NTIA Special Publication 94-29 ______________________________________________________ ____ The NII Field Hearings on Universal Service and Open Access: America Speaks Out ______________________________________________________ ____ A Report of the Information Infrastructure Task Force Telecommunications Policy Committee U.S. DEPARTMENT OF COMMERCE Ronald H. Brown, Secretary David J. Barram, Deputy Secretary Larry Irving, Assistant Secretary for Communications and Information and Administrator, National Telecommunications and Information Administration Washington D.C. SEPTEMBER 1994 For sale by National Technical Information Service, Springfield, VA 22161 (703) 487-4650 TABLE OF CONTENTS Page Acknowledgements . . . . . . . . . . . . . . . . . . . . ii I. Introduction. . . . . . . . . . . . . . . . . . . . 1 A. Background . . . . . . . . . . . . . . . . . . 1 B. The Hearings . . . . . . . . . . . . . . . . . 2 II. Highlights of the Hearings. . . . . . . . . . . . . 3 A. Rationale. . . . . . . . . . . . . . . . . . . 3 B. Basic Themes . . . . . . . . . . . . . . . . . 4 III. Highlights of Technology Demonstrations . . . . . . 13 A. Overview . . . . . . . . . . . . . . . . . . . 13 B. Contribution to the Administration's Universal Service and Open Access Goals . . . . . . . . . . . . . . . . . 14 IV. Profile of the Hearings . . . . . . . . . . . . . . 15 A. Introduction . . . . . . . . . . . . . . . . . 15 B. Transcript . . . . . . . . . . . . . . . . . . 15 C. Hearing Boards . . . . . . . . . . . . . . . . 15 D. Witnesses. . . . . . . . . . . . . . . . . . . 16 E. Role of Public Interest Groups . . . . . . . . 17 Appendix A:Universal Service and Open Access Field Hearing Agendas Appendix B:Summaries of Universal Service and Open Access Field Hearings Appendix C:Brief Descriptions of Major Technology Demonstrations Acknowledgments The series of 1993-94 hearings profiled in this report could not have been held, nor could the report have been written, without the dedication, hard work, and resourcefulness of a number of people. The Universal Service Working Group of the Information Infrastructure Task Force's (IITF) Telecommunications Policy Committee (TPC) must be recognized for its guidance in organizing these hearings and its insightful comments on drafts of this report. Commerce Deputy Secretary David J. Barram, Assistant Secretary for Communications and Information/ NTIA Administrator Larry Irving, and Federal Communications Commission (FCC) Commissioner Andrew C. Barrett vigorously and effectively participated in all five hearings as members of the Hearing Board. The IITF and TPC also gratefully acknowledge the efforts and hospitality of the hearings' respective host States: New Mexico State Corporation Commission (NMSCC), California Public Utilities Commission (CPUC), North Carolina Utilities Commission (NCUC), and the State of Indiana (including the Office of Governor Evan Bayh and Indiana Utility Regulatory Commission, or IURC). A comprehensive listing of all of the State contributors would be unwieldy, but special notice must be given with respect to Hearing Board members Chairman Eric P. Serna and Commissioner Louis E. Gallegos of the NMSCC; Commissioner William W. Redman, Jr., of the NCUC; Commissioners Norman D. Shumway and Jesse J. Knight, Jr., of the CPUC; and Chairman John F. Mortell and Commissioners Frederick L. Corban, Mary Jo Huffman, G. Richard Klein, and David E. Ziegner of the IURC; and their respective staffs. Many members of the Commerce Department, especially from within the ranks of NTIA, participated in the setting up or conduct of the various hearings, and any attempt to list all of the contributors would necessarily be incomplete. However, recognition should rightfully be accorded to those who either co- chaired a particular hearing or contributed significantly to several of the hearings, or both. Besides Deputy Secretary Barram and NTIA Administrator Irving, this "core" group included NTIA's Deputy Assistant Secretary Thomas J. Sugrue, Joann Anderson, Yvette Barrett, Ellen Bloom, Louis Camphor, Paige Darden, Bill Dever, Michele Farquhar, Joseph Gattuso, Brian Harris, LaVern James, Shawna Jones, Alfred Lee, Lisa Leidig, Kelly Levy, William F. Maher, Jr., James McConnaughey, Cynthia Nila, Willa Petty, Janice Robinson, Roanne Robinson, Helen Shaw, Mary Stewart, James Wasilewski, Tanya Whitaker, Larry Williams, and Tatia Williams. From the Office of the Deputy Secretary, mention should be made of the efforts of Althea Allen, Adam Darling, and Leo Sayavedra. Perhaps most significant of all, we must gratefully acknowledge the numerous groups or individuals from around the country who testified at the hearings, thereby ensuring the development of a meaningful record that will provide essential input into the National Information Infrastructure (NII) initiative that seeks to "extend the `universal service' concept to ensure that information resources are available to all [Americans] at affordable prices." From the father in New Mexico for whom the NII represents hope for his severely disabled daughter, to the eighth grader in Indiana who is experiencing new vistas in cyberspace, these hearings have done much to advance the Administration's goals with respect to universal service and open access. Those who provided technology demonstrations concurrent with the hearings should be commended, as well, for showing the bright future that the NII can bring to citizens of this country. The principal authors of this report are NTIA's James McConnaughey, Cynthia Nila, and Lisa Leidig, with support from Bill Dever. I. Introduction A. Background After years of reliance upon an informal commitment, public policymakers in 1934 adopted a Communications Act that articulated in general terms a national goal of widespread availability of a basic communications service at affordable rates. As discussed below and in NTIA's companion Notice of Inquiry on Universal Service and Open Access, this goal has served the nation well in the aggregate, but has not brought basic telephone service to all those who might seek it. A key element of the Clinton Administration's National Information Infrastructure (NII) initiative is to provide a broad, modern concept of universal service, as well as open access, with respect to the NII. Updating our universal service goal would begin the process of giving all Americans who desire it easy, affordable access to advanced communications and information services, regardless of income, disability, or location. Universal service concerns connection and affordability, ensuring that the elderly and the disabled, as well as those in rural communities and inner city neighborhoods, are not priced out of the market for new communications services. Open access relates to how we use that connection, serving to complement the Administration's new universal service priorities. The nexus between open access and universal service entails promoting an environment where information service users and providers are permitted to thrive by eliminating unnecessary barriers to participation to the maximum possible extent. The Agenda for Action, the Administration's blueprint for implementing the NII initiative, directed the National Telecommunications and Information Administration (NTIA) to hold a series of public hearings on universal service and the NII, beginning December 1993, and to make a "special effort" to hear from public interest groups. The objectives of the hearings would be twofold: (1) to gather information on the best characteristics of an expanded concept of universal service; and (2) to provide important input to the Telecommunications Policy Committee of the Information Infrastructure Task Force (IITF), working in conjunction with the NII Advisory Council and state regulatory commissions, to determine how the concept should be applied in the 21st Century. The hearings have contributed to these goals in at least two ways. As a fact-finding vehicle, the hearings have garnered a substantial body of evidence that has shed valuable informational light on the issues surrounding universal service and open access. The technology demonstrations, too, have served as a vehicle for collecting important information on state-of-the-art applications. Secondly, the hearings and the demonstrations have created opportunities for others to share in the knowledge revealed with respect to policy analysis and technological advances. Better education, communication, and collaboration can help ameliorate any tendencies for a class of "information poor" citizens to emerge in this country. B. The Hearings During late 1993 and 1994, NTIA conducted a series of five public field hearings in settings across the United States, seeking public input and discussing government universal service and open access policies. As discussed below, these field hearings produced testimony from 230 witnesses, generated over 1,400 pages of transcript, and attracted more than 1,100 attendees. Commerce Deputy Secretary David J. Barram, Assistant Secretary Larry Irving, and Federal Communications Commission (FCC) Commissioner Andrew C. Barrett presided as Hearing Board members at all five hearings, and were joined on the Board by state regulatory commissioners from each of the host states. NTIA's first two hearings -- held in Albuquerque, New Mexico, on December 16, 1993, and in South Central Los Angeles, on February 16, 1994 -- focused on extending the universal service policy to reflect changes in telecommunications technology and markets. The third and fourth hearings -- convened in Durham, North Carolina, on April 27th and in "Silicon Valley," California, on May 13, 1994 -- examined open access and related public policies that information providers need in order to meet customer demand in an evolving information marketplace. On July 12, 1994, the fifth and final hearing, held in Indianapolis, Indiana, examined both the universal service and open access issues for the purpose of gaining insights into how these concepts should be applied during the remainder of the decade and into the next century. II. Highlights of the Hearings A. Rationale The hearings set forth a wide range of issues relating to universal service and open access. The sixteen panels addressed, in aggregate, dozens of questions that were either presented to witnesses in preparation for the panels or that arose during the "give-and-take" of the sessions. In addition, many other issues came up during the audience participation segments of the hearings, when members of the public who had signed up on a first-come, first-served basis spoke for up to two minutes each on a variety of topics germane to the hearings. Those who delivered remarks --generally, high-level elected officials from the host states -- frequently raised still more issues. The broad array of issues introduced during the hearings also brought a rich mix of perspectives from participants. NTIA sought to bring together a diverse group of witnesses for each panel and across the panels, helping to ensure a full venting of each planned topic at a given hearing. For example, NTIA enlisted a relatively large representation of public interest groups as panelists at the hearing, but usually not more than one from the same organization or specific perspective. Settings were modified in each hearing to introduce new perspectives, while at the same time retaining core issues to permit themes or patterns to manifest themselves. Besides striving for a reasonable geographic balance, NTIA sought socioeconomic and demographic diversity for our hearings. NTIA selected Albuquerque for its largely rural nature, wide-ranging demographics, and relatively low telephone penetration rates (the most commonly used surrogate measure for evaluating universal service in a given area). South Central Los Angeles proved attractive as a forum for discussing universal service in an urban, inner-city setting with diverse ethnicities. As the emphasis changed to open access, Durham was chosen for its "high-tech" economy with largely rural environs. For another open access venue, we turned to "Silicon Valley" (Sunnyvale) as representative of a technology-based economy in more urban surroundings. At the fifth hearing in Indianapolis, NTIA sought to focus the discussion on both universal service and open access in an area where the economy is being re-energized and transformed from its traditional heavy industry and agrarian underpinnings to one heavily reliant on information and telecommunications. B. Basic Themes Core Issues. Despite the myriad issues, participants, and settings, several broad themes may be gleaned from the record of these hearings. These themes generally derive from the following core issues that provided continuity and a firm philosophical foundation for the eight months of hearings just completed: * Whether Universal Service works now and how the goal should evolve; * who currently has network access and what policies will improve access for information providers and users; * how to pay for Universal Service in a competitive environment; and * what basic pricing principles should be adopted with respect to implementing modern Universal Service and Open Access policies. Themes. Based on public testimony provided by a variety of groups during the five hearings, the following themes emerged: General * A consensus exists that government has an important role to play in ensuring that the goals of Universal Service and Open Access are achieved in a multiprovider environment. Universal Service * Despite the availability of affordable basic telephone service for many Americans, the traditional Universal Service or "Plain Old Telephone Service" (POTS) goal has not been fully achieved. * Many witnesses believe that the Universal Service goal should be redefined to include more than POTS. * Traditional funding mechanisms for Universal Service may not be adequate in the new competitive environment. * Multiple service providers -- some of whom are nontraditional -- are beginning to emerge in local markets. * There is considerable support for requiring all service providers in a given area to contribute towards the maintenance of Universal Service. * Many also believe that any support should be targeted to those truly in need. * Rural areas pose special problems and opportunities for public policy. Open Access * All Americans, including those groups with special needs, such as the disabled community, should be able to access the NII. * Several significant issues, such as interconnection and interoperability, standard open interfaces, reasonable prices and tariffs, security, and privacy, must be meaningfully addressed before open access can be assured. Each of these themes is discussed below. General * A consensus exists that government has an important role to play in ensuring that the goals of Universal Service and Open Access are achieved in a multiprovider environment. The record of these hearings provides substantial support for the notion that prudent government policy is needed to promote competition while protecting the public interest. Representatives of academia, cable, competitive access providers (CAPs), cellular companies, commercial broadcasting, computer firms, information gateway providers, local exchange carriers (LECs), long distance carriers, utility providers, satellite service firms, and others advocated that public policy should foster effective competition among transport providers. Among the benefits attributed to competition are greater consumer choice, affordability of service (especially for underserved citizens), faster and more efficient deployment of advanced telecommunications technologies, and promotion of equal and open access goals. A small information service entrepreneur stated that competition in the local loop is critical to achieving lower user costs and open access goals. He faced technical and administrative hurdles when the local exchange carrier serving his area denied him a centrex line that a competitive access provider was willing to provide. The provider eventually obtained the needed centrex line, but observed that the paucity of alternative service providers may impede future information market entrants. Further, many viewed competition as generally promoting -- or at least not inconsistent with -- the achievement of universal service goals of availability and affordability. However, when the market fails, government should ensure affordable service for potentially disenfranchised Americans through carefully targeted support. Contributions towards achievement of universal service goals were perceived as a responsibility of all service providers and, more importantly, a matter of good social policy. In brief, witnesses regard government as an important means to promote fair competition and open access and the benefits they can bring; and to ensure that everyone who desires to be connected to the NII, including the needy, is accommodated. As discussed below, many believe that prudent government policies are also needed where competition may not occur, either during an interim period or for the foreseeable future, as well as to protect users' privacy and security. Universal Service * Despite the availability of affordable basic telephone service for many Americans, the traditional Universal Service or "Plain Old Telephone Service" (POTS) goal has not been fully achieved. The hearings revealed that, despite a telephone penetration rate in excess of 94 percent nationwide, important groups of Americans are not currently connected to the network and do not have access to POTS. In some areas, Native Americans have penetration rates of less than 35 percent, caused by high costs or lack of service opportunities. Recent immigrants may not subscribe because of language difficulties. Those with low incomes may not be able to stay on the network because they spend beyond their means on long distance calling. Witnesses generally expressed a strong sentiment that policies should be implemented to ensure that those with the need for a basic dial-tone service are accommodated. * Many witnesses believe that the Universal Service goal should be redefined to include more than POTS. The ability of households to subscribe to POTS has been the benchmark by which universal service has been gauged since the goal's inception, i.e., since the passage of the Communications Act in 1934 and arguably even earlier. With the advent of new services and capabilities attributable to robust technological change, however, there exists considerable sentiment for expanding the definition beyond basic analog voice-grade service. Some specific suggestions proffered during these hearings include access to a basic set of information and telecommunications services; multiple languages, including Spanish and Native American languages that require special, non-ASCII characters; set aside resources, facilities, and capacity for public, educational, and governmental training and use; new technologies such as video link and cellular telephone service; and services defined as characteristics or features, rather than technologies. Many asserted that user demand must be an important determinant of which new services should be included in any redefined universal service goal. * Traditional funding mechanisms for Universal Service may not be adequate in the new competitive environment. * Multiple service providers -- some of whom are nontraditional -- are beginning to emerge in local markets. The record shows that some local exchange carriers (LECs) are now or will soon be experiencing competition in their historically monopoly service areas. For example, CAPs are entering markets around the country. Time Warner is currently developing a Full Service Network (FSN) -- voice, data, and video -- to serve homes in Orlando, Florida; FSN may be constructed elsewhere if successful. Glasgow (Kentucky) Electric Plant Board, a rural electric utility, has begun construction of a cable TV system, which has already had the effect of lowering the incumbent cable TV system operator's prices and expanding its basic service package. The electric utility plans to offer local exchange-type services and high-speed data transmissions in the future. Additionally, the popularity of cellular and other wireless services may compete with as well as complement traditional local exchange services. * There is considerable support for requiring all service providers in a given area to contribute towards the maintenance of Universal Service. Those who addressed the subject overwhelmingly recommended that all service providers operating in a particular area be required to contribute to preserving universal service. Any plan should be "competitively neutral," i.e., it should neither disadvantage nor place at an advantage a given company vis-a-vis its competitors. Potential participants in funding universal service include LECs, long distance companies, CAPs, cable TV firms, cellular companies, and other wireless companies. The testimony of some witnesses questioned the premise for such a fund; Glasgow Electric Plant Board embraced competition without subsidies -- the electric utility model -- as the preferred approach. The Procter & Gamble Company advocated the use of advertising as a means of ensuring the attainment of universal service. And an academician promoted the notion of "entrepreneurial seed money" to fund universal service. * Many also believe that any support should be targeted to those truly in need. A number of witnesses eschew continuation of the traditional broad-based subsidization, which subsidizes users whether or not they are in need based on such factors as income level and the cost of providing service. Among those who addressed the subject, most opted for more targeted and usually explicit types of support. For example, testimony submitted by Teleport Communications Group stated that if certain groups of citizens are not receiving such services (or would not, without subsidy programs), then there is a legitimate need for targeted subsidies. * Rural areas pose special problems and opportunities for public policy. Service provision in rural areas frequently is the province of a single carrier, the franchised LEC. Competitive entry may not occur for the foreseeable future in some areas. In New Mexico, a Leaco Rural Telephone Cooperative executive argued that a Universal Service Fund (USF)-type mechanism is needed to achieve universal service in many rural areas. His company, with a serving area of 5,700 square miles and only 870 access lines, was cited as an example. At the Sunnyvale hearing, a rural cable operator located in Coleville, California, testified that he offers service in a location so remote (Sierra Nevada region of California) that most people could not receive television channels before he began operating in 1979. He testified that the low population density of rural systems makes them inherently more expensive to operate and also much less attractive to competition. Moreover, rural cable and some local telephone companies argue that the quality and choice of services available in rural areas should keep pace with urban areas. Witnesses also noted that policymakers should be cognizant that rural areas can be vitalized if proper measures are taken. In North Carolina, a representative from the Rural Economic Development Center noted that telecommunications should be part of a rural development strategy because of its relationship to growth in the services sector of the economy. The witness testified that long-term investment in rural telecommunications infrastructure can be encouraged by a "careful balance between deregulated market competition and enhanced access provisions, within a framework that adapts to technological change." Open Access * All Americans, including those groups with special needs, such as the disabled community, should be able to access the NII. A common theme for many witnesses was the importance of accessibility to telecommunications services and capabilities for all Americans. In particular, the special needs of disabled Americans must be addressed if they are to participate fully in the NII. The spokesperson for the World Institute on Disability testified that the 49 million Americans with disabilities experience software, hardware, and content delivery "barriers" in their attempts to fully use the network or information services because current design practices favor those who have no functional limitations in vision, hearing, speech, mobility, or cognition. The representative for the North Carolina Assistive Technology Project noted that graphical user interfaces are needed to provide access to people with disabilities. She further stated that access capabilities for users with disabilities should be incorporated in the earliest design phases of new systems or networks. * Several significant