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EMFA: T4C2 - Private and Public Roles Comments 2



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Private and Public Roles - Comments and Responses #2
----------------------------------------------------

The following messages are included in this final UAC digest:

1. Jennifer Wager -  Customization for Rural America
2. Tom Abeles - Who's on first? what's on second!
3. Max Swanson - Major Issues, Final Thoughts
4. Gary Wilson - PPR Response 

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 [1]

From: Jennifer Wager <JWager@ntca.org>
Subject: Rural America and the Need for Customization--General 
Comments

This experience has been one of learning and switching
perspectives.  We*ve heard perspectives from Bangladesh, Ireland,
the UK, Argentina, from rural Florida to New York City.  These
comments are from a rural American perspective and cut across the
many issues that we*ve raised in this conference.

Just recently, the Foundation for Rural Service (FRS) conducted a
small survey of about 100 high school students from all over
rural America to see if, where and how they are using the
Internet and specifically E-mail.  We did this not to paint an
exhaustive picture of the future of rural telecommunications, but
to get a sense of which direction our young people might be going
with this technology, and to determine what larger-scale types of
research need to be done.

The preliminary results have been exciting.  93% of the students
said they used the Web either at home, school or work, to do
everything from homework, apply to college, look for jobs, to
shopping.  78% said they used E-mail, mostly to communicate with
friends and relatives, but a significant
percent--16%--communicated with their teachers via E-mail.  A
smaller, but important group, reported that their parents used
E-mail to communicate with their teachers.  FRS is working on a
follow-up survey which will create a model and *best practices*
resource for rural schools to empower their teachers and parents
to improve communication through the use of E-mail.  We decided
to tackle this project after being inspired by the efforts of the
Markle Foundation to spark the debate about this *simple tool* of
E-mail.  I*m glad to see people like former FCC Chairman Reed
Hundt and Esther Dyson sounding the call to maximize the benefits
of E-mail for improved communication between teachers and
parents.  I*m also concerned as I*ve listened to many
participants in this discussion raise the issue that E-mail isn*t
automatically transparent for everybody, and that if we want
E-mail to be used universally, we need to make it simple for
people to use.

These students are special.  For one, they come from areas which
are served by telephone cooperatives and smaller, independent
telephone companies that were created as a result of the
universal service mandate established by the Communications Act
of 1934 and the availability of low-interest loans from the
Federal government for wiring rural America. These small
companies and coops sprang up to meet the needs for telephone
service in their communities, which were not being served by the
giants of the telecommunications industry because they weren*t
profitable areas in which to invest.  Many of these small
companies and coops are now Internet Service Providers for their
communities and are helping schools in their communities get
wired for the Internet and connected to the future.

I offer these tidbits not to say that we have the answer to how
young rural Americans are using (or not) the Internet, but to
give a snapshot of the situation, that might be helpful in
understanding the larger picture.

If there is one thing that we*ve learned in the EMFA conference,
it is the importance of customization.  This concept is a major
force driving telecommunications and other industries today. 
Julia Johnson*s remark that government regulators must evaluate
their roles was right on target.  Nearly 1.2 million rural
Americans are served by telephone cooperatives, and many of these
coops are ISPs.  They want to help get their local schools,
libraries and hospitals wired for the Internet.  But some aspects
of the Universal Service Order make that difficult to do for many
rural communities.  We may need to understand the idea of and
need for customization in dealing with rural communities.  RFPs
and a competitive bidding process may work fine in urban areas,
but may be at odds with the more cooperative nature of rural
communities, for example.  The process may need customization for
rural areas.  By keeping the idea of customization in the
foreground of our discussions about a new generation of Universal
Service, we would do much to make it a reality.

Jennifer Wager
Foundation for Rural Service
jwager@ntca.org
http://www.frs.org


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 [2]

From:             tom abeles <tabeles@tmn.com>
Subject:          "Who's on first? what's on second!..."

Do we really know, just in the US, who is on the internet via
email on a regular basis. What is the profile- age, sex,
education, occupation and hours of use/day- the usual survey
information.

We must have the same information over time for the telephone.
And thus we must have some idea, if, ignoring technical issue,
what the potential profile of users and use would or could be for
email.

