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Communications: Navigating Uncharted Waters

Ambassador David A. Gross
U.S Coordinator for International Communications and Information Policy
International Institute of Communications 2007 Conference
Chatham House, London, United Kingdom
October 22, 2007

Trends in Global Communications: Navigating Uncharted Waters

Thank you very much. It's a great pleasure to be here for many reasons, including to be surrounded by so many friends and colleagues. You'll find that PowerPoint presentations are not used by State Department people, so you'll have to look at me rather than at the pictures.

I thought I would take a slightly different tack in talking this morning with you all. It's related a little bit to some of the things that Eli and the Minister talked about. One of the things which I have been focusing a lot of attention over the last 6 or 7 years is on the impact of technology on individuals, and particularly individuals in the developing world. And the three things I thought I would touch upon today would be just a quick look back over the past little while, a few observations on the current impact of technology we're seeing, and then a word or two about what the future may have in store.

Now I was going to start as Eli did a little bit with the more recent times, from the Industrial Revolution and on - except for on Saturday, my wife Betsy and I had an opportunity to go the Royal Academy and see what I thought was a very interesting exhibition. In fact, I'll give you a little advertising here for "Making History." It's a celebration of the past 300 years of looking back at history here in Britain. And there was a point made at the very beginning of that exhibition that I was stunned by actually. It talked about the fact that before the 17th Century - really very recent in terms of man's history, of course - that before the 17th Century, people knew nothing of the landscape beyond their own localities. Early maps did not show roads or distances, and images of places and buildings were rare. I was struck of course by that, because I think we've lost sight in all the information flow that we have today that it was only about 300 years ago or so that people had absolutely no interest or appreciation for that which was beyond their particular community. That's obviously not to say there weren't certain people and certainly elites who were very interested. Obviously, the New World had been founded already. People were exploring. But if you were to ask what an individual, a person living in the countryside or even in major cities, what they were interested in or what they knew something about, the answer would be their families, their close colleagues and friends and that would be about it. You contrast that with today's world - and I'll speak a little more about this in a minute - and it is exactly the opposite. Now that's not to say that the most interesting parts of people's lives aren't still of course found in family and community, but their knowledge, the impact of that which is beyond their family, beyond their community is something which is quite profound and really of quite recent vintage.

May I remind all of you, who of course are a group of experts, about where we've come just in the past couple of years? Let me talk a little about, just throw out, a few statistics. I do that with some trepidation, because statistics can of course be stifling in terms of thinking about issues. But in December 2000, just a few years ago, there were about 700 million people who were subscribers to mobile telephony. And as someone who grew up in that industry - before doing government service I was in industry - that 700 million was an almost unfathomably large number. We thought when the industry was really begun in the early '80s, that the service would really be just for the elite, for those who could afford it in urban areas and the like, and really there would only be a few million subscribers. In fact, there's a famous McKinsey study that said by the year 2000, in the United States there would be something just shy of one million subscribers if all went well. So in December 2000, remarkably, we had 700 million.

Well today, we have over 3 billion subscribers of mobile telephony, an increase greater than four times in a mere less than seven years. That's an extraordinary thing, especially when you consider where that growth has come from. In India today, for example, about 218 million people have mobile phones, increasing at 7 to 8 million each month, with the population of Finland at a little over 5 million. That's the equivalent of every month in India increasing by more than the population of Finland. And of course, I picked Finland because of its great leadership in the area of telecommunications. Now Finland has been added in India alone every single month.

China had about 85 million mobile phone subscribers in 2000, a remarkable number back then. Today, about 515 million - with a population in the United States of only a little over 300 million - it gives you some order of magnitude about the number of users in China today. In China, it also increases by 6 to 7 million subscribers each month. Another Finland being added each month.

Africa, certainly in percentage terms, is the fastest growing for both cell phones, mobile phones and for the Internet in the world, with about 200 million wireless phones in that continent now and with a continent population of a little over 900 million. Extraordinary change.

Pakistan for me is one of the most remarkable stories. In 2000, there were about 750,000 mobile subscribers in the entire country, a country with a population of 162 million or so. They made certain changes about the way in which they did their regulation and liberalized the market. Today, there are about 73 million mobile phones. They went from a tele-density of about 0.22 to over 42 percent today. A remarkable change in just a very few years.

