What we saw was a market that was dysfunctional. So the commission took years to respond but it finally did. And we acted initially to take care of interstate rates. We acted again to look at the entire we passed on order that looks at the entire portfolio and the parties are poised to challenge that. We have published in the federal register which gives the green light to move forward and they are moving forward and we are responding to petitions for stay. Host so it is in the court system right now. But how much of a reduction in rates are you looking at . Guest what we have seen as rates we have heard about rates as high as 14 a minute. That is unusual but we are on record that happened. On average you have about 1 a minute and families were paying hundreds of dollars a year to speak to their loved ones. What we are going to see now is 1012, depending on the size of the institution, cents per minutes and it will make a tremendous lives to families. A call that might have been 15 17 is down to 3 4 and that will make a tremendous difference. Host before we bring John Mckinnon into the conversation. You have been on the commission since 2009. How has the commission changed . How have the issues changed . How have you changed . It is more fastpaced. It is often more partisan to be honest. I have learned about the power of one individual to make a difference. This inmate calling item you brought up nobody was paying attention to that until our office stepped up and said enough is enough. These families deserve relief. So one person can make a difference in changing the lives of millions. I think i have changed and the e ecosystem changed because of the power of one person. Host do all of the commissioners agree on this issue . Guest i think they agree on principle but in terms of application and direction we are headed there are differences. You might have noticed there were two persons who did not agree. One did not vote for it proactively. So again, i think Everyone Wants relief. They did not necessarily agree on the course that we took but i think it was the most balanced, the most fair, and the best for relief sake. Host lets bring John Mckinnon from the wall street journal in the conversation. Talk about the procedures underway and what is going to happen to families. Are they able to make the calls at lower rates or is that starting to happen . Guest that has not gone in the effect. In addition to responding to those challenges in the immediate term we are going to allow for a sixmonth transitional window for the majority of the providers. Families making interstate calls, between state to state, they have already seen relief. Some states have already acted because of this and because of the public cry. Some people have seen relief. But for the bulk of the country, i anticipate, if all goes well, within the next six to eight months everything will be enforced and we will see incredible differences when the comes to families and staying in touch. What is the difference between what they pay now and a consumer who doesnt have a loved one incarcerated . There is almost no comparison. You think about our interaction with our provider. You dont think about the number of minutes you stay on the telephone because it is all you can use especially when it comes to text or voice. You dont think about how long you stay on the phone. You might forget to turn the phone off and there is not an Economic Impact on you. To these families they are charged by the minute and they are often charged by there minute whether the call quality is there or not, they are often charged sort of a minimum also, rather the call drops or not. So these families in addition to the rates being outrageous they dont get the services they pay for and it they face a long process that would frustrate any family especially those families that are the most economically challenged in our nation. I gather there is additional concern regarding video links now. One of the things we did that is not complete when it comes to this particular item is a program or regime i should say a video visitation. Which is what it sounds like. You would have a video conversation with behind prison laws. We didnt say how much that should be in term of charges. But what we are hearing from with advocates and families is these prices are outrageous and the entire visitation dynamic is changing because of it. Case in point, we know of some people who even go on the facilities or close to the facilities are still charged for using video visitation and they cannot see their families other from the neck up. What does that mean . You may not know if something physically happened to them. The types of interaction is limited. We are asking questions about how this is used . How much it is costing families . And whether or not we should do something about this or whether or not we have the capacity to do something about this like we did with tradition voice. Host commissioner mignon clyburn, to you need a con congressional buyin . Guest i would love one because things are best handled on the state and county level. The state facilities are the ones engaging in contracts with the providers. I would love to see more interaction at the state level, the public utility commission, and where they do not have authority or do at the state level in the legislature. I would like to see the legislatures act. That is where true reform happens. This is a ceiling. What we put forth should be a ceiling because the rates are still relatively high depending on the size of the facility. What could make an incredible difference for families is true reform in each and every state to insure that these individuals can affordably seek we talk inmate reform, real reform cannot happen if people cannot be in touch with their lawyers and people dont stay in touch. We have recidivism rates as high as 70 for those in facilities fibyeersz or more. They go home as strangers because they cannot keep in touch. Five years we need a sane regime when it comes to the price they pay and the only way that can happen is at the state level. One of your concerns is actually contact is going to be reduced because it is costing people so much to stay in touch. Guest the highest figures i see of people that keep in contact