I realize that some differences will occur because email is
different from telephones and the s-mails. But, putting hopes,
dreams and wishes aside, and putting down the flag waving about
"equality" of access for all, where will we see, just in the US,
any profound changes with respect to fundamental needs of food,
clothing, shelter and a basic civil society? Where is the
evidence, just in the US, the most wired nation in the world,
that email will fill the void, which separates the have's from
the have not's, and which appears to be growing wider.

Is email worth the fight? why? what would really happen when
every home has an email box sitting next to their tv or phone?

Minnesota has one of the easiest voter registration processes in
the US. Just bring proof of residence on the day of the election
and you can vote; and yet, citizen participation is very low,
other than the vast number of "Monday morning quarterbacks" at
the local watering holes, where voter turn out is large. It seems
that email may have this same element.

Buying a car seems expensive until one figures out that the
cost/day or cost/mile of ownership makes the capital investment
seem small. It seems that  when the costs of the perceived
benefits of universal email are also calculated, that the direct
costs also might be weighted in the same fashion. What is the
true cost of universal email?

puzzled

tom abeles
tabeles@tmn.com
612 823 3154


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 [3]

From:             Max Swanson <maxswn@citilink.com>
Subject:          Major Issues, Final Thoughts

This has been a most enlightening two weeks, and all
involved get a hearty thank you  from this end.

One minor disappointment is that things have been wrapped up a
day early; this means, for example, that the following comments
won't have a shot at being included in Friday;'s non-existent
digest.

[Host: You just made it.  It is Friday in the UK right now. :-)]

One issue that is important for the future of the whole Internet
enterprise is how to break the Net away from the public switched
telephone network.  This is an extremely important next step, at
least on a par with Web accessibility.  Here's a perfect example,
and it has to do with regulation--not the degree of industrial
develpment in a given nation.

I actively participate in a list with many UK subscribers.  Some
were objecting to the increasing number of messages occasioned by
an overly lively discussion and the arrival of new participants.

Well, says I, just use a faster modem, and try a shareware
program, (in use for this message,) which will get the mail and
hang up.

These suggestions totally missed the mark.  Not only do you pay
for all local calls in Brittain, but there's a five-minute
minimum charge for data calls.  Thus you could use dial-up ISDN,
and it wouldn't solve the problem at hand--namely, higher phone
charges.

We can rail all we want at the greediness of phone companies or
the incongruousness of the government's allowing such absurdity;
but as long as Internet basically equates to "telephone", this is
going to happen again and again.  I believe this is what Nicholas
Negroponti likes to call a "bits vs. atoms" situation.

The atoms line up like good little soldiers in the phone cable to
carry the bitstream; but more properly, they incarnate the
bitstream and thus the data.  How can we provide means for
incarnating data via the least expensive pathway in each
regulated telecomm environment; better yet, how can we create a
network that is utterly independent of such regulation but
controllable down to the individual-subscriber level?

Some nations are known as tax havens; will we now have "data
havens/" (Luxemberg was a kind of broadcasting haven until the
European radio scene opened up.)  What form will these data
havens take?

Well, the confverence is over and I cam late to the party. 
Thanks to whoever reads this, and thanks for making the
accompanying website such a pleasure to navigate with Lynx!

  And so it goes.  No GIF's or JPEG's, please.
  Mailto: maxswn@citilink.com   KA0IZH, Jazzbo on IRC.

Net-Tamer V 1.11 - Registered


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 [4]

From:         gwilson@juno.com
Subject:      Theme 4 - Responding to Private and Public Roles


Gary Wilson
Greater Boston Interfaith Organization
gwilson@juno.com
72 Boylston Street
Jamaica Plain, MA 02130-2203 USA
617-524-3147/524-7986


Responding to Private and Public Roles

1. How will private sector competition connect more people
to the Internet? It is argued that the value of the
Internet grows as each additional person is connected.
Will electronic commerce and advertising make basic
Internet conductivity a free or nearly free commodity?
To whom? And for how long? Or will the cost of home
access remain an increasingly powerful computer and
evolve from a monthly flat-rate toward measured fees?


What private and public forces are driving the Internet and
potential Public Access?

