Internet Society of Australia
A Chapter of the Internet Society
ABN 36 076 406 801
The Internet revolution promises access to a world of information never previously available to individuals and countries that were outside the main spheres of economic and cultural activity. And, as the information society and economy grow, access to information will be critical to national and individual well being. One key question for this forum is: does the South Pacific really want to be part of the global communications revolution? There are significant benefits, but there are also costs and significant issues to consider. If the answer to the first question is yes, there is a second question that should be addressed: how should the South Pacific involve itself in this communications revolution? Later in the paper I will talk about Australian and international experience that may be useful in helping you to decide on your answers to these two questions. What is the global communications revolution? Digital technology has produced a fundamental change in the efficiency of providing communication services. The use of digital technology has slashed the cost of providing international phone calls and provided the basis for widespread use of new data services. Some might argue that the dots and dashes of Morse code introduced digital technology to international communications before we could make international phone calls but the cost of telegrams limited their use to a very select group. Digital technology in the current situation means being able to transmit and process voice and other communications using computer technology. This technology has been built into the heart of national and international telephone networks to automate connections and allow highly efficient transport of voice traffic through fibre optic cables. Anyone who has enjoyed the comparison of an international phone call over fibre compared to satellite will tell you the difference. Digital technology has also allowed new facilities to become available in customer equipment - at the edges of the network. The speed and simplicity of cheap fax technology produced its own communications revolution by allowing instant global document transmission. The underlying technologies of the fax machine helped to build the capability for the Internet. On some faxes you can listen to a call being established and you will hear the tell tale whistling of a modem connection being established. Your document will be scanned and converted to bits of data that are then transmitted over the phone line though the modem link. From the view of telecommunications companies the global communications revolution has meant that the world of data transmission was opening. This world includes any type of traffic that is not voice traffic, including services such as: - fax to fax - computer to computer - ATM to central computer - mobile data terminal to base But one aspect of all these services still hindered their usefulness. They are not interoperable. They have largely been built on proprietary standards. Anyone who was not able to licence the technology standard, was unable to participate in the communications network. The Internet is a revolution because it established full interoperability. No matter what type of computer you have, no matter what operating system, the Internet has made universal communicate with all other computers possible through the TCP/IP protocol - the transmission control protocol/Internet protocol - generally referred to as IP. In my view, IP is destined to become the universal protocol for all forms of data communications, as well as voice and video. What has brought about the Internet revolution? Open standards is a process for building technology that anyone can contribute to. In the case of the Internet, the open standards process has built technology that anyone can access and use. There are plenty of other networking standards. There are plenty of communications system. The difference for the Internet standards process is that anyone who has sufficient understanding can participate and anyone can use the technology. The Internet Society is the custodian of the Internet standards process that takes place through the Internet Engineering Task Force - IETF. While building the Internet looks almost like an anarchistic process, operation of the Internet relies on strict adherence to the Internet Protocol standards and adherence to some best practice network management documents produced through IETF. By now you will be wondering if I want to lecture you on the fine details of the standards process; fortunately not. Let me just conclude discussion of Internet standards by saying that there is one reason why cheap access to the Internet is possible for individual users all around the world. It is because of the open standards process that exists in the IETF under the Internet Society. ISOC's vision is that 'The Internet is for Everyone!' ISOC has helped many countries around the world to get online, through its training seminars in IP technology - you can check these out at their web site - http://www.isoc-au.org.au. What do you need to connect to the Internet? The answer is that some simple and fairly cheap technology is sufficient. In Australia, dial-up access is still the most popular by far. Dial up technology is similar to facsimile technology (if you will excuse the pun). A pair of modems is used to establish a data link over a voice telephone line. Computers then use this data link to establish an Internet connection that makes any individual PC part of the global Internet for the period of that session. Obviously, you will also need some way of making sure that your TCP/IP traffic can reach the rest of the Internet and this function is performed by Internet Service Providers. For some Internet services, such as the World Wide Web and file transfer protocol, the ISP only needs to provide connectivity to the rest of the Internet. For other services, the ISP needs to maintain servers eg for storing and forwarding your email. Already you can see some complexity involved in delivering Internet access. In Australia, ISPs are commercial operators who largely depend on telephone companies for inwards connections from their customers and outwards connections to the Internet. The better these two types of companies work together, the better