issues, such as interconnection and interoperability, standard open interfaces, reasonable prices and tariffs, security, and privacy, must be meaningfully addressed before open access can be assured. In the area of open access issues, witnesses generally agreed that reasonable and nondiscriminatory interconnection, interoperability, open network interfaces, and reasonable cost- based pricing and tariffs, were critical to any future vision of the NII. Many witnesses viewed interconnection and interoperability as primary concerns in an environment that depends on seamless connections between transport providers, services, and users. Prodigy Services Company called on regulators to establish an access "Bill of Rights" that would include: reasonable interconnection, open network interfaces, reasonable cost-based pricing and tariffs, and non-discrimination policies. According to many witnesses, affordable access, access to open and standard interfaces and non-discriminatory access were important in a marketplace that encouraged diversity and innovation. Sun Microsystems agreed that open network interfaces were important to interoperability. A representative of Sun testified that interface specifications should be free for anyone to use, and that such a policy would not contradict a company's right to protect implementation techniques. Some witnesses claimed that small companies are finding it increasingly more difficult and more costly to gain access to the NII, where existing service providers are trying to protect their markets. There was also some agreement by both service providers and users that widespread use of the NII will not occur unless privacy and security concerns are meaningfully addressed. North Carolina Agricultural and Technical State University echoed other testimony by noting that personal privacy must be ensured for all transactions utilizing the NII. III. Highlights of Technology Demonstrations A. Overview In conjunction with four of NTIA's universal service and open access hearings, NTIA invited companies and organizations to participate in technology demonstrations. The purpose of these demonstrations was to provide local communities with the opportunity to experience firsthand the applications and technologies that will be part of the Information Superhighway, and to learn more about what different communities are doing to develop an NII that is accessible to all Americans. NTIA held these technology demonstrations in South Central Los Angeles, at Duke University in Durham, North Carolina, in "Silicon Valley," California, and in Indianapolis. More than forty different organizations participated. Criteria for participation included using information technology to promote education, community services, health care, and economic development in conjunction with the NII. The first demonstration held in Los Angeles enabled students from a South Central Los Angeles high school, an adult computer literacy class, and a group of preschoolers to learn about new technologies and applications that could dramatically change school curricula and the ways in which community services and health care are delivered. The State of North Carolina highlighted several applications of its advanced Information Highway, demonstrating how integrated voice, image, document and high-performance computing can work together to improve services and expand opportunities for business, education, and health care. Silicon Valley focused on the entrepreneur and the small business community. Many of the demonstrators at this event had created innovative new services from their living rooms using information technology. Others had developed model social service networks that have received national recognition. The last hearing and technology demonstration, held in Indianapolis, featured some applications unique to Indiana. These applications included the Agriculture Communication Department at Purdue's "Problem of the Week" World Wide Web server, which enables users throughout the world to access still-videotaped agricultural images to aid crop management during natural disasters. The University of Indiana's Music Library and Virtual Textbook, a hand-held wireless computer capable of receiving and transmitting voice, data, and video, was also featured. The hearing also provided an opportunity for showcasing technology: two senior citizens participated via live, interactive, two-way videoconference linking Bloomington and Indianapolis during the first panel segment. Feedback from the public and from demonstrators was extremely positive. Generally, demonstrators appreciated the opportunity to participate in the technology demonstrations, which were open to the public without cost. The demonstrations enabled developing businesses and social service groups to educate local constituents about their technology capabilities to attract users and to create business opportunities. Public participants benefited from the exposure to the new technologies and services, which provided real-life context to the term "Information Superhighway." B. Contribution to the Administration's Universal Service and Open Access Goals All of the demonstrations associated with NTIA's hearings modeled the ways in which providers and communities can work together to bring more services to more people, and in many instances, to improve the quality of those services. The following examples focus on ways in which information technology can be used to promote education, community services, health care, and economic development via the NII. 1. Education GTE, AND Interactive, and the Pacific Telesis Group (PACTEL) in Los Angeles demonstrated how information technology can be used to make learning fun and distance- neutral. GTE's "Project Pass" is designed to teach challenging math concepts by combining the excitement of the National Football League with interactive multimedia technology. Amazonia, a CD-ROM product developed by AND Interactive, enables students to explore the Amazon rain forest while teaching users about environmental and scientific concerns. And, PACTEL demonstrated how distance learning is made possible via two-way interactive video and ISDN technology. 2. Health Care In North Carolina, GTE, BellSouth, the University of North Carolina at Chapel Hill, and MCNC, North Carolina's high technology resource center formed a partnership to develop an advanced telecommunications network called VISTAnet. This network allows cancer researchers to create and manipulate 3- dimensional computer-generated medical images, devising optimal radiation cancer treatment strategies. These strategies will decrease the amount of time it takes for doctors to determine the safest radiation plan for cancer treatment from days to just one hour. 3. Community Services The diversity of information networks represented at the Sunnyvale hearing demonstrated how communities and state and local governments are working together to respond to the diverse needs of their populations. Some examples of these networks include CommerceNet, an electronic marketplace that allows companies to transact business spontaneously over the Internet; and "LatinoNet" and WIDNET (Disability-Related On-line Service), which assist Latino populations and disabled individuals respectively with becoming more integrated parts of their communities. 4. Economic Development Inter-Office Communications, Inc., based in Indianapolis, is an example of how individuals can create entirely new services with information technology. This company developed a special receiver card that is installed in a computer to permit wireless data communications between businesses, schools, and households. This service, which is free-of-charge to end-users, is currently transmitting data from NOAA Weather, NASA Space Center, McGraw Hill, the Children's Museum of Indianapolis, the Indianapolis Zoo, and a local broadcast station directly to the public. IV. Profile of the Hearings A. Introduction NTIA held public hearings in order to gather information "on the best characteristics of an expanded concept of Universal Service." A total of 1,145 persons attended the hearings in Albuquerque, New Mexico (December 16, 1993); Los Angeles, California (February 16, 1994); Durham, North Carolina (April 27, 1994); "Silicon Valley," California (May 13, 1994); and Indianapolis, Indiana (July 12, 1994). B. Transcript The hearings generated more than 1,400 pages of transcript from approximately 41 hours of testimony and discussion. C. Hearing Boards The Hearing Boards consisted of FCC Commissioner Andrew C. Barrett, Deputy Secretary of Commerce David J. Barram, Assistant Secretary for Communications and Information Larry Irving, and members from the host states' public utility commissions. In all, ten State Commissioners participated on the Hearing Boards: Chairman Eric P. Serna and Commissioner Louis E. Gallegos, New Mexico State Corporation Commission; Commissioner William W. Redman, Jr., North Carolina Utilities Commission; Commissioners Norman D. Shumway and Jesse J. Knight, Jr., California Public Utilities Commission; Chairman John F. Mortell and Commissioners Frederick L. Corban, Mary Jo Huffman, G. Richard Klein, and David E. Ziegner, Indiana Utility Regulatory Commission. D. Witnesses With the exception of Albuquerque, the hearings were each structured as a day-long series of three panels and an associated technological demonstration. In New Mexico, the hearing included four panels with no technology demonstrations. On December 15, 1993 -- one day prior to the New Mexico hearing -- a group of federal and state officials participated in site visits to several Native American facilities. A total of 230 witnesses from the panels, audience, or the guest speakers' dais participated in the five hearings. Among these, 105 persons served on the various panels and addressed concerns as to how best to meet the goals of universal service and open access. The Hearing Board questioned panelists at the conclusion of testimony from each panel. Audience members were invited to make brief comments afterwards. In addition, 118 audience witnesses and seven persons presenting remarks appeared at the hearings. NTIA received 27 written comments during the course of the hearings, bringing the total number of hearing participants (i.e., panelists and other witnesses, plus those who submitted testimony, but did not formally appear at the hearings) to 257. The witnesses represented various interests including: non- profits (30); health care (10); education (26); libraries (10); local government (12); state government (15); Regional Bell Operating Companies (6); independent telephone companies (9); rural telephone companies (6); software companies (9); computer firms (3); information service providers (24); information gateway providers (10); cable providers (5); cable public access (4); consumer advocates (12); community interests (34); academia (15); utility providers (2); commercial broadcasters (4); cellular companies (4); other wireless providers (2); large information users (1); competitive access providers (7); electronic publishers (3); long distance carriers (2); disabled Americans (8); and others (29). Witnesses from the panels and the audience addressed a variety of questions, generally focusing on the core issues of the hearings, viz., the current status and future directions of universal service and open access, funding for universal service, and developing pricing principles for universal service and open access. The cumulative weight of their testimony, coupled with those submitting written testimony only, resulted in the basic themes discussed above. Many audience witnesses spoke on their own behalf, including an eighth-grade student who described the benefits that he and his school received by having access to the Internet. Two disabled Americans testified that specialized telephone and computer services have allowed them to enjoy common services that were once inaccessible. One senior citizen reminded the Hearing Board that senior citizens are not apathetic about computer technology, and that the Internet provides senior citizens, many of whom are homebound, the opportunity to communicate with other persons through electronic mail and bulletin boards. E. Role of Public Interest Groups The Agenda for Action called for NTIA to "make a special effort to hear from public interest groups." Public interest groups were well represented in the hearing, including cable public access, consumer advocates, the disabled, educational institutions, ethnic minorities, health care interests, libraries, non-profits, and certain small information service providers. This group represented over one-third of all witnesses. Public-interest witnesses explained various creative uses for networks to benefit the homeless and unemployed, such as access to employment data bases and the ability to electronically apply for unemployment benefits. Among the concerns of the public interest groups was ensuring that universal service continues to be a vital goal of the Administration in building the NII; that universal service is defined broadly in order to prevent those unable to afford more complex services from becoming information have-nots; that all Americans have access to the NII; and, that the definition of access include training in how to use the NII. Paramount among the concerns of the groups was the issue of how to fund universal service. Appendix A Universal Service and Open Access Field Hearing Agendas _________________________________________________________________ _______ ______ UNIVERSAL SERVICE HEARING -- ALBUQUERQUE, NEW MEXICO DECEMBER 16, 1993 "Communications and Information for All Americans: Universal Service for the 21st Century" 8:00-8:30 AM o Registration 8:30-9:00 AM o Announcements; Opening remarks by the Hearing Board: The Honorable Larry Irving, Assistant Secretary for Communications and Information, and Administrator, National Telecommunications and Information Administration, introducing -- The Honorable David J. Barram, Deputy Secretary of Commerce The Honorable Eric P. Serna, Chairman, New Mexico State Corporation Commission The Honorable Jerome D. Block, Commissioner, New Mexico State Corporation Commission The Honorable Louis E. Gallegos, Commissioner, New Mexico State Corporation Commission Honorable Andrew C. Barrett, Commissioner, Federal Communications Commission 9:00-9:15 AM o Welcoming remarks by the Honorable Jeff Bingaman, U.S. Senator (D- NM) 9:15-10:30 AM: Panel 1 -- Does Universal Service work now? Has the goal been reached? Has anyone been left out? o Introduction of panel by Hearing Board (5 minutes) * Witnesses (5 minutes each) o The Honorable Casey Luna, Lieutenant Governor of the State of New Mexico o LaDonna Harris, President, Americans for Indian Opportunity o Jeanne Gauna, Executive Director, SouthWest Organizing Project o Dona Crawford, Director of Scientific Computing and Communications, Sandia Laboratories o Dorian Dodson, Planner/Director, New Mexico Human Services Department o Thomas A. Garcia, New Mexico Vice President, US WEST Communications o Comments and questions from the Hearing Board (20 minutes) o Testimony from audience members (15 minutes) (based on sign-up sheets) 10:30-10:40 AM o Morning Break 10:40-11:55 AM: Panel 2 -- How should the Universal Service goal evolve? What capabilities should be included? o Introduction of panel by Hearing Board (5 minutes) * Witnesses (5 minutes each) o Robert Geesey, Executive Director, New Mexico Committee for the Deaf/Hard of Hearing o Fernando Moreno, Executive Director, Quote...Unquote Inc. o Professor Susan Hadden, LBJ School of Public Affairs/ University of Texas-Austin, and the Alliance for Public Technology o Clay Bracken, Manager, Cellular 3/ ENMR Rural Telephone Coop. o Erich Strebe, STARS Program Coordinator, New Mexico Small Business Development Center o Bill Wilt, President, AI! o Jon H. Cooper, General Manager, KNME-TV, Channel 5 o Comments and questions from the Hearing Board (20 minutes) o Testimony from audience members (15 minutes) (based on sign-up sheets) 11:55 AM-12:00 PM o Announcements (5 minutes) MID-HEARING BREAK 12:00-1:15 PM 1:15-2:25 PM: Panel 3 -- What should government do to modernize Universal Service? What is the role of the private sector? o Introduction by the Hearing Board (5 minutes) * Witnesses (5 minutes each) o Rodger Boyd, Executive Director, Navajo Nation, Division of Economic Development o Joseph Scaletti, Director of Interdisciplinary Training Project, University of New Mexico School of Medicine o Michael L. Gaylor, Executive Director, All Faiths Receiving Home o Carlos Atencio, Chairman, New Mexico Educational Technology Coordinating Council o John Smith, Executive Vice President and General Manager, Leaco Rural Telephone Cooperative o Kevin Bethke, General Manager, Jones InterCable o Gary Tydings, Executive Director, Professional Engineering Development, Department of Engineering, University of New Mexico o Comments and questions from the Hearing Board (15 minutes) o Testimony from audience members (15 minutes) (based on sign-up sheets) 2:25-2:45 PM o Afternoon Break 2:45-4:00 PM: Panel 4 -- How to Pay for It: Are there basic principles for funding Universal Service in a competitive environment? o Introduction by the Hearing Board (5 minutes) * Witnesses (5 minutes each) o Carol Clifford, Assistant Attorney General -- Ratepayers o Richard Bryant, Vice President, La Plaza Telecommunity Foundation o Charles Ferrell, General Manager, GTE-New Mexico o Susan McAdams, Assistant Vice President-Government Relations, Electric Lightwave, Inc. o Thomas Thornhill, President, New Mexico TechNet o Kenneth Solomon, Acting Director, Telecommunications Division, New Mexico State Corporation Commission o Mark D. Bryant, Strategic Initiatives Group, MCI o Comments and questions from the Hearing Board (15 minutes) o Testimony from audience members and other audience comments (20 minutes) (based on sign-up sheets) Wrap-Up -- 4:00-4:30 PM o Comments from audience; summary remarks by Hearing Board (30 minutes) Universal Service Hearing - Los Angeles, California February 16, 1994 "Telecommunications to Serve the Cities -- Universal Service in Urban America" 8:00-8:30 a.m. Registration 8:30 -9:00 a.m. Announcements: Opening remarks by the Hearing Board The Honorable Larry Irving, Assistant Secretary for Communications and Information, and Administrator, National Telecommunications and Information Administration, introducing -- The Honorable David J. Barram, Deputy Secretary of Commerce The Honorable Andrew C. Barrett, Commissioner, Federal Communications Commission 9:00-9:15 a.m. Welcoming remarks The Honorable Gwen Moore, Assemblywoman, City of Los Angeles 9:15-10:30 a.m. Panel 1: Universal Service -- Where are we now? Does Universal Service work? Has the goal been reached? Has anyone been left out? * Susan Herman, General Manager, Department of Telecommunications, City of Los Angeles * Heather Hudson, Professor, McLaren School of Business, University of San Francisco * Maxene Johnston, President, Weingart Center Association * Robert Owens, Executive Director, Kedren Community Center * Charles Smith, Vice President and General Manager, Los Angeles Business Unit, PacBell * Daniel Duran, President and CEO, Pacific Resources Management, Ltd. 10:30-10:40 a.m. Morning Break 10:40-11:55 a.m. Panel 2: Community Building, Health, and Education What role does Universal Service have in building communities, delivering health services and education? What social services need to be delivered? How do they tie into Universal Service? How can the Universal Service concept for advanced telecommunications tie into end user needs in these areas? * Tracy Westen, Adjunct Professor, Annenberg School for Communications, University of Southern California * Reed Manville, President and General Manager, KNBC-TV, Los Angeles * Kenneth E. Dowlin, City Librarian for San Francisco * Alicia Bergmann, Consultant, Information Systems, PacifiCare Health Systems * Mary Rainwater, Executive Director, Los Angeles Free Clinic * Bong Hwan Kim, Executive Director, Korean Youth and Community Center 11:55 AM-12:00PM Announcements/Adjourn for Lunch Activities * 11:30 to 4:00: Advanced telecommunications technology demonstrations, California African-American Museum, Multi-purpose Room. 12:00 PM-1:30 p.m. Lunch/Demonstrations 1:30-1:35 p.m. John Mack, President, Los Angeles Urban League 1:35-3:05 p.m. Panel 3: Who will pay? If we expand the concept of Universal Service, how should it be funded? Tie into inner-city needs. * Timothy J. McCallion, West Area Vice President - Regulatory, GTE California * Moctesuma Esparza, President, Buena Vision Cable * Jerry Farrell, Hughes Communications, Inc. * Keith Kurtz, Public Electronic Network, City of Santa Monica * Michael Morris, Teleport Communications Group * Audrie Krause, Executive Director, Toward Utility Rate Normalization 3:05-3:30 p.m. Wrap-Up Comments from audience; summary remarks by Hearing Board 3:30-4:00 p.m. Adjourn to demonstrations Open Access Hearing - Durham, North Carolina April 27, 1994 "Meeting the Information Needs of All Americans" 8:00 - 9:00 a.m. Registration 9:00 - 9:30 a.m. Announcements: Opening remarks by the Hearing Board The Honorable Larry Irving, Assistant Secretary for Communications and Information, and Administrator, National Telecommunications and Information Administration, introducing -- The Honorable David J. Barram, Deputy Secretary of Commerce The Honorable William W. Redman, Jr., Commissioner, North Carolina Utilities Commission The Honorable Andrew C. Barrett, Federal Communications Commission 9:30 - 9:45 a.m. Welcoming Remarks Dr. John E. Thomas, Chairman, North Carolina Utilities Commission 9:45 - 11:00 a.m. Panel 1: How is the information society evolving? Who is providing information? What is the nature of consumer demand for information? What role do small information providers play in the information society? How will such trends evolve in the future? Terry Grunwald, NCexChange, Project Director, North Carolina Client & Community Development Center James F. Goodmon, President, Capitol Broadcasting Co. Dennis Tharrington, President, Communications Resources Inc. Irma Jean Darquenne, Systems Operator, North Carolina Assistive Technology Project 11:00 - 11:10 a.m. Morning Break 11:10 - 12:25 p.m. Panel 2: How should an open access policy be shaped to accommodate the changing needs of the information society? What are the needs of large and small information providers and consumers for new technical capabilities and access options? How should charges for access capabilities be structured? Should all information providers pay identical charges for each type of access option? Should transport providers be obligated to provide services to all information providers? Randall O. Fraser, President, Cablevision of Raleigh-Durham- Chapel Hill Frank Daniels III, Editor, The News & Observer, Raleigh, North Carolina C.S. (Sid) Boren, Vice President, Strategic Management, BellSouth Telecommunications David Bellin, Graduate Director, Department of Computer Science, North Carolina Agricultural & Technical State University 12:25 - 12:30 p.m. Announcements/Adjourn for Lunch 12:30 - 2:30 p.m. Lunch/Demonstrations 2:30 - 4:00 p.m. Panel 3: What legal and regulatory decisions need to be made to implement an open access policy that promotes the free flow of ideas and information? Will greater competition in competitive information and transport markets alone be sufficient to achieve open access goals? If not, what other actions are necessary? How should open access decisions balance desires to promote the free flow of ideas against a need to compensate the creators of information and ideas? Michael R. Coltrane, President, Concord Telephone Co. Professor James Boyle, Duke University School of Law Betsy Y. Justus, Executive Director, North Carolina Electronics & Information Technologies Association Robert P. Gruber, Executive Director, North Carolina Public Staff Sandra G. Weis, Director of Government Affairs, Prodigy Services Company 4:00 - 4:30 p.m. Adjourn to demonstrations Open Access Hearing - "Silicon Valley," California City of Sunnyvale Community Center May 13, 1994 "Innovation and the Public Interest: Open Access to the Information Society" 8:00-8:30 a.m. Registration 8:30-9:00 a.m. Announcements and Opening Remarks: The Honorable Frances Rowe, Mayor of Sunnyvale Hearing Board: The Honorable Larry Irving, Assistant Secretary for Communications and Information, and Administrator, National Telecommunications and Information Administration, introducing -- The Honorable David J. Barram, Deputy Secretary of Commerce The Honorable Andrew C. Barrett, Commissioner, Federal Communications Commission The Honorable Norman D. Shumway, Commissioner, California Public Utilities Commission The Honorable Jesse J. Knight, Jr., Commissioner, California Public Utilities Commission 9:00-9:15 a.m. Welcoming Remarks 9:15-10:30 a.m. PANEL 1: Who has access? Who doesn't? Is the current environment supportive of open access goals? What effect has this had on innovation in the information marketplace? What benefits can greater access bring to people and their communities? * M. Strata Rose, Unix & Network Consultant, SysAdmin & Internet Information, Virtual City Network Project * Rex G. Mitchell, Vice President, Regulatory Planning and Policy, Pacific Bell * Dan Pulcrano, President, Virtual Valley, Inc. * Leslie L. Vadasz, Senior Vice President, Intel Corporation * Milton Chen, Ph.D., Center Director, KQED Center for Education and Lifelong Learning (CELL) KQED- TV, Inc. * Kari Peterson, Executive Director, Davis Community Television, Secretary, Alliance for Community Media national Board of Directors, and President, Davis Community Network * Henry Der, Executive Director, Chinese for Affirmative Action 10:30-10:50 a.m. Morning Break (Press Conference will be held in the Community Room) 10:50 a.m.