Copyright 1999 Federal News Service, Inc.
Federal News Service
SEPTEMBER 9, 1999, THURSDAY
SECTION: IN THE NEWS
LENGTH:
3618 words
HEADLINE: PREPARED STATEMENT OF
GREGORY
L. ROHDE
BEFORE THE SENATE COMMITTEE ON COMMERCE, SCIENCE
AND TRANSPORTATION
BODY:
Mr. Chairman,
thank you for holding this hearing. It is indeed an honor to appear before this
Committee today on the matter of my nomination to be Assistant Secretary of
Commerce for Communications and Information and Administrator of the National
Telecommunications and Information Administration (NTIA). I have had the
distinct privilege of working with the Members of this Committee for the past
six and a half years. My work with the Committee Members and staff has been one
of the most formative and enjoyable experiences of my life. I have benefitted
tremendously for having witnessed daily the integrity of the Senators of this
Committee and their uncompromising commitment to the public good. I have had a
fortunate opportunity to see how well our Nation is served by all of you and I
am honored to have had the opportunity to work here. I believe that the many
things I have learned working with the Members of this panel has prepared me
well to serve as Administrator of NTIA if continned.
I wish to thank
President Clinton for nominating me to serve in the Department of Commerce. I
also want to thank Vice President Gore and Secretary Daley for their gracious
support of me. I am grateful for the opportunity to serve the public in this
capacity and I will seek through my. actions and efforts to be worthy of this
office and the confidence that has been bestowed upon me.I also want to express
my admiration and gratitude to Larry Irving who has served, with distinction as
the Assistant Secretary of Commerce for more than 6 years. He is a model public
servant and he deserves the highest of praise for his dedication to the public,
particularly the "have nots" among telecommunications consumers, and for the
many talents he brought to that effort. He has left big shoes to fill. NTIA and
the nation will long be indebted to Mr. Irving for the energy and passionate
leadership he has provided on many telecommunications and information issues. It
will be a challenge and an honor to build upon his legacy.
I am nothing less
than thrilled about the opportunity to serve in NTIA. Who wouldn't be?
Telecommunications and information technologies and services are evolving and
growing at an unrivaled pace, creating new avenues of opportunity in so many
aspects of our lives. At the turn of the century, natural resources such as oil
fueled the engine of our economy. Today, telecommunications and information
technologies have our economy roaring. This is a growth industry like no other,
even in our booming economy. The opportunities flowing from telecommunications
and information technologies are bounded only by our collective imagination.
According to the recent Commerce Department report The Emerging Digital Economy
II, information technologies have accounted for more than one-third of our
nation's economic growth during this period of unprecedented expansion.
Telecommunications and information industries are creating jobs, cutting
inflation, and bringing new efficiencies to the American economy. This
revolution, however, is not just about the creation of wealth, but about
enhancing the social well being of all citizens. It is about improving the way
we teach and learn in schools. It is about extending the reach of health care.
And, it is about fostering public safetyand bringing people together.
The
information revolution is by no means limited to the great expanse between the
Atlantic and Pacific oceans - it is worldwide. America is once again leading the
way by championing a competitive marketplace that is a magnet for capital
investment. The economic challenge the telecommunications revolution poses for
policy makers today is how to foster innovation and investment in the U.S.
telecommunications and information industries using a competitive model and
assert our leadership in the new global digital economy. The social challenge is
how to ensure privacy and universal access.
Technology transforms human
society. Today, at the advent of the next millennium, telecommunications and
information technologies are transforming our world at an unprecedented pace.
From the time of the ancient Greeks to the invention of the telegraph,
technology and information did not even belong in the same sentence. When Lewis
and Clark set out to explore the territory acquired under the Louisiana
Purchase, information traveled at the speed of a horse. Meriwhether Lewis'
mid-trip report to President Jefferson from the Corps of Discovery's winter home
in North Dakota in 1805 took 5 months to get to Jefferson's desk in Washington.
