[from a meeting of the NII Advisory Cmte.] FOR IMMEDIATE RELEASE Contact: Carol L. Hamilton 202-482-6001 Larry Williams (NTIA) 202-482-1551 Remarks of Secretary Ronald H. Brown January 6, 1994 Museum of Television and Radio, New York (As prepared for delivery) Thank you. It is a great pleasure to be here this morning at The Museum of Television and Radio. This is a particularly appropriate place for us to discuss the past, the present, and the future of the National Information Infrastructure. Upstairs, on the eleventh floor of this building, in the Chairman's Suite is the desk donated to this museum by its founder, William Paley. That desk, used by Mr. Paley both at CBS and here at the museum, is a converted gaming table complete with locked drawers for storing chips and numbered seats for the players. That gaming table exemplifies risk. The risk taken by William Paley and the others of his generation who saw in the emerging technologies of radio and television not just technological achievement, but the opportunity for investment and economic growth. Their willingness to take risk has returned multiple rewards. As financial investments, to be sure; but also to the nation, whose collective memories are replete with the moving shadows of television and the sounds -- and imagination -- of radio. The willingness to take risk is the hallmark of our time as well. We are now in a period of transition -- between the past that William Paley and his generation built and the future -- where new risks will return even greater rewards. It is a cliche to say, of course, that the future is hard to see. We do not know today which imaginative technologies will spark the enduring demand that television has. We cannot foresee precisely how the new information highways will link millions of Americans -- or what uses our people will make of it. We do know, however, that it is private industries of various kinds -- cable, telephone, broadcast, satellite, computers and others -- who will take that risk. We do know, in other words, that it is the private sector that will build and operate the National Information Infrastructure. And, because of the central importance of private enterprise, we know that the Administration's NII telecommunications legislative package, which will be announced shortly, must provide the basis for a strong, competitive future: one in which everyone can compete against everyone else for the provision of any service. How will we reach that end? Last month in a speech to the National Press Club, the Vice President enunciated five policy principles, three of which address the manner in which competition will build the NII. First, we must promote investment. Second, we must protect competition. Third, we must secure open access to the network. To secure investment, the first principle, the marketplace must offer opportunity and the ability to compete. The investment needed to build a broadband, interactive network across the nation is considerable. The incentives must be equally large. That is why the Administration supports, as its ultimate vision, the eventual elimination, under appropriate conditions, of any limitations on the ability of any information business to offer any information service. That means, to offer two examples, that we endorse the principle that local telephone companies must be able to offer video programming and that cable companies must be able to offer two-way communication. But it does not mean that we forgo any interest in the operation of the marketplace. We are pledged to protect competition and to secure open access. We believe as strongly in those goals as in the goal of promoting investment. Why? Because it is very important that regulated monopolies not be able to use their regulatory franchise as unfair launching pads for the entry into un-regulated activities. Because it would frustrate, not further, competition, if information bottlenecks prevented suppliers from reaching potential customers or customers from choosing freely among competitors. Indeed, this last point deserves particular emphasis today. This museum celebrates content and content, in turn, will drive the demand for information highways just as it drove the demand for television and radio. All of the programs stored in the archives of this institutions are memorials to the lasting impact of radio and television. The fact that countless visitors come to this place to hear and see them testifies to their lingering impact. But that content would be meaningless if the path from creator to listener or viewer were unfairly blocked. In the new information marketplace that will emerge, the risk of blockage comes from the operation of the information highways -- those electronic conduits that will link the information providers, like networks or film studios, to the information customers. You can expect, therefore, that our legislative package will focus tightly on the nature of competition in and among those information highways. To formulate an effective legislative package, we need, of course, to be in constant communication with the industries that will be involved in the building and operation of the NII. That is why I have come here today. And that is why the President decided last year to create a National Advisory Council to advise us on the future course of the National Information Infrastructure and asked me to appoint its members. Today, I am pleased to announce those appointments -- twenty-seven people representing private industry, state and local governments, and community groups. This council that will bring us the wisdom of many perspectives: from different industries, like cable, telephone, television and computers; from state governments and public institutions, from the producers of information, including software manufacturers and electronic publishers and, of course, from the perspective of customers. And I am particularly pleased to announce the two Co-Chairs of the NII Advisory Council; both of whom are here with us today: Delano Lewis is the President of National Public Radio. Through his experience at NPR and his past work in the telephone industry, Delano brings us important insight in the way that communications can work to meet community needs. Ed McCracken is the President of Silicon