-12:05 p.m. PANEL 2: What factors would help or hinder network access for information providers and users? What are the barriers to entry for information providers? What are the barriers that exist for the users? Are telecommunications providers able to adequately respond to market demand? * John F. "Jeff" Rulifson, Director, Technology Development Group, Sun Microsystems Computer Corporation * Leslie Saul, Public Policy and Education Projects Manager, Smart Valley, Inc. * Stephan Adams, Founder, Adamation, Inc. * Susan G. Swenson, President, CEO, Cellular One * Bill Mitchell, Director, Electronic Publishing, Mercury Center * Deborah Kaplan, Director, Division on Technology Policy, World Institute on Disability 12:05-12:15 p.m. Announcements/Adjourn for Lunch 12:15-1:30 p.m. Lunch/Demonstrations 1:30-1:40 p.m. Remarks 1:40-2:55 p.m. PANEL 3: What is government's role in ensuring access and spurring innovation? How would increased competition among local access providers affect the delivery of information? What safeguards, if any, would be needed to ensure effective competition and equal access? What are the legal and regulatory hurdles to open access? From your perspective, how do you view the trade-offs of various access models? How should open access decisions balance promotion of the free flow of ideas against a protection of privacy and intellectual property in a competitive environment? * David S. Holub, Vice President of Operations, hooked * Jim Bidzos, President, RSA Data Security, Inc. * Edward M. Spivak, Regional Vice President, First Pacific Networks, Inc. * Elaine Lustig, Staff Attorney, Corporate and Regulatory Affairs, GTE California, Inc. * John Siegal, Senior Vice President, Chris Craft/United Television * Dale Bennett, Regional Vice President, TCI Cablevision of California, Inc. * John Gamboa, Executive Director of Latino Issues Forum and Co-chair, Greenlining Coalition 2:55-3:30 p.m. Wrap-Up Comments from audience; summary remarks by Hearing Board UNIVERSAL SERVICE and OPEN ACCESS HEARING -- INDIANAPOLIS, IN Indiana Government Center - South Tuesday, July 12, 1994 "At the Crossroads: Defining Universal Service and Open Access Policies for the NII" 8:00-8:30 AM: Registration (Atrium) 8:30-9:00 AM: Hearing Convenes (Auditorium) Announcements; Opening Remarks by the Hearing Board: The Honorable Larry Irving, Assistant Secretary for Communications and Information, and Administrator, National Telecommunications and Information Administration, introducing -- The Honorable David J. Barram, Deputy Secretary of Commerce The Honorable Andrew C. Barrett, Commissioner, Federal Communications Commission The Honorable John F. Mortell, Chairman, Indiana Utility Regulatory Commission The Honorable Frederick L. Corban, Commissioner, Indiana Utility Regulatory Commission The Honorable Mary Jo Huffman, Commissioner, Indiana Utility Regulatory Commission The Honorable G. Richard Klein, Commissioner, Indiana Utility Regulatory Commission The Honorable David E. Ziegner, Commissioner, Indiana Utility Regulatory Commission 9:00-10:20 AM Panel 1 -- Looking Forward without Overlooking: Does Universal Service work now? Has anyone been left out? How should the Universal Service goal evolve in the near-term (e.g., two years) and the long-term? What capabilities should be included? * Witnesses 1. Steven S. Wildman, Associate Professor of Communications Studies, Northwestern University 2. Christopher Williams, Executive Director, Citizens' Action Coalition 3. Robert Mundy, Assistant General Manager, Smithville Telephone Company 4. Sam H. Jones, President, Indianapolis Urban League 5. Jayne L. Gerdeman, Director of Telecommunications, City of Indianapolis/Marion County -- Cable Communications Agency 6. Joan M. King, Member, National Legislative Council, American Association of Retired Persons 7. (via live interactive videoconference) Peter Sokolowski, Phase Industries * Comments and questions from the Hearing Board * Testimony from audience members based on sign-up sheets 10:20-10:35 AM Morning Break 10:35-11:55 AM Panel 2 -- Gaining Access: Who has access? Who does not? Which legal, market, or other factors will help or hinder network access for information service providers and users in the near- term (e.g., two years) and the long-term? * Witnesses 1. Harmeet Sawhney, Associate Professor, Department of Telecommunications, Indiana University 2. Dr. James R. Buechler, Director, Family Practice Residency, Union Hospital, Terre Haute 3. Aviva Mintz, Manager, Project Resources, Children's Museum of Indianapolis 4. Matt Pierce, Chairman, Bloomington Telecommunications Council 5. Stanley E. Hubbard, President and C.O.O., United States Satellite Broadcasting 6. Larry Gilbert, Director, Sales & Marketing, Indiana Digital Access/Time Warner 7. Barbara Popovic, Executive Director, Chicago Access Corporation * Comments and questions from the Hearing Board * Testimony from audience members based on sign-up sheets 11:55 AM-12:00 PM: Announcements 12:00-1:30 PM: Mid-Day Break Lunch (Morrison's Cafeteria, lower level, or local restaurants) Technology Demonstrations 11:30 a.m. - 3:30 p.m. (Conference Room A) 1:30-1:45 PM: Hearing Reconvenes/Remarks/ Introduction of Guest Speaker The Honorable Douglas Hunt State Senator (D-Indiana) 1:45-3:00 PM Panel 3 -- Paying the Piper: How do we pay for Universal Service in a competitive environment? What basic pricing principles should be adopted in order to implement a modern Universal Service and Open Access policy? Should a short-term policy (e.g., two years) differ from a long-term solution? * Witnesses 1. Raymond Lawton, Associate Director for Telecommunications Research, The National Regulatory Research Institute 2. Neil Pickett, Director of Research and Programs, Hudson Institute 3. Mark A. Jamison, Manager, Regulatory Policy and Coordination, Sprint Communications 4. Barbara A. Cherry, Director of Issues Analysis for Public Policy, Ameritech 5. M. Barry Payne, Director, Division of Utility Analysis, Indiana Office of Utility Consumer Counselor 6. Robert J. Herbold, Senior Vice President, Information Services and Advertising, The Procter & Gamble Company, on behalf of the American Association of Advertising Agencies, the American Advertising Federation, and the Association of National Advertisers 7. William J. (Billy) Ray, Superintendent, Glasgow Electric Plant Board, and President, American Public Info-Highway Coalition * Comments and questions from the Hearing Board * Testimony from audience members based on sign-up sheets 3:00-3:15 PM Afternoon Break 3:15-4:00 PM: Hearing Wrap-up Comments from audience; summary remarks by Hearing Board Appendix B Summaries of Universal Services and Open Access Field Hearings _________________________________________________________________ _______ ______ SUMMARY NII Universal Service Hearing Albuquerque, New Mexico, December 16, 1993 Introduction In its policy blueprint, Agenda for Action, released September 15, 1993, the Administration's Information Infrastructure Task Force (IITF) directed NTIA to convene a series of public hearings designed to "gather information on the best characteristics of an expanded concept of Universal Service" (p.8). These hearings are designed to provide an important input for the IITF, working in conjunction with its Advisory Council as well as State regulatory commissions, in determining how the concept should be applied in the 21st Century. On December 16, 1993, the U.S. Department of Commerce's National Telecommunications and Information Administration (NTIA) and the New Mexico State Corporation Commission (NMSCC) held the first of these public hearings, in Albuquerque, New Mexico. The hearing expressly sought public comment on the topic, "Communications and Information for All Americans: Universal Service for the 21st Century." The Hearing Board for the Albuquerque hearing included the Commerce Department's Deputy Secretary David J. Barram and Assistant Secretary Larry Irving; New Mexico State Corporation Commission Chairman Eric P. Serna and Commissioner Louis E. Gallegos; and Federal Communications Commission (FCC) Commissioner Andrew C. Barrett. Opening Remarks Serving as moderator, Assistant Secretary Irving opened the hearing, emphasizing the enormous importance that the President, Vice President, and Commerce Secretary place on Universal Service. He noted that just as President Clinton's recent visit to a rural New Mexico health clinic signifies the crucial nature of medical-care access for people in this country, the December 16 hearing demonstrates the critical importance of universal access to the "riches of the information age" for all Americans and the substantial benefits that telecommunications promises in terms of health care availability and costs. Deputy Secretary Barram stressed that the National Information Infrastructure (NII) initiative is a "keystone" of this Administration in terms of creating better jobs, boosting productivity, improving global competitiveness, and increasing the standard of living in the United States. He spoke of the need for all parties to work together in realizing a "vision of the future" where all Americans should be able to access information and communicate with each other, whether through voice, data, image, or video. The Deputy Secretary indicated that New Mexico was chosen as the site of the first hearing because it is a "land of great diversity" in cultural, geographic, and economic terms. NMSCC Chairman Serna stated that his Commission is "very willing to assist the [Administration's] efforts, and we want to ensure that Universal Service is a goal that is not only achievable, but achieved." He indicated that the Commission had been addressing some of these issues as recently as the previous week and underscored the topic's significance. The Chairman specifically cited two resolutions recently passed by NARUC regarding the States' support of broad Administration goals and the desirability of Federal-State cooperation. Commissioner Gallegos supported the Agenda's emphasis on giving Americans nondiscriminatory "affordable access to advanced communications and information," asserting that such access should not be denied based on income, disability, location, race, or gender. He remarked that access is directly related to economics, and that broad-based cooperation would be needed to "assure that there will no longer be information have-nots." Both NMSCC officials emphasized the importance of focusing on the Universal Service needs of rural areas. FCC Commissioner Barrett urged that Universal Service, universal connectivity, and proper costing and pricing are all important aspects of "what we need to be doing." He complimented the current policy effort with respect to the "redefinition of telecommunications," citing personal communications and the information highway as laudable examples. Senator Jeff Bingaman (D-NM) delivered welcoming remarks to the gathering, held at the Technical Vocational Institute in Albuquerque. Senator Bingaman recounted the benefits of advanced telecommunications for a Santa Fe resident who was able to retain all of her German-English translation clients in Vienna despite the lack of proximity. He also related the story of two high schools in New Mexico. While an Albuquerque school offered courses in five foreign languages, the other school in rural Quemado offered none, a deficiency that could have been overcome through distance learning capability. The Senator also noted the great importance of using telecommunications to provide more and better health care services in rural New Mexico and elsewhere. Panel 1 The first of four panels focused on the questions: (1) Does Universal Service work now? (2) Has the goal been reached? (3) Has anyone been left out? The first witness, Lt. Governor Casey Luna, urged that access to new telecommunications technologies be recognized as social and economic necessities for rural America. He asserted that, currently, finding a doctor in most of rural America is "all but impossible"; for example, there are parts of New Mexico where people are 150 or more miles from a hospital, a situation that could be remedied by modern telecommunications. LaDonna Harris, President of Americans for Indian Opportunity, testified that telecommunications could have multiple effects on Native Americans: it could be "another form of colonization of our cultures" or it could "help us economically and socially, as well, if we learn how to harness it." Based on a survey of tribal governments, Native Americans generally have the "computer ability to connect, but not the linkages." Dona Crawford, Director of Scientific Computing and Communications at Sandia Labs, observed that a balance must be struck between introducing modern information technology as rapidly as possible and allowing all in society to participate in this progress. The "surest path" to achieving this is to promote "close partnerships" among government, business, and consumer groups that would "seek creative solutions," examples of which were offered. Dorian Dodson, Homeless Coordinator in the New Mexico Human Services Department, argued that technologies must be used to help the most disenfranchised in our society, including homeless workers, children, and refugees. Most important of all, people "do not want to be cut off," and she commended the "pioneering" partnership between the NMSCC and the Human Services Department in developing a low income telephone assistance program in New Mexico. Thomas Garcia, New Mexico President of U S WEST Communications, set forth 11 key principles of Universal Service that included, among others, the need to assess demand for new services, to give greater flexibility to local exchange carriers in a competitive environment, to target support to Native Americans and other low-income individuals, and to allow national standards to be set. He stated that although Universal Service has been generally reached nationally, "there is opportunity for more improvement" in penetration levels in the State despite some "rather phenomenal programs" established by the NMSCC and U S WEST. During questioning by the Hearing Board, Mr. Garcia and Ms. Harris agreed to study why more Native Americans do not subscribe to telephone service. Lt. Governor Luna indicated that in his experience, there is a "great need" (i.e., demand) for modern telecommunications services in rural New Mexico. During the audience participation segment, Alan Richardson from the office of Senator Pete Domenici (R-NM) stressed the importance of private-sector investment and assuring Universal Service related to advanced telecommunications services. Other witnesses described the critical role of libraries and government funding of public broadcasting facilities. Panel 2 The second panel addressed the questions: (1) How should the Universal Service goal evolve? (2) What capabilities should be included? Speaking through a sign-language interpreter, Robert Geesey, Executive Director for the New Mexico Committee for the Deaf and Hard of Hearing, urged that the NII have "complete accessibility," including people with hearing, speech, sight, and other disabilities. He also recommended that the IITF's Advisory Council have at least one disabled member. Fernando Moreno, Executive Director of Quote...Unquote, Inc., described the social usefulness of "public access" (non-commercial cable) television in Albuquerque and argued that the traditional Universal Service should encompass much more than simple voice service. Mr. Moreno asserted that the new definition should include access to the NII network by the public as both consumers and producers of information, as well as training in how to use the network. Prof. Susan Hadden of the LBJ School of Public Affairs at the University of Texas at Austin, representing the Alliance for Public Technology, stated that it is more appropriate to redefine Universal Service in terms of (eight) features or characteristics rather than technologies. She also recommended that the government take an active role in promoting Universal Service, setting long-range goals, fostering innovation, and not equating competition and deregulation. Clay Bracken, Manager for Cellular 3/ ENMR Rural Telephone Cooperative, noted that as the list of basic services is expanded to include video, broadband data, interactive media, and wireless technologies, the present Universal Service Fund (USF) support mechanism must also be redefined to include a broader group to pay into it. Erich Strebe, STARS Program Coordinator for the New Mexico Small Business Development Center, testified that 70 percent of the small businesses with whom he comes into contact "have no real understanding of what an information highway is," and no more than 5 percent regularly use the Internet. He recommended the creation of strong incentives to "get small businesses on the net in the first place," such as "low-cost access points" to manufacturing extension programs and other institutions that work closely with small businesses; free use of "network search tools" (for example, Gopher); and free access to government data bases. The next panelist was Bill Wilt, President of Albuquerque Interactive! Inc. and Foundation, formed to support businesses that will provide interactive digital products, services, and applications to Albuquerque residents. Mr. Wilt believes that the proper role of government should be to foster technology- neutral standards for development of the information superhighway. Finally, Jon Cooper, General Manager of public broadcasting station KNME-TV, recommended that the concept of Universal Service be expanded to include universal access, assuring that everyone has access to a "base level of information that is essential to an educated and informed public." He argued that a "toll free place on the information highway" be reserved for services provided by public TV and other government-supported nonprofit institutions such as public schools and libraries. The subsequent discussion between panelists and the Hearing Board addressed, among other things, the role of profit motives in providers reaching users; whether wireless technologies can help serve rural customers; privacy concerns; and whether location is as important a factor as income level in determining Universal Service. During the audience participation period, witnesses presented a number of points, such as: future basic service will increasingly include nonvoice services; technology should accommodate the languages and cultures of minorities; the importance of libraries and other non-profit institutions in the NII; and the need to fund universities and community colleges so that they may train teachers, librarians, and consumers to "be comfortable with" the NII. Panel 3 The third panel concerned the questions: (1) What should government do to modernize Universal Service? (2) What is the role of the private sector? Rodger Boyd, Executive Director of the Navajo Nation, Division of Economic Development, testified that more than 65 percent of Navajo homes do not have telephone service, half because they cannot afford it and half because they "cannot get [it]." Moreover, over 46 percent of those with telephones pay between $70 and $120 per month for their telephone service in a Nation where 56 percent of the households have annual incomes of $19,000 or less. Mr. Boyd stated that Federal funding is needed to assist low-income Navajos to receive service and to help launch cellular telephone systems. Joseph Scaletti, Director of the Interdisciplinary Training Project at the University of New Mexico School of Medicine, pointed out that a key factor in recruiting and retaining health care professionals in rural communities is to overcome "professional isolationism." A telecommunications network has been established in the Four Corners Region of New Mexico, but has been hampered by the lack of high-speed broadband and digital facilities. Cooperation among many public and private sector groups is needed to bring an advanced network and improved telemedicine to that remote region. Michael Gaylor, as Executive Director of All Faiths Receiving Home, stated that a child care agency such as this would benefit from having electronic access to, among other information, records for purposes of performing Federal criminal background checks on potential employees, bulletin boards for employee recruiting, results regarding child sexual abuse investigations, and medication/poison databases. Carlos Atencio, Chairman of the New Mexico Educational Technology Coordinating Council at Los Alamos National Laboratories, testified about the importance of equal access to education through affordable technology. He specifically recommended that schools function as community centers where common telecommunications downlinks could be accessed by all in rural communities and stressed the need for adequate funds for planning and teacher training regarding technology. John Smith, Executive Vice President and General Manager, Leaco Rural Telephone Cooperative, argued that a USF-type mechanism is needed to achieve Universal Service in many rural areas. He cited, as an example, his company's situation: a serving area covering 5,700 square miles with only 870 access lines, and two areas (one in southeastern New Mexico, the second in a portion of Loving County, Texas) that received telephone service for the first time in 1991. Kevin Bethke, General Manager of Jones InterCable in New Mexico, noted that his company, which has owned and operated cable TV systems serving a number of locations within the State since 1986, currently passes over 98 percent of the homes in those areas. He asserted that continuing the existing restriction on cable system provision of telephone service in the State would preclude participation by a potentially significant supplier of new telecommunications offerings that could benefit the public. Finally, Gary Tydings, Executive Director of Professional Engineering Development, Department of Engineering, University of New Mexico, believes that Universal Service should be more properly defined as universal access. This new definition should include access to education and training, assistance to rural clinics with respect to diagnostic tools, help in economic development of underserved areas, and communications links between hubs. The government's role should be to reflect the capabilities of new technologies and services in public policy, not to inhibit competition or even necessarily to provide subsidies. During the Hearing Board comment-and-question period, the discussion centered on the low telephone penetration rates of Navajos; the role of regulatory agencies in economic development; the difficulty of determining demand for new technologies and services; social contracts between commissions and providers; and funding. Witnesses from the audience testified regarding the benefits of REA funding; the benefits and costs of telemedicine in rural America; helping the disenfranchised; partnerships; and the role of educators in the NII. Panel 4 The fourth panel addressed the basic issue of funding Universal Service in a competitive environment. Carol Clifford, Assistant Attorney General in the State's Consumer Protection Division, opined that Universal Service will no longer mean solely connection or price subsidies for use but will have a programming, or content, element. The latter objective could be met through grants from private entities or government, or, if necessary, tax incentives could be created for private provision of "quality of life-enhancing services. Richard Bryant, Vice President, La Plaza Telecommunity Foundation, provided a demonstration and described an easy-to-use community-based (telecommunity) system that connects to education, government, and