Let me start
by noting a couple of things, which I believe this audience
probably already knows. We are quite convinced that we really
are in a period of fundamental economic transformation, and
we've just released a study from our Commerce Department a couple
of weeks ago saying this. To get our Commerce Department to
agree to this is something that means it must be so. Even though
we're given to hyperbole in the Washington area, we don't think
it's hyperbole to say that this economic transformation is on
the order of what occurred in the Industrial Revolution. The
reason we say that is because the information technology industries
have gone from 4% to 6% to over 8% of the economy over the past
decade. Directly, they account for over one third of the real
growth in the economy over the past three years.
If we look
at what has caused that to occur, it has been the building out
of the Internet and the networking of computers which has brought
that growth. The Internet has gone from having 4 million to
about 100 million people on it. One may argue about exactly
what year it will take place-- I think Mr. Negroponte is a little
more optimistic than some-- but I think there's no doubt that
we're going to get to a billion people by the year 2005 at the
latest. That building out from 100 million to a billion is only
going to accelerate the importance of the information technology
industries in the growth of the economy. There are some other
indicators of this. We had a 2.1% inflation rate this past year,
which given the growth that we had in the economy, is quite
good. It would have been a 3.2% inflation rate, were it not
for the decline in prices in computers alone.
So the declining
prices that occurred in one small sector of the economy took
more than a third off the inflation rate in the economy as a
whole, while still contributing a third of the real growth to
the economy in broader information technology. It's a remarkable
occurrence that we now have over 7 million people employed in
information technology occupations. The average wage in those
occupations is over $46,000 a year compared to $28,000 for the
rest of the private economy. We are creating high-paying jobs,
contributing to real growth, and holding down inflation from
the information technology industry.
The information
technology industry is only a small piece of what is going to
occur in the coming years. Built on top of that, we have the
phenomenon of electronic commerce. There are a couple of different
things we speak of when we speak of electronic commerce. The
first is the fact that businesses are now putting up their purchasing,
their supply-chain management, inventory management, customer
relations logistics and their business-to-business transactions
on the Internet. They are realizing very significant cost-savings
and productivity improvements. Virtually every sector of the
economy is affected.
Last year
there was about $6 billion of commerce done electronically.
With investments now being made--so this is not speculative--that
will exceed $300 billion of business-to-business electronic
commerce in the United States alone by the year 2002. What is
driving that is companies in a wide-range of economic activities
ranging from the General Electrics and Boeings to the Federal
Expresses, to the Ciscos, to the Grangers of wholesaling, to
the Walmarts in retailing, that have made these investments.
They have realized such substantial savings, productivity improvements
and cycle-time improvements that it is driving them to spread
these investments throughout their companies, and it is driving
other companies to try to emulate them. So a General Electric
that did $1 billion of business-to-business commerce on the
Internet last year projects that it will be doing $6 billion
by the Year 2000. That's the kind of growth that we are seeing
taking place.
You can
then look to one final statistic, which is that 45% of all business
equipment investment now is in information technology equipment.
That is businesses essentially creating the environment for
business-to-business electronic commerce. In addition to that,
we're re seeing the beginnings of the digital sale on delivery
of products and services across the Internet. It's very much
in its infancy, although it will eventually be bigger than the
business-to-business transactions. It ranges from people purchasing
and having delivered to them games and music to movies and software
of various sorts. About 10 million people are now doing their
banking, or some piece of their banking, on the Internet. Seven
percent of all travel tickets for airlines purchased in the
United States next year will be purchased and delivered electronically
on the Internet.
We're also
beginning to see professional consulting services, educational
services, medical diagnostic services, news services and a range
of other activities being sold and delivered. Then there is
the selling or retailing of physical goods--books, flowers,
automobiles, clothing--where the products are sold on the Internet
and, then, obviously delivered physically. That is also growing
in a dramatic fashion. The final type of business activity is
essentially a new type of business that involves direct marketing
and advertising to affinity groups; companies where they collect
together discussion groups initially, of people with common
interests and essentially develop businesses where people advertise
to those groups or do direct marketing to them or sell merchandise
and so on.