The following is my quicky assessment of the long range forces,
most of which seem fairly obvious.  In many cases we just need to
let these forces play themselves out.  But we must ever be on
watch as competitive markets do not always go in the direction of
the best public interest.  Sometimes competition ceases and
sometimes it goes too far, but right now competition seems to
hold a lot of potential benefit.

The major forces that I see are grouped under:

     Customer and Citizen Control
     Technology and Service
     Content Providers  
     Advertisers
     Distributors  
     Public Sector


Customer and Citizen Control

Quite simply, people want control over their own lives.  They
want media to deliver control information, personal
communication, and entertainment.  They want control over their
media.  They want control over the processes and services that
organize the information that is sent to them.  They want control
over the costs.  But people do not as a whole want total freedom
or a blank sheet either.  Most people don't want to think too
hard except when they perceive it is really important to them.
They don't want too many choices, but they want the right choice.
 People want access to media when it becomes important to them. 
Providing it ahead of time is just a lot of work.  Business often
responds the same way to their own internal needs.  Obviously
this is a very brief summary of a complex topic.  The point is
that the quest for appropriate and limited control is the primary
driver of the Internet.  Until media are really important to
someone, they are not going to be very interested.  Likewise,
services that do not meet the needs above leave competitive space
for someone else to meet the need.  There is enormous power in
this to drive consumer, community and commercial interests to
make something happen. This enormous power is what is making the
Internet grow rapidly.  When these needs become wide spread,
public access will become important to everyone and then there
will be the political cry and will to ensure everyone access.  In
the mean time it will be a political struggle.  In the mean time
we can experience with what works to bring us together in
stronger communities.  But, we will have to be patient.  It takes
time for technology and its uses to evolve.  Nevertheless,  I am
an optimist, I think there is a good chance business will help
because of their own self interest.

Technology and Service

The cost of technology is dropping.  A lot of things depend on
just waiting for technology costs to drop.  Of course I don't
want to wait, but sometimes that is the only realistic option.  I
though we would be where we are today, 20 years ago.  You can't
force technology too much or get too far ahead of it.  You can't
always see all the steps necessary to achieve the vision.  We are
on a 20 percent or better technology experience curve which means
a tenfold price/performance improvement every ten years or less. 
This is something everyone knows but it is very hard to
understand the impact. Dropping costs and prices a factor of ten
changes so many things and can change everything.  In twenty
years that is a factor of over 100.  

For example, 50 million PC's will probably end up on the used
market over the next 5 years alone, and many more will come on
after that at an every increasing rate until the market
stabilizes.  These will be usable for low levels and then ever
increasing levels of Internet service that will eventually move
into full audio and video.  Many will be upgradable for
intermediate levels of service.  They will be the second tier,
the one that low income people will get access to.  They will be
quite usable.  Still, it will be a challenge to plan how to use
this used equipment effectively.  Then they will be completely
abandoned as new technology becomes better and more affordable
than old technology.  Who uses an old Commadore 64 today?  

For example, a thousand dollar multimedia computer today, will
cost only $100 in ten years.  It is very hard to know how the
market will change because of that price change. Used equipment
will have very little appeal.  I believe that it will make
Internet TV the only form of TV in the US, Canada, Japan and much
of Europe.  Who knows what it will do to developing countries.
Over-the-air broadcasting will die.  Why?  Because people will
want the control and choice that only the Internet potentially
offers.  When the price drops enough and the services evolve
enough this seems inevitable. 


For example, $400 set-top conversion boxes for combined cable TV,
Internet, and phone service will drop to $40 in ten years.  We
will go through at least three major generations in ten years. 
There will be greater change over this time.  The oldest
generation could be left at marginal subscriber premises.  Since
all services will be electronically definable, it will be cheaper
to leave subscribers connected with cheap combined phone, cable,
Internet services that are limited but always present, than to
ever physically disconnect service.  This preserves the boxes and
wiring that gets trashed whenever boxes are removed or inactive. 
Personal service calls are expensive.  Customers can do a lot for
themselves.  Eliminating home and business service calls  and
providing self-service at stores to get upgrade boxes will be the
preferred competitive mode for large numbers of customers.  Over
a period of years just about every dwelling gets hooked up to
cable or phone or both.  They just don't stay connected. Not
having to do connections multiple times will save everyone.  This
approach will also be desirable for advertisers.  Advertisers
want access to everyone.  Even the poorest people buy advertised
products. Extending the advertising base to everyone will be an
important benefit of leaving boxes functioning in the home, even
for free.  Besides, advertisers may pay the bill of leaving the
boxes in the home or business.  This is how I think the
commercial interests will create permanent service that will
provide Public Access for video, sound, and E-mail and any
special combination.  But, this cannot be hurried.  It will take
time to cycle through multiple generations of set-top and
Internet connection boxes, whoever the service provider!  