Graphics, an innovative leader among Silicon Valley enterprises. Ed's background in technology and industry will help to shape our perspectives on economic growth and competitiveness. Delano and Ed, with the other members of the council, will play a terribly important role as the Administration considers, not just telecommunications legislation, but the scores of issues that will determine the future of our information highways. With the assistance of the Advisory Council, the Administration will determine "how" we plan to achieve our goals for the NII. Today, I want to address another question: "Why?" Why does this Administration believe that the future of the information highways, is so significant to the nation? Why is this cluster of issues important enough to launch another legislative effort in the midst of health care, and crime and other pressing priorities? Why is this an important concern to me, as Secretary of Commerce? There are a number of reasons. The educational opportunities that can be created by long-distance learning and networks of schools and universities. The medical applications that will be advanced through high-resolution imaging over broadband networks. The community empowerment that comes from linking citizens with their governments. But, as Secretary of Commerce, my business is the businesses of the United States. That is why I want to emphasize this morning one aspect of the information highway -- the potential for economic growth and job creation. Because the NII isn't about technology or even technology policy -- its about how we make our nation competitive in the 21st century. Consider, for a moment the nature and size of the information marketplace. The information marketplace, broadly defined, now constitutes about 10% of our domestic economy. That includes telephone, cable, the manufacturers of telecommunications equipment, broadcasting, programmers and producers, computer hardware and software -- a panoply of diverse information products and services. And those businesses support more that 4.5 million jobs in the United States. As the information marketplace grows, it will create new products and new services, which, in turn, will create new markets and new jobs. By one estimate, the amount of money spent to build the information highway in the next four years could rival, or even exceed, the amount that we spent in the late 50s and early 60s to build our interstate highway system. But, even this understates the real impact of the information revolution. By one estimate, 2/3 of U.S. workers are in information-related jobs, and the rest are in industries that rely heavily on information. Even I have an address on Internet, so that I guess includes me as well. And the NII will help create new companies and new jobs, as it drives the development of new technologies and the creation of new products and services that address our pressing social needs. 2,600 jobs were created in York, Pennsylvania, for example, by Dyncorp, a Virginia-based information processing company. Access to fiber optic telecommunications and a GTE Smartpark played a crucial role in the location of this new facility -- which ranked as the nation's second-largest job generator in 1991. New generations of semiconductors, displays, and hand-held computers -- too name but a few technologies -- will be spurred by NII deployment. These and other technological advances will help us reduce the cost and improve the delivery of health care, through such applications as telemedicine, unified electronic claims, and computer-based patient records. Education and life-long learning also will be improved by these technologies as institutions throughout the country begin to use information networks to promote collaborative learning, to access on-line "digital libraries", and to take "virtual" field trips to museums and science exhibits without leaving the classroom. One example of this is an innovative private/public partnership between Bell Atlantic, the Union City, New Jersey Board of Education and its city government, and the faculty at the Christopher Columbus School. As a result of this partnership, 125 students and 50 teachers now have multimedia- capable personal computers installed in their homes. The students and parents are able to communicate via electronic mail to teachers, strengthening the link between the family and school. The ripple effects on American industry also will be important -- manufacturers using high-speed data transmission to connect different parts of their production cycles; small businesses made more competitive by their ability to work, in real time, with suppliers and vendors; groupware in offices that permit teams of workers to take responsibility for collaborative efforts. In short, America's companies and their workers have a new tool to use in their constant struggle for global competitiveness. This new competitiveness will translate into American success abroad. Consider the opportunities that exist today. In 1992, equipment exports of the telecommunications industry were $7.3 billion. We enjoyed a trade surplus of network/transmission equipment of $1.2 billion and a trade surplus in other forms of telecommunications equipment, including broadcasting, of $1.3 billion. The U.S. packaged software industry's international revenues in 1992 were $22.4 billion. We are the world leaders in the creation of new services -- such as video on demand and interactive shopping. And our television programs and film productions are popular the world over. Although the recent GATT negotiations did not, unfortunately, yield positive results on this issue, the Administration remains committed to supporting the free flow of trade, of all kinds. And opportunities for American businesses are growing around the world. There are countless examples. In China, a provincial governor who says: "The new wisdom is that you first build telecommunications and then build the highway." In Latin America, where the desire for U.S. programming has already led NBC, MTV, and FOX, among others, to launch Spanish and Portuguese-language channels. In Eastern Europe and the former Soviet Union where the need for telephone networks is great and where, in a nation like Hungary, residents must now wait up to thirteen years for