The Global Information Infrastructure: Agenda for Cooperation

DEPARTMENT OF COMMERCE

National Telecommunications and Information Administration

[Docket No. 950217053-5053-01]

The Global Information Infrastructure: Agenda for Cooperation

AGENCY: National Telecommunications and Information Administration.

ACTION: Administration policy statement.

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SUMMARY: On February 15, 1995, the Administration released an ``Agenda

for Cooperation'' for the Global Information Infrastructure. The Agenda

for Cooperation sets forth the Administration's vision for developing a

GII that meets the needs of the people around the world. The Global

Information Infrastructure: Agenda for Cooperation incorporates and

expands upon five principles Vice President Gore presented last year to

the first World Telecommunication Development Conference: Encourage

private investment; promote competition; provide open access to the

network for all formation providers and users; create a flexible

regulatory environment that can keep pace with rapid technological and

market changes; and ensure universal service.

The report addresses the policy issues critical to encouraging the

use of the Global Information Infrastructure (GII), including

information policy and content issues and measures by governments and

industry to demonstrate the benefits of the GII. The report also is

intended to serve as the basis for engaging other governments in a

consultative, constructive, and cooperative process that will ensure

the productive development of the GII.

DATES: Comments may be filed at any time.

ADDRESSES: Comments may be sent to: IITF Secretariat, NTIA, U.S.

Department of Commerce, Room 4898, 14th Street and Constitution Avenue

NW., Washington, DC. 20230.

Comments may also be sent electronically by Internet e-mail to

``[email protected]''. The GII: Agenda for Cooperation will be available

over the Internet via ftp, telnet (login = gopher), gopher, or World-

Wide Web at the Internet address iitf.doc.gov or dialup via modem (202)

501-1920. It will be located in the Documents and Papers directory. For

hard copies, please write or call Openness Program, 1617 HCHB, 14th and

Constitution Avenue NW., Washington, DC. 20230, (202) 482-3999 (voice)

or (202) 501-6198 (fax).

FOR FURTHER INFORMATION CONTACT: NTIA Office of International Affairs,

(202) 482-1304.

Authority: 47 U.S.C. 901 et seq.

SUPPLEMENTARY INFORMATION:

The Global Information Infrastructure

Agenda for Cooperation

Table of Contents:

Preface

I. Introduction

A. Technological Convergence and the New Information Age

B. New World Vision through Communications: The GII as a Product of

Technological Convergence and Competition

C. Cornerstone of the GII: A Community of Global Interest

II. Building a Foundation for the GII--Five Basic Principles

A. Encouraging Private Investment

B. Promoting Competition

C. Providing Open Access

D. Creating a Flexible Regulatory Environment

E. Ensuring Universal Service

III. Encouraging the Use of the GII

A. Information Policy & Content Issues

B. Applications: Delivering the Benefits of the GII

IV. Implementing the GII

V. Conclusion

Preface

Let us build a global community in which the people of neighboring

countries view each other not as potential enemies, but as potential

partners, as members of the same family in the vast, increasingly

interconnected human family.

With these words, Vice President Al Gore introduced the U.S. vision

for the Global Information Infrastructure (GII) at the first World

Telecommunication Development Conference in March 1994. The Conference,

held in Buenos Aires, Argentina, signalled a new undertaking by the

International Telecommunication Union (ITU). Vice President Gore called

upon every nation to establish an ambitious agenda to build the GII,

using the following five principles as the foundation:

Encouraging private sector investment;

Promoting competition;

Providing open access to the network for all information

providers and users;

Creating a flexible regulatory environment that can keep

pace with rapid technological and market changes; and

Ensuring universal service.

Leaders from the world telecommunications community incorporated

these five principles into the ITU's ``Buenos Aires Declaration on

Global Telecommunication Development for the 21st Century.''

The purpose of this ``GII: Agenda for Cooperation'' is to amplify

these five principles and to identify the steps the United States, in

concert with other nations, can take to make the vision of the GII a

reality. We hope that it will also serve as the basis for engaging

other governments in a consultative, constructive, and cooperative

process that will ensure the development of the GII for the mutual

benefit of all countries.

In proposing this initiative, we recognize that market forces and

technological advances have already begun to expand existing

interconnections among our respective nations:

Current state-of-the-art fiber optic systems can now

transmit the equivalent of 80,000 simultaneous telephone conversations

over a single optical fiber and will soon carry 320,000 conversations

over a fiber pair;

Advances in digital compression have vastly improved the

performance and capacity of existing networks by allowing more volume,

including data and video, to be transmitted;

Advances in computer technology will soon offer storage

capacity so great that an individual using a hand-held device will be

able to carry the informational equivalent of a small library and

remotely access many times this amount; and

New digital wireless systems and proposed constellations

of telecommunications satellites have the potential to provide

telephone and data services to any point on the planet.

A nascent GII already exists. What we seek is a superior GII, one

that has higher capacity, is fully interactive, [[Page 10360]] faster,

and more versatile. One that is less expensive to use than existing

systems, and more accessible to all the people of the world. But our

goal is not merely technological advancement--more bandwidth, faster

switching, more powerful processing capability, and greater compression

and storage capacity. We view technology not as an end in itself but as

the means through which the GII can realize its potential to improve

the well-being of all people on this planet.

This ``Agenda for Cooperation'' sets forth the U.S. Government's

vision for developing a GII that can yield the benefits described above

and more. It identifies specific areas where intergovernmental, as well

as government-private sector, cooperative efforts are needed. Also

identified are proposals for concrete actions that the United States

can take, by itself or with other nations, to accelerate the pace of

development of the GII. While we believe the private sector will build,

own, and operate the GII, governments have the power to take actions

that can either accelerate or retard its development. We believe that a

concerted and coordinated international effort can achieve the former

and avoid the latter, and we invite other countries to join us in this

cooperative venture.

I. Introduction

A. Technological Convergence and the New Information Age

As we approach the end of the twentieth century, information is a

critical force shaping the world's economic system. In the next

century, the speed with which information is created, its

accessibility, and its myriad uses will cause even more fundamental

changes in each nation's economy.

These changes will be the result of technological convergence of

the previously distinct telecommunications, information, and mass media

industries. Boundaries that once separated the types of networks used

to deliver voice, data, and video services are increasingly blurred. In

a digital world, these services can be combined and offered over the

same transmission system.

Multiple networks composed of different transmission media, such as

fiber optic cable, coaxial cable, satellites, radio, and copper wire,

will carry a broad range of telecommunications and information services

and information technology applications into homes, businesses,

schools, and hospitals. These networks will form the basis of evolving

national and global information infrastructures, in turn creating a

seamless web uniting the world in the emergent Information Age. The

result will be a new information marketplace, providing opportunities

and challenges for individuals, industry, and governments.

B. New World Vision Through Communications: The GII as a Product of

Technological Convergence and Competition

The Clinton Administration has made the development of an advanced

National Information Infrastructure (NII) and the GII top U.S.

priorities. A major goal of the NII is to give our citizens access to a

broad range of information and information services. Using innovative

telecommunications and information technologies, the NII--through a

partnership of business, labor, academia, consumers, and all levels of

government--will help the United States achieve a broad range of

economic and social goals.

Similarly, other governments have come to recognize that the

telecommunications, information services, and information technology

sectors are not only dynamic growth sectors themselves, but are also

engines of development and economic growth throughout the economy. With

this realization, governments have sharply focused their public policy

debates and initiatives on the capabilities of their underlying

information infrastructures. The United States is but one of many

countries currently pursuing national initiatives to capture the

promise of the ``Information Revolution.'' Our initiative shares with

others an important, common objective: to ensure that the full

potential benefit of advances in information and telecommunications

technologies are realized for all citizens.

The GII is an outgrowth of that perspective, a vehicle for

expanding the scope of these benefits on a global scale. By

interconnecting local, national, regional, and global networks, the GII

can increase economic growth, create jobs, and improve infrastructures.