telemedicine functions. This system of off-ramps for the information highway would feature a basic level of free access and democratic empowerment more similar to the public library system than the telephone model. Charles Ferrell, GTE Regional Manager-External Affairs in New Mexico, testified that in a competitive environment, all methods of funding Universal Service will have to change. He argued that targeted support mechanisms should be provided "only when competitively provided services are too expensive for certain customers to afford and which are determined to be necessary." Government should create the needed support mechanisms to meet social objectives and could require contributions from all service providers. Susan McAdams, Assistant Vice President for Government Relations for Electric Lightwave, Inc., warned against policymakers being "swept up in a crisis mentality" about the potential effects of local competition. She offered several principles for the future funding of Universal Service programs, including the need for funding that is competitively-neutral, applied to all competitors, targeted only to needy consumers and explicit in nature, phased-in where necessary to avoid rate shock, limited in size, characterized by efficiency incentives, and independently administered. Thomas Thornhill, President of New Mexico TechNet, stated that he believes that those who use the information highway should pay for it, with the exception of low-cost access for the education community. Moreover, an incentive system should be created to encourage the health care industry to improve the delivery of their services through use of the information highway. Mark Bryant, MCI Strategic Initiatives Group, posited that there exists a lack of information as to the true cost of local exchange service and the size of the subsidy required. He also argued that all service providers should contribute equitably to the funding mechanism, and that customers should be able to choose their carriers and the recipient of their subsidy money. Kenneth Solomon, Acting Director in the Telecommunications Division at the NMSCC, testified that New Mexico, which has the country's third lowest per capita income and third lowest telephone penetration rate, currently has not achieved the goal of Universal Service. Although the State currently receives the fourth largest USF funding per access line, cutting back or terminating the fund would assure that advanced telecommunications infrastructure would never be achieved in New Mexico. He argued that the present system of funding still works, but a possible alternative funding source could be the proceeds from the auctioning of PCS licenses. Contributions should be made by all service providers, and administration of the fund could be determined by bid. The ensuing discussion between the Hearing Board and the panelists concerned such issues as the future role of State regulation; education subsidies; rate deaveraging and targets of subsidies; the potential effectiveness of competition in rural areas; the Noam NetTrans funding proposal; and use of PCS auction proceeds. Witnesses from the audience raised arguments for greater participation in funding support mechanisms, possibly on a threshold basis; the need for access for disabled and impaired Americans; and the New Mexico Freenet community. Closing Remarks Members of the Hearing Board offered some closing remarks. FCC Commissioner Barrett asserted that cost is an issue that cannot be avoided. He also stressed that "we have to have all players at the table" to achieve an expanded Universal Service and warned that if the new system is "not configured properly," some Americans may possibly be left out of the information age. NMSCC Commissioner Gallegos recounted the accomplishments of his agency over the past five years, including building up the expertise of the in-house staff. He also pointed to the sanctioning of New Mexico State's telecommunications seminar program by NARUC. In closing, Assistant Secretary Irving noted the importance for the Commerce Department of the two days spent in New Mexico. On December 15, a Federal contingent plus representatives of the offices of Sen. Bingaman and Lt. Gov. Luna met with Nedra Darling at the Institute of American Indian Art in Santa Fe and also visited San Juan Pueblo, permitting the group to better understand the difficulty experienced by Native Americans in trying to maintain their tribal heritage and culture while turning to modern technology to improve their education, health care, and economic conditions. He recognized the many people who labored to organize the two days of activities, as well as those who participated in the December 16 hearing, including Senator Bingaman, the Board members, the 50 witnesses, and the audience numbering more than 125. Mr. Irving welcomed any additional comments for the record. SUMMARY NII Universal Service Hearing Los Angeles, California, February 16, 1994 Introduction In the Administration's policy blueprint, Agenda for Action, released September 15, 1993, the Information Infrastructure Task Force (IITF) directed NTIA to convene a series of public hearings designed to "gather information on the best characteristics of an expanded concept of Universal Service." The first of these hearings was held in Albuquerque, New Mexico on December 16, 1993 and focused on the needs of rural communities. A summary of the New Mexico hearing is available on the IITF computer bulletin board. The IITF bulletin board can be accessed by calling (202) 501-1920 using a personal computer and a modem. For access through Internet, point your Gopher client to iitf.doc.gov or telnet to iitf.doc.gov and login as gopher. Comments may be sent by e-mail to nii@ntia.doc.gov. Los Angeles Hearing On February 16, 1994, the U.S. Department of Commerce's National Telecommunications and Information Administration (NTIA) and the California Public Utilities Commission held the second public hearing on the topic, "Communications and Information for All Americans: Universal Service for the 21st Century." The Hearing Board for the Los Angeles hearing included the Deputy Secretary of Commerce David J. Barram and Assistant Secretary Larry Irving, and Federal Communications Commission (FCC) Commissioner Andrew C. Barrett. Commissioners Dan Fessler and Norm Shumway of the California Public Utilities Commission were unable to attend as the hearing was rescheduled following the January earthquake. The hearing board heard testimony from over 50 participants including scheduled witnesses and members of the audience. Opening Remarks Serving as moderator, Assistant Secretary Irving opened the hearing and said it would serve as an examination of the role of universal service in urban areas, especially in community building, health care, and education. He cited divisions in the Los Angeles community as an illustration of differential access to essential services such as health care and education, declaring that telecommunications is a "way out of this world of have and have-nots." Deputy Secretary Barram recounted stories of good will and kindness demonstrated in Los Angeles during the uprisings of 1992 and the Laguna fires to underscore "community" as the key element of the National Information Infrastructure (NII). He introduced the questions: "How have we done in universal access to date?" and how can an advanced information infrastructure "link people and institutions?" He noted that "two-thirds of U.S. workers are employed in information-related jobs." Barram stated that networks will "help break down the barriers of language, distance, and economics" as well as encourage the exchange of ideas, nurture cultural appreciation, and foster an awareness of commonality. FCC Commissioner Barrett thanked the cities involved for "providing an opportunity for everyone to have a say in what this Administration is trying to do." California Congresswoman Maxine Waters said that it is necessary to redefine universal service and determine what constitutes basic service. She described the "17 to 30 program," which helps teens on the street go back to school, as an example of a non-profit organization that needs a way to communicate and share resources. California Assemblywoman Gwen Moore, representing the California Assembly Utilities and Commerce Committee and the National Conference of State Legislators Communications Committee, stressed that universal service has not been achieved in Los Angeles. She said that 23 percent of Hispanics in L.A. are without telephone service "in a state which has among the lowest telephone rates in the nation." She discussed community outreach programs as a means of educating the public about available services. She expressed concern over preemption of state authority to regulate telecommunications. Panel 1: Where are we now? The first witness, Susan Herman, General Manager of the Department of Telecommunications for the City of Los Angeles and member of the Administration's NII Advisory Council, related the unalienable rights in the Declaration of Independence to the freedom in the information age to access the NII both as a user and a producer on a nondiscriminatory basis at an affordable cost. She stressed that the universality of the value of service is as important as who is linked to the NII. She defined essential services as "free or low-cost public safety and emergency services akin to 911, basic information indices and network guides akin to 411 and the operator, and access to public databases maintained by the government on behalf of taxpayers." Heather Hudson, Director for the Telecommunications Management and Policy Program at the University of San Francisco, testified that rural and urban areas have many commonalities including tight budgets, the difficulty of attracting quality teachers and of offering courses students need to get good jobs, as well as problems with health care services. She declared the need for a vision to focus on accessibility, equity, connectivity, and flexibility. She addressed the design of pricing models that consider "communities of interest" by employing extended area service models, toll free access to social services, and distance insensitive tariffs. Robert Owens, Executive Director of the Kedren Community Center, testified that "very few, if any, poor people are involved in the planning, development, production, repair and use" of the information infrastructure. Maxene Johnston, president and chief executive officer of the Weingart Center Association, a nonprofit hotel/health and human services complex for the homeless and poor, said that the NII could address job training and placement, literacy education, health services, and affordable housing. She testified that voice mail, which is literacy and address neutral, is replacing the traditional message center for job seekers at the Center. She stated that an information network can allow human service organizations to eliminate duplicate services. She proposed expanding FINE line, Fast Interactive Needs Exchange, a calling card system for human service consumers to get guidance without reentering the full system. Charles Smith, Vice President and General Manager for the Los Angeles area business unit of Pacific Bell, believes that there should be a choice of two basic service packages. The first package would include traditional services with a Lifeline option to assist low-income customers. The second package would provide access to wideband services like databases and Internet. He stated that "the traditional practice of subsidizing every household" should end and that subsidies "should be collected in a competitively neutral way by all companies that supply telecommunications in any form." Dr. Daniel Duran, chief executive officer of Pacific Resources Management, testified that, for example, "job seekers who wait for hours in unemployment lines to fill out a basic form that could be done through a kiosk in a matter of seconds" attests that universal service has excluded individuals. He questioned how non-English based information resources will be able to link up to and enrich mainstream information sources. He argues that universal service will be a "hollow victory for inner city residents" if their information gathering and information creation skills are not improved. During questioning by the Hearing Board, Ms. Hudson and Ms. Herman agreed that some type of incentives should be used to encourage service providers to reach benchmarks. Ms. Hudson said benefits to providers would be more flexibility and an opportunity to run their businesses with less regulation. She said that "voice and data distinctions don't make sense anymore." Ms. Johnston suggested the Community Reinvestment Act as a model for community responsibility. She believes universal service should be linked to schools encouraging parental involvement in learning and using technology. Mr. Owens advocated using community-based organizations to educate the under-served population. Dr. Duran said that every library should be wired along with instructions to use the information resources. Ms. Hudson suggested carriers contribute to an educational fund. During the audience participation segment, Kathryn Faulk, representing National Exchange Carrier Association (NECA), discussed programs that waive the federal subscriber line charge and the installation charges. She made mention of the Interstate Telecommunications Relay Service Fund started by the FCC to ensure speech and hearing impaired access at affordable rates. Other witnesses discussed Hispanic-American representation in policy and advisory groups, visually impaired access to the NII, and using South Central L.A. as a national test for universal service. Panel 2: Community Building, Health, and Education The first witness, Tracy Westen, Adjunct Professor at the Annenberg School for Communications at the University of Southern California, testified that interactive technology will be tested in California for the 1994 elections. He advocated four areas of focus: political participation, health, employment, and education. Reed Manville, General Manager and President of KNBC- TV, Los Angeles, stated that over-the-air broadcast television is the only free universal service. He testified that "ordinary Americans should not have to navigate through complicated menus to watch their local news." Alicia Bergmann, representing the National Health Foundation, described a pilot project to "create a seamless, fluid system for gathering, accessing, and transferring patient data in a secure and standards-based environment." She testified that electronic health care transactions, administrative and clinical, could produce an annual savings in California of $8 billion, or 10 percent of the state's total annual expenditures. She said that full savings will not be reached unless residential customers have access to fiber linkages and advanced switching capabilities. Kenneth Dowlin, City Librarian for the City of San Francisco, testified that the on-line public access catalogue is a first point of access to the "electronic world." Mary Rainwater, Executive Director of the Los Angeles Free Clinic, observed that computerized medical records for the transient population can be "the next best thing to having a family doctor who knows them." She discussed computer access of free clinics to lab results and outlined challenges: money to get connected, resources to provide more services, and lack of high-tech sophistication among clients. She testified that the clinic had chosen not to implement voice mail because of possible confusion among clients. She expressed concern regarding client inability to "hold on to a swipe card so that they can get health care." Finally, Bong Hwan Kim, Executive Director for the Korean Youth and Community Center, suggested building telecommunications infrastructure in low-income housing. The subsequent discussion between panelists and the Hearing Board addressed the difficulty level of the technology offered to unsophisticated, under-served populations, how the ways people learn will impact the success of the technology, generating projects from the "bottom up" with input from multicultural groups, and focusing on using technology to improve basic health care. During the audience participation segment, several witnesses presented a number of points: digital democracy (voting electronically), privacy of "transaction-generated information," and universal access as a goal extending beyond access to communication tools. Discussion of advanced telecommunications technology demonstrations Assistant Secretary Irving said bringing technology into communities with the universal service hearings is a goal of NTIA. He was pleased to see children from the community center viewing the demonstrations because, he said, "they won't be intimidated by the technology." John Mack, representing the L.A. Urban League, argued the importance of minority ownership of businesses in establishing universal service and encouraged minority partnerships as a prerequisite for obtaining federal approval for infrastructure development. Panel 3: Who will pay? The first panelist, Timothy J. McCallion, West Area Vice President -Regulatory for GTE California, testified that, in a competitive market, users of the services are the first sources of funding. He said once market prices are determined, "unacceptable disparity" must be addressed. He argued that "by first allowing the market to function efficiently, the amount of support required can be kept at the lowest acceptable level." He supported identifying individual cases of assistance. He acknowledged that prices for some will be higher. He advocated "tax-based funding" or contribution from all providers of telecommunications services based on a "general measure of output such as revenue." Jerry Farrell, Executive Vice President at Hughes Communications, representing various satellite companies, argued that satellites are necessary for universal access, estimating that 10 to 15 percent of the U.S. will never get fiber optic wiring. Moctesuma Esparza, President of Buena Vision Cable, said that the public will pay for the NII either as taxpayers or as consumers. He questioned how regulation will affect minority entrepreneurs and small cable T.V. companies as they compete with larger companies. Keith Kurtz, Project Manager for the City of Santa Monica's Public Electronic Network (PEN), a public access computer network of city services, expressed a need for technical standards "to interconnect and to afford nondiscriminatory access." Michael Morris, representing Teleport Communications Group, a competitive access provider, believes competition is the best way to achieve universal service. He advocates a "universal service assurance fund to be administered by an independent third party." He indicated that the legal framework is keeping companies from competing in service areas and is impeding universal service. He predicted community-based entrepreneurs will operate local exchange companies to serve unmet needs. Finally, Audrie Krause, Executive Director of Toward Utility Rate Normalization (TURN), testified that raising rates to pay for infrastructure development is an "unfair use of ratepayer money." She argued that regulators must prevent monopolies from cross-subsidizing advanced competitive services. She believes that it is not necessary to change the scope of universal service because demand of information services is not clear. The subsequent discussion between the Hearing Board and the panelists addressed, among other things, the effect of satellite usage upon local broadcasting, the financial ability of small businesses to expand into new technological areas and their ability to compete against larger providers under new regulations, allowing competitors equal access to subsidies, tax incentives for providers to enter underserved markets, the structure of rates to allow for innovation investment over time, and the balance of small business ownership versus the rapid deployment of new technology. Witnesses from the audience raised arguments for education of small businesses to use information technology for product design and marketing, using the industrial extension center program as a model for paying for universal service, a standard infrastructure connection, making emergency services not subject to disconnection, targeting at-risk youth as partners in developing universal service, training of public facilitators for new technology, and a national commitment to computer literacy. Closing Remarks Members of the Hearing Board offered closing remarks. Assistant Secretary Irving welcomed additional statements for the record. He said the hearings were an effort to "ensure that walls aren't built by these technologies." He stated that a consensus must be reached regarding what constitutes basic service. Deputy Secretary Barram commented that "the pricing for service is still the toughest issue." He encouraged participants to tell others about their projects. He noted that community-based organizations warrant "more conversation." In closing, Commissioner Barrett stressed the importance of the forum to hear varying discussions. The next NTIA field hearing is scheduled for April 27, 1994 in Raleigh, Durham, North Carolina. Information is available on the NTIA Bulletin Board by calling (202) 482-1199. SUMMARY NII Open Access Hearing Durham, North Carolina, April 27, 1994 Introduction In the Clinton Administration's policy blueprint, National Information Infrastructure: Agenda for Action, released September 15, 1993, the Information Infrastructure Task Force (IITF) directed the National Telecommunications and Information Administration (NTIA) to convene a series of public hearings. These hearings were designed to "gather information on the best characteristics of an expanded concept of Universal Service." The first two hearings focused on the future vision of universal service. In Albuquerque, New Mexico, December 16, 1993, NTIA focused on the needs of rural communities. Then in Los Angeles, California, February 16, 1994, NTIA shifted to an urban setting. At each hearing, NTIA received testimony from state and local governments, public interest groups, industry, and academia on issues relevant to an expanded concept of universal service. Summaries of these hearings are available on the IITF computer bulletin board. The IITF bulletin board can be accessed by calling (202) 501-1920 using a personal computer and a modem. For access through Internet, point your Gopher client to iitf.doc.gov or telnet to iitf.doc.gov and login as gopher. Comments may be sent by e-mail to nii@ntia.doc.gov. North Carolina Hearing On April 27, 1994, NTIA and the North Carolina Utilities Commission (NCUC) conducted a public hearing on the topic, "Meeting the Information Needs of All Americans." In this third hearing, NTIA changed its focus slightly from the prior hearings to examine how to promote open access to the National Information Infrastructure (NII) to best meet the information needs of our citizens. The Hearing Board for the North Carolina hearing included Deputy Secretary of Commerce David J. Barram and Assistant Secretary for Communications and Information Larry Irving; NCUC Chairman John E. Thomas and Commissioner William W. Redman, Jr.; and Commissioner Andrew C. Barrett of the Federal Communications Commission (FCC). The Board heard testimony from more than 35 participants, including scheduled witnesses and members of the audience. Opening Remarks Serving as moderator, Assistant Secretary Irving opened the hearing by posing the basic questions: How do we ensure that everyone can use the information superhighway fairly, and what are reasonable conditions for doing so? He expressed concern that people wishing to acquire and exchange information not be denied access to the information superhighway. Secretary Irving introduced several questions for discussion: How do we ensure that information providers -- the small providers as well as the major corporations and universities -- can provide for the needs of the people they serve? How do we ensure that consumers can exchange information, and, in fact, become information providers themselves? Should all transport providers be obligated to provide access? If so, what are the legal and practical barriers to such access? Deputy Secretary Barram pointed out that the open access issue is critical to the proper development of the NII, and that any open access policy must be flexible enough to adjust to changes in technology. He explained that if the information infrastructure is to support a diversity of ideas and fair competition in the free flow of information, then users -- consumers and businesses -- need something more than the simple voice-grade telephone connection that traditional universal service