Remarks of Commissioner Rachelle B. Chong to the American Bar Association International Information Superhighway Conference Washington, D.C. October 20, 1994 Good afternoon. Thank you for that kind introduction. It's a pleasure today to talk about a topic of great personal interest to me -- the Global Information Infrastructure or GII. The GII is the international counterpart to the NII, the National Information Infrastructure, or Information Superhighway. I have been thinking a lot about this lately. I just returned from Kyoto, Japan where I attended the International Telecommunications Union Plenipotentiary session. The GII was a topic that dominated the discussions, both formal and informal. This afternoon, I'd like to tell you how the GII has been defined, how it's been developing up to now, and my vision for the future. Finally, I'll talk about what's being done to make that vision a reality, and what your role may be as international lawyers. I. Definition of GII The term "Global Information Infrastructure" has its origins in a speech by Vice President Al Gore. Last March, he outlined the initiative to create a Global Information Infrastructure at the World Telecommunications Development Conference in Buenos Aires. The initiative has been received with enthusiasm by many of the world's leaders who share our bright view of the possibilities of an international Information Superhighway. In a nutshell, the idea is that we will create an international network made up of local, regional and national information networks. People will be able to exchange whatever kind of information they want to send -- whether it be an architectural drawing, a sound recording, a video program, or a text document. And they will be able to do it quickly and cheaply across national borders and between continents. It will make no difference whether a person wants to send the information to her colleague in the office down the hall, to a client in Anchorage, or to her uncle in Sydney. Let me elaborate. When I talk about the GII, and when others such as the Vice President discuss it, we mean more than just an interconnected system of wires and wireless information paths. The GII is a shorthand way of talking about what some have termed the concept of international connectivity -- the collective expectations we have for how technology can bring people from different parts of the world closer together. So, the GII concept goes beyond the physical cables and radio waves to embody the ideas and information we all will share on this worldwide network. Now, some say that all this discussion just generates unfounded expectations. It seems like a lot of people think of the info-superhighway and the GII as "gee-whiz Buck Rogers 21st century" stuff, as gimmicks that won't really change people's everyday lives. I for one think these folks are dead wrong. I have looked at history -- and it tells me that my vision of the future is right. I do think that it's important to keep these ideas in perspective, however. There's a lot of work to be done in every country to realize the GII. II. Background People have been thinking about these sorts of issues for a long time. It has taken several generations for the technology and the infrastructure to get to the point where they are today. I would like to quote the President of the United States, when one of the earliest stages of the Global Information Infrastructure was completed. He predicted that it would, "prove to be a bond of perpetual peace and friendship between kindred nations and an instrument destined by Divine Providence to diffuse religion, civilization, liberty and law throughout the world." The President was James Buchanan, the year was 1858, and the occasion was the first message sent via telegraph over a transatlantic cable linking the United States with Europe. President Buchanan had tremendous foresight. He understood that a transatlantic cable would link people across national boundaries and across the broad oceans of the world. He recognized that such a communications link could promote peace, order and individual freedom. Back to the future. . . . The excitement about the coming technology that we currently feel must have been felt to a similar degree back in the late 19th century. Shortly after the first cable to Europe opened for telegraph traffic, the first patents were issued for "telephonic telegraph receivers." Within eight years, local exchanges had sprouted throughout the East Coast. Soon, the first long distance lines linking New York and Boston were brought into service. In 1909, one of the first civilian radio transmitters broadcast news and music from San Jose, California, my home state. Television made its debut at the 1939 World's Fair in New York. In July, 1962, the first television pictures were sent from the U.S. to Europe via the Telstar satellite. The signal was faint, and the satellite could only be used for 45 minutes each time it orbited the Earth, but it heralded the promise of things to come. Today, three important technologies are converging. Together they are driving a revolution in the way we communicate. First, telecommunications technology. Fiber-optics offer major advances in signal capacity and clarity over the traditional copper cable. A single fiber-optic strand the width of a human hair can carry 65,000 times more information than copper phone wires and can carry it at least 30 times faster. Second, computer technology and digitalization. Advances in computer technology allow us to take just about any type of