your Internet experience will be as a user. However, in the eternal triangle between users, telcos and ISPs, there is room for confusion. In Australia, we have implemented a program to address the needs of low end users. Now, we are considering whether a code of practice would be useful to help define the technical side of the relationship and establish some key performance measures. In summary, on the infrastructure front, the open standards process producing the TCP/IP protocol has made Internet technology very widely accessible but there are challenges in coordinating the provision of services to ensure an effective Internet experience for users. What are the opportunities that the Internet can bring? The Internet has produced amazing opportunities that have never been available before. These opportunities include: . access to a wealth of useful information sources completely independent of geographic isolation . participation in global markets . easy access to a wide range of cultural experiences that can foster individual development and learning . even some Internet related business opportunities have been successful Information sharing is the underlying benefit in all of these areas. Information that was previously only available to the heads of major organisations or through the world's largest libraries is now readily accessible to anyone using the Internet. Search engines are available to assist in locating information. Share email lists are available to keep you up to date on the latest discussion topics for particularly fields. Often the information sources available on the Internet are even more useful than paper-based information because you can use your computer's processing power to search and process information downloaded from the Internet. Welcome to the knowledge-based society! But the Internet is not just a source of information, it is a mesh where all users can have the capacity to be producers as well as consumers of information. In the jargon of the Internet community, the opportunity is available to become a 'content provider'. The simplest form of content production is writing an email. Production of a basic web site is also a simple process for individuals. There is no need to think that you need to have flashing symbols and clever rollover and click responses to provide useful and attractive information. In fact, if you look at the ISOC-AU web site at http://www.isoc-au.org.au you will see an example of such a site that we regard as useful. Beyond the basics are interactive web sites where visitors can contribute as well as accessing information. More sophisticated web sites are now becoming access points for databases where information is assembled according to the users requirements. In many ways, the Internet is becoming essential for access to the information society and economy. In the same way that printed material such as books, newspapers and journals have been our information access tools, the Internet is now becoming the central means of sharing information. Indeed, it seems that the Internet has caused a resurgence in written communication after the telephone and television caused a shift to voice based communications during the second half of the 20th century. The Internet has sped up the rate of communication so that if you are not participating in its wealth of information, you risk being left behind socially and economically. Hence the debate in Australian and the USA about the digital divide and which groups in the community are finding it difficult to access the new technology. On the economic front, a recent study by the Australian Department of Industry, Science and Resources, has identified participation in a knowledge based economy as a key foundation for a successful economy. The report says that a knowledge based economy is "an economy in which the production, distribution, and use of knowledge is the main driver of growth, wealth creation and employment across all industries". The report goes on to say that empirical evidence suggests that among the more advanced economies of the world, economic growth is most sustainable for those which are strong in all four dimensions of a knowledge based economy. This report points out that `in a truly knowledge- based economy, all sectors have become knowledge-intensive, not just those usually called "high technology". The report is available on the web site of the Department of Industry, Science and Resources at http://www.isr.gov.au. If I may take the opportunity to paraphrase some of this jargon from the knowledge economy, I would say that the Internet allows you to keep up with new developments and participate in discussions so that business can keep pace with what some of the world leaders are doing and thinking. In some rare instances, you may actually be able to lead world discussion. What are the real global market opportunities arising from these impressive communication facilities? This is the question that everyone is still asking as far as I can tell. In the middle of the dot-com boom you would have thought that traditional business models could be abandoned and we were heading for a world the like of which we have never known. The dot-com bust has proved most of the prophets of that world wrong. Business fundamentals are still king. There are only three major new businesses that have survived the bust. Yahoo and Amazon are the best known. Over the period of dot-com boom a lot of money was made and is still in the hands of Internet entrepreneurs, from businesses that "built the Net". AOL became the prime example when it was able to take over the traditional economy media company Time Warner. Also, Microsoft has proved that you do not need physical assets to have a strong market valuation. Their "assets" are market position and intellectual property. There are also emerging opportunities from supplying the Internet. While the gloss has gone off some of these companies after the dot-com bust, they are still substantial businesses and I predict that we will see a resurgence in this area within two years. Major players here are perhaps less well known than the companies that I just mentioned but their significance is strong. Of the equipment suppliers, Cisco Systems, the supplier of Internet routers, must be the most notable because for a short while it was the largest company in the world by