**Remarks of**

**FCC Commissioner Gloria Tristani**

**before the**

**Caribbean Telecommunications Council**

**San Juan, Puerto Rico**

# October 4, 2000

*(as prepared for delivery)*

Thank you so much for that kind introduction. It's wonderful to be back
in Puerto Rico, where I was born and raised, to talk with you about the
communications revolution taking place here in the Caribbean and across
the globe. It's no secret that the Information Age is changing the way
we conduct business, the way we learn, and the way we communicate. And
increasingly, policymakers and members of industry are finding that
leaders in the Caribbean are taking the right steps to unleash this
potential. The promise, of course, is a series of communications
networks that empower individuals, connect communities, and strengthen
economies. We are in a truly remarkable time.

As a Puerto Rican, I'm also very pleased to be here this month, our
nation's National Hispanic Heritage Month. Each year, this celebration
gives us an opportunity to reflect on our history -- and on our future.
To honor the contributions of Hispanic Americans, President Clinton
recently issued a proclamation, which reads in part:

> The Hispanic American community is a collage of distinct groups,
> including people with roots in Central and South America, Mexico, the
> Caribbean, and Spain. Hispanics have been an important part of the
> history and heritage of the Americas since the earliest days of
> European colonization, and today Hispanic Americans are the youngest
> and fastest-growing minority community in our Nation. Devoted to
> family, faith, country, and hard work, they bring unique perspectives
> and experiences to our national community and character.

President Clinton went on to say that "with our cultural and linguistic
ties to our trading partners throughout the Western Hemisphere, Hispanic
Americans are crucial to maintaining our Nation's competitiveness and
prosperity in the global economy of the 21^st^ Century." And so, I stand
here among friends in Puerto Rico and say that the communications
marketplace offers a wonderful opportunity to contribute to the growth
of our people, our nation, our region and the global community.

I'd like to begin today by taking a quick look at the communications
medium that is transforming all our lives, the Internet:

-   Today over 5% of the earth's population is online.

-   190 new users logged onto the Internet every minute last year.

-   Internet traffic doubles every day.

-   In the United States, 2 out of 3 children who have access to a
    computer at home use it to help them do their homework.

-   The Internet economy is estimated to be \$1 trillion next year.

The Internet is a launch pad for opportunity and enrichment. A growing,
evolving, unstoppable source of information and knowledge, it will
eliminate old barriers of time, distance, education, and wealth. It
transcends such distinctions, and has the potential to further
democratize our societies. It can bring the resources of the Library of
Congress in Washington -- the repository of every publication in the
U.S. -- to the fingertips of a schoolchild in Aguada, Puerto Rico or,
for that matter, in the St. Lucia or anywhere across the globe.

Yet we all know too well that access to the Internet is highly uneven.
In the United States, households with incomes of \$75,000 and higher are
more than twenty times more likely to have access to the Internet than
those at the lowest income levels. White Americans are more likely to
have access to the Internet at home than African Americans or Hispanics
have from any location. And Americans living in rural areas are lagging
behind in Internet access, let alone high-speed Internet connections.
Overall, about 33 percent of American homes have Internet access. This
compares with 15% of Puerto Rican homes with Internet access, as
identified by a study by Research & Research.

But before we can tackle the Digital Divide, we must first confront the
issue of basic telephone penetration -- the rate at which households
subscribe to telephone service. As the globe becomes increasingly
connected, some parts of the world are being left behind. Indeed, there
are still parts of the world where teledensity remains at 1-2 percent of
the population, where for most people access to a telephone is a walk of
several days.

In the Caribbean region, statistics are rather hard to come by but the
data that are available are rather startling: in 1999, telephone density
was at 19 lines per 100 people in Jamaica, 9 lines per 100 people in the
Dominican Republic, and just 0.8 lines per 100 people in Haiti. That
compares to 66 lines per 100 people in the U.S. overall and 33 lines per
100 people in Puerto Rico. As policymakers, as industry professionals,
and as citizens, we need to find ways to do better -- here in Puerto
Rico, in the Caribbean, and across the globe.

Fortunately, technological and marketplace developments in the Caribbean
-- in many cases spurred by regulatory decisions -- are causing a stir.
For years the province of state-owned monopoly providers, the Caribbean
telecom market is awakening to investment and competition. The result is
increased telecom build-out and more widespread access to basic
telephone service and the Internet.

On many of the islands, wireless technology is the driving force behind
telecom growth. While wireline penetration remains limited, wireless
deployment is allowing consumers to leapfrog into the next generation of
technology. Many consumers are happily substituting the reality of
mobile service for the faint hope of a wireline connection.

Puerto Rico offers a great example. The island currently enjoys a
vibrant wireless marketplace with 5 mobile operators and a sixth
scheduled to begin service in the next few months. Subscriber growth has
been nothing short of phenomenal. Today there are well over 800,000
wireless customers in Puerto Rico -- more than 20 percent of the
island's population. From 1998-1999, the number of wireless subscribers
grew 58 percent. That compares to a 32 percent wireless growth rate for
the United States as a whole. If the current growth rate continues,
Puerto Rican wireless users may soon surpass wireline penetration, which
hovers around 35 percent. And competition is bringing innovative
offerings. Clearcomm, for example, provides all incoming calls for free.

