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tv   [untitled]    June 8, 2012 4:00pm-4:30pm EDT

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we just don't take contend here and export it, you know, we create content in those places, in those regions and it's really going to be heart of what will drive us forward is creating content. >> sport has been a bedrock of what news does. will that continue to be the number one, do you think? >> if you can afford it. >> if you can afford it. >> there's no question. it's a double edge sword. sports. big sports events second to none in terms of, you know, event content that is at the top of the list. comes with a cost but clearly a challenge you got to digest. we have continued to, around the world, sports has played a central role in driving our businesses forward and it's great content. it's just the challenges are managing the economics. fortunately we got in some ways you need big enough businesses to be able to package and in many ways sports can be a
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driving force, for multidimensional business and carry a lot of stuff forward. it's great content. the nfl doesn't get fragmented. we just sign a deal with a league in germany. that doesn't get fragmented. there's only one german soccer league and the importance of that content is second to none but it comes with a cost that we have to wrestle with. >> nielsen observed a wrinkle in the entertainment landscape. the number of households without a television set is actually rising. is this the precursor to what's happening with newspapers where the conventional way of getting your "daily news" is moving very fast from newspapers to online. could you see a situation where the old-fashioned television set smmly becomes redundant in americans lives? >> we don't think so. that data -- remember how this started and we talked about it last year was quote cord
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cutting, people that would supposedly cut the cord. that didn't happen. reason for everyone to be fearful. we're in the middle of a pretty severe worldwide recession or slow growth period and so i think what all the system operators know that are sitting in the audience is that household formation which used to click along at 1% or 2% a year has been flat so that's really why you haven't had quite as much basic growth in subscription. incidentally those that had cut the cord are not what you think they were. mostly they were economically challenged households that didn't have broadband connections and often not computer. it wasn't like you had all these computer people that were young college grads doing it. the ones you are asking about are those, the new ones, and i think it was answered already that we don't really care where you watch, which screen, whether it's a television or a tablet,
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they are all televisions. and you can't get the stuff unless they hook up through the distribution systems maintained by the people sitting in this room. and it's all going to work out because if the content is good and robust and we've heard that it is, and if it's showing up in forms whether it's on an hbo, it's on netflix, if it's original or serialized stuff in the great interface, one way or another the consumers are finding it useful and they will basically, i think when the recession end you're going to see continued adoption of internet devices by all age groups and you'll see big screens on the wall and, if you listen to what samsung and apple are talking about in devices, i don't know whether you call those things tvs or giant tablets but there's no distinction really of what they are. >> how big an issue for the industry -- it always sounds
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very positive, revenue is going up, everyone happy, everyone working together, everyone chasing the same dream, all working and everyone is getting this feeling of great positivity. piracy remains a big problem for the industry. >> yeah. >> is there going more concerted effort do you think collectively to stamp it out. example i would use in england with the british premier league, for example, they are red hot on this to the extent when people post goals and stuff, taken from their tv set, within seconds they are being pulled down. is this going to happen, do you think to the tv industry generally? does it have to happen? >> i think over time it need happen. we're struggling a little bit with this as a country how we need to get it set up. we had some major public policy to come through that didn't make it through the pipeline that i thought should have and with the internet and things so accessible, if we don't have -- our network is very tight.