policies have sought to provide. Deputy Secretary Barram noted further that universal service policies involve connection issues -- how to ensure that the elderly and the disabled, as well as those in rural communities and inner-city neighborhoods, are not priced out of the market for new communications services. Open access issues, on the other hand, involve how we use that connection. Open access is an important part of the long-standing national policy, embodied in the First Amendment, to promote a diversity of ideas and fair competition in the free flow of information. Commissioner Redman remarked that the North Carolina Information Highway has progressed because state regulators have been able to build a "trust relationship" with regulated companies. Chairman Thomas welcomed participants and audience members to North Carolina. He said that economic growth in a region is spurred by the location decisions of business managers. Chairman Thomas said these business leaders expect a state-of- the-art telecommunications system that makes voice, data and television transmission as accessible and affordable as that available to their competitors around the globe. In welcoming remarks, Jane Smith Patterson, Advisor to the Governor of North Carolina for Policy, Budget and Technology, stated her hope that the NII Initiative will level the playing field between rural and urban areas. She urged the creation of a broadband infrastructure throughout the United States in order to improve industry, education, health care delivery, and the criminal justice system. She predicted that implementation of a broadband network would add $2.7 billion to North Carolina's gross state product by 1999. Dr. Juanita Kreps, former Secretary of Commerce, welcomed the Hearing Board members and participants to Duke University. Panel 1: How is the information society evolving? Panel 1 witnesses were asked to address the following questions: Who is providing information? What is the nature of consumer demand for information? What role do small information providers play in the information society? How will such trends evolve in the future? Professor William Graves, Associate Provost for Information Technology at the University of North Carolina, Chapel Hill, emphasized the need to think in terms of a "learning society" rather than an information society, because the country is developing a "knowledge economy." He advocated free and open competition for carriers and information providers. Dennis Tharrington, President of Communications Resources, Inc., recounted how his former company failed in its attempt to create an audio-text service due to prohibitively high rates for access. He called for regulation that would assure open access, especially with regard to tariffs. Judith H. Hallman, Corporate Secretary of Public Information Network, Inc., discussed the creation and maintenance of a free- net or community information system, which she said is "at the frontier of the democratization of information." Local volunteers gather, assemble and maintain the information, and such services are free and open to all. Ms. Hallman noted the need for acceptable use policies. Irma Jean Darquenne, Systems Operator for the North Carolina Assistive Technology Project, used a voice synthesizer to offer her prepared testimony. She noted that assistive telecommunications technology acts as a "lifeline" to people with disabilities, enabling them to do normal, mundane things that most people take for granted, such as ordering take-out food. Ms. Darquenne expressed frustration over the still undeveloped state of graphical user interfaces (GUI), and stressed that such access capabilities should be incorporated in the earliest design phases of new systems or networks. Jim Bodenbender, Senior Vice President for Corporate Marketing of First Data Corporation, testified that increased bandwidth was an essential prerequisite to offering medical services such as radiological images over the telecommunications network. However, he acknowledged that existing telecommunications networks can already be used to reduce the paper flow associated with patient data, which is estimated to consume approximately one-quarter of the $900 billion in annual health care costs. Terry Grunwald, NCexChange Project Director for the North Carolina Client and Community Development Center, described the benefits that accrue when non-profit organizations network together. Several factors need to be addressed to increase access for non-profits, including: customized user-friendly networking tools, training and support, and affordability. James F. Goodmon, President of Capitol Broadcasting Co., testified that one-way video with two-way audio works well for distance education. He also noted that free over the air television already offers virtual universal coverage of the nation. During the question and answer period, several witnesses suggested that content providers should be separated from transport providers. One audience member, Grant Holcomb, Vice President of Research and Development for Multimedia Design Corporation, suggested that the FCC encourage the software industry to adopt universal user interface guidelines. Another audience member, Walter Daniels, a Durham attorney, stressed the need for broad bandwidth to serve rural health clinics, as well as the need for free electronic access to government information such as laws, regulations, and rulemakings. Panel 2: How should an open access policy be shaped to accommodate the changing needs of the information society? Panel 2 witnesses were requested to address the following questions: What are the needs of large and small information providers and consumers for new technical capabilities and access options? How should charges for access capabilities be structured? Should all information providers pay identical charges for each type of access option? Should transport providers be obligated to provide services to all information providers? Jeanne Milliken Bonds, of the Rural Economic Development Center, noted that telecommunications should be part of a rural development strategy because of its relationship to growth in the services sector of the economy. She said that long-term investment in the rural telecommunications infrastructure can be encouraged by a "careful balance between deregulated market competition and enhanced access provisions, within a framework that adapts to technological change." David Bellin, Graduate Director of Computer Science, North Carolina Agricultural and Technical State University, testified that success of the NII will depend upon several factors, including public access to information, the provision of public gathering places, and guarantees of personal privacy. To ensure personal privacy on the NII, he argued that: (1) every user must be asked for permission each time information regarding his/her transactions is used or sold; (2) transactional anonymity should be guaranteed while at the same time providing for secure billing mechanisms; and (3) end-to-end encryption of personal electronic communications must be mandated. Frank Daniels III, Executive Editor of Raleigh's News & Observer, testified that because many American homes are still without computers --only 17% of homes have modem-equipped computers -- the "least common technical denominator" approach to the NII will provide the best chance for open access. To this end, his organization has focused on providing a bulletin board system, easily accessible by any modem-equipped personal computer in North Carolina. He also cited the success of the Internet, which is thriving because of its openness and because it is relatively inexpensive. Mr Daniels felt we should not ignore the fact that an information highway is already present in our local telephone networks. Randall O. Fraser, President, Cablevision of Raleigh-Durham- Chapel Hill, testified that government policies should avoid determining technological winners and losers. Public policy should instead encourage choices and diversity among service providers. Mr. Fraser argued that access charges should be structured to encourage capital formation and investment, so as to allow for continued development of network facilities. He pointed out that electric utilities have refused to let cable companies lay fiber optic lines over their existing cables on utility poles. He said that at the same time, electric utilities are offering to lease fiber optic lines at three times the cost to the cable companies of providing their own lines. C.S. (Sid) Boren, Vice President of Strategic Management for BellSouth Telecommunications, noted that while the nation has a pervasive narrowband network, only a few places (such as North Carolina) have a broadband network in place to accommodate the vision of the NII. He said that from an economic standpoint, the NII should be evolutionary in process rather than revolutionary. The NII will continue to take shape so long as a market develops and revenues are produced to justify increased capital investment. Mr. Boren argued that regulatory parity, especially with cable, is critical if local phone companies are to be viable players in a competitive local exchange marketplace. Dr. William E. Willis, Jr., Associate Provost for Academic Computing, North Carolina State University, testified that information provision is a business requiring investment, which is available from the corporate and business community. Business naturally sees an advantage to being both service provider and access provider. However, he warned, there is "grave danger in the marriage of those who provide the access and connectivity services with those who dish up the information we need." During the question and answer period, Deputy Secretary Barram stated that technology is moving fast, people are adapting to change, and government needs to develop the means to make the NII flexible. Mr. Boren offered that alliances among business entities are needed to maximize the abilities of each entity. Addressing concerns about funding for the broadband network, Mr. Fraser noted that cable service is routinely extended to schools and other public facilities as a result of franchise negotiations with local authorities. During the audience participation period, Claude Stout, of the Division of Services for the Deaf and Hard of Hearing, remarked that only 20% of titles in video rental stores are captioned. He advocated the full captioning of all educational and entertainment videotapes and programming. Mr. Stout also expressed concern that new NII technologies not be allowed to interfere with radio frequencies now used for assistive listening devices. Other audience members stated that costs of the NII will be shared between public and private sources, and that interconnection standards and cost controls are issues that need to be addressed by government. Jacob Roquet, of the Center for Information Exchange in New Bern, North Carolina, suggested the rural electric cooperatives of the 1930s as a model for providing NII services where market forces are insufficient. Jerry Kirk, Vice President of Customer Support for Carolina Power and Light, proposed that electric utilities could supply one large-capacity cable with dark fiber for lease to other users instead of permitting other users to string additional cables. John Frazier, of the National Telephone Services Company, an African-American owned long- distance telephone company, urged the use of telecommunications technology to solve problems in limited resource communities. Panel 3: What legal and regulatory decisions need to be made to implement an open access policy that promotes the free flow of ideas and information? Panel 3 witnesses were asked to address the following questions: Will greater competition in competitive information and transport markets alone be sufficient to achieve open access goals? If not, what other actions are necessary? How should open access decisions balance desires to promote the free flow of ideas against a need to compensate the creators of information and ideas? Alan Blatecky, Vice President of MCNC, identified eight essential legal and regulatory issues: (1) defining network rights, i.e., user expectations in terms of access, privacy, and security; (2) defining rights and responsibilities in cyberspace (a network "driver's license"); (3) determining how state networks fit into the NII; (4) setting standards; (5) resolving intellectual property issues; (6) determining the difference between common carriers and content providers; (7) redefining universal service and public access; and (8) settling issues of geographic coverage. Professor James Boyle of Duke University Law School, suggested that traditional concepts of civil rights and property law might be hampering access to telecommunications networks. He said intellectual property jurisprudence assumes that intellectual property is created out of nothing; however, much intellectual property is based on already existing information. He said information is the "raw material" of intellectual property. He suggested a broadening of fair use provisions, and a reconsideration of the grant of intellectual property rights. Finally, Professor Boyle suggested that private censorship could also raise First Amendment concerns. Sandra G. Weis, Director of Government Affairs, Prodigy Services Company, said that NII goals will best be achieved with a strong competition policy. She suggested an access "Bill of Rights," consisting of the following points: (1) interconnection at any technically and economically feasible point; (2) open interfaces between networks and information providers; (3) open interfaces between networks and consumers; (4) reasonable cost- based pricing and tariffs; and (5) non-discrimination policies. Michael R. Coltrane, President, Concord Telephone Co., strongly advocated reliance on the marketplace, noting that regulation is necessary only in the event of a market failure. He said the responsibility of a carrier of last resort must be clearly defined and adequately funded, and that universal service should be based on competition, with all providers contributing on an equitable basis. Robert P. Gruber, Executive Director of the North Carolina Public Staff, said regulators should encourage an environment that: (1) stimulates the enhanced services market; (2) maximizes the availability of unbundled regulated services; and (3) provides contributions from these services to support basic services wherever possible. Betsy Y. Justus, Executive Director, NC Electronics & Information Technologies Association, called on the Federal government to encourage new technologies and to provide regulatory flexibility. She said the government's most effective role would be as a catalyst, stimulating private sector efforts. She urged the Federal government to coordinate public and private action to address policy issues such as privacy, security, carrier liability, intellectual property, widespread access and affordability. Closing Remarks Commissioner Redman thanked the NTIA staff and participants. Assistant Secretary Irving closed the meeting, noting that his written remarks would be included as part of the hearing record. He also welcomed audience members to submit additional statements for the record. The next NTIA universal service/open access hearing is scheduled for July 12, 1994, in Indianapolis, Indiana. Information is available on the NTIA Bulletin Board by calling (202) 482-1199. SUMMARY NII Open Access Hearing Sunnyvale, California, May 13, 1994 Introduction In the Clinton Administration's policy blueprint, National Information Infrastructure: Agenda for Action, released September 15, 1993, the National Telecommunications and Information Administration (NTIA) was directed to convene a series of public hearings designed to "gather information on the best characteristics of an expanded concept of Universal Service." The first two hearings focused on the future of universal service. In Albuquerque, New Mexico, on December 16, 1993, NTIA focused on the needs of rural communities. Then in Los Angeles, California, February 16, 1994, NTIA shifted to an urban setting. The third hearing in Durham, North Carolina, on April 27, 1994, changed the focus of the first two hearings to discuss how to promote access to the National Information Infrastructure (NII) to best meet the information needs of our citizens. At each hearing, NTIA received testimony from state and local governments, public interest groups, industry and academia on issues relevant to an expanded concept of universal service. Summaries of these hearings are available on the Information Infrastructure Task Force (IITF) computer bulletin board. The IITF bulletin board can be accessed by calling (202) 501-1920 using a personal computer or modem. For access through Internet, point Gopher client to iitf.doc.gov or telnet to iitf.doc.gov and login gopher. Comments may be sent by e-mail to nii@ntia.doc.gov. Sunnyvale Hearing On May 13, 1994, NTIA and the California Public Utilities Commission (CPUC) conducted a public hearing on the topic, "Innovation and the Public Interest: Open Access to the Information Society." In this fourth hearing, NTIA changed its focus slightly from the previous hearing to examine how to promote open access to the NII to best include the public interest and entrepreneurial community. The hearing board for the Sunnyvale hearing included Deputy Secretary of Commerce David J. Barram and Assistant Secretary for Communications and Information Larry Irving; CPUC Commissioners Norman D. Shumway and Jesse J. Knight; and Commissioner Andrew C. Barrett of the Federal Communications Commission (FCC). Over 250 public attendees were present, and the board heard testimony from 50 participants, including 20 scheduled panelists. Opening Remarks Serving as moderator, Assistant Secretary Irving opened the hearing by introducing the Mayor of Sunnyvale Frances Rowe. Ms. Rowe asked the federal policymakers and regulators to keep in mind the role of the city as "the frontline of public service" when developing the NII. Ms. Rowe then introduced the hearing board. Secretary Irving thanked Mayor Rowe and the City of Sunnyvale for their help in organizing the hearing. Secretary Irving also summarized the topics discussed in the previous hearings. He ended his opening remarks by posing the following questions: How do we ensure that providers (small, entrepreneur, public, corporate, and university providers) can meet the needs of the people that they serve? How can we ensure that consumers can exchange information and become providers? And, whether transport providers should be obligated to provide access and what are the legal and practical barriers to such access? Deputy Secretary Barram noted the importance of Silicon Valley as a large source of the technology. He explained the difference between universal service in the development of the NII, (making sure everyone is connected) and open access (how we use the connections). Also, he stressed the importance of open access as an important part of the long-standing national policy embodied in the First Amendment, to promote a diversity of ideas and fair competition in the free flow of information. Deputy Secretary Barram closed his remarks by posing the following questions for discussion: Who has access? Who does not? Who are the information providers today? How are they able to reach consumers? What factors help or hinder network access for information providers and users? How can we remove obstacles so information flows freely from information provider to transport provider to user and back again? And, what is government's role in ensuring access and spurring innovation? Commissioner Norman D. Shumway of the California Public Utility Commission noted the importance of the hearing. He said that the biggest challenge to the NII is how to offer maximum amount of choice and how to integrate different uses. Commissioner Jessie J. Knight presented three main points for consideration: foster relentless innovation, promote diversity in the range of services, and ensure affordable and widespread access to California's public network. Federal Communications Commissioner Andrew C. Barrett acknowledged NTIA's work in putting together the hearing. PANEL 1: Who has access? Who doesn't? M. Strata Rose, UNIX & Network Consultant, SysAdmin & Internet Information, Virtual City Network Project, stated that in terms of pure physics, bandwidth should be infinite. She noted that there are no physical laws, unlike with spectrum, that preclude creating additional bandwidth. She equated the personal computer (PC) to the telephone, but noted that a PC could supply a lot more, such as pictures and text, as well as audio signals. The question is "How much bandwidth does the average person need?" Should this person have access to full motion video, or is simple text adequate? Rex Mitchell, Vice President, Regulatory Planning and Policy, Pacific Bell, maintained that access was good and getting better. He called for free and open competition, to the maximum extent possible, in the provision of telecommunications services, and noted that legal and regulatory barriers that prevent competition should be removed. Where regulation is necessary, he believed it should be applied in an equitable manner. Furthermore, he believed that the one area where regulation may be appropriate is in interconnection, and in addressing what standards and functions should be used. He noted the enormous and beneficial effects of lifting the MFJ restrictions. Dan Pulcrano, President, Virtual Valley, Inc., equated a newspaper editor to a content provider, and called the "infobahn" both a threat and an opportunity. Small newspapers, when competing with large conglomerates, need a level playing field, according to Mr. Pulcrano. His newspaper had been denied access on many networks, so the paper bought its own server and started posting many different things, and had enabled many diverse groups to get on-line. He noted that the new telecommunications age should not shut out the small guy. Leslie L. Vadasz, Senior Vice-President, Intel Corporation, claimed that the most important access point was the PC, because of its interactive nature. More and more PCs are being used in homes, he noted. To more effectively use the PC as a communications device, however, more bandwidth is needed. He called for the rapid introduction of ISDN. Milton Chen, Ph.D., Center Director, KQED Center for Education and Lifelong Learning (CELL) KQED-TV, Inc., pronounced that public broadcasters are an essential component of the NII. He focused on some important questions, such as, what society intends to do with information technology, who are we, what do we seek to become? Mr. Chen asserted that the most important thing for information technology is community building. Legislation that mandates a public right of way on the NII is essential. Commercial use of the public switched telephone network and spectrum should help fund the public right of way. Other important questions that Mr. Chen pondered were on such matters as clearance of intellectual property rights, resolving difficulties in human access, and educating the public so they can see value in these services. Kari Peterson, Executive Director, Davis Community Television, Secretary Alliance for Community Media National Board of Directors, and President, Davis Community Network, noted the importance of the Public, Education and Government (PEG) channels in providing barrier-free communication for all groups. She cited as an example the fact that many immigrant and minority groups have produced programming, helping to create localism and build community. Ms. Peterson called for a ten percent (10%) set-aside of all bandwidth for PEG channels, as well as additional funding for outreach and training, and dedicated production facilities. Henry Der, Executive Director, Chinese for Affirmative Action, claimed that the current definition of "universal service" is inadequate, and should include "affordable access to the intelligent network." Also, he called for the term "services" to be defined by law. Mr. Chen noted that information technology can and should prevent further social stratification. If access is purely market-driven, however, then he feared that many will be disenfranchised. Without government intervention, according to Mr. Chen, information technology will not inherently foster access, and will continue to benefit only the rich. Thus, he called for more government subsidies and other types of support. Questions from the Hearing Board Deputy Secretary of Commerce David Barram asked the panelists how government would fund all these subsidies -- through an increase in taxes, or some other government fund? Chen recommended a statutory fee on commercial broadcast use of the spectrum and a tax on