Today, high speed Internet access can allow students in Stanton, North Dakota,
adjacent to the Knife River Indian Village where Lewis and Clark spent a chilly
winter, to travel across cyberspace, download volumes of data and information in
an instant, and communicate in real time around the globe.The changes in my own
lifetime have been astonishing. I was born at the time President Kennedy
launched the modern space program and began the race to the moon. Now there is
more computing power in most of the laptop computers carded around every day by
millions of people than there was on the Apollo mission that landed on the moon
30 years ago. Supercomputers that took rooms to house in the 1980's can now fit
inside a desktop computer that can be bought off the shelf. In 1975, there were
50,000 PC's sold. Today, there are twice that number sold every day. Technology
is evolving so rapidly that computers and wireless phones are out-dated the
moment they appear in the store. It is astonishing that over 75% of the revenues
generated by computer companies today come from products that did not exist two
years ago.
My mother, who is here today, grew up in a small farm house
outside of Havre, Montana where my grandfather homesteaded in the early 1900's.
The house had no electricity or phone service until a local cooperative was able
to string a wire to his house 14 miles north of Havre, with the help of REA
(Rural Electrification Administration) financing. The farm house had kerosene
lamps and windmills for power. As a young girl, my mother used to listen to the
grain report on a radio my grandfather rigged up to a large battery the size of
a microwave oven. Although the price of wheat has not changed much since then -
it is about $2 per bushel, about the same it was in the 1940's -
telecommunications technology has changed enormously. Today, my brother-in-law
who farms outside of Grand Forks, North Dakota follows the grain market online
or through satellite feeds direct from the market.The rapid pace of change in
telecommunications and information technology provides unprecedented
opportunities to connect people with each other, create jobs, improve the
quality of life, and rectify social, economic, and personal challenges resulting
from disabilities, economic disadvantage, or geographic isolation. Geographic
distance can be a thing of the past with an advanced telecommunications network.
Storefront businesses on a small town's main street can become worldwide
distribution centers and small country libraries equipped with computers linked
to high speed modems will no longer be limited to their local collections, but
will enable students to access all the great books and minds of the world with
the click of a "mouse."
But all this bounty comes with new challenges.
Technological advances in telecommunications and information services also pose
new threats to national security, public safety, and personal privacy. Moreover,
the globalization of the new digital economy increases our dependency on
information technology and electronic commerce, challenging our nation's schools
to supplement blackboards with computer terminals so they can train a workforce
for the new digital economy.
Addressing the challenges of the information
age while capitalizing on its opportunities is the central mission of NTIA. The
agency also shares in the mission of the Commerce Department to promote commerce
and NTIA is the agency uniquely focused on the promotion of commerce through
information and communications systems.
Indeed, NTIA is the electronic
commerce agency whose function is to: (1) promote technological innovation and
investment; (2)protect security and privacy; and (3) develop technological
applications to advance the social, economic, and equal opportunity goals of our
democracy.
In the era of electronic commerce, NTIA needs to advance policies
that will foster infrastructure investment and ensure universal access to
advanced telecommunications networks that make electronic commerce possible.
This mission can only be accomplished through faithful adherence to the twin
principles of competition and universal service. Furthermore, the agency's
spectrum management responsibilities must ensure the efficient federal use of
this important resource and promote the development of new wireless technologies
by the private sector.
NTIA has a primary responsibility to protect national
security and public safety in telecommunications and information networks and
technologies. The information age brings with it a new generation of electronic
terrorists, hackers, and intruders into personal privacy. The agency's spectrum
management and research functions play a critical role in the defense and
stability of our nation's telecommunications and information infrastructure. In
addition to national security concerns, the telecommunications and information
infrastructure needs to be protected so that consumers can feel as comfortable
about their personal privacy while shopping online as they are while shopping at
the local mall. Through non-regulatory support and guidance, NTIA helps to make
the Internet a user-friendly tool that consumers can trust.
We, as a nation,
also need to invest in the future by creating a technologically advanced
educational system that will ensure our place as the world's leader in the
new digital economy. Shortly after the turn of the. millennium, about half of
the entire workforce of the United States is going to be employed either by
information technology producers or by businesses that are intense consumers of
information technologies. The agency's grant programs are designed to identify
and promote innovative applications of new technologies that improve education,
community development, and electronic commerce. NTIA has the additional
responsibility of advancing policies to help the U.S. retain its global
leadership in the new digital economy and enable all Americans to participate in
the benefits of' the information revolution. The agency's demonstration grant
programs and its promotion of competition and universal access form the
foundation of that vision o leadership and inclusiveness.