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we use a very tight digital rights management system to distribute product. we try to do the same whether it's coming to your home via linear channel, high-speed network, whatever. if we don't keep it tight and respect the fact that there are rights holders and they have conditions on how those doesn't get used and get reimbursed for their content the content goes away. content is not produced -- i'll give you your speech. content is not produced for free. and part of that is it takes a fair amount of sharing between networks and i'm not talking about cable networks, but network providers, mso, regional operating companies, core infrastructure in our country. not only for privacy, or excuse me for piracy, but for privacy and security. so there are all kind of sewn together all three concepts. we have some work to do. and some education to do with
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users who i often get challenged because there's not a piece of live entertainment produced today that you can't find probably somewhere globally being redistributed within ten minutes. >> chase, your company has tried in britain to varying degrees of success. teenage boys, if they can make something for nothing they do, as all their friends do, and they have an extraordinarily quick way to find this stuff, whether it's music, television, movies. they don't pay for anything. how is the genie effect of out of that bottle. what do you do about it if it is. and how tough can your companies can be in reality to stop it from happening. >> i don't think the genie is out of the bottle. the news business probably got further down the road than it should have and now a little bit trying, the one business trying to put the genie back in the bottle to create a better business model, putting all the
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content, news content out there was not not going to lead to a place that ultimately, i want to say, was the way the business model worked. sure, if they can get it free. if you're giving good experience and you give them something like, people will pay a fair value. yes, we should have rules to help enforce it and i think realistically you look at the loss, the legislation that pat referred to failed. but people are acknowledging you need rules. you won't have quality content and quality distribution systems if you don't have rules. so there's a general acknowledgement you need a set of rules. we need to navigate that process better than we did the last time but we need those rules. and i think people generally will pay. if you give them a good experience. when i was with directv, what they didn't like is when you didn't give them what they expected. if you gave them a quality
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experience and gave them what they expected they were willing to pay a fair price. we can't gouge them we got to provide them with a good experience and meet their expectations. people will pay for a fair price for quality terms. >> we all know it. we started that way. tv was free. and, you know, abc, nbc and in britain bbc and so on although i guess everyone was forced to pay for that. >> yeah. >> and then we all came along and we offered something better. better transmission, better diversity of programming and everybody chose to pay, 94% of the people in the united states and all over the world this is happening choosing to pay for choice and quality and distribution system that can give them our stuff, your stuff. >> high quality at low prices. minimizes the piracy. >> it was a choice for them. it's an improvement. it's not something they need to
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adopted it voluntarily. >> let's talk about the future. everyone here will be fascinated to see what you guys think where we'll be in five years time. ten years time you'll be reading your paper on tablets and flexible to go back and forth. i laughed at him. it's ridiculous. but he had an amazing vision for exactly what happened in that time scale. what do you think we'll be seeing in the next five, ten years? how fast will it go? how crazy? >> at the speed of change today, five years is an eternity to predict. when we started streaming over five years ago we didn't have a movie that wasn't often years. this year we have the number one, two, and three movies in the box office. it's one of those things the rate of change is so quick and the technology is moving to quick and more importantly the
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consumer adoption, the generation right behind us is so much more open to change. you talk about piracy, a big chunk of our paid viewing of netflix is happening through game devirks the very demographic that you said would steal if they could. we're at the very first stages of reinvention of television. when you say there's fewer tv sets, what is a tv set, what is television. predict. group, like the fbi has, an unimaginable things that may happen in ten years and if so what is it? what have we not thought of yet? >> i think we're getting pretty clear messages about the importance of search, access across all platforms not just one. we're understanding about the personalization that you really want to be your own personal
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curator. your personal preference will dictate what order you consume device and what device you do that on. i think it will require fatter pipes, faster speeds, choices of tiers, and i think the foundation for innovation sits inside this industry and i think it's just an enormous opportunity for us and will be a fun run the next five years. >> chase? >> i wish i had the answer. >> a lot of money resting on this. >> look, we don't know. we obviously think about it because i think it helps us sort of wrestle with the question but i think you would know what the world would look like in five or ten years you would be diluting yourself. our biggest challenge is not to try, to essentially try and lead, not try to hold back the
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future. when you're a company that has big entrenched businesses one of the real challenges is how you not protect those businesses and hold off. you can blindly sort of charge in, you got have rules and disciplines, but in some ways you want to try and dictate and create and lead these businesses. take advantage of the technologies, create new experiences, probably in some ways probably once they differ a little bit with jeff, i don't think we've gone fast enough and in some ways one of the challenges we have to do is be fast enough because technology is going to keep moving faster and i think we get too hung up on sort of the, sort of protecting or one of the rules of the past and we need to figure out, again, not just blindly, but how do we adopt and how do we embrace these new technologies to deliver a better customer experience. >> finally, as the godfather of