information (voice, data, or video) and digitize it (turn it into ones and zeros) so that the information can be manipulated, stored and sent, across a variety of communication pipelines, with the version received almost indistinguishable from that transmitted. Because digital information has the same characteristics regardless of the kind of information transmitted, a variety of systems can be used to transmit any type of message. For example, a digital message could be sent via a cable TV network, through the telephone network, or through a computer network. Interchangeable digital information will flow through all of these networks, creating competition and resulting in increased choice for consumers. Finally, advances in mobile communications systems. Satellite technology and other mobile services such as PCS promise to provide low-cost, wireless telephone and data transmission service to both rural and urban areas alike throughout the world. They will literally link anyone anywhere to the Global Information Infrastructure. I believe, as do many others, that the confluence of these technologies will usher in a new era of the Information Age. In this era, a global exchange of information and ideas will enrich the lives of people throughout the world. It will allow information to be shared between businesses, educators, hospitals, scientists and governments. It will enable businesses to become more productive and to better adapt to changing conditions, thereby becoming more efficient and benefitting the global economy. Information technology has come a long way since the days when the telegraph transformed international commerce and diplomacy. Today, the oceans are criss-crossed by undersea cables, while the skies play host to radio signals speeding between satellites and microwave towers. President Buchanan's forecast has come true. International communication has promoted a better cultural understanding, in turn promoting trade and reducing warfare as a means of settling conflict. III. Vision of GII So the inventors and engineers have done their jobs quite well, and we've got all this great new technology. What do we do with it? Finally, a nice ambiguous issue the size of Texas that we lawyers can argue over. Already, the futurists have lots of ideas of how the GII will bring tangible benefits to everyone who gets linked to this network of networks. I thought I'd give you some examples of how the GII is making a difference. Entrepreneurs are beginning to appreciate what the GII can do to help their businesses. The integration of the computer and far-flung digital networks will bring enhanced productivity and help make companies more adaptable to changing market conditions. The GII will bring customers and suppliers closer together, lowering costs and enhancing competition. Ideally, the GII will promote new global markets and will foster more sophisticated players in such markets. The drive to build the GII itself will be a tremendous source of new growth. In China alone, where there is only one telephone for every hundred people, the government reportedly plans to spend 6.7 billion dollars on telecommunications equipment over the next two years. The Council of Economic Advisors estimates that in the U.S. alone, telecommunications reform will add $100 billion to the Gross Domestic Product over the next ten years and add half-a-million new jobs. For developing nations, the GII will be an invaluable resource to aid in developing their economies, infrastructure, and political institutions. It will be a means of accessing problem- solving knowledge for government and private industry. It will allow greater contact between governments and their peoples, thereby increasing participation in political matters, thus strengthening democratic institutions. Let's not forget, information empowers people. The coming GII will lead to advancements in education, health care, and other fields which will directly benefit those involved. For example, distance learning can bring the best teachers in a nation to all the students of the world. Picture for a moment, the vision of schools and libraries throughout the world linked to each other by a network of wired or wireless paths. What flows over the pipe is not just transmissions of data or voice, but images. Not just still images, but moving video images that will capture your child's interest and imagination. Instead of a high-school French class repeating taped phrases syllable-by-syllable before a teacher, American and French students could team up interactively through a real-time video link and build their French and English language skills together. What a great way to promote cultural understanding between our children! Moreover, the GII can connect every school and library in the world to create a Global Digital Library, so every child has the riches of a world's library at the click of a computer mouse. Telemedicine will allow a patient to be examined by a far-away medical specialist via interactive television. X-rays and CAT scans can be delivered via high-speed data lines. This will lower health care costs and improve the quality of care. For the world's citizens, the GII will improve their quality of life by providing early warning systems for natural disasters like hurricanes, volcanic eruptions, floods, and earthquakes. Internationally coordinated efforts immediately prior to the eruption of Mount Pinatubo in the Philippines saved countless thousands of people living near the volcano. The GII will also allow experts around the world