 

level of investment by both parties to make sure that worked. So 

it does, I believe, broaden device capabilities and incent innovative 

efforts for a certain level of exclusivity. 
35 

Now, that being said, we recognize the issues that were in front 

of us, and we did make the commitment in July 2009, and we 

stand by that commitment today. 

Chairman KLOBUCHAR. Okay. I am going to turn now to number 

portability, which is something I remember from my past in the 

late 1980s, early 1990s. We actually had an entire hearing on it in 

Minnesota. Number portability is essential to competition, as we 

all know, in the wireless industry. At that time, I was representing 

competitive companies. It was a big deal to us. Without the seamless and fast portability that takes place today, consumers would 

be more reluctant to switch carriers. The whole system is overseen 

by a consortium of large telecom companies that solicit bids from 

contractors interested in running the portability system, and there 

is currently a new contractor selection process underway. The new 

cost and process for switching numbers as well as the speed and 

reliability of that transition will be central to consumers. 

Mr. Graham, does C Spire have concerns about changes to the 

number portability system? 

Mr. GRAHAM. Well, the number portability system, as it exists 

today, is local number portability, meaning numbers can only be 

ported within the same LATA or to switches that exist within various LATA. 

Chairman KLOBUCHAR. Right. 

Mr. GRAHAM. So we think the time has come, especially as we 

get closer and closer to an IP-based world—we are in this sort of 

hybrid world. The time has come to make true number portability 

a reality. Do not tie those numbers to LATAs. We see this frequently where students will come from other States to college in 

Mississippi. They want to become a C Spire customer, but they 

want to keep their number. And, unfortunately, they cannot port 

that number to us because we do not have switches where they 

came from, and we cannot accept that number in our switches 

where they would live and go to school. 

In that case they often decide the number that everyone back 

home knows is more important than switching carriers. That is not 

unique to us. That happens across the country with carriers our 

size and smaller. 

Chairman KLOBUCHAR. I am just thinking back to this hearing 

I did when I remember cell phones were the size of Gordon Gekko’s 

cell phone that too up an entire briefcase in the movie ‘‘Wall 

Street.’’ And I remember then that the arguments were being made 

that people are going to have cell phones all the time and no one 

will really know what the area code is. A lot of the groups are 

going, ‘‘No, that is not true. Everyone will care about having the 

same area code of where they live.’’ And that clearly was not quite 

the case. 

Mr. GRAHAM. That is right. Look at Google Voice, for instance. 

Chairman KLOBUCHAR. Yes. Mr. Spalter, are smaller carriers 

right to worry that larger rivals have an incentive to make the 

porting process costly and burdensome because it helps protect 

large user bases against competition? 

Mr. SPALTER. I do not believe that to be the case, and I think 

the FCC has evolved a conduct—rules for that conduct with regard 

to local number portability, those rules, and it seems to be working. 
36 

And the conduct of companies with respect to those rules also 

seems to be proceeding appropriately. 

Chairman KLOBUCHAR. Okay. Any other—someone wants to add 

anything? Mr. Wood. 

Mr. WOOD. We have heard about the tools the FCC has. I think 

the important thing to remember with the largest carriers is that 

they have a lot of tools themselves to diminish people’s portability, 

not just for numbers but for devices. So to the point made earlier 

about capital expenditures and intensive—the intensivity of those 

capital expenditures, AT&T, when they had that iPhone exclusive, 

was routinely ranked as one of the worst carriers in terms of service, but people stayed with them because that was the only place 

they could use their iPhone. Obviously we do not live in that world 

today, so I would say perhaps there were some benefits to exclusivity, but there were even greater benefits to letting carriers like 

Verizon and T-Mobile and others have access to those devices. And 

the exclusivity in all these methods to reduce churn would really 

be foreign to us in other markets, even in wired broadband, which 

we say is not as competitive. It does have more device portability 

in some ways. It would seem outlandish if you could not take your 

PC or your MacBook from Comcast to Verizon wired broadband. 

So I think there are lots of things the FCC can continue to do, 

not to dictate the technology in any sense but to make sure every 

customer has access to it, no matter which carrier they choose. 

Chairman KLOBUCHAR. Okay. Thank you. 

I will have a few more questions in writing. I think we are getting into the weeds. Would you say that now, Senator Lee? And 

then maybe we will do the rest in writing. 

[The questions of Chairman Klobuchar appear as submissions for 

the record.] 

Chairman KLOBUCHAR. Do you have any other questions that you 

want to ask? 

Senator LEE. Yes, I want to go into the weeds just a little bit 

more. 

Chairman KLOBUCHAR. Excellent. You are in Nerd Land up here. 

We are loving this stuff. Senator Lee. 

Senator LEE. So, Mr. Wood, I have heard some concerns expressed regarding the dominant players in the wireless device operating system market. Some have suggested that the dominant players in that market are unfairly leveraging their market power. Are 

you familiar with those concerns? And if so, do you share them? 