market capitalisation. I have already mentioned one of the largest connection providers, AOL. However, another significant group is emerging in the group of domain name providers. Up until recently, Verisign had a monopoly on provision of dot-com domain names. Now they face competition in both the provision of domain names and the registry services that make domain names operate on the Internet. The classic story of the dot-com style Internet comes from the South Pacific country of Tuvalu. If you go to http://www.tv you will find that you can buy access to many domain names under the country code dot-tv. Of course, many around the world know the acronym tv as meaning television, and this ambiguity has allowed those in the dot-tv venture to trade on the double meaning. As the web site says `dot-tv is the fresh, new, exciting web address that is taking the world by storm!' In fact, I could not find a mention of Tuvalu on the home page of dot-tv. The way the story goes, dot-tv was such a success, that the economy of Tuvalu has received a substantial boost. The CIA world fact book is a good reference to sort out some of these urban myths, and it supports the story saying `in 1998, Tuvalu began deriving revenue from use of its area code for "900" lines and from the sale of its "dot-tv" Internet domain name. Royalties from these new technology sources could raise GDP three or more times over the next decade.' The fact book reports the Tuvalu GDP purchasing power parity - $7.8 million (1995 est.). How long this income source will remain stable is an important question. There is no possibility that there will be another dot-tv if the unitary nature of the Internet Domain Name System is maintained. However, this is not to say that other domain names might prove as useful as dot-tv. There has recently been approval for seven new global top level domains including .biz. On the social and individual side of the Internet, with easy access to global information comes local influences on culture. In Australia, we have been making the transition from an English dominated culture to a USA influenced culture for the last 50 years. The cultural opportunities and challenges of the Internet place even greater importance on the need to be a producer as well as a consumer of information and Internet content. Canada is a county that has been facing the challenges of cultural differentiation for many years because it shares a long border with the United States. If you visit the web site of the Film Board of Canada, at http://www.nfb.ca, you will find they have made a very interesting online initiative. `As a result of a partnership with RISQ (Réseau interordinateurs scientifique québécois) and Canarie, Canada's advanced Internet development organization, students and instructors at the college level, students and professors at the university level, and those working at Canadian research centres connected to the Ca*Net 3 Internet network can now view full-screen versions of a selection of 800 NFB films, on-line and free of charge.' I understand that Australia is also investing resources in digitising our national film and sound collection. What are the key issues? In Australia, we at ISOC-AU see some particular challenges in fostering development of the Internet. Despite fairly widespread use of the Internet, bandwidth and other infrastructure issues continue to be a challenge. We have been working hard to address some service provision issues, both in terms of access to quality Internet connections and the introduction of competition for provision of domain name services. Australia now has a wide diversity of cultures as a result of immigration and our national policy of multiculturalism and we need to work to ensure that Internet technology is accessible for everyone. Finally, we seem to be facing more and more policy challenges in relation to the Internet, with censorship and gambling being the most well known. On the bandwidth front, Australia is well supplied with fibre optic cable as a result of the policies of our national carrier up until 1997 and the telecommunications competition regime in place since then. We also have access to major undersea fibre cables for international connections. This fibre cable provides us with an effective telephone network that reaches nearly everyone in Australia under the "universal service obligation" for telephones. Only those living in remote and rural areas have limited access to this amazing network of fibre. Even with this major national asset, we still face challenges in providing affordable Internet access. Our particular challenges include - reaching people who live in rural and remote locations where Internet services could really help to relieve isolation - dealing with the issues of trying to use the voice telephone network for data transmission - providing affordable and effective access to high bandwidth services - dealing with global and national interconnect pricing ISOC-AU is concerned to promote access to high bandwidth services. We understand that DSL services are available in the USA for around US$50 per month that give unlimited data transfer. In Australia, Telstra has provided one of the lowest cost high speed services at around A$70 per month in a rollout that is planned to pass the homes of 90% of our population in the next two years. But this service does have a limit of acceptable use for data transfer. In our view, more effort needs to be made to speed up the delivery of high bandwidth services that will support effective multimedia over the Internet and efficient business-to-business Internet transactions. Mobile Internet is a key area of new technology development that will take IP off the desktop and allow access to the Internet anywhere or even when you are on the move. At the height of the dot-com bubble, governments began the process of delivering mobile Internet by auctioning radio spectrum dedicated to third generation or 3G mobile communications. In the UK and Germany, speculation about the potential value of this spectrum was so intense that the successful carriers are now complaining that they do not have sufficient funds to invest in the infrastructure. Despite this hurdle and some inflated performance expectations, mobile Internet access will provide a very useful range of services and is already being made available. The DoCoMo messaging