with those in prison is 38 . So the bulk of the individuals dont stay in touch. When 700,000 are released each and every year. That is the number of inmates going home a year. 68 go home as strangers and most are back within five years as i mentioned. We have got to really look at the causes of that. And i think one of the primary causes again is people go home as strangers because they havent kept in touch for the life of the sentence or the length of the sentence and we can do something about this and this is what this item is establishing. One more question about this. Are these companies involved, the phone companies that people normally used . No, they are not the normal players. One or two might be. But the bulk of the industry is two entities now owned by hedge funds who enter into contracts with the facilities. One of the biggest drivers or what i call a preverse incentive is the lowest bid doesnt win but the highest bid giving the permission to the facilities are the ones that get the contract. What does tat mean . That means those rates have been pushed up and and up over the years. It is not a functional market as we know it. It is a dysfunctional market. It is one that is broken. And this is why we acted. Host commissioner clyburn, another issue the fcc is facing is a new proposal on set top boxes. What do you think of chairman wheels proposal . What exactly is it . What do you think of it . Guest it is a new proposal but an old conversation. You might have remembered the proceedings back in the day that really looked at the options or not when people have content coming into their home. What the chairman has observed and we note is 99 of us who pay for television have a set top box we rent from the provider. And a number of outside entities are taking issue not only with that construct, that there is a lack of competition, but what can be viewed or downloaded over that particular device. So what this notice of proposed rulemaking, and i think some of the headlines have been misleading, this is a notice of proposed rulemaking for us to have a conversation in an fcc way to see what the universe looks like and to see whether or not it is a competitive or if competition is warranted, what type of standards we should use. We would have input from a number of bodies to see what the state of play is in this environment and what, if anything, we should do to change it. Host about a month ago on this program we had michael powell, former chairman of the fcc and head of the Telecommunication Association and here is what he had to say about cable boxes. Consumers dont want more boxes. If there is anything like hulu and amazon prime is that streaming is an invention that has overtaken what a lot of people have relied on the box to do. Take dvr. It is an Important Service but as streaming is more dominant the need to record and skip through the commercials much of that is less important because i can stream it. I stream it once, i can stream it ten times. I can rewind it. I can move it forward. And a lot of content is being provided free in binge collective sweets of consumption. That is the path the market thaeb has been moving and that is the direction the consumers are responding to. The advocates want to build another box and create a service around boxes and make the cable guys, develop, build, manufacture and deploy another box we think is retrograde and returning to the way competition was conceived in the 90s and not the way competition is not only conceived in the 2015 but actually unfolded. Host commissioner clyburn . Guest i am hearing we want userfriendly interphases and want to take advantage of all of the opportunities that that box or any other device or peens has to offer. Means and that is an open item. I cannot speak with too much specificity but what i will say in terms of those advocates out there is that they want that device. They want devices in the home to be open to all types of platforms that if i am in independent producer if i dont have a relationship with that cable or satellite entity how does my programming get seen . I would love to be able to take advantage of that device and be able to download or view over that device and these are the types of issues that will be keyed up rather that device should be strictly under the management or the purview of the satellite and cable providers or whether or not they should be more neutral and open to all potential programmers. And in the discussions we will have, the series of questions and more, will address that. You know whether or not there will be an independent, you know, pathway in terms of that or whether or not the current regime, which is in the hands of the mvpds, those void video providers, whether they will have a retained hold over that. You mentioned the independent programmer issue. Explain the program many of them face. Why is it they have trouble getting access . Guest i have heard from independent trainers saying wil you get the Cable Company to give me a call . I heard them saying the terms they entered into it, if they get to that point, such as their Business Models are not working. There are two items that are going to be teed up in the february item. This top boxes and a programming notice of inquiry that will look at the entire ecosystem of whether or not there are barriers to entry when it comes to competition and the amount of programming and content in the market and whether that is a functional or dysfunctional marketplace because there are programmers who are saying, look, we have nation clauses that i enter into a contract with you and you come behind me and you might negotiate a less favorable term than i did. What is going to happen . You are now able to apply what you have entered into a ship with john. That now applies to me. My entire business construct i negotiated with you one on woun is disrupted. Everything i negotiated on my unique standards no longer apply. They are complimentary in a way. They are looking at if there is choices or we should have a standard body that looks at whether or not everyone should be able to download or everybody should be able to use this particular device or if it is going to maintain its current construct which is in the hands of those who provide you that you