This is a preliminary unedited transcript The statements within1 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1 NEAL R GROSS CO INC 2 RPTS MASSIMO 3 HIF142170 4 5 6 INTERNET OF THINGS LEGISLATION 7 TUESDAY MAY 22 2018 8 House of Representatives 9 Subcommittee on Digital Commerce and Consumer 10 Protection 11 Committee on Energy and Commerce 12 Washington D C 13 14 15 16 The subcommittee met pursuant to call at 10 15 a m in 17 Room 2322 Rayburn House Office Building Hon Robert Latta 18 chairman of the subcommittee presiding 19 Members present Representatives Latta Burgess Lance 20 Guthrie McKinley Bilirakis Mullin Walters Costello Walden 21 ex officio Schakowsky Clarke Cardenas Dingell Matsui NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within2 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 22 23 Welch Kennedy and Pallone ex officio Staff present Mike Bloomquist Deputy Staff Director 24 Melissa Froelich Chief Counsel Digital Commerce and Consumer 25 Protection Adam Fromm Director of Outreach and Coalitions Ali 26 Fulling Legislative Clerk Oversight Investigations Digital 27 Commerce and Consumer Protection Elena Hernandez Press 28 Secretary Paul Jackson Professional Staff Digital Commerce 29 and Consumer Protection Bijan Koohmaraie Counsel Digital 30 Commerce and Consumer Protection Austin Stonebraker Press 31 Assistant Hamlin Wade Special Advisor External Affairs Greg 32 Zerzan Counsel Digital Commerce and Consumer Protection 33 Michelle Ash Minority Chief Counsel Digital Commerce and 34 Consumer Protection Jeff Carroll Minority Staff Director Lisa 35 Goldman Minority Counsel Caroline Paris-Behr Minority Policy 36 Analyst Michelle Rusk Minority FTC Detailee and C J Young 37 Minority Press Secretary NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within3 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 38 Mr Latta Well good morning I'd like to call the 39 Subcommittee on Digital Commerce and Consumer Protection to order 40 and the chair now recognizes himself for five minutes for an 41 opening statement 42 And again good morning to our witnesses and welcome to this 43 legislative hearing on the Internet of Things 44 discuss the bipartisan State of Modern Application Research 45 and Trends of IoT Act or the SMART Act IoT discussion draft 46 The SMART IoT Act discussion draft is the result of work 47 the Digital Commerce and Consumer Protection Subcommittee has 48 done over the past two years 49 Today we will Last July this subcommittee held an Internet of Things 50 Showcase 51 districts and across America to demonstrate products and services 52 in the IoT field 53 At that event members invited companies from our It was a wonderful opportunity to see this revolutionary 54 work up close and interact with the inventors doing this important 55 work 56 To accompany that Showcase we held a hearing where 57 participants from the Showcase discussed their companies 58 challenges they face with growing in this space and what we NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within4 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 59 as policymakers can do to help promote the continued development 60 of the IoT solutions 61 This January we held a hearing on the state of manufacturing 62 in the IoT space and over the following months we met with other 63 builders suppliers customers and experts to better understand 64 IoT's enormous potential 65 This technology is having a real-life impact for many of 66 our constituents 67 district that are using this cutting-edge technology to maintain 68 their machinery and keep production on track 69 I've personally met with manufacturers in my I also met with farmers in Defiance Ohio who are using 70 IoT for better grain management increased planting and 71 harvesting efficiency and improved monitoring of the temperature 72 in their storage facilities 73 The draft legislation we discuss today is the result of 74 important bipartisan work after hearing from the experts where 75 we noticed one lingering question 76 rules regulations guidelines and best practices look like for 77 the IoT space 78 79 What does the universe of While we know there are many other topics of interest in this space this legislation kicks off a process to give all NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within5 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 80 stakeholders a base set of information to frame the other 81 challenges without speculating or hypothesizing about what 82 already exists 83 The IoT is already revolutionizing the way that we organize 84 factories and supply chains transport commodities like oil and 85 gas make manufacturing more efficient maximize energy 86 efficiency and even restock our refrigerators 87 This subcommittee has engaged in historic bipartisan work 88 with the SELF DRIVE Act this Congress and I am pleased to see 89 that cooperation continue with the SMART IoT 90 When safely applied to autonomous vehicles the Internet 91 of Things holds the potential to significantly reduce traffic 92 fatalities and make our roads safer while reducing costs through 93 more efficient fuel consumption 94 In these areas and more the IoT holds the potential to 95 greatly improve the lives of Americans 96 colleague Representative Welch for his willingness to continue 97 our work together on this very important issue 98 99 100 I want to thank my As many here know in previous Congresses Representative Welch and I started the Internet of Things Working Group We heard from industry and other stakeholders about the importance NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within6 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 101 of light-touch regulation to foster innovation and jobs here in 102 the United States 103 This bipartisan draft is a result of the lessons learned 104 in those meetings this subcommittee's Disrupter Series hearings 105 and lays the groundwork for constructive conversations in the 106 future 107 The SMART IoT Act will give all stakeholders both private 108 in industry and at the federal level a better sense of what 109 guidelines and best practices exist or are in development 110 As we all know IoT issues cut across so many industries 111 and so many federal agencies 112 overlaps or potential duplication is important for many reasons 113 from ensuring efficient use of government resources to 114 understanding how stakeholders are addressing some of the 115 important but challenging issues of privacy and data security 116 Ensuring that we know about From the Department of Commerce's efforts to foster the 117 advancement of the IoT ecosystem to the Department of 118 Transportation's focus on advancing automated vehicle so much 119 work is being done in this space 120 121 We want to encourage our interagency collaboration and foster an environment where transparency is key Likewise I NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within7 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 122 would like to ensure that the environment for innovation in the 123 United States across all of these industries remains a priority 124 by optimizing our own efforts to promote good consistent 125 government 126 127 I believe the SMART IoT Act is an important step in doing just that 128 And again one of the things I always like to say is that 129 one of the great things about serving on the Energy and Commerce 130 Committee is that we kind of look over the horizon five to 10 131 years 132 When we hear from our witnesses we want to hear from you 133 to know exactly where you're going to be because we don't want 134 to have our regulators or our laws that we were thinking about 135 enacting looking in the rear view mirror or at the end of a car 136 We need to be looking far out into the future 137 So again I want to thank our witnesses for being with us 138 today and I look forward to your testimony today and with that 139 I recognize the gentlelady from Illinois the ranking member of 140 the subcommittee for five minutes for an opening statement 141 Ms Schakowsky Thank you Mr Chairman 142 This subcommittee frequently discusses the Internet of NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within8 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 143 Things 144 devices not mention our IoT showcase last summer 145 We have hearings on IoT in manufacturing and wearable Today we transition from general discussion to discussion 146 of actual legislation The SMART IoT Act is a first step It 147 would require the Commerce Department to survey the use of 148 connected devices and examine the federal role in this space 149 As the bill acknowledged internet-connected devices 150 provide an opportunity for economic growth But we want to ensure 151 that those devices are developed securely My hope is that the 152 report generated by the SMART IoT Act provides the foundation 153 for further legislative efforts 154 Our hearings on the Internet of Things have raised important 155 issues 156 to be baked into these devices 157 What privacy and cybersecurity protections are going Normal household items can now collect very personal data 158 that must be stored and used appropriately 159 present new safety concerns 160 Commission just held a public hearing on IoT and safety last week 161 with stakeholders on that very subject 162 163 Connected devices The Consumer Product Safety We need the infrastructure to support the rise of connected devices including affordable broadband The Internet of Things NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com This is a preliminary unedited transcript The statements within9 may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 164 could also disrupt the current labor market 165 workers are prepared for a changing economy 166 167 168 We must ensure Finally we must make the strategic investments in research to promote future innovation Last week's hearing on quantum computing made clear that 169 the United States is not providing the consistent support 170 necessary to keep groundbreaking research moving forward 171 Standing on the sidelines is simply not an option These 172 are big issues for Congress to tackle and we must rise to the 173 challenge 174 We know what happens if we rely on industry self-regulation 175 Consumer privacy goes unprotected and safety is put at risk 176 The SMART IoT Act should provide a resource for us to better 177 understand the variety of devices on the market 178 I plan to use this information as I continue my push for 179 comprehensive consumer privacy and data security legislation 180 We have had bipartisan furor over misuses of consumer data 181 It's time now for bipartisan solutions to the problem 182 bill before us is a natural extension of the work that members 183 of the subcommittee have been doing for the last couple of 184 sessions NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com The 10 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 185 In 2016 Congressmen Latta and Welch convened stakeholders 186 for several forums under their IoT Working Group to discuss this 187 -- the internet -- the Internet of Things and the issues new -- 188 that new technology raise 189 In many ways the study and the SMART IoT Act is a 190 formalization of that very survey In the coming weeks I look 191 forward to working on a bipartisan basis to move this legislation 192 forward and then I am ready to take the next step of updating 193 consumer protections and funding key investments 194 The Internet of Things has tremendous potential 195 work together to make sure that America benefits from that 196 opportunity 197 198 I thank you Chairman Latta We must I yield back unless anybody wants the remaining time 199 I yield back 200 Mr Latta 201 The chair now recognizes the gentleman from Oregon the 202 203 204 205 Thank you The gentlelady yields back chairman of the full committee for five minutes The Chairman Good morning Mr Chairman and other members on the committee and to our panelists -- witnesses on the panel Thank you for being here NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 11 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 206 Today we will hear testimony about the draft bill the SMART 207 IoT Act to support the development of the Internet of Things 208 here in the United States 209 This bipartisan effort underscores one of the key goals of 210 the Energy and Commerce Committee and that is helping American 211 entrepreneurs and established businesses expand to create jobs 212 for American workers and help improve the lives of American 213 consumers 214 So I would like to thank Chairman Latta and Representative 215 Welch for working on this issue and finding a bipartisan path 216 forward 217 particularly on this subcommittee when faced with new technology 218 policy questions 219 This is what we do at the Energy and Commerce Committee We have done that on the Self Drive Act I would commend 220 my colleagues on both sides of the aisle for the good work there 221 Now we just need to get the Senate to move forward as we are 222 223 won't to do in many cases The Internet of Things or IoT does hold great promise to 224 connect workers suppliers products consumers throughout 225 efficient networks that can save time money and bring about 226 new innovation and resources NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 12 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 227 Building this network won't be easy We know that It 228 requires engineers entrepreneurs and visionaries 229 requires public policies that foresee a world designed for the 230 next-century policies that foresee a world designed for the next 231 century policies that are forward looking and that reflect a world 232 to come of self-driving cars self-organizing materials and 233 innovations we have yet to even think of 234 235 236 237 238 It also These must replace many of our still-existing rules and policies that reflect the old technologies of the last century While America has changed many of our regulations unfortunately have not That is one of the purposes of this legislation that's before 239 us today 240 are aware of the playing field and are not creating conflicting 241 or duplicative obligations or requirements 242 It is meant to set the stage by making sure stakeholders So the SMART IoT Act will create the first compendium of 243 essentially who is doing what in the IoT space 244 the efforts undertaken by private industry as well