Taken as a whole, this worldwide ``network of networks'' will create a

global information marketplace, encouraging broad-based social

discourse within and among all countries.

The GII will depend upon an ever-expanding range of technology and

products, including telephones, fax machines, computers, switches,

compact discs, video and audio tape, coaxial cable, wire, satellites,

optical fiber transmission lines, microwave networks, televisions,

scanners, cameras, and printers--as well as advances in computing,

information, and networking technologies not yet envisioned.

But the GII extends beyond hardware and software; it is also a

system of applications, activities, and relationships. There is the

information itself, whatever its purpose or form, e.g., video

programming, scientific or business databases, images, sound

recordings, library archives, or other media. There are also standards,

interfaces, and transmission codes that facilitate interoperability

between networks and ensure the privacy and security of the information

carried over them, as well as the security and reliability of the

networks themselves. Most importantly, the GII includes the people

involved in the creation and use of information, development of

applications and services, construction of the facilities, and training

necessary to realize the potential of the GII. These individuals are

primarily in the private sector, and include vendors, operators,

service providers, and users.

The GII will both stimulate and respond to global demand for new

information technologies and services.1 The GII can offer

consumers in each country unprecedented access to information from a

variety of sources on a global basis. With appropriate changes in

regulatory structure, the GII can also help usher in an environment

more responsive to user demands by providing companies opportunities to

offer any information or telecommunications product or service to any

customer, rendering obsolete past regulatory labels or technological

niches.

\1\In general throughout this report, references to

``information services'' are meant to be broad and to include all

services, content, and applications to be provided over the networks

of the GII. However, for specific statistics cited from other

sources, the definitions from those sources apply.

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The business community has become the principal force for the pro-

competitive restructuring of telecommunications and information

markets. Business users, whose commercial activities are becoming

increasingly global, require access to advanced services at higher

speeds and capabilities, and at lower costs, to manage their global

operations effectively. When the national carriers cannot provide the

unified international networks and services that companies need to

conduct business and research, frustrated users develop their own

international ``private'' networks, often leasing private lines from

different national carriers. However, these private networks--even the

most sophisticated--still suffer from the high cost of leased lines in

most countries and the difficulties inherent in attempting to create

global networks [[Page 10361]] based on a patchwork of services subject

to widely varying capabilities and regulation.

The scientific and academic communities also have stringent demands

for access to information resources and powerful computing capacity

around the world. The international research and academic community was

instrumental in developing the Internet, an already global mass of

interconnected computer networks. The astonishing growth rate of the

Internet network--over ten per cent per month for more than five

years--is just one indication of the growing demand for and supply of

digital information.

C. Cornerstone of the GII: A Community of Global Interest

The nations of the world are diverse in size, levels of economic

development, political, economic and social structures, and language

and culture. We believe, however, that despite these differences a

broad community of interest exists among countries to better the lives

of the citizens of the world--all citizens. Regardless of a country's

overall level of technological development, active participation in the

evolving GII can provide the tools to improve the quality of life.

For example, the GII can facilitate health care delivery through

telemedicine, linking rural physicians to major medical facilities for

off-site consultations on difficult diagnoses. If only a computer and a

wireless link are available, they can provide a data base search and

on-line questioning of a consulting expert. If fiber optic networks are

available, telemedicine services can include remote visual examination.

Such services are a boon to rural physicians. Similarly, the GII can

quicken response time for disaster relief. It can transform education

with computer-based multimedia systems that teach with both sight and

sound, greatly increasing retention rates and providing children access

to greater educational opportunities. It can provide new tools to

assist persons with disabilities. The GII can also make factories more

efficient, speed the creation of new and better goods and services, cut

the cost of business by improving efficiency, develop new jobs and

markets, increase trade, and facilitate flows of information across

borders.

That is not all. A well-developed GII can enhance democratic

principles and limit the spread of totalitarian forms of government.

Representative democracy is founded on the premise that the best

political processes are those in which each citizen has the knowledge

to make an informed choice and the power to express his or her view.

The GII will allow wider and greater citizen participation in decision-

making by providing the additional means for individuals to keep

informed, as well as to express their opinions. Through the GII, the

world's citizens will have the opportunity to share information and

cultural values, fostering a greater sense of global community. By

encouraging exchanges of ideas, goods, and services among all

countries, the GII can contribute to a framework for lasting peace.

Realizing these benefits will not be easy--our vision of the GII

presents a challenge that cannot be undertaken by a single country, nor

overcome by government fiat. Rather, its success will depend in large

measure on innovation and investment by the private sector. As the

principal source of expertise and capital, the private sector should,

in response to marketplace demands, determine what technologies to

pursue, set the pace of development, establish the appropriate

standards, and develop new services and applications. For their part,

governments can facilitate these activities by creating a legal and

regulatory environment that supports efficient investment and

innovation, and promotes full and fair competition. Governments can

also provide leadership by supporting testbeds for new technologies,

fostering the transfer of resulting technologies to the private sector,

promoting the assimilation and use of applications and technology

through government procurement, and developing applications that

support government operations and dissemination of government

information.

II. Building a Foundation for the GII--Five Basic Principles

The United States believes that five basic principles--encouraging

private investment, promoting competition, providing open access to

networks and services for providers and users, creating a flexible

regulatory environment to keep pace with technological and market

developments, and ensuring universal service--should serve as the

foundation for the development of the GII. In our view, this foundation

will facilitate information infrastructure development in individual

countries and the interconnection of networks on a global basis. It

will also accelerate development of useful applications, and increase

sharing of information among people around the world. We believe these

principles apply equally to the telecommunications, information

technology, and information services industries. In partnership with

the private sector and all users, we believe that governments should

take action to adopt, apply, and advance these principles at national,

regional, and global levels.

A. Encouraging Private Investment

Given the facts that the worldwide market for information

technology, products, and services is currently valued at $853 billion,

and that worldwide investment in telecommunications infrastructure

alone is expected to exceed $200 billion by 2004, both developed and

developing countries need to find ways to share in this growth and

prosperity. Attracting private sector investment is the most effective

way for countries to do so--as well as to improve their networks and

services, promote technological innovation, and succeed within the

competitive global economy. The reasons extend beyond the purely

financial: In addition to providing inflows of capital, private

investment also stimulates development of new technologies, equipment,

services, new sources of information, and managerial skills--all of

which help speed infrastructure growth and improvements, increase

efficiency in the provision of services, and permit greater

responsiveness to consumer needs.

To attract greater investment from both domestic and foreign

sources into their telecommunications sectors, nations are adopting a

variety of approaches, ranging from revenue sharing initiatives and

joint ventures to direct foreign investment, licensing of privately-

owned competitors, build-operate-own or -transfer schemes, and

privatization of government-owned public telecommunications operators.

Countries as diverse as Chile, India, Jamaica, Japan, Malaysia, New

Zealand, the United Kingdom, the United States, and Venezuela have

encouraged multiple private companies to provide telecommunications

services, drawing in private investment to varying degrees and leading

to lower service prices and improved communication.

In other countries where privatization is not currently considered

a politically viable option, governments have taken steps to attract

foreign investment in the form of joint ventures for the provision of

new services, such as cellular telephone and Very Small Aperture

Terminal (VSAT)-based overlay networks for business users. Some

countries have permitted lease and franchise arrangements that include

private expansion of part of the [[Page 10362]] telecommunications

infrastructure, often allowing the private equity share in the network

operation to build up over time. Although providing fewer benefits than

full privatization might, these approaches can also be attractive to

private investors, and they provide quantifiable benefits--new lines,

upgraded switching capabilities, new services and sources of

information, and lower costs to consumers.