Technology is not always on a never reached horizon.  Many
businesses have stayed with slow machines and Windows 3.1 because
there was no compelling need to upgrade. Multimedia PC technology
is dropping steadily in cost while its capability is increasing. 
 Service quality will stabilize and then price will just go down
until a low level plateau is reached where new features are more
important than lower price..  Relatively few people can afford or
even care about the huge leap to high definition TV now.  Even
that technology level will be reached and then prices will
steadily drop.  The furthest goal is perhaps graphic simulation,
but I can think of lots of others add-ons too.  The technology
horizon for these will continue to extend itself for a very long
time, but most of what will be a mainline service will not need
this high level of computer capacity.  Nevertheless, this
technology evolution for more services will continue to fuel the
market for many decades.  It will provide the impetus to keep the
products turning over.  It will feed public access capability!

Content Providers 

Content providers generally want to reach as broad an audience as
possible.  Time-slot broadcasting can never do this.  It can
never maximize the audience or the income.  This will only be
possible on the Internet or parallel services offering full
choice and control.  Video stores will have to disappear as video
disk farms slowly take over.  Time-slot broadcasting will also
have to disappear.   The dual delivery system (broadcast and
Internet) will not be affordable and will not deliver the
service.  The end will come about the time analog TV is phased
out by mandate of the FCC in 2006. The conversion process will
take awhile.  I don't know who will control the disk farms and
get the distribution revenue.  There will be a commercial fight
for this.  Content will get stored as close to the customer as
volume demands, but it will be an international market.  It has
already started with video and sound on the WEB.  ISPs are
already identifying repetitive delivery and cashing it at local
levels.  It is an inevitable process.  It will be very hard to
bypass the WEB and deliver with a separate different delivery
channel.  It would be doomed to long term failure.  All content
is going to the WEB, but it will take time.  There will be
intermediate steps.

Another interesting thing will happen to content providers.  The
market for second best items that survive on time-slot
broadcasting will shrink enormously.   Producers will not find
the ad revenue to pay for them and customers will not pay or
watch.  The emerging communications market will force content
providers to pay much closer attention to customer needs.

Advertisers

Advertisers hold the most interesting power.  They will want
access to the right prospects and the fastest path to a sale. 
The minimum they will pay is the cost of the media, but it is
possible that they will pay a premium for targeted customers. 
The may even bid up what they pay in order to get access to the
right customers.  Customers will develop strategies to shield
themselves from advertising they don't want.  To a certain extent
they will play hard to get.  The more money people have, the more
desirable they are as customers, the more they will play hard to
get.  It is hard to know how this market will evolve.  There are
potential regulator issues.  The small guy with the least money
is likely to attract the least ad dollar.  This does not bode
well for Universal Access.  Conceptually it could go either way. 
But it is a reasonable possibility that advertising could cover
the basic cost of universal service.  Perhaps it will need a
timely nudge.  But it is important not to strangle a new industry
when it is still getting on its feet.  We will need to be patient
to see how advertising will pay the costs.

What advertisers will not do is stay with time-slot broadcasting.
 They will want the right customer profiles!  This well
ultimately only be available on the WEB where customers can
respond immediately no matter what the program type.  The change
over is when the value and extent of tight profile advertising 
exceeds the lower cost per unit of less focused advertising.  It
will be a fuzzy and conservative line.  There is the potential
for instant purchasing or at least lead generation.  It will take
time for this to change but the trend is clear.  Over-the-air
broadcasting will certainly end, if not in ten years then
certainly in 15, but it could be gone in just 8 because of the
competition.   