as a review 245 of what agencies are doing 246 247 This includes Removing regulatory barriers to innovation is one of the most important duties of this committee Doing so allows our NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 13 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 248 economy to grow our workers to flourish and innovation to occur 249 here in the United States 250 The best way to start is to know what is out there already 251 or being developed today It's important to note that since 252 January of 2017 more than three million new jobs have been created 253 in America 254 The U S unemployment rate now at 3 9 percent is the lowest 255 seen in this country since the year 2000 and what's more this 256 comes as more Americans rejoin the workforce millions once again 257 finding work after years of hardship 258 So creating jobs and opportunity is a goal shared by all 259 of us on this committee in fact reflected in the bipartisan 260 work on the SMART IoT Act 261 Chairman Latta and Representative Welch have been working 262 on these issues for several years now 263 progress has been made and we have a great opportunity going 264 forward to do even more 265 Glad to see that this So Mr Chairman and members of both sides of the aisle 266 thanks for your good work on this We have a couple hearings 267 going on simultaneously as I am sure our witnesses and members 268 know NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 14 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 269 So some of us will be popping back and forth But we value 270 your testimony that we have here and the good bipartisan work 271 And with that I yield back the remaining balance of my time 272 Mr Latta Well thank you very much The gentleman yields 273 back and the chair now recognizes the gentleman from New Jersey 274 the ranking member of the full committee for five minutes 275 Mr Pallone 276 Today's hearing on the draft SMART Internet of Things Act 277 is the next step in this subcommittee's review of new and evolving 278 technological development and I commend Chairman Latta and 279 Representative Welch for working together over the last several 280 years to explore and learn how the Internet of Things or IoT 281 can enrich our lives help us be more efficient and grow the 282 U S economy 283 Thank you Mr Chairman Today more and more people have multiple internet-connected 284 devices in their homes things like thermostats vacuums and 285 digital personal assistants and more and more people are wearing 286 internet-connected devices such as fitness trackers 287 But IoT is not limited to consumer products Connected 288 devices of all kinds are used in practically every industry sector 289 like manufacturing agriculture and medicine NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 15 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 290 We have learned about drones that fly into dangerous areas 291 to assess hazards sensors helping farmers understand the 292 topography acidity of their land and doctors receiving real-time 293 data from monitors so that patients in remote areas do not have 294 to travel for daily appointments 295 And today we are considering a bipartisan draft bill that 296 would direct the Department of Commerce to conduct a comprehensive 297 study and report on the Internet of Things 298 Commerce will survey the industry sectors that make 299 internet-connected devices as well as all industry sectors that 300 use those devices 301 The study will also look at how the federal government 302 oversees the use and development of connected devices which 303 agencies deal with the Internet of Things what expertise those 304 agencies have and what entities those agencies interact with 305 and the study will identify government resources available to 306 consumers and small businesses to help them evaluate connected 307 devices 308 The report will provide a one-stop source of how businesses 309 are integrating connectivity and how the federal government is 310 helping the country adapt to this age of connectivity NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 16 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 311 Federal and local government agencies could also use the 312 report to better coordinate their work and I hope the study will 313 encourage them to do so 314 And any report will be a snapshot in time but given the 315 integration of IoT into all parts of our lives in the global 316 economy the report will provide a jumping-off point for more 317 work 318 I would certainly like to see cybersecurity issues given 319 more emphasis when we look at IoT 320 cybersecurity was the issue that came up most often cybersecurity 321 is imperative to keeping ourselves and our country safe from 322 malicious actors 323 Throughout our review And I know some stakeholders have asked that cybersecurity 324 be specifically called out in the study 325 a change 326 I would support such But whether it's made part of the study required by this 327 bill or not Congress must take action to ensure that strong 328 cybersecurity and data security are fundamental to IoT 329 So I am glad that this subcommittee is working on this 330 bipartisan legislation and I'd like to yield the balance of my 331 time to the sponsor Congressman Welch NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 17 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 332 Mr Welch Thank you very much and I want to thank Chairman 333 Latta and Ranking Member Schakowsky for this hearing 334 great to work with Mr Latta too in the IoT Working Group -- 21 335 members that had hearings in advance 336 It was We are trying to get educated before we pass legislation 337 which isn't necessarily how we usually operate But this is a 338 huge opportunity with the Internet of Things 339 and Company did a study and says that it can be between $4 and 340 $11 trillion annually by 2025 341 extraordinary You know McKinsey So that's really quite 342 My colleagues have already spoken about what many of these 343 opportunities are and also Ranking Member Schakowsky I think 344 pointing out some of the implications that we have to contend 345 with with labor is really really important for all of us to keep 346 in mind 347 But I'll just give one example In Vermont the brutal 348 pressure on our dairy farmers right now -- the price is down 349 the costs are up -- and technology is helping some of those farmers 350 hang on 351 And Mangan Brothers a dairy farm in East Fairfield Vermont 352 has a computerized internet-based milking system that's really NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 18 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 353 been helpful to them 354 They installed a milking parlor about two decades ago and 355 now what happens when the cow comes in they have a pedometer on 356 their leg and as soon as the cow crosses the threshold of the 357 milking parlor the sensor picks up which cow it is and relays 358 the information to the computer and all the statistics about the 359 cow's movements and body temperature and other pertinent 360 information is sent to the computer and it's even relevant for 361 when the breedings are done just based on activity spikes 362 It also gives them a report at the end of every milking day 363 with respect to the salt content and that's an indicator that 364 allows the farmers to take steps to avoid diseases 365 So it's a big deal in terms of productivity for them and 366 it is made possible by the Internet of Things 367 point in my last few seconds the only way we are going to have 368 the Internet of Things in rural America is to have broadband in 369 rural America and that's another enormous challenge we have and 370 it's woefully under served 371 372 373 And just the last So we can talk all we want about the Internet of Things but unless we have broadband it's not going to happen So I yield back and thank my colleagues for the time NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 19 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 374 Mr Latta The gentleman yields back and I just want to 375 say just briefly I really appreciate all the work that you and 376 I have done on IoT and also not only chairing the working group 377 but also working together chairing the rural broadband so I 378 appreciate all you've been doing and thank you very much 379 That now concludes members' opening statements and the chair 380 now reminds members that pursuant to committee rules all members 381 opening statements will be made part of the record 382 And again I want to thank all of our witnesses for being 383 with us today We greatly appreciate you taking the time to 384 testify before the subcommittee 385 Today's witnesses will have the opportunity to give 386 five-minute statements followed by a round of questions from our 387 members 388 Our witness panel for today's hearing will include Mr Tim 389 Day the senior vice president of the Chamber Technology 390 Engagement Center at the U S Chamber of Commerce Ms Michelle 391 Richardson deputy director of the Freedom Security and 392 Technology Project at the Center for Democracy and Technology 393 and Dipti Vachani vice president of the Internet of Things Group 394 and general manager of the Strategy and Solutions Engineering NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 20 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 395 396 Division at Intel And again I want to thank you all for being here today 397 and Mr Day you are recognized for five minutes If you'd just 398 pull that mic up close and turn the mic on the microphone is 399 yours NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 21 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 400 STATEMENTS OF TIM DAY SENIOR VICE PRESIDENT CHAMBER TECHNOLOGY 401 ENGAGEMENT CENTER U S CHAMBER OF COMMERCE MICHELLE RICHARDSON 402 DEPUTY DIRECTOR FREEDOM SECURITY AND TECHNOLOGY PROJECT 403 CENTER FOR DEMOCRACY AND TECHNOLOGY DIPTI VACHANI VICE 404 PRESIDENT INTERNET OF THINGS GROUP GENERAL MANAGER PLATFORM 405 MANAGEMENT AND CUSTOMER ENGINEERING INTEL CORPORATION 406 407 STATEMENT OF MR DAY 408 Mr Day Thank you very much 409 Good morning Chairman Latta Ranking Member Schakowsky 410 and distinguished members of the House Subcommittee of Digital 411 Commerce and Consumer Protection 412 Thank you for the opportunity today to testify about the 413 Internet of Things 414 Chamber's Technology Engagement Center or C_TEC 415 I am Tim Day senior vice president of the The Chamber established C_TEC three years ago to tell the 416 story of how technology can empower all Americans 417 we have focused our work on autonomous vehicles unmanned 418 aircraft telecommunications and the new economy 419 420 At C_TEC All of these issues and technologies are connected and supported by the Internet of Things Everyone participating in NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 22 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 421 this hearing today is in one way or another one of the nearly 422 11 billion internet-connected devices projected by Gartner to 423 be in use today worldwide 424 Whether we are streaming this hearing on a smart phone 425 whether or not we have asked Amazon Alexa or Google Home 426 directions to the Rayburn House Office Building or a wearable 427 counted the number of steps it took to get here we all have been 428 connected and our lives are being improved by the Internet of 429 Things 430 Not only does IoT technology directly benefit consumers 431 it is also making businesses smarter and more efficient 432 example the agricultural sector for better crop yields health 433 care for improved patient outcomes and manufacturing for 434 improved operations and maintenance 435 For One study has shown that industrial manufacturing IoT 436 spending is predicted to increase to $890 billion worldwide by 437 2020 438 IoT by creating efficiencies in public services by finding new 439 value for citizens enhancing capabilities and streamlining 440 processes 441 And of course government also stands to benefit from IoT may provide a much-needed answer for agencies seeking NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 23 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 442 to meet increasing citizen needs with decreasing budgets 443 And Chairman Latta back home in the Buckeye State 444 Columbus which was awarded the DoT's 2016 Smart Cities Challenge 445 Grant is using IoT in research and development to create smart 446 vehicle technologies 447 Another study has shown that wireless providers will invest 448 $275 billion towards building 5G networks which will be part 449 of the connectivity backbone of smart cities and IoT 450 This investment will add $500 billion in GDP and 3 million 451 jobs to the American economy 452 to the $11 trillion worldwide economic impact that is predicted 453 by 2025 for IoT 454 This number pales in comparison Needless to say IoT is an economic game changer The 455 Chamber's president and CEO Tom Donohue has stated that 456 technology must be embraced as the growth driver and game changer 457 that it is 458 459 That is why it is so critical that the United States maintain leadership in IoT by adopting the right regulatory framework 460 461 I would like to suggest a couple of ideas for your 462 consideration to strike the correct regulatory balance NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 24 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 463 Congress and agencies should do more to reduce the regulatory 464 burdens compliance costs and overlap 465 Government should evaluate existing regulatory activities 466 and bring together stakeholders in government industry to shape 467 IoT policy 468 Legislation like the DIGIT Act and the draft legislation 469 today the SMART IoT Act are much-needed steps in the right 470 direction to achieve this goal 471 Additionally actions like those done by the FCC led by 472 Commissioner Carr to streamline communications siting rules are 473 also to be praised 474 should avoid the temptation to impose prescriptive regulations 475 on IoT and single out IoT for regulation for issues such as 476 privacy As IoT is still in its infancy policymakers 477 Congress should continue a policy of technology neutrality 478 and finally a skilled workforce will also be critical to the 479 development of this new technology and investment in human capital 480 will determine which