The need for capital investment is particularly acute in countries

with underdeveloped telecommunications infrastructures, where limited

government resources often make private financing a necessary

complement. To attract private capital, many countries that seek to

improve their information infrastructures, which will improve

interconnection to the evolving GII, are taking concrete steps to:

Create a stable operating environment supported by

transparent regulation;

Establish fair and open bidding practices for all

communications and information infrastructure projects;

Recognize the return on capital that potential investors

require;

Establish sound repatriation policies; and

Demonstrate a political commitment to private investment

through appropriate modifications in the legal framework.

The information services sector, traditionally privately-owned, has

experienced tremendous growth due to the largely open investment and

competitive market environments in most countries around the world. In

the United States, for example, the largely unregulated information

services market is projected to have reached $135.9 billion in revenues

in 1994.2

\2\International Trade Administration, U.S. Department of

Commerce, ``U.S. Industrial Outlook 1994'', at 25-1, January 1994.

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Removing barriers to private investment--and providing incentives

for the creation and dissemination of information services through

effective protection of intellectual property rights--is the best means

of sustaining this worldwide growth.

Recommended Action

From the wide range of available options, governments can develop a

strategy best suited to their particular needs. At the same time, they

must institute the appropriate regulatory, legislative, and market

reforms to create the conditions necessary to attract private

investment in their telecommunications, information technology, and

information services markets. To facilitate this process, the United

States will join with other governments to:

Identify and seek to remove barriers to private

investment, and develop policies and regulations that improve

investment incentives in both growing and mature telecommunications and

information markets;

Ensure that applicable laws, regulations, and other legal

rules governing the provision of telecommunications and information

services and equipment are reasonable, nondiscriminatory, and publicly

available;

Engage in bilateral, regional, and multilateral

discussions to exchange information on the various options that have

been successfully pursued to attract private investment, including, but

not limited to, privatization, liberalization, and market reforms;

Work with major international lending institutions, such

as the World Bank and the regional development banks, and major private

financial institutions to determine the best means of attracting both

private and public capital, and establish workshops to train officials

in the different liberalization approaches; and

Encourage international lending institutions to recognize

the ways in which funded social projects, such as the delivery of

education and health care services, can be advanced through improved

information infrastructures.

B. Promoting Competition

Nationally and internationally, the information technology and

information services markets have flourished in the past decade. The

highly competitive computer equipment, software and networking

industries are among the most dynamic in global markets, providing

users with steadily increasing computing power and functionality and

stimulating further demand for more advanced, integrated capabilities.

Similarly, the information services industry has expanded as barriers

to cross-border trade and investment have been removed. In many

countries there are few or no restraints on the services provided. In

other markets there are varying, but fairly light, degrees of

regulation. As a result, the world market for information services is

expected to grow from $275 billion in 1993 to $465 billion in 1998, a

growth rate of 11 percent annually.3

\3\U.S. Department of Commerce, International Trade

Administration, Office of Service Industries, 1994.

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One important exception has been a tendency in a few countries to

erect barriers to foreign competition in entertainment programming

services. There is no body of evidence that limiting foreign

competition has been successful in achieving the desired effect of

stimulating local entertainment programming industries. The effects of

such measures in retarding the development of private investment in

infrastructure also deserves greater attention.

In contrast to the liberal market and regulatory environment for

information technology and information services, the pace and scope of

liberalization and privatization in the telecommunication sector is

varied, ranging from competition in particular market segments to full

liberalization. For example, there has been a discernable trend over

the past decade toward increased competition in the provision of both

value-added services and telecommunications terminal equipment. Some

countries have liberalized further, taking steps to open their long

distance, local fixed telephony, cellular, communications satellite,

cable, and broadcast markets.

Evidence of positive results from such increased competition is

mounting: Networks have steadily incorporated innovative technologies,

producing greater efficiencies; both residential and business users

enjoy lower prices and greater choices in equipment and services;

service providers are more responsive to user needs; and lower costs of

service have stimulated increased network usage.

However, in the largest and most profitable market segments--basic

public voice telephone services and the underlying network

infrastructure--both competition and foreign investment have been

restricted. Maintaining barriers against potential new entrants in

these markets will inhibit infrastructure deployment. Moreover, these

barriers will retard the introduction of new information and

telecommunications services that require competitive access to

underlying networks in order to flourish.

Competition in basic telecommunications services has been growing,

however, in a number of key markets around the globe. In countries such

as Australia, Canada, Chile, Japan, New Zealand, Sweden, the United

Kingdom, and the United States, the introduction of alternative service

providers and networks, which often deploy advanced technologies at

lower costs, has reduced bottleneck control by the dominant facilities-

based providers. These results have spurred other countries to

reconsider their policies. The member countries of the European

[[Page 10363]] Union (EU), for example, have agreed to introduce

competition in the provision of basic telecommunications services and

infrastructure by 1998. The EU considers these steps to be critical to

advancing the goals of their action plan to create a European

Information Society.

Increasingly, countries with national monopoly operators have begun

to question whether they can compete effectively in the dynamic

international telecommunications market. Difficulties in raising

capital and in meeting users' demands for low cost, sophisticated

network capabilities and services are forcing a reconsideration of the

monopoly approach to telecommunications. A recent Organization for

Economic Cooperation and Development (OECD) study comparing the

relative cost of providing international service among OECD members

found that the performance of countries with competitive international

markets was superior to the average of all OECD members. Furthermore,

the OECD study revealed that the quality of service had improved

simultaneously with the implementation of competition.4

\4\``The Benefits of Telecommunications Infrastructure

Competition,'' (DSTI/ICCP, TISP(93)/Rev 1), p. 23, February, 1994.

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Competition within the communications satellite market has also

burgeoned. The intergovernmental International Telecommunications

Satellite (Intelsat) and International Mobile Satellite (Inmarsat)

organizations now face competition from several separate satellite

systems, including Astra, Columbia, AsiaSat, Orion, and PanAmSat. Due

in part to competitive pressures from these separate satellite systems

and from alternative technologies, serious consideration is being given

to restructuring both Intelsat and Inmarsat. Each of these

organizations is engaged in an internal effort to review a range of

options for reorganization, from reform of the cooperative model, to

corporatization, to full privatization.

As governments liberalize particular market segments, regulators,

operators, and new market entrants must grapple with evolving

definitions of the boundary between those networks and services

reserved to the monopoly operator and those open to competition. During

the transition from monopolistic to competitive telecommunications

markets, incumbent operators still play a dominant role as network

infrastructure providers. Incumbent operators not only control

underlying facilities and services that new entrants often need to

deliver their services, but frequently compete directly with these new

service providers in particular market segments. In these

circumstances, effective competition cannot emerge and flourish unless

incumbents are subject to competitive safeguards while they maintain

market power over critical bottleneck facilities and services.

Competitive safeguards serve two main purposes. Some are intended

to eliminate or reduce barriers to entry for new service providers that

are seeking to challenge the incumbent operator. Other safeguards serve

to ensure that incumbent firms with market power do not employ

anticompetitive means to prevent or hinder the development of truly

competitive markets. Market entry opportunities are effective only if

the incumbent service provider is required to compete fairly. For this

reason, some administrations have required incumbent carriers to permit

resale of their networks and services. Resale provides an important

source of competition in markets in which telecommunications

infrastructure costs are high. Similarly, market entrants that choose

to provide facilities-based services in competition with the incumbent

service provider typically will need to interconnect their facilities

with a dominant service provider's network. In a pro-competitive

environment, the terms and condition of interconnection would be

reflected in published rates that include nondiscriminatory cost-based

access charges and technological ``equal access'' to bottleneck

facilities.

Incumbent carriers may also be required to ``unbundle'' network

facilities and services so that telecommunications and information

service providers can order only those elements of the dominant

provider's network they need to provide a service. Finally,

establishment of a transparent regulatory scheme open to all interested

parties, and administered by a regulatory authority independent of the

incumbent service provider, helps ensure that rules governing

competition are fair and that private investment is given a reasonable

degree of security.