telephone service. We will work with you to take advantage of these opportunities. My department, for example, is pushing hard to liberalize export control restrictions that limit the export of telecommunications equipment. Competitive success for American businesses will translate into competitive success for American workers. Empowered by information technology, American workers will continue to be the most productive and the most valuable in the world. But competitive success cannot be confined to just part of America. If you go upstairs in this museum to the third floor, you can call up the vast library of television programs housed here. If you punch #71 in a computer program, you will be able to listen to the first Kennedy-Nixon debate. You can see John Kennedy describe his vision for a strong, growing America and you can hear -- almost feel -- his optimism for the future. And you can see and hear him speak these words: "I don't want," he said "the talents of any American to go to waste." Neither do I. Neither does this Administration want the talents of any American to go to waste. But today, even our present information infrastructure fails to reach all of the talent in America. Consider telephone service. We think of telephones as ubiquitous and we have pledged that they be universally available. And, for most of us in this audience, they are. I'm surprised that one of the cellular phones in the audience hasn't gone off by now. But -- although about 94% of U.S. households have telephone service -- telephones don't reach everyone. African American families are about 10% less likely to have a telephone in their home as are the rest of Americans. In the District of Columbia, where I live, the percentage of households with telephones is actually going down -- now below 90%. If information technology is a key to economic growth and global competitiveness, then what will happen to those that are information-poor? Will we become a nation in which the new information age acts as a barrier, rather than a pathway, between Americans? Will we become a nation in which some school children attend schools connected to the information highways, and some do not? Will we become a nation in which some communities have libraries connected to electronic job-training or continuing education programs, and some do not? Will we become a nation in which some hospitals can provide advanced care through medical imaging, and some do not? The answer must be "no." That is why the Administration will propose a renewal and re-invention of the concept of universal service. We will propose a structure to suit the new age of information -- to build on past models, like telephone service and television broadcasting which has been freely available to all, and public education, which represents a commitment by this nation to an informed and well-schooled citizenry. That program must have a scope that expands as new technologies become vital to societal achievement. And we must implement a system that depends upon all information carriers for its success. The future of universal service is thus tied, inextricably, to the promise of competitiveness and economic growth. That is why the Department of Commerce will explore how we can link economic growth with universal service. We have already begun through the work of the National Telecommunications & Information Administration, under the leadership of Assistant Secretary Larry Irving. Through a new grant program, NTIA will help to ensure that our hospitals, schools and libraries are not left on the side of the road while the rest of America goes speeding along the new information highways. NTIA has begun holding hearings around the country to explore the manner in which new universal service obligations can be met. The first hearing was held in December in New Mexico and the next will be held on January 20th in South Central Los Angeles. Succeeding sessions will be held around the country in the coming months. I have often talked about the importance of a government- business partnership. That partnership requires that the government, on its part, take action to help markets function efficiently, to spur economic growth, and to protect competition. The partnership places obligation, as well, on the private sector. And not just to take full advantage of commercial opportunities. The challenge -- for you -- is to expand universal service to the National Information Infrastructure. That is not an obligation just of government to be imposed, as a distasteful act, upon business. It is an obligation of leadership in this society. Just as progressive businesses have increasingly recognized that their fate is tied to education and good schools, so the businesses that will take advantage of the new information marketplace must realize that our national fortune is dependent on our national competitiveness -- on ensuring that no talent goes to waste. As I meet with the industry leaders in the coming weeks and months, I intend to repeat the same question, over and over: "What will you do to avoid creating a nation of information 'haves' and information 'have nots'?" At the conclusion of the NTIA hearings on universal service, I intend to invite leaders from both industry and from the communities to meet with me. By that time, the Administration's legislative package will have been introduced. And, by that time, I want to hear from you what the private sector intends to do to accomplish this critically important goal. We will sit together and, by the time we rise from that table, we must embrace a shared vision. This is our challenge to you. Before I conclude, however, let me reflect for a moment on the work of this museum. This is a place that collects memories and information; knowledge and insight. A place where any person -- literally any person -- can sit and watch the first episode of "Cheers" -- or view Edward R. Murrow's denunciation of Joseph McCarthy. It is, to use the term, user-friendly. The availability of its content enriches as it informs. To a future generation, that will be the story of the National Information Infrastructure, as well. Its content will enrich and inform our children and grandchildren's lives. Our job is to nurture that future, in the best way that we know how. Thank you.