countries lead going forward in this space 481 We are currently witnessing a new industrial revolution led 482 by advanced technology including IoT which is a force for good 483 that should be fostered by smart regulatory frameworks that NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 25 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 484 encourage investment promote innovation as well as connect and 485 empower all Americans 486 487 488 Thank you for this opportunity I look forward to your questions The prepared statement of Mr Day follows 489 490 INSERT 1 NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 26 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 491 Mr Latta Thank you very much for your testimony 492 Ms Richardson you are recognized for five minutes NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 27 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 493 STATEMENT OF MS RICHARDSON 494 495 Ms Richardson Chairman Latta Ranking Member Schakowsky 496 thank you for the opportunity to testify today on behalf of the 497 Center for Democracy and Technology 498 CDT is a nonprofit technology policy organization dedicated 499 to protecting civil liberties and human rights in a digital world 500 including privacy free speech and access to information 501 We believe the Internet of Things has the power to enrich 502 people's lives in ways both big and small 503 that the Internet of Things poses unique privacy and security 504 challenges 505 But we also recognize Many of these devices collect information that is intensely 506 personal yet ungoverned by U S policy and privacy law 507 also become common to hear of serious security breaches which 508 have allowed hackers to use IoT devices to either steal 509 information or participate as part of a botnet 510 It has CDT's preference for technology policy is for private 511 industry to voluntarily create and adopt standards The 512 government plays an important role in setting standards and 513 incentivizing good behavior especially in sectors where security NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 28 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 514 failures had extreme consequences or in the consumer market when 515 users don't have a fair shot at understanding or managing 516 products 517 Congress has the authority and the responsibility to 518 determine whether the current government and private balance is 519 the right one 520 to assess that in two ways We hope this bill will help collect information 521 First we hope the SMART IoT Act will collect information 522 to determine whether voluntary standards and privacy standards 523 are not only being created whether they are being adopted by a 524 critical mass of industry players 525 Voluntary standards are the default in the IoT space and 526 billions of devices are up and operating on the internet and 527 more are coming 528 529 530 The foundational question we should be asking is whether this approach is working as a general matter Second the study should tease out any overlap or gaps in 531 government oversight of these IoT devices Cross-agency 532 coordination is crucial to sharing information and will help make 533 sure that the government is not issuing conflicting guidance or 534 requirements NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 29 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 535 Now we recommend the bill clearly state that nothing in 536 it should be interpreted to discourage agencies from continuing 537 work in critical areas like connected cars or health devices 538 Agencies like the FDA and NHTSA are driving standards for 539 devices or systems that have literal life or death consequences 540 and that work cannot wait 541 While industry deserves an overarching government plan for 542 IoT IoT is already too large and too diverse to cabin in a single 543 agency and developing sector-specific expertise will ensure that 544 government involvement is supported by the technical and policy 545 knowledge needed to make the right decisions 546 After you receive this report we expect that you will find 547 that one of the largest gaps in standards and oversight is in 548 the consumer market 549 As Ms Vachani mentions in the IoT report for Intel most 550 IoT devices and applications relate to industrial products smart 551 cities and the health industry 552 Many of these devices are subject to practical and regulatory 553 limits already For example some of these devices are embedded 554 in critical infrastructure which is already regulated writ 555 large and some of these devices are really quite simple and do NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 30 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 556 not collect personal information or offer computing power that 557 makes them attractive hacking targets 558 only measure water pressure or county the number of cars that 559 pass through an intersection 560 Think of sensors that The users of these sorts of devices also are often more 561 sophisticated and the corporate versus corporate relationship 562 can contractually ensure that IoT devices continue to work safely 563 But the consumer ecosystem does not have many of these checks 564 and balances Consumers are stuck in a take it or leave it system 565 and they will not have the option to leave it much longer as 566 connectivity is built into everything 567 Lay users just do not have the technical capacity to 568 understand and control the current crop of IoT devices on the 569 market 570 go wrong 571 They also have few legal remedies when something does If security fails devices can be a gateway to stealing 572 personal information or subject the owner to actual spying 573 Failures can harm a person or her property in the real world like 574 smart locks that can remotely open front doors 575 576 And these devices can be taken over as part of a botnet that can send scam email or in the case of the Mirai botnet take NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 31 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 577 578 down websites and internet access more generally In other words there's a lot at stake in the consumer market 579 and the current system is just not working 580 this committee finds the report to be just the jumping off point 581 for better oversight of consumer products and we look forward 582 to working with you and your staff on this bill 583 We are hoping that The prepared statement of Ms Richardson follows 584 585 INSERT 2 NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 32 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 586 Mr Latta Well thank you very much for your testimony 587 Ms Vachani you are recognized for five minutes NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 33 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 588 STATEMENT OF MS VACHANI 589 590 Ms Vachani 591 Thank you Mr Chairman Ranking Member Schakowsky and 592 593 Thank you members of the subcommittee I appreciate the opportunity to testify today on behalf of 594 Intel Corporation and I commend you and Congressman Welch for 595 your leadership on the SMART IoT Act 596 First I would like to turn to the vast benefits of the IoT 597 and discuss real-life IoT use cases that are relevant to the 598 committee's jurisdiction 599 Gartner predicts that IoT technology will be in 95 percent 600 of electronics for new product design by 2020 601 transformational societal and economic benefits that will flow 602 from this broad deployment of IoT technology is what energizes 603 Intel 604 The And the SMART IoT Act is a welcome indication that this 605 enthusiasm is matched by this subcommittee 606 transforming sectors like health care smart cities and 607 transportation 608 I would like to go over a few use cases The IoT is already Smart health care NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 34 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 609 -- less than 01 percent of patient data is available beyond the 610 bedside for health care teams to make clinical decisions 611 To solve this problem Medical Informatics Intel and Dell 612 partnered on an FDA-cleared IoT platform called Sickbay 613 continuously captures patient data from the bedside medical 614 devices and transforms it into actionable intelligence 615 Sickbay This enables care teams to make better and fast decisions 616 and predict patient deterioration before it occurs In the last 617 four and a half years Texas Children's Hospital used Sickbay 618 to improve health care for 2 1 million patients 619 Smart cities -- 92 percent of the world's population lacks 620 access to clean air and leading to millions of deaths annually 621 To address this Intel and Bosch developed IoT-powered pollution 622 monitoring systems that provide intelligent data and enable 623 real-time analysis 624 These IoT systems are used by governments to improve air 625 quality in congested cities like Pune India by factory owners 626 to track emissions and provide safety checks for all workers 627 by construction site managers to provide air quality warnings 628 and improve efficiency and by cities to provide residents with 629 recommended times for exercising outdoors NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 35 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 630 Use case number three transportation -- as the subcommittee 631 is aware the impact of autonomous vehicles will be life changing 632 particularly in our disabled community and aging population 633 The number of U S residents aged 78 and older will increase 634 by 53 7 million by 2030 compared to just 30 9 million in 2014 635 Many of these residents live in communities with poor or 636 no public transportation 637 mobility benefits 638 on AV AVs will offer vastly improved Intel applauds the committee's leadership 639 Next I would like to offer Intel's strong support for the 640 SMART IoT Act and respectfully offer recommendations to enhance 641 the legislation 642 Nations are racing to lead in this competitive IoT sector 643 It has been Intel's strong desire that the federal government 644 be more proactive in ensuring U S IoT leadership in declaring 645 the U S the IoT a national priority for the innovation in 646 investment and competitiveness 647 We applaud the subcommittee for its bipartisan work to set 648 America on its leadership path by ensuring an IoT study and 649 recommendations to promote IoT adoptions to grow our economy 650 I was on the Hill last October to unveil a broadly supported NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 36 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 651 industry report on IoT 652 IoT reflect this report 653 Intel recommendations to the IoT -- SMART First we urge the subcommittee to include a robust 654 definition in IoT that is nonproprietary neutral regarding 655 technologies and applications and contemplates both the consumer 656 and the industrial IoT 657 658 In fact industrial smart city and connected health will make up 70 percent of the use cases 659 Second we urge IoT -- you to seek specific recommendations 660 that would be highly impactful on laying the groundwork for the 661 national IoT strategy 662 incentives for the federal government and agencies to adopt IoT 663 technologies to advance their federal mission including smart 664 infrastructure solutions 665 This includes recommendations on How the federal government can best support global 666 industry-led IoT standard efforts and avoid new regulations that 667 duplicate existing industry standards and a criteria for the 668 federal government to invest in IoT public-private partnerships 669 and testbeds 670 671 Thank you for the opportunity to share Intel's thoughts on the SMART IoT Act We look forward to working with you to see NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 37 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 672 this bipartisan bill enacted into law -- that first step towards 673 a national IoT strategy -- and ensure U S leadership in this 674 transformational sector 675 The prepared statement of Ms Vachani follows 676 677 INSERT 3 NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 38 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 678 Mr Latta 679 being with us today 680 that will conclude our testimony from our witnesses and we'll 681 begin our questioning from our members and I will recognize 682 myself for five minutes 683 Well again I want to thank our witnesses for We really appreciate your testimony and Mr Day do you believe a compendium of all current federal 684 action on IoT-related issues will help promote interagency 685 collaboration and consistent federal action 686 Mr Day Thank you Mr Chairman and again I think what 687 we've heard is that the Internet of Things holds incredible 688 promise for our economy and the quality of life for citizens 689 I do I think the draft that we have before us today helps 690 with increased transparency and how government regulates this 691 technology in a better way 692 We are firm believers that the government should make data 693 available and complying a list of federal policies that affect 694 IoT I believe would go a long way in enabling the companies 695 that we are working with at the Chamber and others and especially 696 also small and startup companies to understand the regulatory 697 environment that we are faced with today 698 Mr Latta Yes let me ask you about that right there NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 39 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 699 because I know that when my friend from Vermont and I were doing 700 our Working Group meetings -- and actually we had them right here 701 in this room -- it didn't make any difference if you're from the 702 East Coast the West Coast the Midwest what type you're in 703 as Ms Vachani was talking about from everything from health 704 care to manufacturing to FinTech you name it 705 There was one thing that we heard from everyone -- that we 706 needed to make sure that we have a soft touch regulation out there 707 so people can be out there innovating and it's no -- we didn't 708 hear anybody ever say that they were against regulations but not 709 to have anything that was over burdensome that they couldn't go 710 out and regulate 711 When you're talking about these smaller companies out there 712 could you talk to me or talk to the committee a little bit about 713 what