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tv every where or as we call it at times warner, just the godfather, what is your vision for utopia. what is the ultimate end game in a dream scenario. >> actually agree with you. we all have to focus on the internet. you have to know what you are, you're an elephant not a lion. we have to as an industry look at the interfaces and let the consumers use the interfaces they want. so if they like an apple interface, a netflix design, you got to let them use that. don't get hung up on trying to control the interface. you'll still have your subscriber relationship. you can't develop the best world class interfaces at the scale that a distribution company has. silicon valley and the internet industry is a global industry, that's what they do. we should harness that and let
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those interfaces make the fundamental product right and the fundamental strength of your distribution system get more powerful. but harness them. don't try to hold that back. your consumers won't allow it. >> gentlemen, thank you all very much. ladies and gentlemen, my all-star panel. fascinating discussion. thank you very much. [ applause ] on our road to the white house coverage first lady michelle obama and ann romney wife of republican presidential candidate mitt romney were on the campaign trail this week. tonight at 8:00 eastern c-span 2 will show campaign stops by both. michelle obama in dale city, virginia on women's health and ann romney in miami on cuban americans. tonight is the 68th annual radio and television congressional correspondents dinner. c-span will have live coverage. house speaker john boehner is the keynote speaker with
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entertainment by wayne brady. live coverage begins at 9:00 p.m. eastern. this is c-span 3 with politics and public affairs programming throughout the week and every weekend 48 hours of people and events telling the american story on american history tv. get our schedules and see past programs at our websites. and you can join in the conversation on social media sites. the comptroller of the currency says jpmorgan's $2 bill plus trading loss was due to an inadequate risk management issue within the bank's chief investment office. thomas curry's comments came during a hearing on implementation of the dod frank regulatory law. jpmorgan's president jamie dimon is expected to testify before the same committee next wednesday on june 13th. this hearing is about two hours and 15 minutes.
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this hearing is called to order. >> when jpmorgan announced it has lost millions of dollars in a large trade reportedly designed to reduce the firm's risk, it reminds us that no financial institution is immune from bad judgment. while the jpmorgan trading loss does not appear to have caused systemic problems it's a clear reminder that wall street continues to need better risk
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management and enforcement. to repeal or weaken wall street reform and defund it would take us back to the days before the financial crisis of 2008. wall street reform was a response to the crisis caused by a lack of consumer protection, reckless behavior in the financial sector and regulators who failed to take action in time. we now have an agency solely focused on consumer protection, tough new rules to end negligent and reckless practiceses by some on wall street and the process of enhancing and more judicious
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liquidity. wall street reform also requires regulators to sharpen their focus on their largest and riskiest financial institutions. all the regulators joining us today are members of the financial stability oversight council, a body created to monitor risks facing our financial system. most here all work in the broker world to prohibit proprietary trading with government issued insured deposits and the fdic continues to work diligently to implement the living wills requirements and establish the liquidation
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authority for global large, complex financial institutions. similarly while there is a need for strong regulation of all financial institutions, wall street reform recognizes that small community banks should not be treated the same as larger banks. because large complex banks take on the most risk and pose the greatest threat to our economic stability they should be required to pay their fair share. and to deposit insurance fund. likewise the banks that did not create the crisis should not have to take on risks by their larger competitors and assessments have been lowered accordingly. one approach to all is not appropriate and many partners
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have raised concerns about challenges faced by small community banks. i hope to hear from our witnesses today about the steps they are taking with regard to small banks. some have claimed that the wall street reform act was not the right set of solutions to the crisis and that it asks or regulators the activities of the firms they regulate. i disagree. to restore competence in our financial system after the crisis we need more, not less scrutiny. the wall street reform act has built a stronger oversight framework that closes regulatory gaps and enhances financial stability and better protects consumers, investors and taxpayers. and so despite a repeated cause to deregulate and defund by those who endure the costly
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lessons of the financial crisis, completing the imprepleamentation of the wall street reform act must be and remains a top priority for this committee. i look forward to hearing from the witnesses here today about the progress they have made to complete implementation of the wall street reform as well as the actions they have taken regarding the jpmorgan trading loss and the potential implications of the laws for supervision and wall street reform going forward. i also want to thank member shelby for all their input and cooperation over the past several months. at a time when most of america thinks that congress is in a gridlock the committee has been very busy getting things done on the seventh floor.