to share their research to solve international problems, like global warming, and to collaborate on public health projects, like finding an AIDS vaccine. With the development of Low Earth Orbit communications satellites, occupants of remote areas will finally have inexpensive access to the global information network. This means that remote villagers in Africa will be able for the first time to install a telephone, which up to now has been prohibitively expensive because of the cost of stringing wires to the nearest telephone company exchange. IV. Getting There Well, I know this all sounds grand, but the hard part of the program is how to build the GII. With all the splashy talk in the media and by the industry's leaders, it is important to remember that the construction of the GII and the Information Superhighway is an evolutionary process. The point I was trying to make when I mentioned the first transatlantic telegraph cable is that building the world's information infrastructure is a process that has been going on for a long time. I want to be clear that the FCC and the rest of the U.S. Government do not intend that the GII be a keyword for a new government project to string actual cables or launch satellites, all funded by taxes or some other method. Rather, the FCC hopes to be a cheerleader and perhaps a referee as we shepherd the process along by encouraging private investment, fostering competition, ensuring a flexible regulatory framework, ensuring open access to the network, and that its riches are available to all. These are the five principles first enunciated by Vice President Gore, then adopted by the World Telecommunications Development Conference in Buenos Aires last March. These principles will guide the evolution of the Global Information Infrastructure in the months and years to come. I think these five principles bear elaboration. First, we should encourage private investment. We believe that private enterprise is the best organizational form to foster the kind of innovation and investment necessary to achieve a useful information infrastructure. We recommend that other countries adopt regulatory structures that will encourage investment by private companies. Countries all over the world have recognized that privatization is the best means to encourage a robust telecommunications infrastructure. In the former Soviet Union, there are now over 80 private firms providing telecommunications services in its 86 regions to clients throughout Russia. Just last week, in the Czech Republic and in Greece, those governments announced they would sell off portions of their government-owned telecommunications monopolies to allow faster innovation. In the U.S., we have introduced several programs to encourage private sector development in the telecommunications field. As examples, we have introduced tax incentives to encourage private sector research and development and new business formation. The Rural Electrification Administration of the Department of Agriculture has announced $225 million in new loans for rural telecommunications facilities and services to stimulate private investment of nearly $1 billion. But privatization is not enough. There must also be competition. That's the second principle. Competition promotes reasonable rates and increases efficiency and innovation. Countries simply can't afford NOT to have competition. The U.S. has been moving aggressively to introduce competition in all aspects of the telecommunications market. In the ten years that competition has existed for U.S. long distance service, the cost of a long-distance call has declined significantly (about 40% depending on how you measure it) and it has brought about a multitude of new service plans, improved connections and quality of service. Recently, the FCC approved a proposal to enhance competition in the U.S.-U.K. international resale market. The British have been introducing competition into their telecommunications markets. In the rest of the European Union, most member states have agreed to allow resale of basic telephone service starting in 1998, with significant competition already existing in many of those markets for mobile, satellite and enhanced services. Even China recently announced the formation of China Unicom, a second telecommunications network that will provide new services and increased access. The third principle for the GII, especially important to the FCC, is for countries to put in place flexible regulatory frameworks. These flexible regulatory frameworks allow regulators to keep pace with the fast-moving technological innovations. I see a regulator's role as one which ensures fair competition and fosters private investment while protecting consumers' interests. The goals of regulation should be set such that competition is enhanced and compliance is simple so that the operators are not overburdened with paperwork. I am encouraging the FCC to streamline procedures and eliminate red tape wherever possible. The fourth point for building the GII is that we should provide open access to the network for all information providers. Every user should have access to the thousands of sources of information available around the world, with all the systems interconnected. Ideally, network owners should charge nondiscriminatory prices for access to their networks. Another precondition of open access is the ability of multiple systems to interface seamlessly. To bring about the GII, the U.S. should work to develop international standards to ensure interoperability and interconnection