television and radios. Peterson suggested that the cable model was useful and advocated franchise fees. Audience Comments Liz Kniss, Mayor of Palo Alto, spoke about the City of Palo Alto being accessible to the public through the internet. Marianne Mueller, representing herself, stated that public access can be facilitated by funding libraries so that librarians can be trained to use the Internet and other services on the NII. Catherine Hung, West Valley - Mission Community College District, suggested that the government should help unite small service providers so that they may work together; recycle outdated equipment; and continue its social vision of focusing on the community. Bob Roy, Wireless Communications Alliance, expressed concern that one service may dominate the NII. He also believes that the convergence of cellular, paging, telephone, and other systems will lead to more efficient uses of the NII. Mark Roest, NGIN Research, expressed concern that there will be a division of information haves and have nots on the NII. He would like to see the NII architecture reflect reality and pointed to the Dewey Decimal System working for libraries, as an example. Dave Crocker, representing himself, stated that there needs to be a level playing field for consumers and service providers of the NII. He also recommends the Internet model for the NII. John Powell, Association of Public Safety Communication Officials International, expressed concern for state and local rights. He said that part of the spectrum should be allocated to state and local governments, so that public safety services, such as fingerprint scanning, may be utilized. Norman Jayo, Editor, Media Arts and Information Network, stated the need for everyone to be "media literate," in order to utilize the NII. He is especially concerned with training low income persons. Charles D. Evans, HFV-TV, Independent Rural Cable TV, expressed concern that the NII will take longer to implement in the rural areas because of the possible increased cost to connect a rural rather than a denser urban area. PANEL 2: What factors would help or hinder network access for information providers and users? John F. "Jeff" Rulifson, Director, Technology Development Group, Sun Microsystems Computer Corporation, stated that intellectual property rights are hampering the development of graphical user interfaces (GUI). He called for barrier-free access and barrier- free GUIs. Also, he believed that the industry standards-setting bodies will not be able to resolve this problem. Therefore, the federal government should use its purchasing power, post a list of barrier-free interfaces, and require agencies to buy from that list. Leslie Saul, Public Policy and Education Projects Manager, Smart Valley, Inc., called public institutions, like libraries and schools, "information equalizers," and noted that these institutions should be the focus of the NII. She claimed that there are attitudinal barriers to access and used the example that parents are worried that emphasizing information technology may degrade the "three Rs." She also acknowledged that children sometimes do access "bad things." Stephen Adams, Founder, Adamation, Inc., advocated a three-tier system of access pricing, similar to the first, second and third class tiers of the U.S. Postal Service. He stated that he would like to see a dialtone for high capacity use. In talking about access disparity, he noted that the PC may not be the proper metaphor. He noted that millions of inner-city youths, who had never used a PC, had similar amounts of processing power in their Nintendo and Sega games, and suggested that such devices might serve as a model for providing access. Susan G. Swenson, President, CEO, Cellular One, said that the cellular industry was replicating the landline network, but not replacing it. She noted that most of the barriers for the cellular industry have been regulatory and she used, as an example, the fact that it takes about 13 months to get a cell site permit. She also stated that standards are preventing access and that she was not sure of what government's role should be in setting standards. She noted that a cellular industry consortium worked to develop standards for data packet switching, which was a good example of industry overcoming barriers. Bill Mitchell, Director, Electronic Publishing, Mercury Center, San Jose Mercury News, declared that the big challenge is determining what type of compelling content will draw people to the NII. He theorized that once the content is compelling, people will be drawn to use the NII. Deborah Kaplan, Director, Division on Technology Policy, World Institute on Disability, expressed the need for equipment manufacturers to develop NII products for the disabled. She stated that, if such design factors are considered up-front, outfitting the NII for the disabled need not be expensive. She termed this concept "Universal Design." Lastly, she called for the Administration to encourage and promulgate guidelines for inclusion, and for the FCC to respond to disability concerns. Audience Comments Dianah Neff, City of Palo Alto, expressed concern that service providers and users will be hesitant to use the NII if security issues are not resolved. Also, she called for training, so that people can get comfortable with technology used on the NII. Edward J. Radkowski, Northern California Health Care Technology Alliance, stated that health care costs can be significantly lowered if there are interactive, on-demand networks on the NII, which can provide a patient's complete medical history. However, Mr. Radkowski would like the government to regulate the telephone companies so that they do not have access to highly confidential medical records. Gary Shultz, Multimedia Research Group, stated that a barrier to the development of the NII may be lifted by allowing telephone companies and cable operators to be broadband carriers. Also, he felt that entrepreneurial service providers should be encouraged on the NII. Dennis Bugdahl, College of Siskiyous, expressed support for the open access principle, but believes that the cost of phone service in rural areas is a barrier. Ralph Gillman, Sunnyvale, Calif., stated that one barrier to deployment of the NII is the conflict over whether telephone companies or cable companies will control access to the NII. Also, he believes that this problem can be solved by allowing more user control of regional projects. Judy Clark, Computer Professionals for Social Responsibilities, advised the panel to look to community and local networks, as well as large networks, when designing the NII. Helen Hernandez, representing an Encino government affairs firm, expressed concern that minorities and women will not have access to ownership of service providers. She also stressed the need for all Americans to receive training, in order to become familiar with the technology used on the NII. Solomon B. Hill, Computer & You program, Glide Memorial Church, expressed concern about what type of access the homeless will have to networks. He stated that providing homeless children with access to network technology will empower these children. However, the benefits derived from giving homeless children access will not be known until the children can engage in communication through the network. Peggy Liu, Net Manage Inc., stated that security on the NII is her primary concern. She believes that there must be development and implementation of technology that would guarantee that information and payment for services is kept confidential. PANEL 3: What is government's role in ensuring access and spurring innovation? David S. Holub, President of Operations, hooked (a small Internet Service Provider), called for the government to assure small businesses that they will have equal access to the mechanisms that deliver the information services to the public. Mr. Holub's main concern was that small businesses will not survive economically and technologically, if the federal government spends too much time working out rules to regulate telephone, video, and hybrid service providers. He stressed that the government has a role in maintaining competition among service providers, including competitive access providers (CAPS). Jim Bidzos, President, RSA Data Security, Inc., advocated the use of encryption and digital signature, in order to protect and authenticate electronically-generated documents. He urged the government to adopt this technology. Edward M. Spivak, Regional Vice President, First Pacific Networks, Inc., called for the government to pass and/or lift regulations, in order to allow full competition for two-way broadband services. He claimed that this would enable the service provider to bring down the cost of service, which will in turn result in the expanded deployment of services in rural areas. Specifically, Mr. Spivak called for unbundled rates for interconnection and for the government to expedite the rulemaking and appeals process. Lastly, he urged Congress to clarify the legislative intent of new laws (particularly, which are federal and state powers). Elaine Lustig, Staff Attorney, Corporate and Regulatory Affairs, GTE California, Inc., declared that government regulations should foster the development of a combined free enterprise/common carrier model in the telecommunications industry. She explained that this would require service providers to set their prices according to the underlying costs and market conditions for each service. She called for regulations to be lessened where there is competition. Where there are no service options, she called for the implementation of price caps, in order to prevent the service provider from pricing its services above the cost-based price. Ms. Lustig claimed that price caps would prevent the subsidization of other services, as well as allow other service providers to enter the market. She also stressed the importance of the following points: Regulatory parity; the common carrier model; assurance of open access to all information providers; and minimal regulations (in order to encourage service providers to deploy high capacity technology). John Siegal, Senior Vice President, Chris Craft/United Television and Chairman of the Television Board of Directors of the National Association of Broadcasters (NAB), stressed the need for the FCC to review and modify the national and local broadcast ownership rules, in order to promote competition amongst and between telcos, cable television operators, satellites, broadcasters, and other media. He expressed concern over the concentration of access to information and supports the "in-region buyout" prohibition (which prevents telcos from acquiring more than a five percent interest in an existing non-affiliated cable system in its service area). He also supported protection of competition through policing and imposing penalties on anti- competitive behavior; protection of regional programming; regulation of telcos as cable television operators, if they offer video programming; and provision of video programming by telcos on a common carrier basis. Dale Bennett, Regional Vice President, TCI Cablevision of California, Inc., stated that the government should encourage competition between multiple service providers, provide consumers with choice and access, protect consumers from monopolies, and spur innovation. He called for lifting all legislative barriers preventing competition in the local exchange market. Lastly, Mr. Bennett urged the government to establish the same regulations for telcos and cable companies providing the same service. John Gamboa, Executive Director of Latino Issues Forum and Co- chair, Greenlining Coalition, expressed concern that minorities, especially the Hispanic community, will be left out of the NII. He called for the government to make service providers demonstrate that low income persons will not be excluded from the NII. Summary Remarks by the Hearing Board Commissioner Jesse Knight CPUC asked the panel what the CPUC must do to prepare itself for the NII. Mr. Bennett expressed his desire for TCI to be able to enter the marketplace that the CPUC regulates. Mr. Siegal commented that he does not want TV signal carriage over cable or telephone wires to resemble MCI's struggle to enter the long distance telephone market. Ms. Lustig noted that the CPUC's regulatory process of long hearings with large participation is detrimental to the deployment of the NII, because it delays action. Mr. Gamboa stated that the CPUC must get input from minority grassroots organizations and believed that the CPUC's intervenor payment system has punished the Hispanic community, because it has not allowed the community to comment, as it wishes. Ms. Lustig added her desire for a less contentious system. Deputy Secretary of Commerce David Barram asked Mr. Spivak whether HFS allows cable companies to interconnect with other cable companies and telephone companies. Mr. Spivak answered that the technology is available and claimed that broadcasters, too, can interconnect with cable. Mr. Bennett commented that TCI can also interconnect, but regulations are holding up interconnection. He noted that TCI could not interconnect on a switched basis, because cable delivery of telephony remains impermissible. FCC Commissioner Andrew Barrett asked the panel whether there can be interconnection by satellite. Mr. Bennett said that it is technologically possible for one-way interconnection, but that two-way interconnection has not been explored. Mr. Holub expressed his interest in knowing whether newcomers will be able to interconnect. Assistant Secretary Larry Irving asked whether there was opposition to the four principles Ms. Lustig presented. Mr. Bennett wanted to know how content will be treated. Mr. Siegal added that telcos carrying video programming should be subject to must carry regulations. He did recognize that broadcasters could pay a fee to video carriers in order for them to carry their programming. Also, he believed that all free programming services for consumers must be carried by all video providers. Mr. Irving asked Ms. Lustig what responsibilities should information providers have with regard to interconnection with classrooms and schools. Ms. Lustig responded that information providers already do offer free services to schools. Mr. Irving also asked the panelists for their thoughts on availability/provision of navigational tools. Mr. Bennett commented on the TCI project with Sega to develop less expensive navigational tools. Mr. Spivak commented about the need to have low cost navigational tools by pointing to the U.K., where First Pacific Networks sells their processor for $10. Mr. Siegal expressed his concern about where the device providing access to service is located. He said that he does not want there to be a headend gatekeeper; instead, access to information should be a memory device located at the home. Audience Comments Mr. Richard Pettinato, CEO of Media Captioning, expressed concerned over his eligibility for a NTIA/TIIAP grant as a for- profit organization. Mr. Irving addressed his concerns by encouraging him to form a partnership with a non-profit organization in order to qualify for the grants. Mr. Landon Noll, Council Member - City of Sunnyvale, encouraged the government to adopt cryptology and develop standards for its use. Mr. Stan Kawzynski, Sunnyvale City Council and League of Cities, expressed the League's support for competition, but would like cities to regulate providers in a way that is similar to the franchising agreements with cable operators. Mr. Kawzynski added that cities should be allowed to regulate video providers locally, because these providers use rights-of-way. Mr. Steve Cisler, Apple Library of Tomorrow, expressed concern about the lack of government attention to training novice users and to interfacing with low power providers. Ms. Lynn Purvis, Sierra Planning Organization, expressed concern that rural America will not have the economic resources to participate in the NII. Mr. Thomas Long, TURN, questioned what the cost of the NII will be and if it is worth the price. Mr. Michael Morris, TCG, stressed the need for local competition. Ms. Mary Clair Sprot, California Library Association, urged continued governmental funding for libraries, so that they can provide access to the NII, as well as training. Mr. Joe Hamilton, Fremont Union High School District, advocated that schools should have low, or no, cost access to the NII. Ms. Jean Kwan, Board of Directors of Oakland High School and representative of the Asian-Pacific Community, expressed concern about access to the NII by low-income schools and children. Mr. Tim Hyland, Oracle, encouraged government to include entertainment applications on the NII. He said that novice users, who fear technological innovations, will be drawn to entertainment applications and, eventually, may tap into educational applications. In closing, Mr. Irving thanked the panel and audience witnesses, members of the hearing board, and technology demonstration participants for their contribution to the hearing. SUMMARY NII Universal Service and Open Access Hearing Indianapolis, Indiana, July 12, 1994 Introduction In the Clinton Administration's policy blueprint, National Information Infrastructure: Agenda for Action, released September 15, 1993, the National Telecommunications and Information Administration (NTIA) was directed to convene a series of public hearings designed to "gather information on the best characteristics of an expanded concept of Universal Service." The first two hearings focused on the future of universal service. In Albuquerque, New Mexico, on December 16, 1993, NTIA focused on the needs of rural communities. In Los Angeles, California, on February 16, 1994, NTIA shifted to an urban setting and looked at the needs of inner-city groups. The third hearing in Durham, North Carolina, on April 27, 1994, changed the focus of the first two hearings to discuss how to promote access to the National Information Infrastructure (NII) to best meet the information needs of our citizens. The fourth hearing in Sunnyvale, California, on May 13, 1994, examined how to promote open access to the NII to best include the public interest and entrepreneurial community. At each hearing, NTIA received testimony from individuals representing state and local governments, public interest groups, industry, public institutions, and academia on issues relevant to an expanded concept of universal service. Summaries of these hearings are available on the Information Infrastructure Task Force (IITF) computer bulletin board. The IITF bulletin board can be accessed by calling (202) 501-1920 using a personal computer or modem. For access through Internet, point Gopher client to iitf.doc.gov. or telnet to iitf.doc.gov and login gopher. Comments may be sent by e-mail to nii@ntia.doc.gov. Indianapolis Hearing On July 12, 1994, NTIA and the State of Indiana conducted a public hearing on the topic, "At the Crossroads: Defining Universal Service and Open Access Policies for the NII." In this fifth hearing, NTIA continued to explore the scope and requirements of an expanded concept of universal service and open access, and appropriate funding mechanisms. The hearing board consisted of Deputy Secretary of Commerce David J. Barram and Assistant Secretary for Communications and Information Larry Irving; Commissioner Andrew C. Barrett of the Federal Communications Commission (FCC); and Chairman John F. Mortell and Commissioners Frederick L. Corban, Mary Jo Huffman, G. Richard Klein, and David E. Ziegner of the Indiana Utility Regulatory Commission (IURC). Over 250 members of the public attended. The hearing board heard testimony from 21 panelists and 21 audience members. Opening Remarks Serving as moderator, Assistant Secretary Irving opened the hearing by noting the importance of redefining the concepts of universal service and open access in a way that will ensure that all Americans benefit from advanced information technology. Assistant Secretary Irving delineated several reasons why it is important that everyone have access to the information superhighway. He mentioned recent studies that show that in all job categories, from clerks to professionals, people who know how to work with computers earn more than those who do not. He talked about programs in inner-city and rural schools that demonstrate that getting kids onto computers and networks can put students of different backgrounds on a more equal footing. Teachers have found that kids who use computer networks have a new enthusiasm for learning and have improved their test scores. Assistant Secretary Irving stated that he had visited schools in Harlem and seen such results. He also talked about telemedicine projects, which allow doctors and health care providers in rural hospitals and clinics to consult with specialists hundreds of miles across a state over video conferencing links. He noted that two weeks ago during a Department of Commerce trade mission to Latin America, he saw a telemedicine demonstration linking a doctor and patient in Texas with a doctor in Chile. Assistant Secretary Irving stated that the basic question we pose is: how can we ensure that everyone has an on-ramp to the information superhighway and can gain access fairly? Assistant Secretary Irving noted that under Governor Evan Bayh's leadership, Indiana is taking important steps to bring the benefits of the information revolution to its residents. Governor Bayh led a telecommunications summit last year. A few weeks ago, Indiana adopted "Opportunity Indiana," an innovative regulatory scheme. On July 11, 1994, the Governor announced a new technology initiative for the state -- "Access Indiana" -- providing Indiana schools and libraries with access to the Internet. Deputy Secretary Barram noted how these hearings have provided information to better understand technology and the future needs of all Americans. He stated that he is convinced that the hearings have provided the Administration with information and insights that never would have reached NTIA had we remained inside the Beltway. The witnesses have truly represented all of America. He summarized the issues to be addressed today by each of the panels. The first two panels would focus on universal service and open access, respectively. The third panel would address the difficult questions of how these services will be paid for, and who will pay. How can the profit motive be harnessed to serve the public interest? Deputy Secretary Barram talked about the pivotal role that information technology plays in our development as a nation. The NII is helping to build and rebuild communities. The hearings help to focus on critical questions, such as: How fast must we have true universal service? Is universal service 100%, 93%, 80%? What services should be universal? Does it have to be in your home or in your hand to be accessible? Is it acceptable for those with resources, such as businesses or rich school systems, to pioneer new ideas, or should we set up the system so everyone moves ahead at a similar speed? Commissioner Klein of the IURC noted that the issues of universal service and open access are important to Indiana. The IURC wants to avoid a situation of haves and have nots. Commissioner Klein noted the importance of ensuring that the NII reaches rural areas. He noted that as part of "Opportunity Indiana," Ameritech is making special efforts to bring services to areas with low telecommunications penetration. The IURC also has been involved in NARUC's universal service efforts. Commissioner Barrett of the FCC noted that universal service exists and works well. He stated that we need to determine whether we need to broaden the concept beyond the dial tone and whether to equip everyone in their homes rather than only equipping libraries and schools. Commissioner Barrett expressed a preference for targeted subsidies, as opposed to general subsidies. Commissioners Corban and Huffman did not make introductory remarks. Panel 1: Looking Forward without Overlooking Panel 1 witnesses were asked to address the following questions: Does universal service work now? Has anyone been left out? How should the universal service goal evolve in the near term and the long term? What capabilities should be included? Steven S. Wildman, Associate Professor of Communications Studies, Northwestern University, stated that in 1993, 94 percent of households had telephone service, an increase from 91 percent in 1991. However, there is much lower penetration in rural areas and among low-income households. He noted that one consequence of competition is increased disenchantment with the current subsidy system to achieve universal service. He stated that there is a need to reform the pricing mechanisms and dispersing systems. He noted that targeted subsidies are difficult because