you have heard from them some of the major hurdles that 714 they're facing right now or things that need to be overcome 715 Mr Day Absolutely and you know I think what's exciting 716 about this is that this does impact middle America the coasts 717 Everyone as you said is impacted by this and I think when you're 718 a small business and a startup and my focus at the U S Chamber 719 of Commerce in the emerging technology space it is just that NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 40 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 720 It's emerging 721 It's changing by the day We are still learning what the technology means and so I 722 think there needs to be a structure but not too prescriptive in 723 the approach and you know quite frankly business leaders and 724 new startups and entrepreneurs are looking to run the -- their 725 businesses with the support of the government but not being told 726 exactly how to do it because we are still working on the benefits 727 and how this actually applies to you know the companies that 728 we are working with 729 And so I think what business leaders want to know is give 730 me the ability to invest to be able to take my idea to the next 731 step but don't you know regulate me so much that I am not able 732 to produce quality results and in the end be successful as a 733 startup 734 Mr Latta Thank you 735 Ms Vachani again I would like to turn a question to you 736 now 737 on and can you explain how those applications benefit the economy 738 and jobs 739 740 What are some of the IoT applications that Intel is focussed And again I was very interested because I know you were going through the health care the manufacturing the NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 41 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 741 transportation and construction but if you could get a little 742 bit more in depth with that I would appreciate it 743 Ms Vachani Absolutely So we have -- gosh we have over 744 500 market-ready solutions that we work with the industry to 745 create because one of the things -- the common misconceptions 746 about IoT it's vertical right 747 You have a retail solution and you have an industrial 748 solution and honestly when you look across the board our 749 customers are looking at solutions that go across multiple 750 industries 751 And so there are multi industry solutions They don't 752 necessarily sit in one nice little box as a vertical and so you 753 will see an industrial environment where they're -- where they're 754 trying to do predictive maintenance at the same time as inventory 755 management the same time as building management and you see 756 several different vertical like solutions coming together into 757 one application 758 And we believe that the maximum benefit is when these 759 solutions start to come together One of the areas that I want 760 to reflect on is that the U S is actually a leader worldwide 761 in our innovation that we have in IoT NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 42 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 762 So you will see solutions overseas that have Intel or other 763 companies within the United States technology our AI 764 applications our software that are driving innovation around 765 the world and that's expanding our economy just the same because 766 that's created here in the United States 767 768 769 It's built here by us and by our companies that are innovating at a faster rate Mr Latta In my last 24 seconds follow up with that 770 because again it's good to hear the United States is leading 771 on this 772 United States be the innovator out there 773 What's happening across the globe that is making the Ms Vachani Well I think that what we come down to is 774 we have some companies here that are able to look at these 775 solutions like Intel truly and that goes from the data center 776 all the way to the thing 777 And so we can look at this problem holistically and that's 778 important that we do that as well as some of the new technologies 779 that we come up with with specifically integrated circuits as 780 well as the software and artificial intelligence and the 781 leadership in artificial intelligence within this country 782 Mr Latta Well thank you very much My time has expired NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 43 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 783 and I yield back and I recognize the gentlelady from Illinois 784 the ranking member of the subcommittee for five minutes 785 Ms Schakowsky Thank you 786 Connected devices can follow us through every aspect of our 787 lives collecting data At the same time the committee has spent 788 a lot of time looking at how the data collected about us is used 789 by companies and by the government 790 We heard from Facebook about how much data it collects how 791 it shared that data with third parties and how it used our data 792 to sell advertising 793 794 795 As more and more devices collect data about us that data can be used to affect our decision making So Ms Richardson let me ask you some questions While 796 IoT devices provide benefits are you concerned about their data 797 collection 798 Ms Richardson Absolutely The way the U S works its 799 privacy law is to do it categorically to cover for example 800 communications financial data health information held by 801 doctors and if you don't fall into one of these categories you're 802 just not protected and there are very few if any limits on how 803 the information can be collected and used NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 44 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 804 It's going to be possible that a lot of these IoT devices 805 are going to collect data that is not covered by one of these 806 categories already and that would be one of the benefits of having 807 a baseline comprehensive privacy law in the United States as we 808 would not have so many cracks and you would see the IoT data have 809 some procedural rights for Americans 810 Ms Schakowsky I would like to work with you on that 811 Five years ago we were barely talking about location data 812 or facial recognition and now we are talking about genetic 813 information also 814 Ms Richardson should we be concerned about what personal 815 information is out there and how the kinds of personal information 816 available to collect change over time 817 Ms Richardson Yes The information that is collected 818 by these devices is really unique 819 few years before we widely collected things like you mentioned 820 that reflect let's say your heartbeat your location the food 821 you eat where you go the people you know and it can all be 822 aggregated in ways that give a very rich picture about people 823 in ways that they might be shocked to know 824 You only have to go back a I think one of the things you saw at your hearing with NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 45 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 825 Facebook is that the surprise factor is really what upsets people 826 in many ways 827 So this is something we need to watch more closely and 828 hopefully a universal privacy law would be able to protect that 829 sort of really sensitive information right now 830 Ms Schakowsky 831 absolutely necessary 832 nonsiloed way 833 834 835 So it's clear that privacy legislation is I like the way you talk about it in a In fact the Federal Trade Commission has recommended many times that Congress enact comprehensive privacy legislation Ms Richardson again the SMART IoT Act would examine how 836 different industries are using and developing IoT 837 a resource be helpful in the development of best practices for 838 privacy and IoT devices 839 Ms Richardson Yes Could such I think that would help us get a 840 better view of where the industry is going 841 to find though that there are very few when it comes to privacy 842 and for the most part the standards are about interoperability 843 technical standards and cybersecurity and you're going to find 844 a really big gap here 845 Ms Schakowsky I think you're going So the FTC recommended in the past that NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 46 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 846 privacy legislation should not be IoT specific 847 with that 848 Ms Richardson Absolutely Do you agree We want a forward-looking 849 tech-neutral law that will be able to cover all sorts of 850 information regardless of the type of device or entity that's 851 creating it 852 Ms Schakowsky So Mr Day said that one of the things that 853 we need to worry about is too much regulation standing in the 854 way 855 that we set some rules of the road some guidelines that industry 856 needs to follow 857 Don't you think there's a balance though of making sure Ms Richardson Yes and in a way those can drive 858 innovations themselves You end up having requirements that 859 inspire new solutions to protect privacy and security 860 And CDT does believe in a light touch but there are a few 861 places that government intervention -- or oversight is maybe a 862 better word -- is most urgent and that's where you look at things 863 like cars or pacemakers and devices that really have life or death 864 consequences if something goes wrong and I think we are seeing 865 the consumer market is just an area where everyday people are 866 not able to make informed decisions about the devices they're NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 47 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 867 buying the information that's collected and then how to secure 868 the devices 869 Mr Latta 870 The chair now recognizes the gentleman from Pennsylvania 871 Thank you The gentlelady yields back for five minutes 872 Mr Costello Thank you Mr Chair 873 I want to sort of continue down that path of consumer-facing 874 devices and speak a little bit more about being a small business 875 owner or a startup and approaching the infrastructure purchase 876 questions from an adequate security measure perspective 877 In what direction do we need to head -- and it may not be 878 necessarily government it may just be more industry -- in what 879 direction do we have to head in order to make sure that we are 880 getting it right 881 A rather open-ended question but why don't I start with 882 you Ms Richardson 883 Ms Richardson As far as security standards go we have 884 endorsed tech-neutral cybersecurity controls 885 really top-level decisions that both the manufacturers and the 886 operators can make 887 So these are So for example when you're building a device you should NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 48 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 888 always have the capacity to update the software right and you 889 could say that without getting a really prescriptive technology 890 you know description of how to do that and each company can decide 891 how to do that 892 And there is a list of maybe a half dozen of these sorts 893 of practices that I think are reasonably set as the baseline and 894 they include other things like being able to have passwords or 895 other authenticators that can be changed and things like that 896 Mr Costello Following through on that steps or 897 approaches that small and medium enterprises can utilize to 898 overcome concerns or difficulties relating to the system 899 integration side of IoT solutions to -- go ahead 900 901 Ms Richardson Can you repeat the question about system integration 902 Mr Costello Small and medium enterprises overcoming 903 their concerns or difficulties relating to system integration 904 of IoT solutions 905 a really big company integrating is very easy 906 -- 907 908 If you -- look I don't want to -- if you're Ms Richardson Not actually If you're a small It's actually difficult either way NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 49 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 909 Honestly the number-one challenge for IoT right now is 910 scale Scale is very difficult right and even with a company 911 as large as you would say Intel there -- if you look at our 912 market-ready solutions rarely do we have a solution that only 913 involves Intel 914 I mentioned many of our solutions -- Bosch was involved There is others There's Dell involved -- as 915 And so you're talking about multiple companies coming 916 together to include a complete solution and for a small or 917 medium-sized company that gets even more difficult right 918 And this is where the industry standards come into play 919 because when we start to create standards that are interoperable 920 and that we know work together that a small or medium-sized company 921 can create a piece and we know that that piece will work with 922 the rest of the system 923 And Intel and many other companies -- we were here with 924 Samsung -- are working across the industry to help those standards 925 get deployed and become more consistent interoperable 926 927 928 929 Mr Costello So when you use the term scale there what are you saying Ms Richardson What I mean by scale there is we are able to create -- I will give you an example We'll create a proof NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 50 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 930 of concept inside of the walls of Intel in our building and it 931 will look beautiful and work perfectly 932 It'll have the in system the data center It'll have the 933 store let's say 934 I take that out of my office inside of Intel and try to put into 935 a Levi store or I try to put it inside of a mall now it's working 936 with everything else around it and that's when we struggle 937 because there's other systems 938 It'll do inventory management There's old data There's new data 939 infrastructure is there 940 they don't 941 As soon as Maybe the Maybe they have connectivity Maybe And so that becomes more difficult for us to deploy and then 942 think about thousands and then add millions to that right 943 that's where we struggle with being able to take that technology 944 and deploy it into multiple instances across the world 945 Mr Costello That's helpful And You were speaking about 946 industry standards and depending upon what industry we are 947 talking about -- health care manufacturing whatever it may be 948 -- the place that you go for that industry standard to make its 949 way into code or regulation or whatever