While the political challenges posed by attempting to restructure

the telecommunications market are significant, the increased

opportunities provided by introducing competition far outweigh the

potential difficulties of pro-competitive market reform. Further, the

interconnection of competitive national information infrastructures can

increase the pace of development of the GII. The more competitive an

information and telecommunications market, the more productive will be

its interaction with other markets participating in the development of

the GII.

Recommended Action

The most effective means of promoting a GII that delivers advanced

products and services to all countries is through increased competition

at local, national, regional, and global levels. To that end, the

United States will join with other governments to:

Assess, through information exchanges and existing

multilateral organizations, the positive experiences of different

countries in introducing competition and progressively liberalizing

their telecommunications, information technology, and information

services markets;

Work constructively to remove barriers to competition in

telecommunications, information technology, and information services

markets;

Include timetables for increased competition in basic

telecommunications infrastructure and services in national information

infrastructure development plans, and, as an interim step, increase the

pace of liberalization through the expansion of resale;

Encourage new entrants by adopting competitive safeguards

to protect against anticompetitive behavior by firms with market power,

including measures designed to prevent discrimination and cross-

subsidization;

Implement specific regulations to facilitate competitive

entry in the telecommunications sector, including the following

essential elements: (1) Interconnection among competing network and

service providers; (2) ``unbundling'' of bottleneck facilities of

dominant network providers; (3) transparency of regulations and

charges; and (4) nondiscrimination among network facilities operators

and between facilities operators and potential users, including

resellers;

Ensure that government-sponsored technical training

activities incorporate programs specifically related to the development

of pro-competitive markets and regulations (including such issues as

competitive safeguards and interconnection);

Pursue a successful conclusion to the General Agreement on

Trade in Services (GATS) discussions on basic telecommunications to

obtain the opening of markets for basic telecommunications services

through facilities-based competition and the resale of services on

existing networks [[Page 10364]] on nondiscriminatory terms and

conditions; and

Consider the full range of options for promoting

competition in Intelsat and Inmarsat, including: (1) Pursuing changes

designed to increase the operational efficiency of Intelsat and

Inmarsat, retaining their fundamental intergovernmental character, but

substantially reducing the scope of the current intergovernmental

agreements by removing provisions that convey unfair advantage and

inhibit efficient functioning; (2) transforming the organizations into

private corporations; and (3) transforming the organizations into

multiple private service providers that compete with one another, as

well as with others.

In selecting among these options, the goal must be to enhance

competition and not diminish it.

C. Providing Open Access

Achieving the goal of a global information market will require

government action to ensure that all information service providers have

access to facilities, networks, and network services on a

nondiscriminatory and low cost basis. By ensuring open access to

facilities and networks, and thus promoting competition, governments

can dramatically increase the availability of information services to

all consumers.

Maximizing consumer choice among diverse sources of information

should be the primary objective. As the information needs among

consumers will vary, both within and among nations, attempts to predict

the information resource requirements of citizens should be avoided.

Rather, governments should foster market and regulatory climates

conducive to the broadest possible access to and distribution of

information. As countries accelerate the development of their

respective information infrastructures, more and more consumers will

seek access to networks and services that cross national and

international boundaries. Improving consumer access to diverse sources

of information has direct social and economic benefits. The ability to

generate, exchange, and use information, technology, and ideas is

central to economic growth and development, increased competitiveness

in a range of industries, and to the improvement of the quality of

life.

An essential technical element of the open access concept is

interoperability, i.e., the ability to connect applications, services,

and/or network components so that they can be used together to

accomplish tasks. As the GII will be based on many different existing

and emerging components at local, national, and global levels, it is

imperative that these components be interoperable. The key to

interoperability is the development of global standards. We believe

such standards should be voluntary and developed through a process that

is largely market-driven and that takes into account the views of both

the large and well established and the smaller, newer market players.

Three principal international standards organizations involved in

the development of information technology and telecommunications

standards are the International Organization for Standards (ISO), the

International Electrotechnical Commission (IEC), and the International

Telecommunication Union (ITU). The ISO and IEC develop information

technology standards through the ISO/IEC Joint Technical Committee 1,

while the ITU concentrates on telecommunications standards. Further,

there has long been coordination and collaboration between the ISO/IEC

Joint Technical Committee 1 and the ITU, which has helped minimize the

duplication of standards development work and the possibility of

conflicting information technology and telecommunication standards.

The vast majority of countries adhere to the processes of

developing international standards and the resulting recommendations

from all three organizations. In the U.S., and increasingly in other

countries, the private sector plays an essential role in these

international standards development processes by providing the

technical expertise and resources to develop standards at national and

international levels.

It may also be constructive to consider encouraging greater

collaboration and cooperation both domestically and internationally

among the different standards bodies, including less formal

organizations. In recent years in the United States, a significant

number of new standards consortia, whose principal focus is in the

standards implementing arena, have been established outside of the

traditional national standards development organizations. These new

consortia have often sped up the widespread adoption of internationally

generated standards, and their memberships have included small and

medium-sized companies.

Given the convergence of technologies and the rapid changes in

national and international market structures, the development and

acceptance of voluntary, international standards are critical to the

development of the GII. The international standards organizations and

their memberships must redouble their efforts to ensure that standards

are developed that assist the rapid delivery of information. Moreover,

the pace of the work in international bodies must continue to increase

to better reflect marketplace needs for technological development, so

as not to impede the realization of the GII. In the absence of timely

development and implementation of standards on a global basis, the

benefits of improved interoperability will be delayed.

Recommended Action

In partnership with the private sector, governments can take action

to improve access to facilities and networks, and promote the

availability of a wide range of diverse services and information,

including strong support for the development of international standards

that promote interoperability. To achieve these goals, the United

States will join with other governments to:

Develop appropriate policies that encourage increased

access by citizens to diverse sources of information;

Provide unrestricted and equitable access to networks for

providers and consumers of services and content, based on sound

commercial practices;

Hold regular bilateral and multilateral dialogues on ways

of increasing the flow of information across borders to facilitate

greater access to content by consumers;

Encourage an open, voluntary standards-setting process

that does not denigrate intellectual property rights and which includes

the participation of a broad group of interests, including the private

sector, consumers, and, as appropriate, government agencies;

Work through regional and international bodies to increase

the pace of consensus-based, voluntary, and transparent standards

development and adoption, and to promote the broad dissemination of

standards-related information;

Work together and with national, regional, and

international standards bodies to identify priority areas for increased

coordination among different private national and international bodies

in support of interoperability of networks and services on the GII.

D. Creating a Flexible Regulatory Environment

Policymakers worldwide face a daunting challenge: Creating an

appropriate regulatory regime that minimizes regulation and fosters

competition through transparent rules and processes and is sufficiently

flexible to be responsive to changing technologies and markets. As the

pace [[Page 10365]] of technological innovation quickens, this will

become increasingly difficult and yet increasingly necessary.

With the U.S. experience as our guide, we offer the following

observations about the characteristics of telecommunications

legislation that are necessary to respond to changes in this dynamic

sector. The optimal regulatory and legislative frameworks will:

Identify the goals and objectives of the law, including

the promotion of competition;

Be sufficiently flexible to permit the introduction of new

services and technologies without requiring amendments to the

legislation;

Delegate broad powers to a regulatory authority

independent of a national operator and charge that independent

authority with keeping abreast of technological and market

developments;

Establish a transparent and open process whereby the

public and interested parties are informed and can participate in

rulemaking and adjudicatory proceedings; and

Aim towards open market access based on nondiscrimination

principles.

We recognize that regulatory reform can take many paths. Some

countries have established a regulatory entity responsible for both

formulating and implementing telecommunications and mass media policy,

as well as overseeing the activities of these sectors. Others have

relied on the separation of operational and regulatory functions of the

government-owned and/or franchised national operator, with government

bodies assuming responsibility for regulatory decisions. Still others

rely more heavily on national competition law and policy for oversight.