In the Dominican Republic, with its burgeoning telecom market, the
number of wireless subscribers increased 70 percent from 1998 to 1999.
New technology, moreover, helps to bridge the Digital Divide. Star Media
and Codetel have established the Dominican Republic's first personalized
mobile Internet portal that delivers local news and short messages
directly to consumers' mobile phones.

Together with technology developments, liberalization of telecom markets
is advancing rapidly in the English-speaking Caribbean. Indeed, the
leaders of many Caribbean states have recently taken courageous
market-opening steps. As you know, Cable & Wireless is the entrenched
wireline provider in the English-speaking Caribbean countries. C&W is
the beneficiary of long term licenses granted by these island nations
which generally included very favorable terms, including long-term
monopolies. But these governments have, to their immense credit,
subsequently recognized the importance of competitive communications
markets to healthy economies and vibrant communities.

On February 16, 2000, Jamaica's Parliament passed legislation codifying
the government's deal with Cable & Wireless to end the latter's
telephone monopoly. In doing so, the government has embarked on a 3-year
transition plan to full competition. Jamaica recently auctioned two new
wireless licenses and the providers expect to begin offering service
early next year.

In addition, members of the Organization of Eastern Caribbean States
have established a regional regulatory authority, the Eastern Caribbean
Telecommunications Authority. Its first task is to oversee the uniform
revision of new telecommunications laws, which will eventually be
proposed to each of the individual parliaments.

Other nations are also in discussions to end C&W's long-established
monopoly in the Caribbean.

I congratulate these nations for taking affirmative steps to ensure that
their people will benefit from a competitive telecom marketplace.

Liberalization, however, is still at an early stage and a key challenge
for all governments is the development of a strong regulatory framework
to guide the transition to a fully competitive market. In each nation,
policymakers face similar challenges. These challenges are tough, I can
assure you. But there are a few stalwart principles to bear in mind, to
keep the transition on course. And in the end, all of us -- regulators,
service providers and manufacturers alike, know that these are
challenges we must face if we are to embrace the communications
revolution. The Information Age promises great benefit for our citizens
and our economies, so long as we seize the opportunity.

These principles were first outlined by Vice President Al Gore back in
1994 when he addressed the first International Telecommunication Union
Development Conference in Buenos Aires. There he called upon all nations
to join in the creation of a Global Information Infrastructure (GII).
This network of networks, he asserted, would allow all of us "to
transmit messages and images with the speed of light from the largest
city to the smallest village." The Vice President understood that we
were in the midst of a revolution -- a revolution that would enable us
to transcend old barriers of distance and time, and connect the people,
cultures and ideas of all our communities. And he predicted that this
information infrastructure would be the key to the future growth of our
national and international economies. How right he was.

Vice President Gore set out the following building blocks for a
successful transition: (1) a privatized and liberalized
telecommunications sector; (2) open telecommunications networks; (3) a
strong, independent regulatory authority; and (4) government policies to
promote universal access. This framework is taking hold right here in
the Caribbean and across the globe, and the FCC stands ready to assist
those nations prepared to commit to these principles.

During the past year, my colleague FCC Chairman Bill Kennard has
championed a Development Initiative aimed at partnering with telecom
policymakers in the developing world. The FCC has entered into work
programs with several countries that have embraced competition as a
method of expanding access to telecommunications. Jamaica is one
example. FCC staff have worked with their Jamaican counterparts to
provide spectrum management and numbering assistance. In partnership
with USAID, the FCC has also assisted the OECS members in the
development of the regional regulator.

As policymakers, we confront hard issues. Of course, the United States
is but one model -- we don't purport to have all the answers. But we
have seen dramatic increases in consumer benefits with the advent of
competition -- demand and usage are up, rates are down, and economic
growth and job expansion continue unabated.

Despite the United States' own progress towards injecting competition at
home and abroad, we still have work to be done right here at home. Here
in Puerto Rico, PRTC is still the overwhelmingly dominant provider.
Competitive entry thus far is lagging behind the mainland, and consumers
are not yet reaping the full promise of the Telecommunications Act of
1996. While a few resellers are making some headway in the business
market, facilities-based competition is still in its infancy. Recently,
however, GTE, which controls PRTC, was absorbed into Verizon, the
combined Bell Atlantic/GTE provider. PRTC now has access to the
resources of one of the largest wireline carriers in the United States
and the first RBOC to show that its local market was sufficiently
competitive to enter long distance market. I am looking forward to
seeing the benefits of Verizon's management here in Puerto Rico the next
time I visit the island.

I am pleased, however, that over the last three years schools and
libraries in Puerto Rico have benefited from over \$120 million in
discounts on telecommunications services, Internet access, and internal
connections under the "E-rate" program created by the 1996 Act. This
program provides primary and secondary schools and libraries with
discounts ranging from 20-90 percent off commercially available rates.
Last year, Puerto Rico received the 4^th^ highest per student funding at
an average of \$93 per student. I am proud that the E-rate program will
be funded at its cap of \$2.25 billion this year.

I came to Washington in 1997 to serve as an FCC Commissioner guided by a
single principle: creating incentives and adopting policies to ensure
that *all* Americans benefit from the communications revolution. In
truth, our role is much broader. Together with our neighbors here in the
Caribbean and across the globe, we have a wonderful opportunity to
enhance our societies and our economies. The reforms and innovations
taking place here in the Caribbean are going a long way to reaching
these goals.