the case may be is 950 oftentimes different NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 51 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 951 Share with me challenges or frustrations in navigating 952 federal regulatory agencies to determine IoT industry standards 953 and how we could go about improving that 954 Ms Richardson 955 Mr Costello 956 Ms Richardson Well one I would encourage -That's a question for everyone Yes I can start One I would encourage 957 you to look at the industry standards that are already available 958 to us because the industry is starting to coalesce around a few 959 standards that go across multiple industries 960 Again we are not saying this is just for industrial or 961 environment or it's just for retail This is how we collect data 962 across the board and that could be a standard 963 So I would encourage you to look and I think that's part 964 of the recommendations here is to look at what the industry is 965 already doing and leverage that because we have come across 966 together in this space and I will allow you guys some time 967 Mr Latta Yes If -- since the gentleman's time has 968 expired if you all could just real briefly answer that would 969 be great 970 971 Mr Day Well I think what we are doing today in discussing is the right first step I think between the DIGIT Act and what NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 52 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 972 we are doing with the legislation in draft form today is that 973 first step and it's the right approach to some of these issues 974 that we are discussing and bringing forward today 975 Thank you 976 Mr Latta 977 Would you like to comment much 978 Mr Costello 979 Mr Latta 980 981 982 983 Okay thank you very Yield back The gentleman yields back His time has expired And the chair now recognizes the gentleman from California for five minutes Mr Cardenas Thank you very much Chairman Latta and 984 Ranking Member Schakowsky for having his important hearing and 985 I would like to thank the witnesses for coming forward and 986 enlightening us as to what's going on out there in the real world 987 My background is in engineering I got my electrical 988 engineering degree from UCSB back in the days when we used punch 989 cards in our programming your technical you lack 990 So I think a lot has changed but I think that many of us 991 do welcome these changes and having said that I think that public 992 policy needs to make sure that we are mindful of this fast-moving NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 53 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 993 effort of the Internet of Things and how it affects individuals' 994 privacy how it affects industries how it affects jobs how it 995 affects the jobs of today and tomorrow and how do we get American 996 workers ready and prepared to be the workers of today and tomorrow 997 These are the kinds of things that weigh on my mind During 998 my careers I actually owned a small business at one time so I 999 know what it's like for a small business to be able to pull 1000 something off the shelf in a very efficient cost-effective manner 1001 and I think the Internet of Things is making that much more 1002 efficient every single day and making smaller businesses 1003 especially mom and pops a heck of a lot more competitive 1004 Wherein the old days maybe back in my days in the '80s 1005 and '90s when I was a business owner everything was in maybe 1006 fives and tens of thousands of dollars to get an innovative device 1007 Now it appears that we can actually get an innovative device 1008 that changes and allows us to be more efficient and hire more 1009 individuals and grow our business to the tune of hundreds of 1010 dollars 1011 Is that correct Do we have devices out there that maybe 1012 20 years ago to innovate were in the thousands of dollars and 1013 today it might be only a few hundred NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 54 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1014 1015 1016 Can one of you give me an example of something that you can think of that actually touches on that Ms Vachani Absolutely If you think about for example 1017 the building management that was in New York the deployment that 1018 we did those were sensors that were -- they were not very 1019 expensive 1020 We are talking sensors that are dollars on -- as it is and 1021 they can look into a room and save a small business on their costs 1022 -- their infrastructure costs by looking at occupancy inside of 1023 a room and deciding that the AC needs to be turned on because 1024 no one's in the room 1025 This isn't expensive technology from that stand point but 1026 it's changing the way we live and the way we operate within our 1027 businesses and saving us cost right 1028 One of the major ways that this building in New York was 1029 able to save money is we found a leak in one of their pipes Again 1030 we are talking about a sensor that's able to determine that there's 1031 a leak in a pipe and will waste right and they were able to 1032 reduce that cost 1033 And so from that standpoint innovation isn't necessarily 1034 requiring extensive amount of investment but there is ways where NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 55 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1035 we can start to make decisions very quick when this data comes 1036 together 1037 Mr Cardenas Ms Richardson I have a question -- thank 1038 you -- I have a question for you about consumer applications and 1039 how do you think the Internet of Things devices are being used 1040 inside manufacturing workplaces 1041 I happen to represent a community in Los Angeles that has 1042 a big corridor of manufacturing lots of -- tens of thousands 1043 of manufacturing jobs in my district 1044 Ms Richardson Yeah and I think it's still unknown how 1045 this is going to affect the workforce on balance right 1046 going to create new jobs of the people who actually have to create 1047 the devices and we hope that a strong privacy and security 1048 practice will create professionals to deal with that also 1049 You're I think there are questions to ask about whether they will 1050 replace human beings on the job But there will always be 1051 decisions that human beings have to make that we can't let 1052 computers do 1053 So I don't think it will eradicate humans altogether 1054 Mr Cardenas 1055 Well on that note there are things such as smart helmets and smart glasses that now can be deployed in NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 56 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1056 the workplace and do you have any comments about how these devices 1057 might to affecting somebody's privacy in the workplace 1058 Ms Richardson Yes and people's privacy in the workplace 1059 is much more limited than in their home or out in public 1060 is long established that employers can really control the type 1061 of information that they're collecting on their property and while 1062 they're conducting their services 1063 This I think though when you see a lot of these sorts of 1064 applications they don't have to necessarily collect a lot of 1065 personal information right 1066 This is where again the controls built into the products 1067 on the front end are important so that you can collect the 1068 information necessary for your work but not let's say what they 1069 do on their breaks or the conversations they're having or things 1070 that are really not core to doing the job 1071 Mr Cardenas Thank you I mean Mr Welch talked about 1072 the cow and I was thinking wow I hope that cow is not creeped 1073 out about the privacy -- 1074 1075 1076 Laughter -- about every time she walks into the barn But Ms Vachani I know Intel has been active on the NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 57 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1077 connected worker's front and arguing that they keep workers safe 1078 and productive 1079 Can you give us an example of that Ms Vachani Absolutely Actually there's a really good 1080 example with a fireman which resonates with me right By 1081 connecting a fireman that goes inside a building we now know -- 1082 by the sensors we can tell what is the oxygen level around him 1083 or her if the firewoman -- the fireman is laying down or standing 1084 up what exact location they're in within the building if they're 1085 laying down 1086 These are -- these are opportunities for us to save lives 1087 of some of our workers that are working in critical conditions 1088 I think it's essential 1089 Mr Cardenas 1090 Mr Latta 1091 And I am sure they only have happy cows in Vermont 1092 The chair now recognizes the gentlelady from California for 1093 Thank you Thank you I yield back The gentleman yields back five minutes 1094 Mrs Walters Thank you Mr Chairman 1095 Mr Day do you believe that a review of all regulations 1096 guidelines standards and other policy efforts undertaken by 1097 federal agencies is important and do you think it will assist NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 58 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1098 us in ensuring consistent policy of Internet of Things-related 1099 matters 1100 Mr Day 1101 Yes I do Thank you for the question Congresswoman I think the SMART IoT Act by studying all sectors 1102 of the IoT and how they regulate technology and current policies 1103 will go a long way in cutting down overly burdensome regulations 1104 and duplicative regulation as well 1105 I think when you're looking at the broad spectrum of 1106 applications here it's critical when you're looking at the impact 1107 on self-driving cars to getting a patient through a hospital more 1108 efficiently cost effectively 1109 It's all important and I think the legislation before us 1110 today will streamline that process and benefit by frankly 1111 everyone 1112 Mrs Walters 1113 And Ms Vachani can you please discuss the benefits to a 1114 connected world both for business like Intel as well as consumers 1115 who use Internet of Things products 1116 Ms Vachani Okay Thank you There's multiple benefits through the 1117 Internet of Things Whether it be more efficiency inside of a 1118 factory so predictive maintenance is a very simple use case that NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 59 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1119 we use in factories that allow us to determine if a machine is 1120 going down sooner than it actually does go down and that'll prevent 1121 the down time for the factory right 1122 This is a fundamental analytics that has changed how 1123 efficient our factories can be Let's think of retail where one 1124 of the number-one determinations of success or how they lose 1125 customers is because the item you're looking for isn't there 1126 1127 So you go in for a pair of jeans you don't have your size 1128 you leave you forget 1129 people are looking for and that we have the inventory ready for 1130 them and that we understand what inventory you have 1131 loss is a major loss for our retail businesses especially brick 1132 and mortar businesses 1133 That's important that we understand what Inventory And then I would also look at cities and how cities are using 1134 technologies to do gunshot detection at intersections or 1135 monitoring the environment as far as air quality is concerned 1136 And that data enables us to decide if the changes we are 1137 making -- let's say we have in India electric rickshaws 1138 they actually having an impact on our air quality and to make 1139 wise decisions based on data rather than hypotheses that we are NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com Are 60 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1140 making things better 1141 Mrs Walters Okay Thank you 1142 Mr Day as we continue to advance toward an increasingly 1143 connected world some have expressed concerns with protecting 1144 consumer information 1145 These are vitally important concerns yet we also must 1146 acknowledge that Internet of Things devices in a connected world 1147 provide substantial societal benefits 1148 1149 1150 Can you speak to how we can protect consumer information without losing the upside to a more connected world Mr Day You know I think it's obvious that the Chamber 1151 believes that consumers deserve to have their personal data 1152 respected by the companies and it's important that we are mindful 1153 of that going forward 1154 I think the other thing that I mentioned in my opening 1155 statement was that technology is not a single all-powerful 1156 industry and that I think it's important that this is a part of 1157 every industry 1158 And when we are looking at the Internet of Things I think 1159 it's something that we need to be mindful of but not directly 1160 linking the privacy you know issue to this legislation as we NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 61 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1161 go forward 1162 But I think it is something as we've all testified to that 1163 it's important and we need to be considering what data means now 1164 because data is being created in massive amounts and how that 1165 is handles is truly important 1166 And I think that's one of the areas where the Chamber is 1167 doing a lot of work and you will be hearing more from us on some 1168 of the importance of privacy principles going forward as a 1169 result of some of the discussions that we've been hearing in 1170 Washington lately 1171 Mrs Walters 1172 Ms Vachani as you may know this committee is very focused Okay Thank you 1173 on the advancement of self-driving cars 1174 discusses the enormous benefit of increased mobility that 1175 autonomous vehicles will provide for aging and disabled 1176 populations 1177 1178 1179 Your testimony Can you expand on this and discuss the role Internet of Things plays Ms Vachani Autonomous vehicles what the connection back 1180 to an aging population is if you don't have public transportation 1181 for someone to get to the hospital or someone to get to where NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 62 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1182 they want to go for a social benefit let's say and having more 1183 independence for our elderly population a vehicle that is 1184 autonomous is safer for them to get from point A to point B and 1185 that