policymakers and regulators need a lot of information about who is receiving the subsidies and the amount of the subsidies. He believed that our short term goals should focus on devising pricing mechanisms. Our long term goals should be to redefine the concept of universal service and link universal service with education. Christopher Williams, Executive Director, Citizens' Action Coalition, noted that universal service is a social policy goal, not a technological standard. He believed that some households simply do not want a telephone. However, some low income residents want but cannot afford even basic telephone service. He noted the need to expand the concept of basic service without raising rates. He said that "basic service" should include digital capabilities. He cited "Opportunity Indiana" as an example. "Opportunity Indiana" made touch tone part of basic service and prices were reduced. Moreover, as a part of "Opportunity Indiana," Ameritech agreed to undertake educational projects. He said that there is a need for an equitable payment scheme for universal service. He noted the importance of allowing the states to be laboratories in this area. Robert Mundy, Assistant General Manager, Smithville Telephone Company, the largest independent local exchange carrier in Indiana, spoke about distance learning. He noted that to install a distance learning system into any school, medical facility, or governmental building requires approximately 18 months of preparation and planning. He noted that the necessary equipment and services are extremely expensive. For instance, a 50 mile DS3 connection is approximately $17,000/month. He believed that these prices are based on antiquated tariffs. New tariffs must be filed to insure the usability of the network at an affordable rate. He stated that network cost will be the biggest deterrent of using distance learning as a teaching option. He said that it is possible to offset the equipment and network costs through reasonable access costs, government or business funding, and investment tax credits. Sam H. Jones, President, Indianapolis Urban League, testified that minorities are still outside of the telecommunications and information loop. He stated that it is important that the appropriate legislation and policies be adopted so that access is available not only for the affluent. Without access to information, persons cannot fairly compete in jobs and education. Universal service is necessary to bring the information superhighway to housing projects and urban, public schools. In addition, Mr. Jones urged large companies to include minorities in their plans and have effective minority participation. Jayne L. Gerdeman, Director of Telecommunications, City of Indianapolis/Marion County, noted that local governments are the entities who can and will ensure that universal service of telecommunications is made available to everyone. Local governments can coordinate the procedures for delivery of universal service to all neighborhoods and to the local business community. She put forth the idea of having a committee of experts in public housing meet with telecommunications experts and local, state, and federal government policymakers to develop an approach for servicing lower income residents. Joan M. King, Member, National Legislative Council, American Association of Retired Persons, noted that AARP urges that the following basic principles serve as guideposts for an expanded concept of universal service: (1) basic telephone service should be made even more affordable than it is today if it is to serve as a platform for universal access to the information superhighway; (2) proper cost allocation and rate design are needed; toll, data, and video services must shoulder a fair share of joint and common network costs; (3) new communications capabilities must be included in basic service; the technological and service capabilities of the information age will require that customers have access to an affordable basic digital service, capable of interconnecting with all networks; and (4) delivery of the NII must be available and accessible to all on an equitable, timely basis, regardless of income, race, physical condition, or location. Peter Sokolowski, Phase Industries (via live interactive videoconferencing), spoke about the importance of computer access by the elderly. Accessible on-line computing gives senior citizens immediate availability to medical information and help, access to government information and social service agencies, interaction with society, and the ability to use information from otherwise inaccessible sources. Questions from the Hearing Board Deputy Secretary Barram asked the panelists how government policymakers run fast enough to keep up with technological developments. Professor Wildman replied that there is no complete answer, but we need to look for policies with a lot of flexibility. As technology causes costs of services to fall, we can afford more services to be part of a basic service definition for universal service. Ms. King spoke of the need for a clear policy that sets forth broad guidelines. Commissioner Klein noted that if state commissioners are bound by guidelines, they may not be able to keep a company viable that is a victim of competition. Mr. Sokolowski noted the need to avoid micromanagement by regulators. Government should set forth minimum standards and enforce those standards. Commissioner Corban noted the importance of new services being driven by customers, citing the examples of the Cerritos, California video- on-demand services and the Internet. Ms. King noted that new technologies can change the cost equation. For instance, we now do not need fiber in the last two miles because of advances in digital technology. Audience Comments Jim Williams, Seniors Information Connection, spoke about the activities of seniors and the NII. Eldon E. Fredericks, Education Technology Specialist, Department of Agriculture and Purdue University, talked about connecting the extension staff to the NII via the Internet and other networks. Mark Grady, New Paris Telephone, Inc., spoke about the importance of universal service to all parts of Indiana. Bonnie Mathias, Wright State University, noted that expanding universal service and network interoperability will promote civic responsibility. She advocated helping people learn how to navigate on the Internet. She urged increased connectivity and access to the NII for schools and citizens. Rita Ramundo Stull, Cable Dimensions, stated that the telecommunications industry consists of good corporations. She said that it is a mistake to expect these corporations to take into account the public interest. Robert Browder, Communications Workers of America, a cable slicing technician, Ameritech, expressed labor concerns. He urged the government to deny opportunities to compete in new areas to companies that do not treat their workers fairly. He stated that universal service means that poor neighborhoods are wired at the same time as affluent ones. He noted that "Opportunity America" is a good first step to needed changes. Terri Bailey, Southeastern Indiana Telephone Co-op, noted that rural America consists of more than farmers. Many small businesses and consultants work in rural America. Moreover, many farmers now have or desire access to commodity markets via modems. She noted that Southeastern Indiana Telephone could not have put its digital network in place in rural Indiana without the current cost systems. Panel 2: Gaining Access Panel 2 witnesses were asked to address the following questions: Who has access? Who does not? Which legal, market, or other factors will help or hinder network access for information service providers and users in the near-term and the long-term? Harmeet Sawhney, Associate Professor, Department of Telecommunications, Indiana University, testified that a new definition of universal service has eluded researchers because they have defined the problem in an incorrect manner, seeking to define a "bare minimum" that should be available to everyone. According to Sawhney, this definition is problematic because information is not like food where there is a minimum that people need in order to survive. Information has value only when the recipient has a need for it. Thus, Professor Sawhney believed that the focus should be on the information needs of the beneficiaries rather than a normative framework that defines what everyone ought to be given. Universal service could mean different things to different groups of users based on their information needs. He also put forth the idea that the users will have to define their own needs. The monies for a Universal Service Fund could be used to fund proposals put forward by user groups. In the case of rural areas, four or five communities could collaborate and put together a proposal, such as for distance learning. He believed that the availability for funding would stimulate collaboration and innovation. Dr. James R. Buechler, Director, Family Practice Residency, Union Hospital, Terre Haute, is involved in a project designed to introduce medical students and family practice residents to rural medicine. Telecommunications is important to this project in several ways. First, it provides fast access to up-to-date medical information. Second, computerized medical records that have interfaces with hospitals, labs, and multiple providers allow for better quality of care. Third, telecommunications devices and networks make telemedicine possible. He noted that a network of connecting rural hospitals to larger hospitals for things such as x-ray consultation and for educational programs could be very useful. However, the cost involved to set up such systems is very high. And when grant money is gone, it is hard to keep the system running. Aviva Mintz, Manager, Project Resources, Children's Museum of Indianapolis, noted that the Children's Museum is interested in being an information provider. As such, the Museum would give access to its collections, put together virtual exhibits, sponsor a World Wide Web designed by kids, and provide classes to the public about using Internet. She noted that the Museum would like to be eligible for federal grants as well as reduced access rates. Some of the issues the Museum faces are copyright issues, pornography, and compatibility problems. Matt Pierce, Chairman, Bloomington Telecommunications Council, stated that although students and persons affiliated with Indiana University have affordable access to the Internet, most of the Bloomington community cannot obtain affordable access to the Internet. He noted that cities can greatly benefit from community-wide networks, which can be powerful tools for economic development by giving local businesses access to a large portion of the households. Community networks can also be linked to the NII. He testified that volunteers from industry, schools, government, and other groups are currently trying to put together "HoosierNet." He noted that HoosierNet's goal of linking everyone in a community network depends upon finding an affordable way to maintain an information infrastructure. Stanley E. Hubbard, President and COO, United States Satellite Broadcasting, stated that the Direct Broadcast Satellite (DBS) industry is open for business. Commercial distribution of the Digital Satellite System commenced on June 17, 1994. DBS will provide competition to cable on a national basis. He noted that DBS can be interactive. He stated that USSB intends to present public service programming. Larry Gilbert, Director, Sales & Marketing, Indiana Digital Access/Time Warner, stated that Time Warner's vision of the future for cable technology is known as "The Full Service Network" (FSN). The first FSN is now operational in Orlando and is being tested by 4,000 customers. Time Warner expects to spend over $5 billion over the next five years to build FSNs serving its cable customers. The FSN will require full interconnection with other network-based service providers and fair and equitable interconnection rights. Barbara Popovic, Executive Director, Chicago Access Corporation (CAC), noted that CAC programs six channels as well as provides training and facilities to local residents. She stated that in Chicago, there are 8,000 nonprofit groups, 85-95% with budgets of under $100,000. These groups would have little access without PEG channels on cable. She noted that the success of public access television as a model is that it is a public forum, it has a strong training component, and it is locally based and focused. However, only 20 percent of cable systems have community channels, and cable TV currently reaches only 62 percent of American homes. Vast areas of rural America are unserved. Questions from the Review Board Commissioner Klein asked Dr. Buechler to describe his relationship with the telecommunications companies. Dr. Buechler stated that trying to put together the necessary technology required that he work with several different BOCs and long distance carriers, which often created problems. Commissioner Klein asked Ms. Mintz how she was finding financing to put the Museum's information on the network. Ms. Mintz replied that the Museum was forming partnerships with business, such as Ameritech who was helping the Museum with a zoo exhibit. The Museum also is looking for federal grants. Commissioner Klein asked the panelists to list barriers to the NII. Mr. Gilbert replied that there was a need for interconnected networks with technical standards established by independent third parties. Mr. Gilbert also noted that new emerging providers need access to existing networks. Mr. Pierce mentioned the tension between businesses seeking profit and public interest needs. Mr. Hubbard said that the regulatory bodies need to avoid the temptation to drive the marketplace rather than support the marketplace. Mr. Hubbard also talked about the importance of not favoring one technology over others. Deputy Secretary Barram noted that he was intrigued by the testimony of Professor Sawhney regarding groups of users, such as individual communities, coming together and tapping into a type of venture capital fund. Professor Sawhney said that the REA funds might serve as an example of a community coming together and asking for funds. Assistant Secretary Irving raised the issue of access for public institutions and the idea of a public right of way. Ms. Popovic stated that setting aside 20 percent for public access may seem high, but industry gets to keep 80 percent. Mr. Hubbard noted that broadcasters' obligation to serve the public is already part of the licensing process. Mr. Pierce stated that the cable industry makes a determination of the communities wants and considers those wants in its negotiations. He noted that some level of local access is needed as it is vital to communities. He cited the City of Bloomington as an example. Mr. Gilbert stated that the marketplace should determine the level of public access. Ms. Mintz said that public access should not be seen as a liability. Audience Comments Dustin Plummer, 8th Grader, Selma Middle School, spoke about the importance of access to the Internet -- its library, weather satellites, gopher, and networks for reports. He told the Hearing Board that Selma's Academic Superbowl teams placed better this year using Internet than they ever have. He noted how one of the history teachers was able to download information about the Holocaust to use in his class. Students now have access to information that they cannot get from the school's library. Parents and the community are interested in what the school is doing and how the students are performing. He said that he has helped teachers learn about computers, software programs, and the Internet. He stated that the teachers are easy to help because they are interested and excited about the use of computers and networks as educational tools. He believed that computers would be the machine of the future. Herbert Stahlke, Associate Director, University Computing Center, Ball State University, spoke about distance learning. Ball State is a major provider of distance learning. Some of the barriers are the cost of access in many parts of the state and the cost of Internet access for libraries and schools. Erik Mollberg, Public Access Channel 10, represents public access facilities. He addressed the need to reach out to disabled groups. Michael A. Burke, Columbus Public Schools, talked about the need to learn how to deal with the vast amount of information available to us. He also voiced his concern about the cost of Internet access for K-12 classes. Bill Nelson, Wright State University, noted that educational Nets provide teachers with lots of educational opportunities. Michael F. Weisbard, Chandler Systems, Inc., a small computer software business, expressed two concerns: (1) that no one business should be allowed to control access or content; and (2) that we need to address copyright issues. James D. Miller, Central Institute for the Deaf, talked about the potential for multimedia technologies to serve the needs of the deaf community. Assistant Secretary Irving noted that the Clinton Administration has challenged the manufacturing industry to design products to meet the needs of the hearing, vision, and physically impaired upfront rather than retrofitting products. Barbara Markeson, Indiana Cooperative Library Services Authority, noted that library associations want preferential rate structures. Hugh Carter Donahue, Research Associate, Research Program on Communications Policy, MIT, stated that we need to revisit the "value in the network" view. He said that our technological goal should be interoperability. We should not view the user as consumer but rather as citizen. He noted that regulators should not be cartel managers. Remarks by Senator Douglas Hunt Senator Hunt delivered remarks on behalf of Governor Bayh. Senator Hunt noted that when discussing the terms and conditions of individual access to the information highway, we should keep in mind the importance of encouraging the creative participation of individual Americans. He noted that the Internet is based on a simple but vital concept: the free exchange of information. He noted that the dominant idea of the Internet is the idea that social wealth is created by bottom-up dynamics. One application of this idea is community-based networks or "free-nets." This "information street" may be the roadway most useful to everyday life. Citizens have access to free-nets at no cost. Senator Hunt believes that creating free-nets in Indiana may be the quickest and most cost-effective way for the state government to put its citizens on the information highway. Libraries around the state could be tied to computer networks. A second application of this idea is connectivity. He spoke of the need for interstate cooperation, especially in the area of commerce. Panel 3: Paying the Piper Panel 3 witnesses were asked to address the following questions: How do we pay for universal service in a competitive environment? What basic pricing principles should be adopted in order to implement a modern universal service and open access policy? Should a short-term policy differ from a long-term solution? Raymond Lawton, Associate Director for Telecommunications Research, The National Regulatory Research Institute, stated that social goals, such as ensuring that information haves and have nots do not exist, cannot be directly addressed by the dynamic efficiency of a free market. He stated that telecommunications services have been deployed such that the first recipients are the urban/business/high income customer because this generally is where the demand, skill to use, and the ability to pay are the greatest. Services and infrastructure are extended to the suburban/institutional/medium income customer next, and to the rural/residential/low income customer last. In order to avoid a situation of information haves and have nots, regulators have traditionally used funding mechanisms to accelerate deployment to the third recipient. With competition arriving, Mr. Lawton stated that there seems to be an emerging consensus that all providers of telecommunications services should pay one universal service surcharge that would then be available on a voucher basis for rural, poor, elderly, and some residential and business customers. Targeting helps avoid, for example, having rural universal service funds be used for those with rural vacation homes. He noted that one actual and practical funding model is the American Disabilities Act of 1990. In the ADA, every telecommunications provider under the FCC's jurisdiction is assessed a surcharge that goes into a fund that interexchange carriers can use to help the hearing, vision, and physically impaired to use the interstate public switched telecommunications network in accordance with the provisions of the ADA. Neil Pickett, Director of Research and Programs, Hudson Institute, stated that there is a need to restructure the allocation of subsidies more efficiently. In general, policies should direct subsidies to individuals. Blanket subsidization of residential rates in high-cost areas is inefficient and unfair. He said that qualifying low-income households could receive vouchers redeemable by the company providing services, or companies could receive credit for each low-income customer they serve. He also spoke about the need to refocus the definition of universal service. Universal service should be defined to mean the availability of service as opposed to the physical possession of service. He also noted that the experience of the computer industry over the last 15 years demonstrates that the market, not the regulator, should test the types and prices of services to be provided. Mark A. Jamison, Manager, Regulatory Policy and Coordination, Sprint Communications, noted that as competition enters the traditional monopoly markets, the cost allocation system needs to change. Funding for universal service should be explicit and targeted. Assistance for universal service should be based on need, including end-users who would not be able to pay cost-based prices and companies that service high-cost areas. Subsidies should be targeted. He also stressed that funding should be broad based and competitively neutral. Barbara A. Cherry, Director of Issues Analysis for Public Policy, Ameritech, stated that short term reform requires a more competitively neutral mechanism to collect universal service subsidies presently collected in service prices, such as access services. In the long term, overall subsidies to achieve traditional universal service should be reduced and more narrowly targeted than under the present price structure. Primary reliance should be on explicit subsidies, where recipients of subsidies are specifically targeted, which are funded in a competitively neutral manner. Explicit subsidies should be funded from general tax revenues (ideal circumstance) or from a sectoral levy on the telecommunications sector (second-best solution). She also noted that there is a need to provide compensation to carriers with carrier-of-last-resort obligations. She stated that the remaining reliance on implicit subsidies and carrier-of-last-resort obligations to achieve traditional universal service goals requires pricing flexibility for all carriers in order to address cream-skimming effects of competition. She noted that these reforms are even more imperative if the definition of universal service is expanded. M. Barry Payne, Director, Division of Utility Analysis, Indiana Office of Utility Consumer Counselor, stated that his comments were his own, as an economist, and did not necessarily represent the views of the Consumer Counselor or the Office of Consumer Counselor. He noted that efficiency, not competition, should be our goal. He believed that universal service in the aggregate has generally been paying for itself for a long time and more recently has been paying for other services as well. Robert J. Herbold, Senior Vice President, Information Services and Advertising, Proctor & Gamble, on behalf of the American Association of Advertising Agencies, the American Advertising Federation, and the Association of National Advertisers, stated that one of the major contributions advertisers can make to the NII is to serve as a source of revenue for funding the infrastructure. This can occur through the sponsorship of TV programming or other services that may be offered over the information superhighway. He noted that advertising stimulates competition and innovation, elements that are important to our economy and national ability to compete. William J. Ray, Superintendent, Glasgow Electric Plant Board, noted that electric utilities can play a significant role in the construction and operation of the NII in their communities. He noted that many persons incorrectly