I've gone
through this economic discussion because, if you take the totality
of what I've just described, it means that increasingly economies
are going to be dependent upon this medium for their economic
growth over the next couple of decades--and I think governments
all around the world are realizing this now. Five years down
the road, we will add the effects of the human Genome Project
and what we learn about that to the information technology industries,
and those two areas will drive our economies for the next quarter
century, and they'll affect broad swaths of the economy.
This means
that the Internet which started as a research tool, developed
a bit as an educational tool, and had a culture which was very
much of a libertarian that grew up around it, is now confronting
a commercial culture of those who are now betting their company
on the Internet. Governments are also becoming much more interested,
because the success of their economic policies, in some way,
is related to what occurs now in the development of information
technology and the Internet. The clash of cultures that occurs
among the commercial, governmental and--what you might call--the
traditional Internet community, is something which I observe
in my office everyday in one way or another, and it's quite
remarkable. It's something that one wishes one could have a
movie of because it's quite interesting.
We've been
recently struggling through the issue of how to develop governance
for the technical management of the Internet--the domain name
system, the numbering system, and so on. During the course of
December or January, I had a number of the key players who were
interested in this issue coming to have lunch at the White House
with me. The clash of cultures was very evident in this, and
I'll talk more about this in a minute, because it comes to questions
of governance in this new digital age. What all this means is
that I think we are going to have to make some fundamental changes
in our commercial, legal and economic paradigms, and also in
the way in which we interrelate politically. Those changes will
also be on the order of magnitude of what occurred during the
Industrial Revolution.
This project
of coordinating our work in the Internet and electronic commerce
grew out of a question the President asked me a couple of years
ago. He asked me to try to identify a couple of major initiatives
he could take, if he got a second term, which would extend the
good economy we have into the next century. You probably all
are glad about not having to hear anymore about the "bridge
to the next century" that you heard about during the campaign,
but it is something we took seriously. We've had a good economy
since 1992, and depending upon your political persuasion you
may or may not give this administration credit for it. At least
you have to say we didn't screw it up. It's been a pretty good
economy, and we think that the good economy will continue for
a few more years. So his question was, "what can we do
that will ensure its longer-term continuation?" The digital
economy was something that wasn't even on the original list.
But as I went around talking to people, it became clear that
it would be, perhaps, the fundamental driver. And so we elevated
it to great importance in the White House, and made it one of
our strategic objectives.
One of the
first things I did when I started working on this was to read
some histories of the Industrial Revolution. It was interesting,
because there were fundamental changes that took place. Some
countries embraced them and, inevitably, were the ones who succeeded.
Then those that did not, and tried to hold on to their old ways
of doing things, were the ones who fell backwards. We are in
a similar period right now. And the questions are, "what
are those new paradigms, who will embrace them, and who won't?"
The subject
is "First Principles," and let me make a couple of
suggestions about what I think some of those principles are.
Let me say up front that I suspect I am probably wrong about
some of it, and I won't know for a couple of years. But, at
least, it's our best thinking about what some of those principles
are.
The first
principle is that this will be an environment or a world where
private actors lead, not governments. The reason for that is
not ideological, from our point of view. We're Democrats; we
don't dislike government. We think government has legitimate
roles to play in society. For example, we were having a discussion
tonight about health care. I have a very different view about
the role of government in these two areas. I think the government
should guarantee everybody adequate access to health care, but
the digital economy moves too quickly and requires too much
flexibility for the processes of government to be, in most cases,
successful in relating to it.
I can assure
you now, having worked in the private sector for 20 years in
my career and in government for five, that although the private
sector has its bureaucracies--and those are sometimes forgotten--government
bureaucracies really are much more burdensome. It's very difficult
to work at a high productivity level in government; it's very
difficult to work flexibly; it's very difficult to move quickly;
and the Internet requires those things. It also is often true
in government that irrationality, fueled by some particular
event that occurs in the public dialogue, can take hold and
sweep bad actions into being without enough forethought. That
can happen anywhere in society, but I think governments can
be particularly susceptible to it. And so for those reasons,
we believe that even where collective action is necessary as
a first instance, and it won't work in all cases, but as a first
instance--we ought to look to private collective action in one
way or another to handle questions or issues that need to be
dealt with. And I'll give some examples in a few minutes.