enables them the flexibility and the independence that we 1186 want for our elderly population 1187 Mrs Walters 1188 And I am out of time 1189 Mr Latta 1190 1191 1192 1193 Okay Thank you Thank you Thank you very much The gentlelady yields back And the chair now recognizes the gentlelady from Michigan for five minutes Mrs Dingell Thank you Mr Chairman and to Ranking 1194 Member Schakowsky for the leadership on this issue and to 1195 everybody for being here 1196 I think that it's safe to say that we do have agreement on 1197 both sides of aisle about the significant and revolutionary things 1198 that the Internet of Things is bringing to industry and consumers 1199 and you all have certainly talked today about examples where it's 1200 already making a difference 1201 1202 But I continue to have a reservation that's been expressed by a number of other of my colleagues NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 63 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1203 As we compare the rise of IoT to the development of the 1204 internet that the internet thrived because of the light regulatory 1205 touch used and I think we are not paying enough attention to 1206 security and privacy 1207 So I have to already say to you Mr Day before I even ask 1208 you my questions to say that we should deal with privacy is not 1209 something that I am going to be comfortable with because I think 1210 that the technology -- that the Facebook hearings have showed 1211 people had no idea of the amount of data that was being tracked 1212 and am already -- there aren't -- there isn't security on how 1213 that information is being used and we are not protecting even 1214 the privacy of an individual 1215 1216 So I won't go off on that right now to that comment But I had to respond But I would like to ask a few questions 1217 Ms Richardson in a market that's rapidly evolving how 1218 have you seen companies balancing getting to the market first 1219 with protecting security 1220 Ms Richardson Yes We often see that privacy and 1221 security is what fall short here and a lot of these controls 1222 that are considered to be best practices are not hard from a 1223 technical matter NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 64 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1224 For example a couple of years ago the BitTag -- the broadband 1225 internet technical advisory group -- put out a report with a list 1226 of maybe five to 10 things that were of utmost priority like 1227 encryption right making sure that the data collected was 1228 protected in transit in storage avoiding hard-coded passwords 1229 -- this is one of the problems with the Mirai botnet right 1230 1231 1232 All of those cameras were accessible with the same password the hackers knew and they were able to get all these cameras And if you meet some of these baseline best practices you're 1233 going to lift all boats right It's not going to solve every 1234 problem but it will certainly give us herd immunity as users of 1235 all these different devices 1236 Mrs Dingell 1237 Ms Vachani on the consumer side have you seen privacy 1238 being designed into these products before they're hitting the 1239 market 1240 Ms Vachani Thank you Yes Actually I will tell you and hope to 1241 give you confidence that the security and privacy is utmost 1242 imperative when we are designing a solution -- where we store 1243 data how that data is transmitted and we look at that as a 1244 fundamental premise as we are integrating these solutions and NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 65 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1245 1246 we make decisions that are different We may store data locally because it makes it easier for 1247 us to be able to protect it 1248 in the solutions that we create and we -- if you look at the 1249 solution that we had with regards to the health care monitoring 1250 that's FDA approved and we follow all HIPAA laws right 1251 enable our silicon so that our consumers are able -- our solution 1252 developers are able to follow HIPAA laws 1253 Mrs Dingell And so these criterias are absolutely We So not to be sarcastic but as someone who 1254 has been hacked at least 15 times every one of the major ones 1255 and that's one of the difficulties is once that hack occurs -- 1256 once that data is obtained by somebody you can't put the genie 1257 back into the bottle 1258 Mr Day I know your organization has -- is concerned and 1259 apprehensive about regulations as you expressed it 1260 of my concerns is going to build right on what I just said -- 1261 that down the road there will be these massive data breaches that 1262 we keep seeing or an abuse of privacy 1263 We'll convene a hearing But one The witnesses will be questioned 1264 Everybody will express outrage and concern but the damage will 1265 have already been done which was one on Facebook which I just NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 66 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1266 talked about 1267 Do you think it would be helpful to develop some clear rules 1268 of the road for companies now so we can try to mitigate this for 1269 the future 1270 Mr Day Thank you Congresswoman for the question 1271 And to answer you directly yes I firmly believe that and 1272 I think I would like to suggest that the offer is extended to 1273 work with you and your office on these issues 1274 In fact the Chamber is currently going through a process 1275 right now on developing privacy principles that we will be working 1276 with Congress on 1277 1278 1279 And so I think probably earlier than later to be engaging with you and your staff would be a great opportunity I will tell you again that I firmly believe consumers 1280 deserve you know to have their personal data respected by 1281 companies that they're working with and I think that it's critical 1282 though that we strike that proper regulatory balance that protects 1283 consumers while promoting the technology that we all use every 1284 day and appreciate 1285 1286 Mrs Dingell That's one of the biggest challenges in this committee NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 67 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1287 I know I am out of time Mr Chairman but it would be 1288 interesting for the record to get what principles they are 1289 coalescing around that you mentioned earlier in your testimony 1290 1291 1292 1293 1294 I think it would be useful for all of us Mr Latta Thank you very much back The chair now recognizes the gentleman from Kentucky for five minutes 1295 Mr Guthrie 1296 Thanks Mr Chairman 1297 1298 1299 1300 The gentlelady yields here Thank you very much It's great to be here Thanks for having all the witnesses We've had some really interesting hearings in this space The other day we did quantum computing which I am still trying to figure out The guy said well I will make it simple for you -- it's 1301 like flipping a coin and getting heads or tails is normal 1302 the quantum world you can flip a coin and get heads and tails 1303 at the same time 1304 So that really made it simple for me In I've been thinking 1305 about that all weekend trying to -- trying to figure out what 1306 he actually meant 1307 That's how he explained it But it is good that we are getting to like you know a NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 68 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1308 work product out of this so it's important So that's kind of 1309 what I want to focus on today and hopefully things I can 1310 understand 1311 So Mr Day can you briefly explain while voluntary 1312 industry-led globally recognized and consensus-based processes 1313 for Internet of Things standards are so critical and could you 1314 name some examples of industry-led efforts that are currently 1315 taking place 1316 Mr Day So with this legislation is as I testified to 1317 I think is an important first step and I think by having certain 1318 standards set and compiling information again by all industries 1319 and sectors will benefit all of us and that I think the benefits 1320 both to consumers to industrial and to government are very clear 1321 and you know it's everything from keeping a global competitive 1322 lead on other countries and that this country needs to continue 1323 to be the leader in technology and again I think you know 1324 it's a great attribution to what the subcommittee and full 1325 committee has done on a bipartisan basis on self-driving cars 1326 to you know the health care applications that we've discussed 1327 So there's a whole host and wide variety of areas where this 1328 is a true benefit and again fully support the legislation -- NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 69 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1329 the draft legislation and the DIGIT Act as well 1330 out in support of that early on and work -- hope to work with 1331 the committee going forward on passing the legislation 1332 Mr Guthrie Thanks We have come And so Ms Richardson why do you 1333 believe compiling a list of industry standard-setting efforts 1334 under the SMART IoT Act will be a critical part of helping to 1335 inform future congressional action 1336 Ms Richardson Yes and we would go one step further to 1337 say the list should also come with an estimation of whether the 1338 standards are being estimated 1339 or get a report back that has a thousand standards listed because 1340 the next question is going to be well are these being implemented 1341 right -- who's using these and are they working We don't want you to come back 1342 That's the logical question and I think that's what Congress 1343 advocates industry is sort of dancing around at this moment -- 1344 is that process working 1345 So I would recommend to include that analysis top and that 1346 would help you figure out where you really want to focus your 1347 efforts going forward 1348 Mr Guthrie Okay Thank you 1349 And Ms Vachani we've heard in the past hearings about the NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 70 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1350 critical need for security and good cyber hygiene both in 1351 production lines for IoT devices within the -- and within the 1352 federal government 1353 What are you doing at Intel to safeguard IoT devices and 1354 networks from hacking vulnerabilities and what can small to 1355 mid-size businesses do to take meaningful steps to address data 1356 security concerns 1357 Ms Vachani So if I look at Intel's contribution here 1358 we are -- our security is fundamentally written into the silicon 1359 development 1360 connectivity 1361 think of security across the board 1362 So it's in hardware its software It's in the So we think of silicon across the board and we We are also -- one of the areas that you talked about was 1363 software defined right 1364 change or as we learn more can we reprogram our devices -- can 1365 we update those 1366 Can -- as security standards start to And so that's included in our assumptions So we enable the industry through not only hardware but 1367 software security to be able to implement the best known security 1368 that we know at this point in our space 1369 So absolutely paramount in what we do 1370 Mr Guthrie Okay Thank you NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 71 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1371 I know you mentioned earlier -- and I had another hearing 1372 but I heard you mention earlier -- scale 1373 what you see as other potential impediments to deployment of IoT 1374 and what we should be aware of going forward 1375 Ms Vachani But could you name Well one of the -- we've talked quite a bit 1376 about standards and one thing I want to make sure we make the 1377 point of is these standards are international and so scale is 1378 just not within the United States 1379 I would like for us to be competitive internationally and 1380 having these standards that were global allows us to provide 1381 technology to other countries and export our great experience 1382 that we have here 1383 And so I believe the interoperability and enabling us to 1384 be competitive internationally and taking advantage of these 1385 international standards will be -- will be important for us to 1386 be successful 1387 Mr Guthrie Thank you and thank you for your testimony 1388 I appreciate it It's a little more understandable for someone 1389 like me I asked the guy how could you flip a coin and get both 1390 Ms Vachani I have no idea 1391 Mr Guthrie He says it's like -- it's like putting it NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 72 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1392 in a box and the box is continually spinning and that really is 1393 the clue 1394 Laughter 1395 This is -- this is coming from a guy who's never solved the 1396 golf peg game Cracker Barrel So we'll figure it out 1397 Thanks a lot 1398 Mr Latta 1399 The chair recognizes the gentlelady from California for five 1400 1401 I appreciate it and I yield back The gentleman yields back minutes Ms Matsui Thank you Mr Chairman I want to thank you 1402 and the ranking member for having this hearing today and I want 1403 the witnesses -- thank you very much for being here 1404 I've discussed the potential block chain applications with 1405 the subcommittee before including its possibility to allow 1406 spectrum sharing as next-generation broadband networks are 1407 deployed 1408 As you all know block chain is a decentralized accounting 1409 technology that verifies transactions through a shared ledger 1410 system 1411 1412 When a transaction and a block chain is completed that transaction is verified against a ledger stored on each computer NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 73 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1413 in the network 1414 The IoT and connected devices will facilitate a significant 1415 expansion of data transactions likely between multiple different 1416 networks and block chain could be used to verify and secure these 1417 transactions 1418 Is there an opportunity for this legislation to more 1419 precisely explore how new technologies could facilitate the 1420 secure advancement of internet-connected devices 1421 And anyone on the panel can answer that 1422 Mr Day I will take a first attempt at answering that 1423 question 1424 an area where IoT will offer a lot of