pay rental to every month. Do you feel this relates also to the problem or issue of over the top video and just peoples access of over the top providers . Guest guest you cannot ignore the rest of the ecosystem. When i mentioned the programming, a lot of people talk about over usage. But if you have terms and conditions that prohibit me or make it so unattractive to use those other platforms how do things flourish in that perspective . So again, it is looking at whether or not these platforms, that i will have the ability, the option to purchase, and even if i keep the current regime, what do i have access to and that is at the heart of the debate. And talk also about the consumer side of this issue. I mean how big of a concern is that for you . Consumers are paying on average, you know, 56 a month, depending on the relationship you have. They are paying hundreds of dollars, you know, a year. And some of them want more options. They want that device to be more to them than strictly singular relationship with the current programming construct of the satellite or the cable providers. So part of what we are going to discuss is how, or if we should do that, what type of choices and competition is out there and those saying we want more diverse programming offering, what is the best way for us to facilitate that without disrupting what is already phenomenal in the existing space. Michael powell was saying that basically the world is moving past the devices and yet he says this proposed rulemaking is focused on devices. He said it is ignoring the new world of apps. Do you think that is fair . I believe what the chair has proposed is lets have a conversation about a more neutral standard. That the questions that will be teed up and it is saying to look were a well established body that will look at how to make it truly open so consumers have more options. All of this proceeding is particular in terms of choosing one platform over another. Choosing a technology. This proposes not to do that. To allow the ecosystem to weigh in and set its own standards and ideally people have more options at the end of the day. Host commission clyburn, it is said deployment for rural access is not being done quick enough. What tools does the fcc have, in your view, to increase that . We are trying to focus on where those 34 Million People and have targeted, streamlined, and efish ant means of addressing them. We have for a number of years used the High Cost Fund which is called the connective American Fund which gives us 4 billion annually to address these needs. We have done a pretty good job of closing the communication divide. We have not done a perfect job because again 34 Million People are still without. We are having conversations about efficiently looking at those communities, where we should expend and leverage our resources and looking at the Lifeline Program that says ye, on a parallel course we have to make sure the technology and infrastructure is in the ground but if people cannot afford to take advantage of it we look at running the risk of investing where it leads nowhere. So we need to make sure we continue to spend money wisely. I have been to aspen and those companies there are getting high cost support while there are people in the most economically challenged regions in the country are not getting enough. We will be looking at that and asking hard questions and redirecting money where it should bet flow so the next time i come on this show it will be substantia substantia lower than the 34 million. Host you said you have another theory of that people are not participating because of the cost. Guest in terms of the lifeline . Guest in terms of the broadband. Guest one thing with lifeline, which is another universal program that seeks to meet the economic challenge people have, for 30 years it has been a part of our dynamic and focused on voiceonly. We dont live in a voiceonly word and that is evident based on teenagers and every around us. We need to look at our National Priorities and that includes not only getting people connected but enabling them to have more access to the goods and services in the needs of their community in terms of education and health care and public safety. And how do we best do that. We are proposing to recalibrate and redesign that program to make it modern and one that is d dignified. Take them out of the embarrassing tents and things you have seen on videos that bothered me, too. And really design a program that meets the current nieeeds of americans and that includes advanced Communication Services and that is broadband in some. Who do you hope to reach a conclusion on lifeline . This has been under debate for some time. Guest it really has. I hope it comes within the months. I am not the chair. I would want it tomorrow. This is something he cares about. He realizes getting the carriers out of the business is what we need to do and if we leverage with databases like the snap database and do all of that and more we could have a program that meets the needs of communities and dont penalize people who might be lowincome and relegating them to be on the other side of the divide. You have opportunities to invest in that. With the Lifeline Program when it comes to affordability for services and i am looking forward to doing all of those in concert. That is the only way we will really close the digital and communication divide in this country. When do you think the Digital Divide gets closed . Guest that is a question i know as technology divides we will probably get there. People want to put a period behind that sentence. I dont get hung up putting a comma behind the sentence because i know subject changes when it comes to technology over time and the needs and demand. We are living in a global society. I am going to speak at may parents alma matter and i want to let them know the competition comes from people all over the age from all around the entire global. You need to be ready. That question, i am hopefully to be able to say, will never be answered. We will never put a period behind that because we should always be evolving, always improving, and always attempting to bridge gaps so people can hip themselves. This is about enabling individuals to help themselves and providing them with t