We are only
beginning to see the potential of the dynamic force of policies based on the new
vision of competition and universal service - the dual maxims under the
Telecommunications Act. I am convinced that an open, competitive environment
will most effectively foster innovation and investment in the telecommunications
and information industries in this country and deliver services at the lowest
prices. Spawned in large part by the Telecommunications Act of 1996, many
segments of the telecommunications industry are currently in the midst of a
transition from a monopoly environment to a deregulated competitive one. If
confirmed, I will work to advance competition and universal access faithful to
the framework created under the Telecommunications Act.
Certainly there have
been implementation struggles with respect to some of theprovisions of the
Telecommunications Act and there are many challenges that lie ahead before the
Act can be declared a complete success. The Act has spurred unprecedented
consolidation in some areas of broadcasting and telephony. Some of these
alliances are going to help foster competition in the new era where the old
distinctions are giving way to a new structure. In some cases, however,
consolidation poses new challenges to ensure a competitive marketplace and will
require creative and innovative policy responses to preserve the important
tenants of diversity and localism.
Nevertheless, the Act has given rise to
many positive developments and promises many more for the future. There were
only about a dozen competitive local exchange careers (CLECs) in existence in
1995 when the Telecommunications Act was written. Today them are more than 150
CLECs with a total market capitalization of more than $40 billion and are
competing in about 90% of all the local exchanges in the country. While CLEC
penetration is still only about 4 percent, local competition is happening. To my
surprise, there is local competition in even in Regent, North Dakota. That
simply would not have been possible without the Act.
Just prior to the
enactment of the Telecommunications Act, telecommunications services generated
about $200 billion in revenues. Today, the industry has grown to about $250
billion. The capital markets are investing billions into telecommunications and
information companies and consumers are presented with more choices and
opportunities than ever. Information technology industries and electronic
commerce (a classification hardly in the common lexicon until just a couple of
years ago) account for more than one third of the growth in the grossdomestic
product over the past three years. The Act has certainly played a role in
stimulating the investment and opportunity that has expanded the overall
economy.
Vice President Gore characterized it best at the signing ceremony
of the Telecommunications Act when he said that the Act was "not a mid- course
correction" but rather "a new flight path to an entirely new world." That new
world is an era of fascinating technologies, broadband capability, and advanced
telecommunications and information services that create unprecedented
opportunity for communication and connection.
The roll out of advanced
telecommunications services such as high speed Internet access is due, in part,
to the pro-competitive policy established under the Telecommunications Act. New
competitive local exchange carders alone have the infrastructure available to
provide broadband services to 25 million customers. The incumbents are not
showing any signs of ceding broadband delivery to the newcomers and themselves
are investing billions to provide DSL (digital subscriber line) services to
millions of customers. Cable modem service is available to 32 million households
- which is about 30% of all homes passed by cable - and on average there are
about 2,500 new cable modem customers each day.
We have seen that
competition is the most efficient means to spur innovation and lower prices.
While consumer choice in local phone service or cable service is still more the
exception than the rule, continuing down the road to competition is the best
path for telecommunications policy to follow. Competition in broadcasting,
cable, satellite and other media industries willalso provide the most efficient
means to curtail prices, expand choices, and create opportunity for new
ownership and diversity. The competitive model should also be carried to the
international area, where the U.S. needs to lead the way to help create an open,
competitive global environment.
I am also very mindful, however, that the
information wave sweeping across the country is not sweeping up everyone.
According to a recent Commerce Department report, Falling Through the Net,
ninety-four percent of US households have access to basic phone service. But
computer access at home is only around 40% and a mere one-quarter of all
American households have access to the Internet. While the overall numbers are
impressive and indicate that we live in a Nation that provides vast opportunity
through telecommunications and information services, it is important to note
that access to these opportunities still lags behind for people in some segments
of our society. People living in rural areas, minorities, and low-income
families, for instance, tend to have less access than others. Telecommunications
policy must, before all else, be grounded in the value of enhancing the social
and economic well being of all citizens. The telecommunications revolution
cannot become telecommunication nihilism. The growth of telecommunications and
information services must enhance value and meaning in peoples lives and be
built upon the values of our democracy, including equal opportunity.