Regardless of the regulatory model that countries adopt,

regulations should clarify the respective rights and obligations of

incumbent operators and new entrants. New market entrants need

assurances that incumbent operators will not be allowed to use their

dominant market positions to hinder the evolution of successful

competition. Similarly, public and transparent regulatory processes

create stable commercial environments, which are necessary to attract

private investment. As such, rules and regulations should clearly

indicate:

The scope of permissible competition, e.g., the particular

market segments open to new entrants;

The means by which new entrants can gain market access,

e.g., private investment, licensing requirements, and cross-border

services;

The nondiscriminatory terms and conditions of

interconnection to an incumbent operator's network and of supplying

information services over the network; and

The procedures by which new entrants and users can bring

complaints and obtain redress from the regulator, e.g., enforcement

mechanisms. Additionally, it is critical that a pro-competitive

regulatory regime ensure:

The establishment of other structural or nonstructural

safeguards to protect against the anticompetitive exploitation of

market power by the incumbent service provider to the detriment of the

new entrants;

The appropriate balancing of public service obligations

among operators/carriers;

Charging and pricing policies that are based on the costs

of providing service; and

The efficient, effective, and pro-competitive management

of scarce resources, especially the radio frequency spectrum.

In light of the increasing demands on the radio spectrum for the

introduction of new wireless communications systems and services, the

last point merits particular emphasis. Among these new technologies,

none better embodies the need for an open regulatory model embracing

competition and careful management of the spectrum than the nascent

hand-held mobile satellite services. If these services are to achieve

their global potential, cooperation among national spectrum regulators

will be required, as will a willingness to permit multiple market

entrants to ensure that new satellite services do not become the

exclusive property of a sole provider.

Governments should avoid burdensome regulation that stifles

innovation and new service offerings. Governments must guard against

the expansion of regulation into market segments that have not

traditionally been subject to regulations and that have functioned

extremely well on an unregulated basis. The examples of Australia,

Canada, and the United States in computer and business information

services are illustrative. They are among the leading nations in

personal computer penetration rates among consumers. Not

coincidentally, they also provide an open, dynamic, and almost totally

unregulated market for information technology and services. Equally

important, while some government regulation is necessary as a

marketplace transitions from a monopoly to a competitive structure,

once competition is achieved, continued regulation can be unnecessary

or even counterproductive in promoting efficiency, innovation, and

customer responsiveness. In short, governments must be prepared, and

must invest their regulatory agencies with the authority, to adjust

regulatory structures as the demands of the marketplace and technology

require.

Just as national regulatory environments need to be responsive to

emerging market and technological developments, so too must the

overarching international environment continually adapt to new

developments. The successful efforts of governments and industry to

improve global interconnectivity and liberalize international

telecommunications demonstrate the value of working together in various

international fora to promote progressive and flexible national

regulations. These efforts must continue.

Recommended Action

Although national regulatory environments necessarily reflect the

specific social, economic, and political needs of each individual

country, the essentially global nature of the markets for

telecommunications, information technologies, and information services

require that national regulations be responsive to global developments.

The United States will join with other governments to:

Re-examine and adapt regulations and legislation to

accommodate market and technological developments at national and

global levels in support of the five GII principles;

Create, through regulatory and/or legislative reform, a

pro-competitive, technology-neutral regulatory environment to maximize

consumer choice, to provide fair access to networks, and to stimulate

infrastructure development, the introduction of new services, and the

wider dissemination of information;

Exchange views and information on national regulatory and

legislative initiatives and seek to identify common challenges and

options for developing flexible and transparent regulations in support

of the development of the GII;

Work collectively in regional and international

organizations to convene meetings devoted specifically to encouraging

the adoption of regulatory policies that will promote the GII; and

Encourage creation of independent national regulatory

authorities for telecommunications separate from the operator that

shall promote the interest of consumers and ensure effective and

efficient competition. Such authorities should have sufficient powers

to carry out their missions and should operate [[Page 10366]] with

transparent decisionmaking processes that are open to all interested

parties.

E. Ensuring Universal Service

The goal of providing access and affordable service to all members

of society is fundamental to the development of the GII. The definition

of universal service, however, necessarily varies from country to

countryranging from the provision of high quality telephone service to

every home and business in most industrialized countries to access to a

public telephone in many developing countries.

The ability to provide universal service on a national basis

depends upon a number of factors, including the level of infrastructure

development, the reach and technological capabilities of national

networks, and the cost of access to the network and services. Other

factors to be considered include the availability and use of advanced

methods of network planning and maintenance, and explicit performance

and service quality goals.

The definition of universal service is also being expanded by the

advent of digital technologies. In many countries, including the United

States, policymakers face increasing pressure to expand universal

service beyond ``plain old telephone service'' to include a broader

array of new telecommunications and information services. In fact,

universal service has always been an evolutionary concept, expanding as

the capabilities of the network and the types of service demanded by

the great majority of users have increased. For example, in the United

States fifty years ago, a party-line was deemed sufficient for

universal service purposes; now an individual line for each subscriber

is generally viewed as a component of universal service, together with

such features as direct dialing for long distance calls and 911

emergency service.

In both developed and less developed countries, wireless

technologies can help meet the needs for both basic and more advanced

services. For example, by augmenting terrestrial-based facilities with

satellite facilities and services, national networks can maximize their

potential. The point-to-multipoint and mobile communications

capabilities of satellites, which are global in reach, permit the

extension of services to even the most remote regions.

Moreover, in helping meet universal service goals, one option for

governments to consider is the establishment of community ``access

points.'' For example, institutions such as schools, libraries, or

hospitals could be equipped with basic and advanced information and

communications technologies for use by members of the public. Such

community access points would facilitate the efficient provision of

broader public access to a core set of services.

Although several countries have raised concerns that competition

diverts revenues from the public operator and undermines its ability to

provide universal service, experience shows that access to the

telephone has been improved in the most liberal national markets. In

the United Kingdom, for example, many customers are ordering a

telephone for the first time largely because increased competition--

cable television companies are now offering telephone service--has made

it more affordable. In the United States, concerns were raised a decade

ago that increased competition in the provision of long distance

services, which had traditionally subsidized basic local rates, would

threaten universal service. These concerns abated as competition

spurred innovation and price reductions, which in turn have expanded

universal service. Further, studies by the OECD indicate that telephone

penetration has not been eroded in any member country that has

introduced infrastructure competition. The OECD concluded, ``Universal

service has not been impaired by market liberalization; (rather)

facilities competition can be applied to complement and enhance

universal service.''5 Indeed, many now argue that full and open

facilities-based competition, by reducing prices, is the most effective

way to promote universal service.

\5\Ibid, p.3.

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As together we strive to expand the worldwide telecommunications

infrastructure and build the GII, we must all keep the goal of

universal service constantly in mind. With significant decreases in the

costs of information transmission and processing, the creation of the

Information Society has the potential to improve the quality of life of

all citizens. Recognizing that information leads to empowerment, the

nations of the world must work together to ensure that as many citizens

as possible in all societies have access to the resources of the

Information Age.

Recommended Action

Although the provision of universal service varies from country to

country, the goal of providing all people with greater access to both

basic and advanced services is a crucial element of the GII. The United

States will join with other governments to:

Consider, at the local and national levels, the benefits

afforded by the introduction of competition and private investment in

meeting and expanding universal service;

Exchange information at the bilateral and multilateral

level to address the range of available options to meet universal

service goals; and

Consider, at the national and international levels, ways

to promote universal access as a means of providing service to

currently underserved and geographically remote areas.

III. Encouraging the Use of the GII

While we believe that the adoption, application, and advancement of

the five core principles are necessary to create an environment in

which the GII can realize its full potential, such actions alone are

insufficient to guarantee it. Regardless of the sophistication of the

technology or services being offered, users must be assured that they

can allow the GII entry into their homes, offices, and lives to access

and share information safely and without forfeiting any of their

rights. Governments, companies, and public-interest groups, by working

together on information policy and content issues, must address these

concerns.