The second
principle is that there are two different ways that one could
think about the Internet and the Internet economy growing up.
The first model is the traditional telecommunications and broadcast
model, where governments all around the world for various reasons
either owned it or regulated it, as we do here in the United
States through the Federal Communications Commission. The other
model is to say that it ought to be market-driven. That is,
that private buyers and sellers should be able to come together
to do business and communicate with each other free of government
regulation. And that, with respect to the economic activity,
governments should provide a uniform commercial environment
for the conduct of contracts. If a buyer and seller or two people
coming together wish to have the protection of a legal regime
of contracts, they can do so. They don't have to, but it's there
if they want to choose to operate in it. The history of free
enterprise teaches us that, in most cases, buyers and sellers
will wish to have that protection. The role of governments is
to help codify contracts rather than regulation.
Now we believe
that the second paradigm--the market-driven environment--ought
to be the one that governs in this Internet economy. This is
not ideological; it's practical. We think that competition and
consumer choice should be the driving forces in this new world.
We don't think that the reasons why we regulated telecommunications
and broadcast hold anymore. For example, with broadcast, there
was a limited amount of spectrum to be allocated; so the government,
in the l920s, began doing the allocation. It was because the
government was conferring commercial value on certain groups
that it regulated them. With the telephone system, when the
infrastructure was being built out, the size of that investment
necessary relative to the size of the companies was huge. So,
governments licensed monopolies and then regulated them to build
out the infrastructure. With the Internet, you'll have almost
unlimited bandwidth, and you don't need spectrum allocation.
In my view, you will probably see the greatest competition to
build out the infrastructure of the Internet that we've ever
seen in free-market economies. Computer companies, software
companies, telecommunication companies, broadcast companies,
consumer electronics companies, wireless companies--even electric
utilities--publishers are all vying to build out the infrastructure
for the Internet. The best thing we can do is to let that competition
occur with consumer choice driving. What makes this significant
is that telecommunications, broadcast and the Internet are all
going to converge, as everybody in this room knows--although
most people in the society haven't come to that realization
yet. The Internet will be on your television. Broadcast television
will be on your personal computer. You make telephone calls
from both of them. It will be delivered to your home by satellite,
wireless, television cable or telephone line. What we are saying
is that "conversion" environment should be a market-driven
environment, which means we have to go through considerable
de-regulation. Now that doesn't mean there aren't certain public
purposes that need to be followed, but it means that the basic
structure should be a market-driven structure.
The third
principle is that when government does need to act in this arena--as
it will to help codify uniform commercial code for dealing with
issues of taxation, intellectual property protection, and the
like--the actions ought to be precise, uniform and transparent.
So, rather than passing omnibus legislation of some sort, we
should act only in precise ways when it is necessary to act.
The fourth
principle--and this is one that's probably the hardest thing
for people to understand, at least in Washington--is that whatever
we do needs to take cognizance of the nature of the medium that
we're dealing with. For example, technology changes very rapidly
with this medium, so any policy needs to be technology-neutral.
This is because if its tied to a given technology, it'll be
outmoded before it's enacted. Similarly, this is a de-centralized
medium. Therefore, attempts to centrally control it or censor
it are impossible, even if they were desirable (which I would
argue they're not). Life is too short to spend too much time
doing things that are impossible, so we need to respect the
nature of the medium in the way we try to deal with policy issues
related to it. Finally, this is the first medium and the first
marketplace that is global from the very beginning. Therefore,
the traditional model where industries or where mediums grow
up within countries, and countries negotiate how they work together
doesn't work here. From the beginning, you need a global framework,
which is why our strategy has been pursuing a global set of
agreements.