equate universal service with "subsidy." He believed, however, that electric utilities provide a unique opportunity to solve many of the problems of delivering the information highway to less densely populated and less economically advantaged communities without the necessity of a large subsidy pool. Municipal power companies like Glasgow serve less densely populated, middle-class urban and rural communities, the areas that the large telecommunications carriers will overlook or delay in wiring the NII. He believed that the electric utility companies in these smaller, rural communities can immediately ensure that the goal of universal service to the NII is accomplished. Remarks and Questions from the Hearing Board Commissioner Klein noted that when a competitor is allowed into a previously monopoly situation, the competitor must bear some of the burden of the last loop. Commissioner Ziegner asked the panelists who is going to drive the NII effort. Mr. Herbold replied that the free enterprise system will drive it. Mr. Jamison stated that customers will drive it. Chairman Mortell asked the panelists who should be subsidized and what services should be subsidized. Mr. Pickett replied that the market will determine what services but it cannot determine who. Mr. Jamison noted that we need to spread broadly the financial burden of universal service and subsidize customers based on need. Deputy Secretary Barram and Commissioners Klein and Ziegner discussed the issue of when is it appropriate for state regulators to depart from cost-based pricing for political and public interest reasons. Audience Comments John Koppin, Indiana Telephone Association, noted that the states are the proper laboratory for experimenting with universal service payment schemes. Steve Hawley, Ohio Valley Network, endorsed federal and state grants favoring partnerships among local players. He stated that universal service should be paid for by all providers. He said that pricing for schools and other public institutions should be at lower rates to allow for wide use. He also noted that any policy should require periodic review. Jon Findley, SMART TV, a developer of interactive services, noted that building the NII is expensive and that advertising is a key component in offsetting the cost. Michael N. Ruggiero, Governor -- 6th District American Advertising Federation, spoke about the value of advertising to the NII. He noted that advertising allows for free over-the-air broadcasting and inexpensive newspapers. He briefly discussed the issue of advertising on the Internet. Mary Worth, Communications Workers of America, stated that the workforce policies being adopted by telecommunications companies are eroding service. She noted that AT&T is laying off experienced telephone operators. She also raised the issue of telecommunications firms closing their operations when workers try to organize. She cited Sprint in Indiana as an example. Closing Remarks by the Hearing Board Deputy Secretary Barram stated that this hearing had provided an excellent dialogue on the issues of universal service and open access. He noted that Indiana reflected the part of the United States where you learn to share the burden, a commendable attribute, especially in the context of universal service. Assistant Secretary Irving noted that fairness and equity are important concerns. The choices we make today will determine who has access to better health care, better schools, and an enhanced quality of life in the future. As the Administration goes forward in developing universal service and open access policies, it will be mindful of the discussion and issues raised at this hearing. Assistant Secretary Irving noted that there are no easy answers. He quoted Don Tapscott, co-author of Paradigm Shift: The Promise of Information Technology, who said: "Technology will not necessarily make things better or worse. It provides the opportunity to do either profoundly, dramatically, and really fast." He noted that as we seek to use this opportunity to make things better, the input from the participants at the hearings is invaluable. Assistant Secretary Irving encouraged hearing participants and attendees to send him or his colleagues any additional comments, whether by phone, fax, or electronically via the NTIA/NII bulletin boards. He noted that although this is NTIA's last public field hearing, NTIA will be putting out a Notice of Inquiry on these issues will be holding a virtual hearing later this year. In addition, the NII Advisory Council's Mega Project II is "Access to the NII." Thus, there are still avenues for further dialogue. Appendix C Brief Descriptions of Major Technology Demonstrations _________________________________________________________________ _______ ______ TECHNOLOGY DEMONSTRATIONS THE CALIFORNIA AFRO-AMERICAN MUSEUM February 16, 1994 LOS ANGELES AND Interactive AND demonstrated two interactive multimedia applications, "Illuminated Books and Manuscripts" and "Amazonia." Illuminated Books and Manuscripts uses interactive multimedia technology to teach students how language works as a system and provides a software tool for students to build multimedia reports themselves. Amazonia is a CD-ROM product developed for Paramount Publishing that enables students to explore the Amazon rain forest by a variety of criteria, stressing environmental and scientific concerns. GTE GTE demonstrated its hands-on educational program, "Project PASS," that teaches challenging math concepts by combining the excitement of the NFL with interactive multimedia technology. NDS (Network Design Systems) NDS presented an integrated Windows based, client/server application for health care providers. The demonstration included patient and employee management functions, imaging capability, an electronic interface concept for insurance providers and billing systems, and an interactive concept for health risk assessment between health care providers and individuals at home. North Communications North demonstrated its interactive multimedia kiosk networks, which are installed in public areas and user-controlled via touchscreen. Multimedia kiosks combine key elements of the computer, television, and the ATM machine, employing state-of- the-art software and imageware technology to provide government information that is available in several languages. NTIA Openness Program An NTIA Spectrum Openness staff person demonstrated how to access federal government information through both dial-up and Internet connectivity. PACTEL (Pacific Telesis Group) PACTEL demonstrated two educational applications for a National Information Infrastructure. One application featured distance learning, using two-way interactive video and ISDN technology. Teachers and students participated from a remote site. The other application featured students demonstrating access to Internet with ISDN dial-up technology. Whittaker Communications, Inc. & Image Data Corporation Whittaker used tele-radiology software to display medical images, brain scans for example, on a lap top. These images are typically transmitted over high-speed Super Multimedia Servers to a doctor's personal computer. Jet Propulsion Lab & the USC Advanced Biotechnical-Medical Consortium This consortium presented VOXAR II human volumetric visualization therapy planning, medical expert decision support systems, and an imaging-guided treatment system that previews 21st century managed health care in the high performance computing and communications environment. This supercomputer-driven medical telemanagement application for the NII primarily represents the work of the members of the USC ABC and JPL-CalTech and Northrop, but also includes the work of CEMAX, AT&T, and Picker International. MEETING THE INFORMATION NEEDS OF ALL AMERICANS Technology Demonstration April 27, 1994 Durham, North Carolina Falconer Group The Falconer Group demonstrated a teacher support program that allows a teacher to manage a class at the individual student level. This program is capable of managing all teacher functions including lesson planning, teaching, student motivation, parent involvement, administration, and other tasks. GTE-VTEL GTE and its business partner VTEL demonstrated a video conferencing system that integrates voice, images, data, and computer features. The system conforms to international standards and supports data rates up to T1. GTE demonstrated this video conferencing system via the public switched network with dialable, on-demand access to any one of its national demonstration center facilities. MCNC (North Carolina's High Technology Resource Center), One-Room Systems, and the Institute for Academic Learning MCNC presented its video-on-demand system that adapts technology to provide full screen, full-motion video-on-demand for research, education and industry users of the North Carolina Information Highway. The demo presented in April used two workstations and a fileserver to access a digitized French language lesson. This system was developed by the Institute for Academic Technology and allowed individuals at both workstations to retrieve and use the lesson at the same time but at different speeds. This system enables educators and trainers who are unfamiliar with computers to prepare lessons that can be shared with thousands of different sites. Ncexchange Ncexchange demonstrated its electronic network that allows over 160 nonprofit groups in North Carolina to access up-to-date program information, build organizational capacity, learn about new funding sources, plan meetings, co-author proposals, collaborate on special projects, and much more. This network was launched in 1990. Ncexchange bases its operations on HandsNet, the nation's premier network for groups on human services, community development, and rural issues. In 1994, users will gain the option of participating in NandONet, which connects users to a NC-based information service as well as the worldwide resources of the Internet. North Carolina Information Highway Exhibit - Southern Bell Southern Bell presented an interactive demonstration via broadband links with four sites throughout North Carolina. Remote sites were seen on a quad-split screen with all sites able to see and hear the others. Applications included health care (remote diagnosis), education (distance learning), criminal justice (video arraignment, judicial testimonial), and economic development (rural community leaders). North Communications North demonstrated its public access, interactive, multimedia kiosk for delivery of government information and services. It is currently in use by the states of California, Nebraska, Hawaii, Texas, and Arizona to deliver information on unemployment benefits, drivers license renewal, car registration and job matches. Northern Telecom Northern Telecom exhibited its Integrated Community Network concept, which includes cross-discipline applications, such as community and economic development and systems integration for the activities necessary for successful development of an information highway. Off-site VISTAnet Presentation GTE, Bellsouth, the University of North Carolina at Chapel Hill, and MCNC, North Carolina's High Technology Resource Center This partnership demonstrated VISTAnet, which allows the creation and manipulation of three-dimensional computer-generated medical images to devise optimum cancer radiation treatment strategies. VISTAnet's computer graphics, vast computational power and high- speed, and fiber optic communications link sites 20 miles apart to allow doctors to explore hundreds of radiation plans to find the safest one. VISTAnet combines the enormous computing power of a Cray Y-MP 8/432 supercomputer, a Pixel-Planes 5 raster graphics system, and the capability of a SG1 340 VG4 medical workstation. ON AND OFF RAMPS TO THE INFORMATION SUPERHIGHWAY Technology Demonstrations Innovation and the Public Interest: Open Access to the Information Society City of Sunnyvale Community Center May 13, 1994 Silicon Valley AbagOnline - Access to Bay Area Governments Online AbagOnline demonstrated its system of freely accessible government information to Bay Area citizens, using the new technologies of computers, computer bulletin Boards, on-line databanks, and the Internet. This system, which debuted on May 2, 1994, links several Bay Area government agencies to provide public information to any citizen with a computer. California's Information Superhighway- Pacific Bell A representative from Pacific Bell was available to answer questions about Pacific Bell's plans to invest $16 billion over the next 7 years to bring a broadband information superhighway to half of the homes, schools, and businesses in California. The remainder would be fully wired by 2010. Pacific Bell's "California First" deployment is intended to rapidly provide California with the best telecommunications infrastructure in the world. CityNet CityNet demonstrated its non-profit computer system that links virtually all elements of the city of Cupertino, including major corporations, schools, and city hall. Recently, Cupertino's Vice Mayor Wally Dean created a wireless remote unit for CityNet that enables users to access CityNet from wherever they are. The City of Sunnyvale The City of Sunnyvale demonstrated its use of the Internet for on-line electronic communication, which began on April 8, 1994. The City's on-line connection enables citizens who are linked to Internet with their personal computers to send messages, comments and questions to City Hall. The City's Internet address includes the following departments: Recreation Registrations, City Council, City Attorney's Office, Office of the City Manager, Finance Dep't., Information Technology, Public Library, Mayor's Office, Employment Development/NOVA, Job Training, Parks and Recreation Admin., Patent Library, Human Resources Dep't., Community Development, Public Safety (police & fire), Public Works, Purchasing, and Utility Billing. CommerceNet CommerceNet, a non-profit consortium of Northern California technology-orientated companies and organizations, demonstrated its electronic marketplace where companies transact business spontaneously over the Internet. CommerceNet supports business services that normally depend on paper-based transactions. Buyers can browse multimedia catalogs, solicit bids, and place orders. Sellers can respond to bids, schedule productions, and coordinate deliveries. CommerceNet services will eventually include specialized directories, broker and referral services, vendor certification and credit reporting, network notaries and repositories, and financial and transportation services. Context Productions Context Productions, founded in 1989, is a multimedia design and production company that uses new technologies to create compelling and "immersive" experiences with the arts and sciences for users at home, in the schools and in public spaces. It is dedicated to developing the tools and skills needed to use the capabilities of interactive multimedia to "counter the passive nature of current media programming." Context Production focuses largely on science education. InfoSeek InfoSeek, founded in January 1994, demonstrated how an untrained user can locate any document, stored on any computer database on the Internet, within 5 seconds. InfoSeek has developed a patent- pending method to quickly determine which databases of information documents are most relevant to a user's natural language query. InfoSeek has also developed a patent-pending method for combining search results from multiple heterogenous search engines. Its demo used Mosaic to access a 300M database of 75,000 documents from 140 computer publications. Internet Distribution Services, Inc. IDS, founded in November 1993, demonstrated how it uses the Internet to distribute commercial information from the Palo Alto community. The Palo Alto Weekly, a client of IDS, is the first general circulation newspaper to publish its full contents to the Internet at the same time it prints the paper editions. Other IDS customers include: Palo Alto's Country-Fare Restaurant; The Company Corporation; The Center for Software Development; ANSWERS Magazine; Document Center; N-FUSION Records; and Gymboree. LatinoNet LatinoNet of San Francisco, which began operation as a national information provider on May 17, 1994, demonstrated its telecommunications network that enables the Latino community and others to share information, produce information, increase collaboration, and respond to the needs of the Latino community. NETCOM On-Line Communications Services NETCOM On-line Communication Services, Inc., a leading commercial Internet service provider located in San Jose, demonstrated two of its services, NETCOM and Netcruiser. NETCOM services include News Feeds, electronic mail, Domain Service, file transfer programs, and access to the global Internet. NetCruiser software is an Internet Travel agent, designed to help users move through Internet with ease. Quote.Com Quote.Com demonstrated how easy it is to retrieve stock quotes, industry analyses, and other items, using the Mosaic graphical user interface. QuoteCom, founded in October 1993, provides financial market data to the Internet community. One of its founding principals is that a certain level of its service will always be free of charge. For example, Quote.Com allows users to retrieve current market quotes up to 5 times a day on any U.S. stock, mutual fund, or commodity free of charge. RadioMail Corporation RadioMail Corporation demonstrated its two-way, interactive, wireless messaging services that allow mobile and geographically dispersed work groups to maintain digital dialogues with one another for data only. RadioMail messages find people wherever they are; message delivery is guaranteed. RadioMail is offered at a fixed monthly rate without usage or roaming charges. WIDnet - Disability-Related Online Service WIDnet demonstrated its on-line service that links disabled individuals, advocacy organizations, government agencies, service & product providers, businesses, and employers. Some of WIDnet's on-line features include: a resume publication service, an electronic marketplace, a market research tool, commercial business services, public & private forums, a job bank, conferencing, a document library, electronic mail, and news and travel services. DEFINING UNIVERSAL SERVICE AND OPEN ACCESS POLICIES FOR THE NII Technology Demonstrations Universal Service and Open Access Public Hearing Indiana Government Center South July 12, 1994 Indianapolis Agriculture Communication Department, Purdue University The Agriculture Communication Department at Purdue University demonstrated its "Problem of the Week" World Wide Web and Mosaic Client Application. This application enables both educators on campus and individuals in other institutions throughout the world to access still videotaped agricultural images. Currently, there are 42 county and district offices in Indiana and a number of individuals in other institutions with access to the server. Andersen Consulting Andersen Consulting demonstrated Interactive World, an interactive multimedia interface that allows users to go anywhere on the information superhighway and choose from a variety of services and activities. These services include Interactive World's subworlds called "Me and My Community" and "Job World." Andersen Consulting's Indianapolis Office has worked on projects for the Indiana Governor's Office, the Department of Workforce Development, the Family and Social Services Administration, the Department of Environmental Management, and the Data Processing Oversight Commission. Center for Excellence in Education, University of Indiana The Center for Excellence in Education at the University of Indiana-Bloomington demonstrated its Virtual Textbook, a hand- held wireless computer capable of receiving and transmitting voice, data, and video. Presented for the first time in July 1993, the Virtual Textbook makes remote, digitized databases accessible to students in their homes, classrooms, and school libraries. The Virtual Textbook also enables students to contact peers and experts around the world through the Internet or other communications networks. HoosierNet HoosierNet demonstrated its interactive community-wide network which enables users to access World Wide Web information provided by area organizations and its interactive electronic mail services. HoosierNet has a variety of participants including Monroe County School Corporation, the City of Bloomington, Monroe County Library, Bloomington Hospital, Indiana University, and the Chamber of Commerce. Indiana Cooperative Library Services Authority The Indiana Cooperative Library Services Authority (INCOLSA) demonstrated library information services accessible via the Internet. INCOLSA's services provide access to community information databases, state and national library catalogs, government, non-profit and private information resources, tables of contents, full texts of journals, and databases of graphical resources. Indiana Higher Education Telecommunications Service The Indiana Higher Education Telecommunications System (IHETS) demonstrated INDnet, a high-quality network connecting Indiana's scholars and researchers and their colleagues around the nation and world. In connection with the Partnership for Statewide Education, IHETS will also demonstrate programs from its statewide television network which delivers post secondary education throughout Indiana. INDnet offers support for distant education activities that link Indiana's students with 28 participating institutions. Indiana University Music Library The Indiana University Music Library demonstrated its Variations Project, a system designed to distribute digital compact disc quality audio and full motion-video across buildings, campuses, and inter-campus networks. The project will also demonstrate World Wide Web technologies which enable users to access music- related information from other institutions on the Internet. Inter-Office Communications, Inc. Inter-Office Communications (IOC) demonstrated its special receiver card that allows wireless data communications between businesses, schools, and homes. Currently operating in Indianapolis, IOC's data network allows NOAA Weather, NASA Space Center, McGraw Hill, the Children's Museum of Indianapolis, the Indianapolis Zoo, and WRTV-TV to transmit computer data directly to the public. Pilot schools in the Indiana High School Education Network also utilize the wireless receiver card to transmit information about school schedules and activities. Jon Powell & Associates, Inc. Jon Powell & Associates, Inc. demonstrated several of its telecommunications applications including CARE, a computer assisted risk evaluation for domestic violence; an electronic court case management system; and a telemedicine system used in prison. Jon Powell & Associates developed these applications in coordination with the Indianapolis Sheriff's Office. Ohio Supercomputer Center The Ohio Supercomputer Center in Columbus, Ohio provided a biomedical technical demonstration using advanced interfaced designs and high performance computing. The Center's biomedical applications include telemedicine distance learning programs and remote medical diagnostics and consultations. Smithville Telephone in Cooperation with GTE Telecom Incorporated Smithville Telephone demonstrated various applications using its interactive video network. Real-time demonstrations included connections with a German and Japanese class and a STARNET meeting in Ellettsville, Indiana University and a teachers meeting in Bloomington, and a rural teachers presentation in Ellettsville. Wide-band connectivity was provided by GTE Telecom Incorporated. The Indianapolis Zoo The Indianapolis Zoo provided written handouts describing its plans to use emerging telecommunications and information technologies to advance informal science education. Currently, the Indianapolis Zoo uses Ameritech's fiber optic network for video conferencing with classrooms in both Indiana and Georgia. The Indianapolis Zoo is also working with the American Zoo and Aquarium Association to form a network of North American Zoos and aquariums linked by fiber optics. Thomson Consumer Electronics Thomson Consumer Electronics demonstrated its RCA Digital Satellite System (DSS). DSS, which will be operational by December 1994, will bring U.S. consumers 150 channels of educational and entertainment programming. Programming will be provided by DIRECTV, a unit of GM Hughes Electronics and by the U.S. Satellite Broadcasting Co. (USSB), a division of Hubbard Broadcasting. Time Warner's Full Service Network Time Warner demonstrated its vision of the electronic superhighway. This vision includes video on demand, multimedia, voice telephony, and interactive data communications applications that connect consumers to a wide variety of services. .