An equally important task for governments and private sectors is to

demonstrate the potential benefits of the GII to citizens. It is only

when people see tangible results of applications that they will begin

to appreciate how it can be used to improve their lives. This

appreciation is the key to stimulating demand for the services and

content of the GII, which in turn will provide the impetus to remove

institutional and regulatory barriers to its full utilization.

A. Information Policy and Content Issues

Developing an effective information policy will provide governments

with perhaps their greatest challenge. The central objectives of

information policy include ensuring that: (1) The privacy of

individuals and organizations using the GII is protected; (2) the

security and reliability of the networks and the information that

passes over them are preserved; and (3) the intellectual property

rights of those who create the information, education, and

entertainment content are protected. To assure the growth of an

information infrastructure accessible and accountable to the citizens

of the world, governments must develop and implement these objectives

in close [[Page 10367]] partnerships with each other and with

representatives from business, labor, academia, and the public.

1. Privacy Protection

By bringing news and information to people on a global basis, and

thereby allowing them to communicate more freely with each other,

communications technologies serve a democratizing function. These same

technologies also permit both governments and the private sector to

transmit, process, and store vast amounts of information about

individuals. While these capabilities are increasingly essential for

governments to function effectively and for businesses to operate

efficiently, questions continue to grow about an individual's right to

privacy and the accompanying responsibilities of holders and

transmitters of this information to safeguard this right.

In many nations, the past two decades have seen the primary

gatherers and users of personal data shift from government entities to

private sector firms. In the 1970's and 1980's, businesses were quick

to exploit the explosive growth in low cost, high performance

computers, adapting this technology to a wide range of economic,

financial, and marketing applications. As electronic commerce spread

during the 1980's, there was growing recognition that the electronic

transfer of data across national boundaries required an international

consensus on individual privacy protection.

In 1980, the OECD developed and adopted a set of voluntary privacy

guidelines that were accepted by its 24 member countries. In 1981, the

Council of Europe, whose membership consists of the European Union

Member States and other European countries, adopted ``fair information

practices'' similar to those of the OECD to regulate the collection,

storage, and automated processing of personal data, and transborder

data flow. Both the OECD and Council of Europe privacy guidelines,

which generally recognize that the free flow of information is critical

to transborder economic activity, provide a framework for domestic

legislation that has been used by both member and non-member nations.

They also recognize diverse means of protecting information privacy,

including self-regulation and industry codes of conduct. The North

American Free Trade Agreement (NAFTA) and the General Agreement on

Trade in Services (GATS) Annex on Telecommunications also contain

provisions that recognize national privacy protection regulations.

The United States and other countries around the world are re-

examining existing privacy policies to ensure that they apply

comprehensively to the transfer of personal data over global networks.

A balanced privacy policy--preserving the individual's right to privacy

while maintaining the free flow of information across national

borders--is important to the development of global networks and

services. Working together, nations should ensure that the transport of

personal data adequately takes into account the following agreed-upon

international privacy principles:

Personal data should be collected only for specified,

legitimate purposes;

The dissemination, sharing, and reuse of information

should be compatible with the purposes for which it was originally

collected;

Personal data should be accurate, relevant, and up-to-

date;

Individuals should be informed how personal data will be

used and should be allowed to examine and correct this information; and

Transmission of personal data should not be unduly

restricted or subject to burdensome authorization procedures.

Recommended Action

In order to foster consumer confidence in the GII and to encourage

the growth of interconnected global networks, users must feel that they

are afforded adequate privacy protection. To this end, the United

States will join with other governments to:

Identify key privacy issues that need to be addressed in

relation to the development of national and global information

infrastructures;

Work with both the public and private sectors to achieve

consensus on a set of fair information principles for the collection,

transfer, storage, and subsequent use of data over national and global

information infrastructures;

Ensure that privacy protection does not unduly impede the

free flow of information across national borders;

Share information on new privacy protection policy

developments and on new technologies and standards for privacy

protection; and

Encourage the use of voluntary guidelines developed by

international bodies, such as the OECD, as the best means of ensuring

the protection of privacy on an international basis.

2. Security and Reliability

A network as vast and complex as the GII will pose difficult

security challenges for all nations. The same modern technology that

makes communication faster and easier also makes communications systems

vulnerable to ever greater security risks. These risks are not newmost

are well-known among security managers. What is new is that these risks

are much more widespread, are potentially much more serious, and affect

a population of users who do not have the information or training to

deal with them.

The anonymous and impersonal nature of computer crime, for example,

makes this problem particularly unsettling, for legal systems depend

upon their ability to identify the malfeasors. Yet serious violation of

privacy or property rights can be accomplished by destruction or

alteration of information by anonymous individuals in remote locations,

with not a fingerprint in sight. The technical challenges of protecting

the privacy and integrity of information stored in computer systems are

even greater than those that apply to information transmitted by

telephone. And as was true with the telephone, legal as well as

technological solutions are needed.

Security includes the integrity, confidentiality, and reliability

of the networks and of the information they carry. If users do not

believe that an information infrastructure is a trustworthy, reliable

system, they will be reluctant to use it, thereby diminishing its

value. To gain maximum benefit from global networks, users must be

confident that the messages they receive are authentic, that sensitive

information is available only for authorized use, and that unauthorized

users cannot access, alter, or destroy information.

In addition to protecting the security of information that is

transported over the GII, governments and industry must guarantee the

reliability of the network itself. In the event of breakage or service

interruption, network operators must work quickly and cooperatively to

repair damage and provide backup systems to minimize the duration of

any such interruptions. To have a truly global infrastructure, greater

emphasis must be placed on resolving reliability concerns, including

such issues as network performance, network connections and

interoperability, the development of new technology, and regional and

demographic differences in reliability.

Recommended Action

To promote the development of a secure and reliable GII, the United

States will join with other countries to:

Work collectively to increase the reliability and security

of national and international information infrastructures;

Initiate a broad international dialogue among users,

providers, and all [[Page 10368]] other participants in the GII on

issues related to protecting the confidentiality and integrity of

information transmitted and stored on global networks;

Exchange information and encourage further cooperation

within regional and international organizations such as the ITU and the

OECD on measures to ensure network security and reliability, including

the sharing of outage information;

Share information regarding the best means available to

advance security goals while not impeding progress on other GII

principles, such as the promotion of competition and open access; and

Exchange information about, and accelerate efforts to

develop new technologies needed to improve the security of the GII

(e.g., encryption, digital signatures, and firewalls.)

3. Intellectual Property Protection

Protection of intellectual property rights is essential to the

development of a successful GII. In order to promote creativity and

provide the broadest possible access to the world's media and

information sectors under viable commercial conditions, countries will

need to protect the creative content of the GII--text, images, computer

programs, databases, video and sound recordings, as well as multimedia

products.

Providing for adequate and effective protection of intellectual

property in the digital environment requires complex legal and

technical solutions. Some of these solutions may be viewed as

controversial by some users of the system. However, the cost to society

of inadequate intellectual property protection far outweighs these

concerns. Inadequate protection of intellectual property discourages

the creation of copyrighted works, creates barriers to innovation,

stifles the use of new applications, and diminishes foreign investment.

It jeopardizes the work of researchers, creative artists, and a wide

variety of entrepreneurs.

It goes without saying that if creative works are not adequately

protected, their creators will be reluctant to permit them to be

distributed over the GII. For this reason, rightsholders must not be

compelled to license rights to their works. Instead, GII participants

should cooperate to find legal, market-based alternatives to compulsory

licensing. Reliable and efficient means of transferring intellectual

property rights must also be assured. They might, for example, adopt

various licensing arrangements, such as on-line and off-line licensing,

direct licensing, and voluntary collective licensing. More sensitive

issues, however, may have to be addressed on an individual basis. For

example, licensing of rights may be done on a per-use, per-work, or

other basis. Licensing of rights for multimedia works, which involve a

number of copyrights--not all of them with obvious attributions--could

be facilitated by special licensing arrangements.