What do you think of them? 

Mr. WOOD. I am familiar with them. I think that the interplay 

between the operating system manufacturers, the equipment manufacturers, and the carriers are all a matter of some concern, because when those things break down, it can ultimately harm the 

real people who depend on these devices. I do not know that the 

FCC or Justice or the FTC is necessarily the appropriate body because I have to say I am not as familiar with some of these concerns. But, of course, there is a lot of market power in all of these 

different markets. We just see usually that the carriers have more 

of a shield against this kind of creative destruction that Professor 

Layton talks about because they have this 100-year head start or 

decades-long head start when it comes to the inputs that they need 
37 

to provide service. But I do not say that to diminish the possibility 

that an equipment manufacturer or an operating system manufacturer working in conjunction with a carrier could make agreements 

that are not ultimately to the benefit of competition or to consumers. 

Senator LEE. Okay. Thank you very much. I may have some additional questions on other matters in writing. 

Thank you, Madam Chair, and thanks to all of you. 

Chairman KLOBUCHAR. Well, thank you. Once again I would like 

to thank our witnesses for testifying today. Your expertise is critical to help us understand the competition in the wireless market. 

I think that the takeaways today are that while the industry is 

competitive and benefiting consumers and that we have recently 

seen a surge of competitive activity, there are still challenges, particularly when it comes to rural areas where the competitive carriers face an uphill battle to be able to offer consumers the benefit 

of competition. So any further consolidation in this market will naturally raise concerns, and there will be a high bar to meet to show 

that further concentration will truly benefit consumers. 

Our Subcommittee will continue to be involved in these issues. 

As you know, we have several hearings coming up that touch on 

these issues, and I want to thank Senator Lee for his continued 

partnership on this Subcommittee, and I want to thank you all for 

coming. The record will remain open for one week, and the hearing 

is adjourned. 

[Whereupon, at 12:01 p.m., the Subcommittee was adjourned.] 

(39) 

A P P E N D I X 
40 

PREPARED STATEMENT OF CHAIRMAN PATRICK LEAHY
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42 

PREPARED STATEMENT OF RANDAL S. MILCH
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44 
45 
46 
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50 

PREPARED STATEMENT OF KATHLEEN O’BRIEN HAM
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65 

PREPARED STATEMENT OF JONATHAN SPALTER
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67 
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69 
70 
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PREPARED STATEMENT OF ERIC B. GRAHAM
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90 
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94 
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PREPARED STATEMENT OF ROSLYN LAYTON
100 
101 
102 
103 
104 

PREPARED STATEMENT OF MATTHEW F. WOOD
105 
106 
107 
108 
109 
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111 
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QUESTIONS SUBMITTED BY SENATOR KLOBUCHAR FOR RANDAL MILCH
117 

QUESTIONS SUBMITTED BY SENATOR KLOBUCHAR FOR KATHLEEN HAM
118 

QUESTIONS SUBMITTED BY SENATOR KLOBUCHAR FOR JONATHAN SPALTER
119 

QUESTIONS SUBMITTED BY SENATOR KLOBUCHAR FOR ERIC GRAHAM
120 

QUESTIONS SUBMITTED BY SENATOR KLOBUCHAR FOR ROSLYN LAYTON
121 

QUESTIONS SUBMITTED BY SENATOR KLOBUCHAR FOR MATTHEW WOOD
122 

QUESTIONS SUBMITTED BY SENATOR FRANKEN FOR RANDAL MILCH
123 

QUESTIONS SUBMITTED BY SENATOR FRANKEN FOR KATHLEEN HAM
124 

QUESTIONS SUBMITTED BY SENATOR FRANKEN FOR ERIC GRAHAM
125 

QUESTIONS SUBMITTED BY SENATOR FRANKEN FOR MATTHEW WOOD
126 

RESPONSES OF RANDAL MILCH TO QUESTIONS SUBMITTED BY SENATORS KLOBUCHAR

AND FRANKEN
127 
128 
129 
130 

RESPONSES OF KATHLEEN HAM TO QUESTIONS SUBMITTED BY SENATORS KLOBUCHAR

AND FRANKEN
131 
132 
133 
134 
135 

RESPONSES OF JONATHAN SPALTER TO QUESTIONS SUBMITTED BY SENATOR

KLOBUCHAR
136 
137 

RESPONSES OF ERIC GRAHAM TO QUESTIONS SUBMITTED BY SENATORS KLOBUCHAR

AND FRANKEN
138 
139 

RESPONSES OF ROSLYN LAYTON TO QUESTIONS SUBMITTED BY SENATOR KLOBUCHAR
140 
141 
142 

RESPONSES OF MATTHEW WOOD TO QUESTIONS SUBMITTED BY SENATORS KLOBUCHAR

AND FRANKEN
143 
144 
145 
146 
147 

Æ