Iraq is a very good example. Under Saddam Hussein, there were no cell phones for a variety of reasons - not the least of which, he did not want people who would be in opposition to him being able to communicate with each other. There were no cell phones in that country at the time of Saddam Hussein. Today, there are about 10.5 million mobile phone subscribers in the country. And just to give you a relatively recent development, there are three licenses that were recently auctioned in Iraq. The three licenses each went for $1.25 billion plus a guarantee of 18% of the revenue going to the government. These are 15-year licenses, and these were all purchased by carriers in the region, and it's an interesting economic bet by knowledgeable players in the region about what they view the economic future of Iraq will be. Quite extraordinary.

In Afghanistan, not only were there no cell phones there under the Taliban, but you had to leave the country to make an international telephone call. There was virtually nothing there. Not really a surprise, because all you who know Afghani history know that there wasn't much infrastructure there even before the Taliban. But under the Taliban, there was none. Today, there are 3 million mobile phone subscribers in an extraordinarily poor country. Now why did this happen? This happened for a large number of reasons, and you all are familiar I suspect with virtually all of them. It's a combination of the cost dropping dramatically and people's strong desires to communicate with each other. Also factors were regulatory changes and liberalization. Minister Timms touched on some of these, about the fact that if you have liberalization, less state control and more independent regulators as that term is often used, you see remarkable things happening.

Now of course we've focused a lot on the economic impact, and there have been some tremendously interesting studies about the economic impact of both the increase in mobile phones and the increase in Internet access which has been paralleling the mobile phone. And we start to see some serious convergence now around the world between those two industries. But I think what you see is something even stronger, and we see this in the discussions we've already had in mentioning 2.0. The same is true for mobile phones I think in many respects and that is people use this to connect themselves to their community. They connect themselves to their family. And in so doing, there's an economic impact and there's a very important social impact. The economic impact is that you see the growth in mobile phones and increasingly the internet at the very lowest economic levels. Something none of us that were earliest in the industry predicted could be or would be the case. As I travel around, it's individuals, day laborers, farmers, fishermen who use the technology to eek out a few extra cents, to eek out a few extra dollars. And in so doing, they are having a tremendous impact on themselves, their families and their communities. But also, you see a way in which communities can stay more closely connected than they ever have before.

In a world of globalization, when people move across borders, move out of their communities, particularly rural parts of the developing worlds, to go to the cities, the ability of people to stay connected with each other is a very basic human need and has always created tremendous tension. And today, as you travel around, you see that need being met. That social need - not only the economic need, but the social need - being met by people being able to communicate at lower cost and, as Eli pointed, sometimes at virtually no cost at all. You see laborers from South Asia who work in the Middle East staying connected to their families by using Skype, by using low-cost mobile phones, by using email, by using social networking. You see people throughout Africa being able to stay connected to villages because of the increased ubiquity of mobile phones. And so you see some of the social needs and tensions being transformed in ways that we had not predicted could be possible just a few years ago.

I'm reminded a little bit of when I was traveling with my wife in Vietnam just a couple of weeks ago, and I had a desperate need to be connected to my community as I was driving from Danang to Hue through the rice paddies and small fishing villages. I had a desperate need to learn the football scores back home, and so I took out my wireless device. Remarkably, I had a data channel. I was able to pull up the New York Times and find out not only the football scores, but then to e-mail my son to tell him that he had failed to send me the football scores and here they were! And so it is apparent I found it to be an extraordinary tool halfway around the world.

You see this time and time again, the ability of people to gain access to the information that's important to them. Whether it's crop information or information about fishing, whether it's football scores or the like, people have access to it. And so we've seen just in the past couple of years, since the year 2000, an extraordinary explosion in access and availability. You see the world changing in ways that I think policymakers by being focused so much on the future, as we should be, often lose sight of that which has happened in our most recent past. We see the impact of this beyond the economic. We see it very dramatically in the political as well. The comments were made earlier about the impact in terms of particularly the Internet on political campaigns and the like.