between systems. Fifth, and finally, we should ensure that the principle of universal service is kept in mind as the GII expands its reach. The promise of information technology is especially great when we consider its potential to deliver inexpensive, reliable communications to remote locations. Did you know that there are more telephone lines in the city of Tokyo than in all of Africa, and that more than half the people in the world have never made a phone call? We hope that the coming technology will change that. This morning, the FCC began licensing global Low Earth Orbit satellite systems that will bring telephone and high speed data service to anyone on the planet. This means that Siberians, Eskimos and Samoans will all for the first time be able to install telephones in their villages and have an on-ramp to the Information Superhighway. This is not to say that this technology will be a magic solution to the problem of underdevelopment of telecommunications. Developing countries have 75% of the world's population but only 12% of its telephone lines. Because a working communications infrastructure is so important for economic development, it is crucial that we encourage efforts to help these countries modernize their communications networks. These five principles (private investment, competition, flexible regulation, open access and universal service) will guide our efforts to make our vision of a new Global Information Infrastructure a reality. V. Current GII Efforts The U.S. government has been working hard to bring this vision to reality. Recently, countries throughout the world have become very interested in building their own networks to ensure they are linked to the GII. In the coming months, there will be a flurry of international activity as representatives from countries throughout the world meet to coordinate their countries' positions on GII. I thought I'd update you on some of the key activities. As I mentioned before, Vice President Gore announced an action plan for the GII at the ITU World Telecommunications Development Conference in Buenos Aires. He proposed that work be done for the next four years in guiding the construction of GII. At the G-7 summit in Naples last July, the world's leaders approved President Clinton's proposal that telecommunications ministers from G-7 countries meet to address issues related to constructing the GII. This was an extremely significant step because the only other time the G-7 has agreed to hold such a high-level meeting on a specified topic was last March in Detroit to address global unemployment. Around the same time, members of the Asia Pacific Economic Cooperation (APEC) and of the Organization for Economic Cooperation and Development (OECD) will meet in Vancouver to address cross-border issues affecting the development of GII. And this December, Western Hemisphere leaders will meet at the Summit of the Americas in Miami to focus on telecommunications and information infrastructure issues. Finally, the U.S. government has held high-level policy discussions with representatives from other countries to open overseas markets for products and services that will be part of GII. In every country in the world, we can see the beginning of projects which embody the spirit of GII as expressed by the five principles I spoke of earlier. In Pakistan, Chile, Australia and many other countries, the governments are promoting private investment in their state telecommunications companies as vehicles to provide a solid communications infrastructure. VI. Your Role -- Building the GII Now we come to the really important question on GII -- what's in it for you -- international lawyers and business people. Well, the ball is already rolling. One need only glance at the newspaper to realize that this is not just a lot of government talk. Private industry has confidence in the GII. Corporations around the world are putting their money on the table because they realize the tremendous potential of the GII to better the lives of the world's citizens. And you as international lawyers will play key roles as the advocates for these companies and as advisors to governments promoting development of the GII. For those that hold such positions, I urge you to think creatively to help these industry and political leaders sharpen their vision of the GII so that we can build the best network possible. As international lawyers, you can help us define this vision so that it brings the broadest benefit to the greatest possible number of people. Please keep in mind the five principles I outlined earlier. As you participate in building the GII, you can influence the regulatory process so that red-tape and bureaucracy don't destroy this vision of a viable multinational info-superhighway. For those of you advising foreign governments, I would urge you to help them expand their networks by adopting programs that encourage private investment and competitive markets. At the same time, let us not forget open access and universal service. Telecommunications development is vitally important for economic development. By ensuring a multitude of voices on the network and easy accessibility, you will empower many more people, leading to enhanced economic growth and greater democratic participation. Some U.S. telecomm companies have introduced training seminars for foreign telecommunications managers. This is a step in the right direction. Well, that concludes my glimpse of the future. I'm sorry if I waxed eloquent, but this is a topic I am really excited about. Thank you.