benefit 1425 And I agree with you -- I think block chain is certainly At the Chamber we are just now beginning to work on our 1426 FinTech work and we are calling on members of help us understand 1427 the benefits 1428 we should be looking at this 1429 I think the legislation as drafted though is the correct 1430 step 1431 to progress 1432 1433 And so I think there are a number of ways that It allows for technologies like block chain and others But as we are understanding the technology and the benefits thereof we can continue to work with you and other members of NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 74 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1434 Congress on implementing certain regulations as appropriate 1435 facing the technology 1436 Ms Matsui 1437 Ms Vachani Anyone else Block chain is absolutely a technology that 1438 Intel is looking at and one that can be used in IoT applications 1439 so a really good connection there 1440 I think though one of the points that you made when you 1441 kicked off as you're looking five to 10 years out and you have 1442 the benefit of doing so and so today it's block chain and tomorrow 1443 it is -- it could be something even more revolutionary and that's 1444 why it's important that we consider this not from a very 1445 technology-specific standpoint but you're more holistically as 1446 to what's necessary for us to be successful regardless of the 1447 implementation technology 1448 Ms Matsui Okay Narrow band IoT networks are 1449 particularly useful for long-range low-power applications 1450 Specifically these networks improve capacity spectrum 1451 efficiency and power consumption levels of user devices 1452 Narrow band IoT networks have potential both nationwide and 1453 particularly for rural and indoor coverage These networks can 1454 coexist with commercial mobile networks and their propagation NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 75 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1455 characteristics could provide better range and reduce coverage 1456 costs for consumers in both rural areas and across the country 1457 Anyone on the panel -- what role do narrow band networks 1458 have in the IoT ecosystem from a spectrum efficiency cost and 1459 deployment perspective 1460 Ms Vachani I think narrow band is going to help with -- 1461 there are several elements in narrow band that makes IoT 1462 applications you have already referred to -- it's lower cost 1463 lower power and a longer -- which enables longer battery life 1464 1465 1466 So think about we currently have an application where we are sensing the environment for a case of strawberries right We want to make sure the humidity is right We want to make 1467 sure the temperature is right 1468 connectivity -- the continuous connectivity while extending the 1469 battery life and not increasing the cost of something that we'd 1470 want to do with a pack of strawberries 1471 1472 1473 1474 1475 Narrow band allows for that Also understand that when you move to the world of 5G now all of this comes together So now we have a narrow band spectrum 5G includes all of those spectrums -- will enable us to be able to pull this together as a complete solution It revolutionizes how we think of connectivity and our NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 76 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1476 spectrums because narrow band is included as well as low latency 1477 as well as high bandwidth 1478 Ms Matsui Okay Great 1479 Anyone else want to comment on that 1480 Okay Spectrum is the invisible infrastructure and 1481 Congressman Guthrie and I are working on this 1482 underpins our communications infrastructure and adequate supply 1483 is necessary to realize the potential on next-generation 1484 broadband networks and the IoT 1485 In the -- it Specifically agencies should have access to funds made 1486 available for engineering research that could lead to the 1487 repurposing of spectrum for commercial use 1488 What role will next-generation networks play in our IoT 1489 strategy and how would delivering more spectrum to commercial 1490 users help 1491 Ms Vachani I would summarize it into one word which is 1492 interoperability If you think about a wider spectrum analysis 1493 so 5G enables low spectrum as well as high -- low latency high 1494 bandwidth and now you have that on one network 1495 1496 And so you're able to include all of those that it's not very much a vertical solution Remember I said We have all kinds NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 77 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1497 of pieces that are coming together into an IoT solution which 1498 can vary in spectrum and once we have a solution that encompasses 1499 all those spectrums now it makes deployments easier for our 1500 customers thus enabling scale which we -- 1501 1502 Ms Matsui Okay I've run out of time so thank you very much 1503 Ms Vachani 1504 Ms Matsui 1505 Mr Latta Thank you Yield back Thank you very much The gentlelady's time has 1506 expired and the chair now recognizes the gentleman from West 1507 Virginia for five minutes 1508 Mr McKinley Thank you Mr Chairman and I apologize to 1509 the panel -- that we've got a hearing going on downstairs so we 1510 are back and forth in between them and perhaps I've missed some 1511 of your testimony that targeted what my questions were 1512 But I want to begin with saying that I am going to start 1513 by assuming you have all read Case's book The Third Wave Two 1514 out of three have 1515 I was fascinated with that book -- that the possibilities 1516 of where we might go long term things like the -- it was mentioned 1517 about the refrigerator that could speak to you your clothing NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 78 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1518 1519 could tell you how your -- whether your wellness Those were all in the long terms I am somewhat interested 1520 in the short term however and that is is there anyone -- can 1521 you tell me from your -- the three experiences we have up here 1522 is there something in the pipeline of the IoT that might indicate 1523 the propensity of an area to have a problem with opioid abuse 1524 I know some people have -- or they've talked about doing 1525 it to be able to develop where that might be But is there anyone 1526 that you know of that's actually got something close to fruition 1527 that we could do this 1528 Because we are getting as we all know nationally getting 1529 hit pretty hard with this and we don't know where the next problem 1530 is going to crop up until after 1531 being proactive We are reacting rather than 1532 So I am curious to see with the Internet of Things in a short 1533 term is there someone developing software that might be able to 1534 identify where the next problem could crop up 1535 Ms Vachani Yes Actually Intel is working on a -- 1536 exactly on that problem concerning the monitoring of medicine 1537 and the ability to know exactly where that medicine is going -- 1538 is it going to the right person monitoring how many tablets are NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 79 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1539 there and knowing exactly who's taking those -- having some facial 1540 detection -- who's picking up those tablets 1541 And so absolutely I believe that there is a connection 1542 -- you have made a very relevant connection and thank you for 1543 that 1544 1545 1546 Mr McKinley What's the time -- do you have a sense of -Ms Vachani We are seeing an implementation immediately 1547 and it's an evolution over time 1548 have facial detection immediately at all of our pharmacies but 1549 it'd be interesting 1550 I mean we are not going to It's an evolution over time but we are seeing implementations 1551 right away in which we can start to monitor medicine better 1552 It's just -- it's just a matter of is it getting to the right 1553 person how many and are the right people taking it 1554 So you think about in the opiate but you can also think about 1555 it with elderly patients as well right or making sure they are 1556 taking their medicines on time 1557 Mr McKinley That may be a worry but again the propensity 1558 -- what -- this area this community may be hit hard next 1559 what I am looking for as well NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com That's 80 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1560 Where -- the fact that there could be some software that 1561 says the drugs -- 20 million pills are going to one pharmacy that 1562 ought to trigger something 1563 Ms Vachani 1564 Mr McKinley 1565 1566 1567 1568 Right But in the meantime is there socioeconomic barriers that we need to break down So Mr Day you look like you had -- you were going to contribute to this conversation Mr Day So yes at the Chamber Congressman we have been 1569 looking at economic situations across the country and that impact 1570 of joblessness and how communities have been impacted by this 1571 plight and looking at ways that we can start to examine the linkage 1572 between the two 1573 And I think to the point on monitoring pill bottles and 1574 knowing times of when they're taken and monitoring you know 1575 who are getting their prescriptions et cetera those are things 1576 that are happening now but there is a lot more to be done 1577 Mr McKinley Well if I could on that that just -- because 1578 you touched on something I am kind of sensitive to is the 1579 socioeconomic -- household income education level 1580 West Virginia has -- some will use that as the excuse for NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 81 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1581 why West Virginia is being in that -- leading the nation in opioid 1582 overdose but number two until last year was New Hampshire and 1583 New Hampshire has polar opposites on that 1584 It has one of the highest household income It has the 1585 highest education level and on and on and on with good 1586 socioeconomics 1587 1588 1589 1590 1591 So think there's something separating the two between us So I am just curious if someone's developing something more sophisticated than just going on socioeconomics Mr Day I am not personally aware to be honest with you But I think it would be an opportunity for us to work together 1592 as we continue our work with the Chamber and working with our 1593 member companies on various technologies and I would be happy 1594 to do that 1595 Mr McKinley 1596 Ms Vachani 1597 1598 1599 I would like to pursue that I would like to offer that we can follow up with the details of the solution I just Mr McKinley If you could back to my office I would appreciate that 1600 Ms Vachani I would love to do that if I could help 1601 Mr McKinley All of you Thank you very much NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 82 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1602 I yield back my time 1603 Mr Latta 1604 The chair now recognizes the gentleman from Vermont and 1605 I want to thank him for all of his hard work not only in this 1606 Congress but in the last Congress working on IoT issues with 1607 me 1608 1609 Thank you very much So thank you very much The gentleman yields back The gentleman is recognized for five minutes 1610 Mr Welch Thank you and thank you as well Mr Latta 1611 I want to focus a little bit on rural America -- just to 1612 have each of you say what it is we need to do in rural America 1613 if we are going to have any opportunity to yield the benefits 1614 of IoT 1615 I will start with you Mr Day 1616 Mr Day So I think one of the most important things and 1617 you mentioned it earlier Congressman is the fact that broadband 1618 is not in every household in the country and that's first and 1619 foremost I think for a lot of reasons I think for being able 1620 to compete globally being able to be connected and be able to 1621 have a business based upon the internet is critical 1622 And so I think for rural America -- and I applaud your NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 83 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1623 efforts That's first and foremost 1624 Mr Welch Thanks 1625 Ms Richardson 1626 Ms Richardson Well I think the whole point of having 1627 standards and what your bill is discussing is to shift the 1628 responsibility for security to the people who can best address 1629 it right -- the manufacturers the operators -- and I think this 1630 is where sort of low-tech users benefit most from this 1631 And so to the extent that your rural users are rapidly 1632 deploying new technology that they're not familiar with they will 1633 certainly benefit from better security standards 1634 Mr Welch 1635 Ms Vachani 1636 Ms Vachani Thanks Absolutely I think -- I absolutely applaud 1637 the benefit to get broadband into rural America but understand 1638 that we can do technology -- implement technology today whether 1639 it be a cellular signal right 1640 I will give you the example of my parents who still live 1641 in the same house that I grew up in and won't leave no matter 1642 what I do at this point 1643 Having some type of monitoring making sure they're getting NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 84 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1644 up in the morning and that they're -- oh somebody's opened the 1645 refrigerator that she's eating -- there's elements of that that 1646 I think is important that we can do today for rural America with 1647 the connectivity that we have and we don't have to limit ourselves 1648 to that deployment 1649 Mr Welch 1650 The other broad question -- I just want to go down the panel Okay Thank you 1651 -- is about privacy and security 1652 about that 1653 You have talked a little bit But is there a role that you believe the Congress has to 1654 play in ensuring an individual's personal data is protected and 1655 is it your view that an individual has to have the control over 1656 how his or her data is being used -- something we asked Mr 1657 Zuckerberg when he was here a while ago 1658 Mr Day Well again I think to emphasize the point that 1659 consumers again have and deserve the right to have their 1660 personal data respected by all 1661 1662 1663 1664 Mr Welch Let's go quickly because I have one more question Mr Day As we develop our principles at the Chamber I look forward to working