I cast a somewhat broader net looking back just a few years. In the very early 1970s, according to Freedom House, there were probably only about 40 democracies, loosely defined, in all the world. Just 40 - and 40 at the time was an extraordinary accomplishment. It was in fact unparalleled in human history to have that many democracies in the world at that time. Today, without trying to be too precise either in definitions or numbers, there are approximately 120 democracies in the world - some freer than others, but 120 democracies. A greater rise in democracy since the early 1970s to today, 30-odd years, than there has been in all human history. Now maybe this was an accident. Maybe it's just one of those things that is bound to happen, but I don't think that's the case. It's not tied just to the Internet - though that clearly has played an important role. It's not just tied to the rise in mobile phones - though clearly, that has played a role as well. But rather, it is as you look back and take a look at the way the world has changed in the way we communicate over the past 30 years or so, that we see a radical and historic revolutionary change. It is the daily news that you get, no matter what source you get it from, whether it's through newspapers or through the Internet, it is in fact your daily broadcast news. The fact that when something happens anywhere else in the world, you not only hear about it but you see it. It has happened because of changes in technology. It has happened, because those changes in technology have brought the price of bringing information to us as individuals, to us as communities and countries, down in extraordinarily radical ways.

When the first modern submarine cable, TAT-1, went across the Atlantic in 1956, the cost of a circuit was extraordinarily low. It was about $1 million for each circuit. The price of a circuit has gone down 99.9% today. The cost of making an international call or sending video is, as Eli pointed out, virtually zero, at the margins. It's extraordinary. That means that you have local content, individual content, being created in ways that now allow people to circumvent governments and circumvent traditional media sources, in ways that allow people to express themselves politically. And I don't think we've really begun to understand precisely how that will play out.

Let me say a word about the future since of course we are all, as policymakers and others, acutely interested in the future. I read a book very recently that I found both exasperating at times and extraordinarily perspective at times, called The Black Swan. And it had as its core principle, core thesis, something that I think all policymakers should take to heart. And that is the view that history is not really a continuum in the traditional sense, and therefore the future will not be either. But rather, it is at its core, determined by a very few highly impactable, but highly improbable events. One can argue that the Internet, for example, is one of these things. And that is by definition, things that experts no matter how smart and how much information they have, cannot by definition predict. And yet that unpredictable thing or things will change virtually everything. And as we look back in history, you see that. It's events, it's decisions, it's technology. And as a policymaker, I find that both helpful and very sobering all at the same time. It means we should not try to manage the future based upon today's information. That is a fool's errand. But rather, as policymakers, we should try to facilitate the future whatever it will be.

So I was particularly pleased, as I always am when I hear Minister Timms' comments, extraordinarily wise and perceptive, when he talked about for example, spectrum flexibility. I think that's another way of looking at the same issue, of basically saying we as government officials cannot predict the future, certainly not in the long term, and only with minor success in the short, medium term probably as well. And as a result, we should allow that future to unfold the way it should, based on whatever that future technology is, whatever the future impact of various events shall be, and allow for those who are closest to customers, or closest to people, try to provide that better future. And so as we look to the future, we should do so of course, with a great deal of humility and do so in a way that brings maximum flexibility, because in so doing it brings maximum potential benefits.

Lastly, as the comments were made earlier today about the World Summit on the Information Society and what it has and has not done, including the upcoming second meeting of the Internet Governance Forum, I look forward not only to that event but to continuing the progress that we made at the World Summit by ensuring that not only each country and each government be responsible to its people to advance their interests, but also to remind ourselves that at its core, perhaps the most important part of this technology is to allow for the free flow of information, to allow the changes that occurred that were unthinkable in society back before the 17th Century, but even unthinkable in any real terms even at the beginning of this century, just seven short years ago. And so one of the things I'm proudest of, having worked with colleagues such as Ambassador Thorne and others, is putting together what I thought was a very powerful Tunis Commitment. I remind ourselves and our colleagues around the world that it is in fact as memorialized in the Tunis Commitment, that it is freedom of expression and the free flow of information, ideas and knowledge that are essential for the information society and beneficial for development. It is, in fact, that core. It is in fact that information flow is what brings the benefits to our people, whether living in the developed world or in the developing world.

Thank you very much.

Released on November 27, 2007


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