Distributors

Distributors of communications technology and services have many
directions they can go with the technology and the service design
in their attempt to profitably meet the needs of customers. 
There will be a lot of money made and lost in this process. 
Calling the winners will not be easy.  Cable companies are
gearing up to take on phone companies.  Phone companies are
gearing up to take on cable companies.  Wireless services are
gearing up to take on everyone.  There is no need for a
communications monopoly.  Distributors have to make the tough
calls:  Will it make money! Forecasts like me only have to sell
the forecast, not take the blame when products and services fail.
 

I find it hard to see how existing broadcasters can do anything
else but move to distribution of their signals through media that
allow choice and control.  This can be done over the air but not
as time-slot broadcasting.  I believe they will be forced to
deliver over the Internet and forced to abandon their towers. 
Networks will not pay for tower-based over-the-air boardcasting. 
Without that subsidy and with competition from Internet TV, local
stations just will not be able to stay on the air, even if there
is still some remnant audience.  If cable and phone competitors
provide minimum service for free or a very low price,
broadcasting will be completely shut down.  It seems to me only a
matter of timing.

Advertisers and customers will not be loyal and competition will
continually try new services until there is little room for
competitive difference.  I think this means something like the
Internet, if it is not the Internet by itself.  Local
distributors may well offer video-on-demand separate from the
Internet but it will compete with some who offer it over the
Internet.  Distributors will not be able to restrain the growth
in capacity of the Internet services.  If they do, competitors
and the public sector will force them to change.

I believe that intermediate offerings like 500 channels of TV,
while perhaps necessary steps, will be very short sighted if they
are the primary vision.  People don't want 500 channels, they
want choice and control and that is very different from what
cable providers are offering today. The lock-in and raise the
price strategy of cable companies will become much more difficult
with the evolution of high-speed Internet connections.  New ways
to make money will need to be found.  Perhaps it will be in
taking charge of the audience profile at the local level.  

Distributors are the major actors today, but they are slowly
loosing control to their customers.  This is a very good thing
and we should let it happen while we keep a close eye for abuses.

Public Sector

The public sector has a place in directing what should happen. 
It should be at the table to represent the common interest.  This
does not however mean they have more wisdom or foresight than
commercial parties or individual consumers.  In many cases the
best thing government can do is get out of the way.  

As an example, the FCC approved in conjunction with industry a
new digital standard and set a retirement date 2006 for analog
broadcasting of TV.  Instead of creating a narrow standard that
could just as easily turn out to be wrong as right, they opened
the door to a wide number of directions and left the market to
sort out the details.  I think this quite wise and I have
followed the technical details of the debate quite closely. 
Commercial companies know they must come together or the market
will not appear because consumers will largely sit on the
sidelines waiting for order.  

Mandating public access before it is commercially practical or a
service that is a necessity, runs the risk of slowing down the
evolution of the Internet and other communication channels. 
Mandating public access is essentially a tax which might be
useful at the right time.  It certainly has been for telephone
service.  But service providers have enough competitive and risk
problems now without adding major additional items.  But this is
an issue of degree.  In Boston where I live I would ask more of
cable companies than current cable regulators.

I do think that strongly letting communication carriers know that
they will eventually be held accountable for public access and
working with them to define it early on is a very important task.
 Voluntary compliance does not always work as witness the seat
belt implementation problem in cars that required legislation,
but letting business know that the public sector has an interest
and that it is coming is very important.

The public sector is a vital force in developing the new
communication technologies and I have just touched the surface. 
I defer to others with more imagination and experience in this
area.

Summary

I saw a vacuum in the presentations so I quickly wrote the above.
Clearly the subject is vaster and more complicated, but perhaps I
have presented a few new thoughts or something to challenge you. 
>From long experience in technology forecasting I count myself to
be lucky if I am even 50 percent right, but ideas do need to be
expressed to generate appropriate discussions.  The hardest
things to understand are the social changes that technology
generates and the new uses that these changes bring about.  When
technology drops tremendously in price, people change the way
they view and use it. This is very hard to anticipate, but now is
not too early to start thinking about it!.  



end - whew - thanks for all the comments and responses


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