and information service in Japan provides the most successful international example. Vendors and carriers are now working strenuously to deliver this new capability. In Australia, the implementation of a half way service through the general packet radio service (GPRS) is imminent - often dubbed as 2.5G. In order to maximise the community benefit provided by the Internet, it is essential that it is universally accessible. The value of a communications network increases the more people are connected to it. ISOC-AU has been contributing to efforts that ensure universal access. Our experience is probably similar to that in other countries, where young people were the ones who rushed to the Internet. Around 75% of Australians 18 to 24 years old have accessed the Internet. But we are now seeing very fast growth in interest from those over 55 years and around similar numbers of men and women are accessing the Net. However, important groups are missing out. Those without jobs and those with low incomes are less likely to use the Net even though they probably need its resources just as much. In addition, there are accessibility issues connected with the design of Internet and computer technology. Web sites need to be designed to allow universal access. The World Wide Web consortium W3C has developed universal access guidelines (see http://www.w3.org/WAI/) and the bobby web site can assess how accessible a site is (see http://www.cast.org/bobby/). The rate of change of Internet technology is challenging everyone and it is a significant challenge for politicians and policy makers. ISOC-AU has been taking a key role in working to lift the understanding of Australian politicians and decision makers about the Internet. We had a major struggle during 1999 and 2000 over censorship of the Internet in Australia. As a result we now have legislation with strong penalties related to censored content but it allows for an industry code that is quite relaxed. Fortunately, our work along with others was able to reverse the original concept that it was possible to censor the Internet in Australia at a single point. Online gambling has been the subject of new legislation and it incorporates a number of political compromises. The government has been unable to find a suitable approach to provision of Internet content on our new digital broadcasting technology and their proposed datacasting solution has collapsed. From our perspective, the difficulties being faced in policy making arise principally from attempts to apply existing policy models from telecommunications or broadcasting to the entirely novel technology of the Internet. Policy makers really need to consider the policy requirements of the Internet afresh and from a sound technical understanding. Recognition of the value of ISOC-AU has grown in this regard and we are now becoming involved in policy making from the beginning in a number of areas. Where is the Internet taking us? What are the challenges? The promise of the Internet is overcoming the tyranny of distance and accessing global markets from anywhere. This promise became the mantra for many dot-com proponents seeking access to early stage venture capital or market funding. The truth emerged as part of the dot-com bust. You need a little more than the existence of the Internet and a catchy title for your new business. Business fundamentals rule! You need a solid business plan and these days you probably need quite deep pockets to establish a major Internet business venture - millions have gone into promotion of amazon.com for example and they are now reportedly just about to achieve revenue that covers costs. Even so, there are plenty of opportunities for existing and new businesses to gain benefit from using the Internet. There are numerous examples of small software companies that are successfully selling software around the world from their Web sites. There is significant potential for increasing the efficiency of your operation from electronic transactions. In Australia, Internet banking is now very popular presenting banks and customers with substantial cost savings. Already the speedy access to information provided by computers and the Internet is helping to improve the efficiency of business. Alan Greenspan, Chair of the United States Federal Reserve, has discussed this benefit many times in his speeches and connected it to the long run of growth in the USA economy during the 1990s. As we move towards effective models of online authentication of identity there will be even more potential for efficiency gains. Privacy is one of the key challenges in the take up of online commerce by consumers. In Australia, the Federal Privacy Commissioner, Malcolm Crompton, has recently announced the results of research about attitudes to privacy among individuals, business and government organisations. The level of concern about threats to privacy is very high in Australia, maybe above 90%. According to the survey, people want to have control of their information in the online environment. They want to trust that organisations holding personal information will treat that information carefully. Where they have doubts about this trust, then people will often falsify information provided in order to retain control. The result is that large organisations can have a significant amount of unreliable information in their databases - according to the survey up to 50% of the information may be inaccurate. The solution to this challenge is to implement effective privacy policies and make these policies known to customers and individuals. What is the major lesson that we have learned from Internet experience over the last 10 years? Well the classic Australian example has been the powerful PC that is installed on the desk of a senior executive, not for it actually to be used, but only to symbolise the powerful position of the person occupying the desk. You can pick up some great bargains in these machines at government auctions. The lesson is to look for the substance, to ask what is the real benefit. Not to be taken in by the `technology glamour trap'. | Tony Hill ed@isoc-au.org.au Executive Director | | icq 103707971 Internet Society of Australia (ISOC-AU) | | Tel +61 2 6257 5544 PO Box 152 | | Mobile 041 212 8755 Civic Square ACT 2608 Australia | | Fax +61 2 6262 9938 www.isoc-au.org.au | | The Internet is for Everyone! |