Now, added
to these basic principles, let me throw a couple of more out,
and then I'll give you some examples of what we mean by these
and how we are working with them. There are a series of areas
where we are trying to engage in gaining international agreement,
and also among the states in the United States, to try to create
the kind of framework that can allow this medium to grow in
a free way. Those include things like dealing with tariff and
tax issues, where we're trying to have the Internet become a
duty-free environment, and we're hoping to get an agreement
in Geneva through the World Trade Organization in a couple of
weeks that will do that. We've been opposing any discriminatory
taxation against the Internet--no bit taxes or Internet access
tax or inter-telephony taxes.
We've also
been working to try to form agreements on uniform commercial
code, on intellectual property protection, on ensuring that
standards will be set and electronic payments developed in a
market-driven way, without government regulation. We are also
trying to get systems put in place that will allow privacy to
be protected and so on. But in the way in which we're going
about these, we're trying to respect the principles that I've
mentioned earlier, and I'll give you a couple of examples.
In the question
of content, we started down a path that was not a correct path
initially. Now, I think we have gotten to a better place. We
don't believe that one should attempt to censor the Internet.
Governments should not attempt to censor the Internet. As I
said earlier, even if they wanted to, they couldn't, but, in
my view, they shouldn't want to anyway. What should be put in
place is a model of empowering people to make their own decisions
in an individual way--this should be a question of consumer
or individual choice. If you're the kind of parent that's afraid
of the Internet--because your children understand it better
than you, and you're afraid of what they're getting into--when
you sign up with your Internet service provider, you should
have the ability to check some boxes according to your own value
system. This would allow you your own choice in a simple way
which would conform to your value system.
There should
be software packages that might be identified with organizations
that you feel comfortable with. Christian Coalition might have
a package or the Children's Television Network or whatever.
So you, as a parent, can say, "well, that's OK--if they
have a filtering package, I'll go with that and feel comfortable."
The important thing is that there's choice for the consumer
or the parent to do what they wish, not the government saying
what it should be. Or if you're the kind of parent that mistakenly
believes you understand the Internet better than your children,
then you can let everything through. In the Browser or Search
Engine software, you should be able to do the filtering you
want. If you love violence and you hate sex, you can filter
out the sex and let the violence through. Of course, the methods
to do this are not going to be fool-proof or anywhere near it,
but parents who didn't want their kids to see "Playboy"
magazine. . . When I was growing up, that wasn't fool-proof
either. I think the important paradigm here is one of empowering
people to make their own choices, and the Internet uniquely
gives us the ability to do that.
Similarly,
with respect to privacy protection, it is very important that
people are able to protect their privacy on the Internet. This
is probably the most difficult issue we're facing right now.
It's a fundamental value that we think should be respected in
this country. It is also important, just an economic matter.
The biggest concern people have about doing business on the
Internet is the fear of losing their privacy. However, the fact
that we feel strongly about that does not lead us to believe
that we should pass a thousand pages of regulations to protect
privacy. The reason is because, if we pass those regulations,
we'd be lying to the American people. We would be saying to
them, "don't worry- we're protecting your privacy,"
when we couldn't enforce it. Now what do I mean by that?
There are
10,000 Web pages that can be formed every week, and there's
no way that any government agency could monitor them all to
know whether they are conforming with whatever laws or regulations
we would pass. Not too far down the road, the vast majority
of those will also be somewhere else in the world. They might
be on servers almost anywhere, so that even if we did find some
place that we thought was violating privacy, tracking them down
would be a hard thing to do. By the time we did, then legally
prosecuting them would be very hard. So the notion that we can
somehow protect these things in a central way would be a lie.
Instead, what we're looking for is something which will empower
people to be able to protect themselves, if they choose to do
so.