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the bipartisan export/import bank reauthorization passed with broad support and was signed into law by the president last week. we passed in the senatee this bipartisan sanctions bill for the federal reserve board of governors received four votes and will help to secure the passage of their confirmation. we passed a bipartisan transportation bill in the senate and the transportation conference committee meetings are currently ongoing with the house. we passed a 60-day extension of the national flood insurance program and we have commitment from the senate's leadership to bring the banking committee's bipartisan reauthorization bill to the floor in the coming weeks. in addition, there is another
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important legislative matter facing this committee. helping responsible home owners refinance into lower interest rates at no cost to the taxpayers. we have already had several full committee and subcommittee hearings and financial proposals. i would like to take a bipartisan approach similar to other committee past bills of this congress where we worked together in a bipartisan vehicle with amendments limited to those relating to the underlying bill. i am hopeful that my colleagues will agree to move forward in this matter, as well, so that we can help responsible home owners and help the housing market rebound. with that i turn to senator shelby. >> thank you, mr. chairman, and thank you for calling this very, very important hearing and to
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our panelists today. welcome again. i think we have spent a lot of time together. probably we will spend a lot more in the future right here. today the committee will hear from the financial regulators who supervise our nation's banks. the safety and soundness of our banking system depends on your efforts. it was not long ago that our banking system began to collapse notwithstanding the presence of a large and vigorous regulatory structure. i believe it is critical that this committee conduct rigorous oversight to ensure that the financial regulators do not repeat the mistakes of the past. as the primary regulator of the national banks, the office of the comptroller of the currency is responsible for ensuring the safety and soundness of our largest banks. this means that the occ
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supervises jpmorgan chase whose recent $1 bill trading loss has been in the news. and because taxpayers basically guarantee jpmorgan's deposit the american public, i believe, has a right to know whether these trades threatened or could have threatened the solvency of the bank. in addition this committee, i believe, has an obligation to determine whether this loss reveals any operational or regulatory weakness that could cause more serious problems in the future. next week jpmorgan ceo jamie dimon will appear to explain his bank's actions. today i would like to hear the occ's views of what happened at jpmorgan. in particular the comptroller, i believe, should give his assessment as whether the trades ever threatened the safety and soundness of one of our nation's largest banks. banks are in the business of
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taking risks. and losses as we all know are an inescapable part of risk taking. job creation and economic growth depend on banks taking risks. it's the job i believe of regulators to prevent banks from taking risks that expose taxpayers. some people have used jpmorgan's loss as an opportunity to argue for a stronger implementation of the rule. no matter where you stand on the volcker rule, this argument, i believe, is a bit premature. most importantly, why is the occ's current authority sufficient to prevent these trades from putting taxpayers at risk if they did. if so did the occ properly use the authority that it has. i look forward to hearing the comptroller's answers to these questions among others. also with us today is the acting chairman of the insurance. we have been told that dodd-frank will prevent future
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taxpayer bailouts. and insolvent financial institutions will be allowed to fail. yet under the fdic's plan for implementing dodd-frank's resolution authority, short term creditors would still be bailed out. the lesson we all should have learned from the t.a.r.p. bailout is that creditors of a failed firm should bear its losses. today i hope acting chairman would reassure this committee that the fdic's resolution authority will not institutionalize government bailouts. regrettably the fdic is not the only regulator that has taken actions that may institutionalize too big to fail. the financial stability oversight council led by treasury and the federal reserve board have recently used the
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authority granted by dodd-frank to designate several companies that are systemically important and are preparing to designate a larger group soon. i believe the danger presented is that the market will view it as an implicit guarantee that the federal government, the taxpayers will not allow the designated institution to fail. this was the same problem that arose with fannie mae and freddie mac and ultimately has led to about a $200 billion taxpayer bailout and more to come. i would like to hear from the treasury and the federal reserve board as to how the designation process will eliminate rather than create too big to fail companies. we will also hear from the director of the bureau of consumer financial protection, the bureau's regulation and supervision will impact the safety and soundness of our banking system i believe. unlike other bank regulators the
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bureau is not required to consider safety and soundness when it writes rules or takes actions against banks. i think this is becoming apparent as the bureaus proposed rule will impose huge costs on banks and create serious confusion about what banks need to do to comply with consumer protection laws. for example, the director of the bureau has unilateral authority to declare products to be abusive. however, the bureau has said that it will not write a regulation to clarify what the term "abusive" means. think about it. the refusal to write a rule stands in stark contrast to the director's statements that the bureau would give banks clear rules of the road. in other words, certainty of what they could do and what they couldn't. the refusal of the bureau a lot of us believe to issue clear rules means that banks will have higher costs, more exposure to


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