One of
the principle tenants of the Act was a policy obligation that "access to
advanced telecommunications and information services should be provided in all
regions of the Nation." The Act provided all Americans with an assurance that
they will not be left behind. If we, as aNation, want to ensure that access to
the Internet and advanced telecommunications and information services will be a
shared benefit throughout the Nation, we will need to implement a policy of
inclusion, such as that envisioned under the Act. In my judgment, bridging the
gap in access will require a faithful implementation of the principles of both
competition and universal service - the driving forces to investment for
advanced capability. Broadband is more than just greater bandwidth - it is an
expansion of opportunity. It is the new frontier that can allow more Americans
the chance to participate and succeed in our democracy. Broadband access will
enable small, previously isolated communities to create thriving businesses -
making location virtually irrelevant. Broadband will help exorcize the demon of
distance that has been the scourge of rural communities in their pursuit of
equity and opportunity.
If continued, one of my top priorities will
be to advance a strategy to stimulate broadband deployment
using the pro-competitive tools and universal service assurance provided under
the Telecommunications Act. Federal policy should strive to stimulate open,
competitive markets and at the same time establish mechanisms to prevent certain
classes of people - whether rural, minority, or low-income - from falling
behind. Ubiquitous deployment of broadband capability will help to uncover the
human capital that has historically been buffed by geographic and other barbers
that can be stripped away by new communications technologies and services.
Abraham Lincoln learned his lessons by writing on the back of a shovel with a
piece of chalk. While he managed to succeed, how many more great leaders and
contributors to our society remain hidden because of isolation from great
libraries and laboratories? If all Americans have better learning and training
tools than shovels, how many more Lincoln's, Martin Luther King's, or an
astronautlike Eileen Collins will arise? Without ubiquity, there is less
opportunity for the diversity of our nation's human capital, which has always
been the source of America's greatness.
Thomas Jefferson saw the West as
America's future. To Jefferson, the purchase of the Louisiana territory was much
more than a bargain land acquisition. It was an opportunity to unleash the
national energy to explore, establish new avenues of commerce, and build a new
way of life for a young nation. His instructions to Lewis and Clark when they
began their expedition in 1803 was to explore the "rivers of commerce" of the
continent. Two centuries later, broadband capability is creating new rivers of
commerce for us to explore and fulfill the hopes and dreams of a nation that
believes in the values of democracy, equal opportunity and freedom. The
consumers, producers, and policy makers of the information age are looking
towards the future, much like Lewis and Clark did as they rowed their keelboat
up the Mississippi and Missouri rivers. While we are not certain about what lies
ahead, the idea of broadband, like the image of the Western frontier, seizes our
imagination. Somehow, we know that this previously uncharted territory holds
great promise and opportunity.
In concluding my remarks, I want to express
my deep appreciation to all the Senators who have supported me to become the
Administration's nominee for this position, including all the Senators on this
Committee. I especially want to thank Senator Daschle for all of his support and
help. And finally, no words are adequate to express my profound gratitude to
Senator Dorgan for not only supporting me as a nominee but for the granting me
the honor and privilege of working for him for the past ten years. Senator
Dorgan took a big risk ten years ago by givinga Seminarian a chance to work in
the world's greatest deliberative body, Congress. He has been my mentor and
friend ever since and I will always treasure and call upon all that I have
learned from him.
If confirmed, I intend to work to create a cooperative,
inclusive approach to policy making within the Administration and with the
Congress. As one of the many staffers who had the privilege of working on the
Telecommunications Act, I understand that a bipartisan and inclusive process can
achieve the best results and accomplish the difficult task of crafting consensus
and compromise that balance a diversity of interests. I have truly enjoyed
working with the Senators and staffers on the Senate Commerce Committee and I
hope that, if confirmed, I will have the opportunity to continue working closely
with you on telecommunications and information service policy issues.
Mr.
Chairman, thank you once again for scheduling this hearing. You and your staff
have been very cooperative and helpful to me in this process and I am very
grateful.
I will be happy to answer any questions from the panel.
END
LOAD-DATE: September 10, 1999