The way
we see this working is based on getting some private sector
groups, which would include both industry and consumer groups,
to come up with codes of conduct on privacy that were based
on the OECD privacy principles which are widely accepted. That
is, a seller or somebody running a Web-site should notify a
consumer or somebody who visits that Web-site that information
is being collected or that they want to collect it, and there
should be an option for the consumer to say, "No, I don't
want that." You would have the ability to control your
own data. You might say--of course, you're doing the pioneering
work here at MIT which will give the consumers the technical
ability to do this-- "Yeah, it's OK with me if you collect
this information, but only if you use it in this way, and not
that way." Then the consumer should have the ability to
update the information, check it for accuracy, and so on.
Effectively,
there's a contract being formed between the seller and the buyer,
and the buyer has control of what is done with their information.
Now the code of conduct organization would specify this, and
there would be a series of enforcement organizations that would
enforce the code of conduct. So if a Web-site joined the code
of conduct organization and was conforming with it, they would
be able to display a privacy seal on the Web-site. The code
of conduct organization would essentially hire college students
or whatever to surf the Web for all places that had the seal
to make sure that they are conforming, and the organization
would be able to process consumer complaints, and would be able
to refer cases of fraudulent behavior to the Federal Trade Commission
under the existing anti-fraud laws.
This system
would allow the government and the private sector--both consumer
groups and industry--to go to 'Net users and say, "look,
this is a free medium; you can go wherever you want, but be
careful if you go some place that doesn't have one or another
of these seals, because your privacy may not be protected."
It would be up to you. We want to keep it a free medium, but
as a matter of information and education, in these where you
see a seal, you know that you're protected; where you don't,
you may or may not be. By the way, we think most businesses
that you'll want to do business with will have a seal, but it
would be up to you. That would create a market incentive for
Web-sites to get a seal because, otherwise, they'll be limiting
the potential number of people who come and visit them. Some
will; some won't. But most who are serious about wanting to
do business, we think, will. Now, again, the paradigm here is
to understand up front that in this new world, no government
in a central way can guarantee its people that it can fully
protect them. But what it can do is give tools and give the
ability to people to protect themselves; we can empower them
to protect themselves, and we think that is a more likely outcome
in this new world.
Let me just
turn to a couple of other issues that represent fundamental
values, and these will get more to the question of the media
and the question of the political realities.
One of the
things that we're observing as the new digital economy comes
is that it is scrambling some traditional political alliances
and identifications in ways that are not predictable. It has
been a shock to some in Washington that I, who am identified
along with the First Lady as among the big liberals in the Administration,
have nevertheless been advocating what would be regarded as
a more libertarian or a more market-oriented approach or government
backing-off approach with respect to Internet policy. To me,
it's not surprising. My background is as a business strategy
consultant, and, basically, you look to solve problems; you
don't start with ideologies. You start with what you need to
do to solve problems. And what is happening is that the advent
of the new medium is causing changes in the alliances that one
sees formed. And, for everything that we're doing in this whole
area of Internet commerce and, also, the Internet in general--not
everything but almost everything, about 80% of it--we have bi-partisan
support. It's been a bi-partisan effort and, therefore, we're
being able to move ahead on the issues, but the coalitions are
very different than one sees almost anywhere else.
There are
a couple of areas where, I think, we don't yet have it right,
and these represent very fundamental challenges. First, I have
a great concern. I think in this whole question of how we create
the right kind of environment in terms of government-business
relationship, I think we're moving in the right direction in
almost all the areas now--at least, it seems to be--and we're
also being successful. But I'm very concerned about issues of
what effect the new digital economy will have on income-distribution
and on relationships of rich and poor, both in the country and
in the world, because these are tremendously empowering technologies.
And, as a value, we need to be sure that it's not just the wealthier
in our society or in the world who have access to them because
if that's the case, it will widen the gaps between rich and
poor enormously. And so, for those reasons, when I said earlier
that this should not be a regulated environment, that does not
mean to us that the government does not have roles to play.
The government does have roles to play.