Recommended Action

The GII cannot achieve its promise if authors, producers, and other

content creators are not guaranteed adequate protection of their

intellectual property rights. To achieve this protection, the United

States will join with other governments to:

Cooperate in national, bilateral, regional and

international fora (such as the World Intellectual Property

Organization) to achieve high levels of intellectual property and

technical protection in order to guarantee to rightsholders the

technical and legal means to control the use of their property over the

GII;

Ensure that voluntary licensing regimes provide

rightsholders and potential users of copyrighted works maximum

flexibility in negotiating the conditions governing the use of

copyrighted works, eliminate compulsory licensing, and guard against

the imposition of standards that would impede the free-flow of

information;

Provide effective enforcement against the unauthorized use

of a copyrighted work (infringement), including severe legal penalties

and vigilant monitoring. Enforcement is particularly critical as

technological innovations jeopardize the existing ability of rights

holders to protect their works;

Encourage the development and use of technological

capabilities and safeguards, such as software envelopes, headers,

assurances of authenticity, and encryption methods to complement

existing copyright management techniques and prevent infringement at

all levels. Cooperative efforts to develop testbeds, define standards,

and construct infrastructure components for these safeguards should be

encouraged, as should measures to prevent or render illegal the use of

devices to overcome these safeguards; and

Work in collaboration with intellectual property-based

industries towards greater efforts to educate others about the

importance of intellectual property protection.

B. Applications: Delivering the Benefits of the GII

Given that the value of the GII will be determined by how people

benefit from it, governments must cultivate active participation by

consumers and businesses in the application of new technologies. By

working together in creative partnerships, the public and private

sectors can apply information and telecommunications technology to a

variety of critical and complex issues: improving productivity and

economic growth in an increasingly competitive and interdependent

global economy; providing adequate health care; ensuring the

development of workforce skills through education and training;

providing equitable access to information through public institutions,

such as libraries; enhancing leisure-time activities; protecting

natural resources and the environment; and ensuring the delivery of

government services and information.

Many governments are already examining ways to promote the

development of the information infrastructure and to demonstrate,

through pilot projects and testbeds, the myriad benefits of new

technologies. In the United States, the National Information

Infrastructure (NII) initiative includes a Federal matching grant

program that provides support for planning and demonstration projects

initiated by state and local governments and non-profit entities in

such fields as health care and education.6 The U.S. NII initiative

also includes a number of other federally supported applications in the

areas of environmental monitoring, digital libraries, international

transportation and trade, and the electronic dissemination of

government information.7

\6\Administered by the National Telecommunications and

Information Administration, the basic objective of the

Telecommunications and Information Infrastructure Assistance Program

(TIIAP) is to provide clear and visible demonstrations to people at

the local level of the advantages that can be accrued in their daily

lives as a result of having access to a modern, interactive

information infrastructure.

\7\Additional information on how information infrastructure

applications can benefit people can be found in two reports from the

U.S. Information Infrastructure Task Force's Committee on

Applications and Technology: ``Putting the Information

Infrastructure to Work,'' National Institute of Standards and

Technology Special Publication 857, Gaithersburg, MD., 1994; and

``The Information Infrastructure: Reaching Society's Goals,''

National Institute of Standards and Technology Special Publication

868, Gaithersburg, MD., 1994.

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The reach of applications being developed around the world can be

expanded internationally through collaborative projects among

[[Page 10369]] commercial entities, academic institutions, and private,

voluntary, and multilateral organizations. International applications

have the unique potential to permit countries not only to bring diverse

global resources to bear upon local problems and needs, but also to

find solutions to needs that transcend national boundaries, such as

environmental monitoring and global trade and commerce.

These applications can transform the possibilities of the GII into

realities for citizens around the world. What follows is an

illustrative, but not exhaustive, list of examples that demonstrate the

value of expanding collaborative efforts in the development of

international applications:

Distance learning projects can make available a wealth of

educational resources to improve local educational and training

capabilities, offering cost-saving, effective alternatives to overseas

studies;

Computer networks linking medical school libraries and

remote sites can improve the delivery of health care services,

particularly to rural communities, by expanding access to demographic,

epidemiological, and medical reference materials. In Zambia, district

hospitals are being linked for clinical consultation, distance

learning, health literature dissemination, and epidemiological data

exchange. African medical libraries are linking up with libraries

overseas for research and document delivery services;

Satellite and radio-based systems that collect and

disseminate health statistics can be used to identify underserved

segments of the population and to target those areas for expanded

delivery of family health services;

Remote sensing can be used to identify and protect

important ecological systems. The Administration is promoting an

international partnership, known as Global Learning and Observation to

Benefit the Environment (GLOBE), that will allow children all over the

world to collect and share environmental data. Students will work with

teachers and environmental scientists to expand knowledge about

weather, air and water chemistry and quality, biodiversity, and other

``vital signs'' of the Earth. The combined data will be transformed

into striking ``pictures'' of the entire planet, allowing each student

to see how their school's observation is an important part of the

global environment;

Computer and satellite networks can provide monitoring

and, in some cases, early warning of natural disasters, allowing for

better coordination of humanitarian assistance efforts between host and

donor countries, speeding the delivery of aid and assistance. In the

South Pacific, the PEACESAT satellite network has been used to

coordinate emergency assistance after typhoons and earthquakes, and to

summon medical teams during outbreaks of cholera and dengue fever;

Computerized market price data for agricultural and

horticultural products can provide new agribusiness opportunities and

can facilitate direct links between exporters and clients;

Access to international markets, particularly for small

and medium sized businesses, can be created by providing electronic

access to information such as transportation schedules and costs,

insurance and customs data. The United Nations Conference on Trade and

Development (UNCTAD) trade points system uses electronic data

interchange and other technologies to establish a network of trade

points around the globe. In Algeria, for example, the introduction of a

computer-mediated trade point has stimulated an increase in the number

of companies involved in international trade from twenty to 2,500;

Electronic data interchange technologies, which can reduce

the administrative cost of international trade transactions by as much

as twenty per cent, can help companies increase productivity by

streamlining manufacturing and service delivery. Through industry-led

consortia such as CommerceNet, companies can explore collaborative

engineering, on-line catalogs of products and services, and mechanisms

for electronic payments;

Scientists can continue to explore the use of

``collaboratories,'' tools and virtual environments that allow

scientists to work together without regard to space or time. Scientists

need the ability to share data and the tools for data analysis,

visualization, and modeling, to control remote instruments, and to

communicate with their colleagues;

Using the World Wide Web, individuals and institutions all

over the globe have begun to create distributed ``virtual libraries''

on specific subjects. As these opportunities continue to grow, tools

for information discovery and retrieval and protection of intellectual

property rights will become increasingly important.

In our view, public-private sponsorship of GII pilot projects and

testbeds is worthwhile. It will help identify and address a number of

technical, policy, and regulatory barriers to the realization of the

GII. These include issues of privacy, security, interoperability, and

intellectual property protection, as well as artificially high prices

for telecommunications services and outdated rules and regulations

designed for paper-based transactions. A strategy that concentrates on

``learning by doing'' is far more likely to resolve these barriers.

The roles played by governments, the private sector, academic

institutions, and non-profit organizations will vary depending on the

nature of the application. In some cases, such as global electronic

commerce and entertainment services, the private sector should take the

lead, while in other areas, such as international public health,

cooperation between public health agencies, hospitals, clinics, and

universities would be appropriate. Whatever the application,

governments must recognize that while they can play an important

catalytic role in fostering international collaboration, they should

not attempt ``top-down'' management of this process. The Administration

hopes and expects that many of the best ideas for global cooperation

will bubble up from the grassroots with little or no government

involvement.