with you on those details NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 85 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1665 Mr Welch 1666 Ms Richardson 1667 1668 1669 1670 1671 Thank you We eventually need legislation That's going to be the only way out of this mess we are in Ms Vachani I think working together between government and industry is essential to come up with the solutions Mr Welch plays But there has to be some role that Congress We can't be passive observers of what's going on 1672 Mr Day Right 1673 Mr Welch 1674 Let me ask you Ms Vachani -- I know Intel has been a leader Do you agree with that Thanks 1675 in IoT advancement and I know you have had a high position as 1676 a thought leader in that space for years 1677 So I want to follow up your testimony and ask if you can 1678 expand your suggestions as to the definition that we should use 1679 in his bill and why it's so important to get that definition right 1680 Ms Vachani One of the number-one challenges of scale 1681 and it sounds very simple is terminology 1682 other when we -- when we are having -- and I see us doing it in 1683 the industry and so we are in this space 1684 1685 We live it and breathe it We talk past each But we use different words to represent different things and we are talking past each other NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 86 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1686 So one of the fundamental things I've had to do within my 1687 organization within my company as well as outside is to start 1688 to get on the same language and that's one of the things we are 1689 asking for this as well is just to get on the same language so 1690 we know when we are speaking to each other what we are referring 1691 to 1692 Mr Welch 1693 I thank the panel 1694 And I yield back 1695 Mr Costello 1696 The gentleman from Oklahoma Mr Mullin is recognizes for 1697 1698 1699 1700 Okay Thank you Very helpful Presiding The gentleman yields back five minutes Mr Mullin Thank you Mr Chairman and thank our panel for being here I got just a few questions and Ms Vachani -- is that how 1701 you pronounce it 1702 the -- for the help of myself and you might have already been 1703 asked this question but as you have heard we were running back 1704 and forth between committees 1705 Ms Vachani 1706 Mr Mullin I appreciate you being here and I just for No problem Are there barriers or what are the barriers NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 87 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1707 1708 that's keeping the U S from leading in the IoT Ms Vachani You know I will ask -- I answered this 1709 question of scale but I will answer this question slightly 1710 differently to add to that 1711 What I find is if you look at the city level there's quite 1712 a bit of innovation going on 1713 San Diego is doing within their lights in California 1714 about New York and the building that's happening in -- building 1715 management that's happening in New York 1716 I talked about San Diego and what We talked At the city level I believe that that implementation is 1717 taken seriously and there's a lot of innovation happening But 1718 where I think we can make a difference is scale across the city 1719 at a nationwide -- right 1720 So these pockets of innovation how we can reuse how can 1721 we learn and how can we deploy it more worldwide -- I mean more 1722 United States wide 1723 That's slightly different than what I see in other countries 1724 where we are looking at it more nationally 1725 looking at it more nationally and so you'd get the benefit of 1726 the individual innovations that are happening at a national level 1727 Mr Mullin India China are Well I will use my district for example even NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 88 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1728 1729 1730 my personal house We don't -- we don't even have slow dial up The best we can do is 3G through our phone and 50 percent of my district has little to no access to the internet 1731 Ms Vachani 1732 Mr Mullin Mm-hmm And so we talk about metropolitan areas But 1733 you're right we are leaving out the rural pockets which is by 1734 mileage wise is the vast majority of our country 1735 Is that -- is the other countries as you alluded to are 1736 they doing a better job at that and then -- and if so what are 1737 they doing that we are not 1738 Ms Vachani So large parts of India and large parts of 1739 China don't have connectivity either right and so that isn't 1740 an isolated and probably more of an issue there than it is even 1741 here 1742 They are looking at how to deploy faster so that these rural 1743 areas do have connectivities -- that's one area we could look 1744 further at -- as well as leveraging the technology that is 1745 available 1746 So going into a factory in another country -- they have 1747 connectivity no broadband but they have some level of 3G -- 1748 we are able to leverage that to at least start to get some NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 89 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1749 automation within the factory 1750 the connectivity that we do have an maximizing that at the same 1751 time deploying more robust connectivity 1752 1753 1754 1755 Mr Mullin So again taking advantage of So how -- what role can Congress play then How can we -- how can we encourage companies or industry to look out farther than just in metropolitan areas We did this with electricity We did this with phone 1756 service This is a new technology that's keeping us from 1757 connecting 1758 to put in place to help encourage that So what is that we can do What can Congress do 1759 Ms Vachani I think we can look at this not in the siloes 1760 that we do today You have the benefit of a holistic view not 1761 just in each department but as a holistic view how we deploy this 1762 Mr Mullin 1763 Ms Vachani Right That's the benefit and then frankly 1764 speaking how do we invest so that we start to -- start to deploy 1765 this technology more robustly -- is there an investment strategy 1766 to that as well 1767 Mr Mullin 1768 Switching gears Ms Richardson how difficult is it to 1769 Thank you so much secure an IoT device NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 90 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1770 Ms Richardson I think that would depend on the device 1771 itself and how it's connected to the internet 1772 are a handful of best practices that we see across different 1773 sectors and industries things like encryption strong password 1774 and other authentication models update ability 1775 Mr Mullin I think there Is there -- is there certain security measures 1776 been put in place since the 2014 Target breach especially the 1777 Wanna Cry ransom 1778 1779 Ms Richardson There's nothing mandatory and I think the -- these sorts of practices that -- 1780 Mr Mullin Should there be 1781 Ms Richardson That's a hard question and I am realistic 1782 about mandatory requirements on the private sector 1783 think we are there 1784 I don't I think though the government should explore its own 1785 purchasing power 1786 and some of the agencies are writing privacy and security 1787 guidelines in preparation for a big level up in purchase of IT 1788 modernization and that would be one way that you could influence 1789 the market without forcing anybody to do anything specific 1790 Mr Mullin Right now you know the Trump administration Thank you and I yield back NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 91 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1791 Mr Costello 1792 The gentlewoman from New York Ms Clarke is recognize for 1793 1794 The gentleman yields back five minutes Ms Clarke I thank you Mr Chairman and I thank our 1795 ranking member Ms Schakowsky 1796 panel for their expert testimony here this morning 1797 I would like to also thank our As you may be aware earlier this year I launched the 1798 congressional Smart Cities Caucus and I would add Smart 1799 Communities with Rep Darrell Issa 1800 I was inspired to start the Smart Cities Caucus from my 1801 personal interactions with seeing the amazing build-out first 1802 hand in New York City 1803 The Smart Cities Caucus serves as a bipartisan group of 1804 members dedicated to bringing American communities into the 21st 1805 century through innovation and technological change 1806 Embracing smart technology will make our communities more 1807 sustainable resilient efficient liveable and competitive in 1808 a world in which technology is constantly advancing 1809 So I would like to ask a couple of questions first to you 1810 Ms Richardson What are your recommendations for the SMART IoT 1811 Act considering the interplay of the Smart Cities and which NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 92 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1812 federal agencies should play an active role in sort of harnessing 1813 what we know already 1814 Ms Richardson Well you have some of the work horses of 1815 the cybersecurity world in Commerce right so that is a benefit 1816 that you have with NIST NTIA and other places 1817 I think when you look at the smart cities you have a couple 1818 of different types of devices 1819 don't collect personal information -- you know they're low 1820 broadband information sharers right and they're just water 1821 pressure how many cars passed through here things like that 1822 that are going to be less risky from both a security and privacy 1823 standard 1824 You have really basic ones that I hope that you're report will highlight some of the more 1825 high-risk things that are either facial recognition location 1826 tracking right 1827 license plate readers or toll roads and how those are being 1828 deployed by the government 1829 Ms Clarke That's the result of many of these things like Ms Vachani Intel IoT portfolio includes smart 1830 cities smart buildings and smart video What are your 1831 recommendations and why are smart cities so important to Intel's 1832 IoT portfolio NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 93 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1833 Ms Vachani Essentially the smart cities enables us to 1834 create an infrastructure for safer cities as well as enabling 1835 our cities to do better planning 1836 If you look at the GE solution that we deployed on smart 1837 cities it does stuff like gunshot detection right It's 1838 determining if there was a shot and if so what we do about it 1839 It looks at air quality right and so this enables us to 1840 take advantage of the technology we've built for many other 1841 industries 1842 technologies we've built maybe for a factory or for a home but 1843 we are able to leverage that to improve not only our environment 1844 as well as our cities and its planning 1845 1846 1847 Smart cities is a culmination of many other So we see that there's a leverage of our technology across the board and that smart cities can take advantage of it Ms Clarke And would you just sort of envision for some 1848 of my colleagues who are in rural communities how we can sort 1849 of look at that ecosystem that is being developed in sort of more 1850 densely populated areas and what can be taken from that for sort 1851 of more sprawling communities in terms of connecting them in smart 1852 ways 1853 Ms Vachani Yes and if you look at the -- I will go back NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 94 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1854 to the GE solution 1855 pole 1856 electricity 1857 power to connect up sensors and then it uses a 3G connection that 1858 goes back up into a data center 1859 1860 The GE solution takes advantage of a light So that's what we are building on top of It already has power It already has You take advantage of that So again we are able to take advantage of infrastructure that's already there and built in as best as possible 1861 Ms Clarke Very well 1862 And Mr Day anything that you'd like to add in this 1863 Mr Day Absolutely and I want to applaud you on your 1864 efforts with Congressman Issa with co-chairing that caucus It's 1865 very important and C-TEC has joined a couple of events and we 1866 look forward to continuing to work with you 1867 But I think when you look at a city for example 20 percent 1868 of a given city in the United States is dedicated during the work 1869 day to parking and I think one of the things that C_TEC has been 1870 taking as a priority and working with you and others on is the 1871 fact that autonomous vehicles will impact both that issue as well 1872 as the environment and other issues and I think it in the end 1873 will prove to be very beneficial for a lot of reasons 1874 And so smart city activities are critical and what we are NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 95 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1875 trying to do and be creative in our thinking and our approach 1876 and how IoT plays in that is paramount and a top priority of ours 1877 going forward 1878 1879 Ms Clarke Well thank you very much for your response today and I yield back Mr Chairman 1880 Mr Costello 1881 Seeing there are no further members wishing to ask questions 1882 I would like to thank all of our witnesses for being here today 1883 Before we conclude I would like to include the following 1884 documents to be submitted for the record by unanimous consent 1885 a letter from the Consumer Technology Association a letter from 1886 CTIA and a letter from EPIC 1887 Gentlewoman yields back The information follow 1888 1889 COMMITTEE INSERT 4 NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com 96 This is a preliminary unedited transcript The statements within may be inaccurate incomplete or misattributed to the speaker A link to the final official transcript will be posted on the Committee’s website as soon as it is available 1890 Pursuant to committee rules I remind members that they have 1891 10 business days to submit additional questions for the record 1892 and I ask that witnesses submit their response within 10 business 1893 days upon receipt of the questions 1894 1895 1896 Without objection the subcommittee is adjourned Have a good day Whereupon at 11 54 a m the committee was adjourned 1897 1898 1899 1900 1901 NEAL R GROSS 202 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE N W WASHINGTON D C 20005-3701 www nealrgross com