For example,
we are advocating wiring all the schools and libraries, engaging
in significant funding of training programs of teachers and
working with private-sector people to bring these technologies
to the inner city, to rural areas and so on. We think it is
crucial that it happen. If it does happen in a serious way,
then the new technologies, we think, can serve to narrow income
gaps because the spectre that you see in so many inner city
schools where kids are working with 20-year old textbooks, even
in science or math, can be overcome with the Internet if it's
done right. And a variety of other disadvantages that now exist
in the society can also, if not be overcome, at least, be lessened.
But the fundamental question is, will we make sure that this
resource is fully distributed in the society or not. And we
think that's essential that it happen.
We feel
the same way in the international arena. More than half the
world's people don't have access to a telephone now; but, as
the lower earth orbital satellites go up, there will be the
ability for the most remote villages in Africa to have access
to the Internet. It will be cheaper for them to have that access
that way than to build out the telephone system. All you'll
need is a local area network with a power source in a village,
and then somebody able to train and educate a couple of people
to operate it. In fact, it will be easier to maintain than the
telephone system. Now I don't mean to minimize the difficulties
of that, but in our view, we need to put on a major effort to
ensure that the building out occurs. So, we are undertaking
a major initiative with respect to the World Bank and some of
aid organizations elsewhere to try to make that occur.
A second
issue, which is probably the greatest concern to me, is that
as the new digital economy comes, much as with the industrial
economy when it came, there are going to be tens of millions
of jobs lost, and tens of millions of jobs created. There'll
be losses in areas like retailing, middle-men type functions,
insurance agents, travel agents, and so on. There will be gains
in information technology-related industries--design industries,
media industries. The good news is that the jobs created will,
on average, be higher-skilled, higher-paying jobs than the ones
lost. The bad news will be that, if our people aren't educated
enough and if we don't have a sufficient re-training program
in this society, our people won't be able to take those new
jobs. Right now, our educational systems and training systems
are woefully inadequate to do that, and I think that is my greatest
concern that we are not now facing.
Let me address
one more issue, which I know is the issue that you've been discussing
for most of today and probably tomorrow. That issue is the effect
on media on the political process. Personally, when I first
came to Washington, I remember there was a profile written of
me--I think it was in the "Washington Post" magazine--and
there were one or two critical comments in it. Objectively,
by and large, it was probably a very positive article. I think
it said I was humorless or I didn't have much of a personality,
which I took great umbrage at. Now if that was what was said
about me in a newspaper article, I'd bring it up as the best
article that's ever written. At that time, it probably was the
best profile ever written about me, but I took great umbrage
at that time.
One of the
things I've learned, and I think it's something that we all
are going to have to learn in the digital age, is that we're
going to have thicker skins. Things that would have gone as
gossip behind your backs will now be publicly available to everybody.
Actually, I think it's probably better to see what people are
saying directly than to have it be behind your back. Personally,
I welcome this. I don't think it's a bad thing that there is
going to be thousands and thousands of information sources.
When you try to do something, particularly if you try to do
something in a public arena, it's going to be commented upon
in chat-rooms, posted in discussion groups and so on. I also
don't think it's a bad thing that there will be all kinds of
rumor mills and things posing as news activities which are just
based on rumor and some outright intending-to-be slanderous
or whatever. Having observed close up how the media is working
now, including reputable newspapers and other sources that we
all rely on, I don't think that's a bad thing either.
In many
respects, I was one of the more--I was going to say "most"--naive
people coming to Washington with this Administration. I had
been in the private sector all my life, and this was my first
job in Washington. And one of the things I was very naive about
is when I picked up some of our more credible newspapers and
read them when I was living in Rhode Island, I just assumed
what I read was correct; I just assumed it was correct if it
was in the "New York Times" or "Washington Post."
One of the things I learned in Washington is that's not true
at all.
The pressures
that reporters are under in terms of deadlines, the way in which
the spin game works, and the way in which the leak game works
means that reporting is quite often inaccurate. When it's inaccurate,
it's not malicious or anything. Most reporters are trying to
do the best they can. Some of them are more successful at it
than others, just like in any field of endeavor. I think most
sincerely want to try to do it right and get it objective, but
the nature of the way the process works means that that's not
often the case. Given that, to my way of thinking, it's better
to have more and more sources out there, and let people judge
for themselves what they find credible and what they don't.