Successful applications will set in motion a continuous cycle of

demand that will encourage future development of the GII. Demonstrating

the power of the GII to successfully address pressing problems will

stimulate consumer demand for a variety of products and services at

affordable prices. This demand will provide the necessary incentive for

the private sector to broaden the reach and expand the capabilities of

the GII, enhancing its ability to deliver benefits to people and again

increasing demand. As a ``network of networks'' linking people and

information, the GII can leverage the collaborative potential of

existing efforts and provide real solutions to existing and emerging

global issues.

Recommended Action

International applications are the best way to demonstrate the

potential power of the GII to affect lives all over the world. The

United States will join with other countries to:

Support, along with the private sector, the initiation of

pilot projects and testbeds that demonstrate the benefits of the GII,

in areas such as electronic commerce, health care, digital libraries,

environmental monitoring, and life-long learning, with opportunities

for participation by both developed and developing countries;

Cooperate in the facilitation of electronic information

exchanges in support of global trade and commerce;

Facilitate the sharing of information in the public domain

with other [[Page 10370]] countries on government-funded and private

sector applications projects to promote a broader understanding of the

diversity of technology that can be applied to meet various public

needs;

Encourage the assignment of a higher priority for

innovative applications of information technology, which will encourage

increased use of the GII;

Encourage private sector-led efforts to develop

application-level standards (e.g. data interchange formats, application

program interfaces) to ensure interoperability at the application

level; and

Work constructively to assess and eliminate the barriers

to the development and deployment of GII applications.8

\8\ A report of the Conference on Breaking the Barriers to the

National Information Infrastructure can be obtained from the Council

on Competitiveness in Washington, D.C. The conference was co-

sponsored by the Council and the Clinton Administration's

Information Infrastructure Task Force.

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IV. Implementing the GII

The various approaches governments have taken in response to the

technological convergence of telecommunications and information

industries have resulted in the development of asymmetric markets and

regulatory environments around the world. These asymmetries often

impede the cross-border transfer of services and information among

business users, entertainment providers, and consumers. The United

States believes that these differences can be overcome, in part through

the work of market forces and technological developments, but also in

part through collective agreement among all countries to adopt,

advance, and apply the core principles of the GII. By working through

existing international and regional organizations, and engaging in

bilateral efforts, government and industry can remove obstacles

blocking the effective development of the GII.

Multilateral organizations will play a vital role in this effort.

In particular, the International Telecommunication Union (ITU), the

Organization for Economic Cooperation and Development (OECD), the

International Organization for Standardization (ISO), and the World

Intellectual Property Organization (WIPO) are uniquely able to

contribute practical solutions to problems affecting the development of

the GII.

As the preeminent international organization dealing with

telecommunications issues, the United Nations' ITU was the first

multilateral forum in which the GII was discussed. With its broad

membership of 185 developed and developing countries, the consensus-

based ITU serves as a global forum for technical discussions ranging

from voluntary standards development and frequency allocation

activities to network development. Accomplishments already achieved

under ITU auspices in technical telecommunications and development

issues suggest that the ITU can play a significant role in the GII

development process.

The OECD, an international think tank which undertakes economic

research on various aspects of its members' economies and policy

concerns, has been constructively addressing telecommunications and

information policy issues for several years. Its policy and statistical

analyses have contributed to a broader understanding of the economic

benefits of liberalization in the information and telecommunications

sectors.

Organizations such as the ISO and the WIPO, which deal with

specific cross-sectoral issues, can serve as important fora to discuss

and advance issues of open access and information policy. For example,

any changes made to bilateral or regional intellectual property regimes

may ultimately become issues in the WIPO.

In addition, both Intelsat and Inmarsat, the treaty-based satellite

communications organizations that have played a significant role in

advancing global telecommunications, are now contemplating options for

restructuring. Because of these organizations' broad international

memberships, they could serve as useful fora for review of

commercialization alternatives.

The General Agreement on Tariffs and Trade (GATT) is a multilateral

agreement setting out the rules and principles by which countries

trade, primarily in the area of goods. The Uruguay Round of GATT

negotiations led to the establishment of the World Trade Organization

(WTO), which deals with services, investment, and intellectual

property--areas that substantively affect telecommunications trade. The

General Agreement on Trade in Services (GATS), under the new WTO,

includes an Annex on--access to and use of--the telecommunications

networks of WTO members, and includes substantive commitments from a

number of parties on value-added telecommunications services. More

generally, the GATS--access to and use of--telecommunications annex

applies to all services for which countries have scheduled market

access commitments. Now that it is in effect for the U.S. and most of

its major trading partners, the GATS can substantially reinforce the

principles of the GII. In addition, there are on-going negotiations, to

be concluded by April 1996, to liberalize basic telecommunications

services through the Negotiating Group on Basic Telecommunications.

Regional organizations also have important roles in achieving

regional consensus on issues pertaining to telecommunications and

information markets. Organizations such as the Inter-American

Telecommunication Commission (CITEL) of the Organization of American

States (OAS), the Asia Pacific Economic Cooperation (APEC), the

Southern Africa Transportation and Communications Commission (SATCC)

and the European Conference on Postal and Telecommunications

Administration (CEPT), among others, frequently serve as fora for the

exchange of valuable information and as test sites for implementation

of the most expedient and beneficial policies. These bodies also serve

as effective vehicles for improving and enhancing network development

and technical cooperation among participants on a regional basis.

Finally, plurilateral and bilateral dialogues can be arranged among

and between nations to focus on particular issues. In addition to the

deliberations in regional and international organizations, these

discussions can become building blocks for cooperation as together we

seek to construct a truly global GII. For example, the G-7 Ministerial

Conference scheduled for February 1995 is one of several such

opportunities for focused, high-level discussion of the Global

Information Infrastructure.

As important as these international governmental organizations are,

perhaps even more important are the numerous formal and informal groups

within the private sector. These groups, which range from international

trade organizations to professional associations to advocacy groups to

industry-led standard-setting bodies, provide communication channels

between the people who will actually build and use the GII. Such

private sector groups facilitate the international teaming and

strategic alliances that will ensure the development of a truly

seamless ``network of networks,'' rather than a patchwork of

incompatible systems and services.

V. Conclusion

As Vice President Gore noted in Buenos Aires, it is possible to

create a global information network that transmits messages and images

with the speed of light from the largest city to the smallest village.

Through the [[Page 10371]] interconnection of disparate but

interoperable networks, these information highways will allow us to

communicate as a global communitygiving individuals, businesses, and

economies greater access to each other and to a wider range of

information. Equally important, the GII will offer governments an

unprecedented opportunity to equalize global disparity in

telecommunications and maximize the economic and social benefits of the

Information Age for their citizens.

Harnessing the global potential of information and communications

technologies to this end will require collaboration among the

industries that will build, operate, provide, and use services and

information available over the evolving national networks. It will also

require cooperative efforts among countries, working together

bilaterally, regionally, and through multilateral organizations, to

facilitate the interconnection of their respective networks and the

sharing of information among nations.

In our interdependent world, technological and regulatory choices

made in one country can affect those made in neighboring countries,

creating a multiplier effect for the GII's development. To help guide

this development, the Administration proposes five core

principlesprivate investment, competition, open access, a flexible

regulatory environment, and universal service. These principles, we

believe, along with effective information policies, will provide a

foundation upon which the GII can be built.

The overarching goal of the ``Agenda for Cooperation'' is to foster

the cooperation that will be needed to spur the transformation of a

thousand discrete networks into a connected, interoperable global

information infrastructure. As all nations take steps to develop and

upgrade national information infrastructures, we invite you to join

with us in ensuring that the benefits of the GII will be available

throughout the world.

Larry Irving,

Assistant Secretary for Communications and Information.

[FR Doc. 95-4546 Filed 2-23-95; 8:45 am]

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