If that means that as a public official you get whacked more
often, so what? I mean, that's just part of the game and you
need to accept it, understand it, and just move on. I don't
find that offensive anymore, and I find it just part of what
you sign up for when you go into public life.
I think
what will be interesting is that some news organizations, if
they're going to continue to command the revenue streams and
the audiences that they've been used that they have been used
to traditionally, they are going to have to find ways to brand
credibility. That will be an interesting challenge for some
of them. Having been in business strategy for 20 years--I'd
often talk to a business where there was a fundamental change
in their industry occurring and the business was being threatened,
and the business would say, "but I have this great value,
and the consumer will see that." I remember sitting with
mini-computer companies who said, "the personal computer,
yeah, OK, but my mini-computer can do things that personal computer
can never do." They just didn't want to admit that they
had to fundamentally change. That's a common phenomenon in business.
In sitting with a lot of news organizations and reporters in
Washington who were talking about the Internet press, which
they look down on, they say, "sure people will pay to read
my stories, because I give more in-depth analysis, or I give
my judgment." It doesn't ring too true to me in many cases.
The public is not necessarily going to accept that.
So, I think
there's going to have to be fundamental changes, and I don't
think it's a bad thing that we'll have more and more sources.
I also think there will be more openness, and I think that's
a good thing. One of the things we did with our electronic commerce
strategy, which broke new ground in the White House, is that
we posted the first draft of our paper on the Internet for comment.
It took about a month or two of argument for me to get agreement
to do that, but I finally did. We went through l8 drafts and
treated it as a virtual document; we got in comments; we made
revisions, and so on. We heard from hundreds of people you'd
never hear from normally in a White House/Federal Register comment
process, and there were about 50 or 60 suggestions we got from
the Internet traffic which were very good that we incorporated
them. We got some of the comments you'd expect, like "the
best thing you could do is die," and so on. But a lot of
what we got was very useful and constructive. Now, we've done
that with everything. All our papers are posted; they all go
through revisions; it's all open. And, you know, guess what?
The people who said, "Life as we know it will come to an
end if you open up the decision-making processes were wrong."
It's been very effective, and it hasn't hampered anything. I
think the openness that's going to be brought is a positive
thing. Obviously, there are certain national security areas
and things of this sort where people's lives can be in jeopardy
and so on, where you have to keep a process that's not open.
But I think that for most policy-making, I think you can have
an open process.
Finally,
let me just conclude by saying what I started by saying, which
is that I don't think any of us understand where all of this
is headed. It is part of what leads us to be taking a cautious
approach. We're being very successful, in the sense that we
think we are going to conclude agreements in the next few months
that are going to have a moratorium on taxation on the Internet
and electronic commerce, and we're not going to get the kind
of database restrictions that some had proposed, so I think
it's going to be a balanced, intellectual-property protection.
I hope and think we're going to get a duty-free zone on the
Internet. We're moving to privatize the technical management
of the Internet, and I think that's going to work well. We're
moving to a paradigm there where we're essentially saying we're
not going to have inter-governmental organizations like the
International Telecommunications Union governing the Internet.
Instead, what we're going to have is de-centralized, private,
non-profit bodies--stakeholder-based--like the Internet Engineering
Task Force or the Internet Architecture Board or this new non-profit
that will be set up for the domain name system, not some centralized
governing body. I think we are going to succeed in moving ahead
in getting this private-sector led privacy protection regimes
in place. There's moves now that we think are real that will
cause that to happen in the coming months.
So we're
succeeding in a whole number of these areas. But the final word
I'll leave you with is that despite all that, we have to be
very humble about it all because we don't really understand
it. We need to keep a very broad, consultative process going
and enough flexibility to keep changing as the technology and
the market teaches things. Let me stop there. I'm looking forward
to hearing the commentators, and then we can have a discussion.
(APPLAUSE)