**Connecting the Globe: The Asia -- Pacific Initiative**

**Remarks**

**By FCC Chairman William E. Kennard**

**Before the**

**Confederation of Indian Industry**

**New Delhi, India**

**September 22, 2000**

Thank you for that generous introduction.

I had the pleasure of joining Prime Minister Vajpayee at a Washington
luncheon, which was hosted by Vice President Al Gore during your Prime
Minister's recent visit there. It was a great moment for democracy.
Here, in one room, were leaders of two of the world's leading
democracies: India, the world's largest democracy, and America, the
world's oldest democracy.

And it was heartening to hear the leaders of both nations speak of
common themes: of linking our two societies more closely, and of
harnessing the energies of both our democracies for the betterment of
our own people, and for the people of the world.

For our two societies are bound together by the power of certain ideas:
the power of open and free elections, the power of an open and free
press.

Our predecessors, the seafarers of earlier centuries, explored
continents. They sought out each other then, as when the European
explorers sought out India when they discovered what came to be called
the West Indies, today's Caribbean nations.

And we seek out each other now, as the new explorers of ideas.

In the century that has just closed, my country received a powerful idea
from yours. It was an idea that spared my country much bloodshed, and
immeasurably advanced the cause of freedom in America.

That was the idea of peaceful, nonviolent protest to achieve change,
exemplified earlier in the century in your own nation by the teachings
and actions of Mahatma Gandhi.

This idea was carried to my country through Martin Luther King, Jr., who
studied Gandhi as he prepared for the ministry at Boston College.

King's sermons spread Gandhi's vision, and that vision became a major
influence on my generation and on the maturing of my country into a
modern democracy.

Now I would like to reciprocate to your country with an idea of our own.

Many of you have heard about the Initiative I launched last year that
focuses FCC efforts to close closing the global digital divide. Inspired
by Vice President Gore's vision of a global information society -- one
that includes developing, emerging, and developed countries alike -- we
will provide policy and regulatory assistance to key countries that are
taking action to sustain their place in the global information society.
We have selected countries that we believe are regional leaders for the
developing world. And there is no doubt that India is such a leader --
not only for developing countries in Asia-Pacific, but in some cases for
the developed world as well.

This is the third continent I have had the privilege of visiting to
introduce this Initiative. To date we have forged successful, on-going
partnerships in Africa, Latin America, and the Caribbean.

Today I am pleased to announce the commencement of the Initiative in the
Asia Pacific region and to report to you that we signed the first work
plan for the region right here in Delhi.

With each new continent, the Initiative achieves a higher level of
promise, as the practices the Initiative advocates are linked and
reinforced around the world.

The key organizing principle for the Initiative's "best practices" is
competition - - competitive choice in every aspect of the
telecommunications market. But we don't advocate competition simply for
competition's sake; competition is the means of achieving universal
access to telecommunications. This is the primary goal of our efforts --
one that I know that we share.

We have found that competition invests a market with an amazing and
constructive set of incentives. It exerts an upward pressure on service,
choice and innovation, at the same time is exerts a downward pressure on
waste, duplication and prices.

Here are the Initiative's best practices:

1.  Multiple, privately-owned service providers that give consumers
    choices and constrain rates.

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1.  Independent regulatory agencies with the power to pry open
    monopolies, and the discipline to deregulate when monopolies yield
    to competition, and agencies that make decisions in an open,
    transparent way.

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1.  Efficient spectrum management, cost-based interconnection, and
    widespread universal service.

The roots of these principles go back to 1994, when U.S. Vice President
Al Gore presented the best of what my country had learned during the
early stages of the current information revolution to the ITU
Development Conference in Buenos Aires. Those recommendations were later
incorporated into the World Trade Organization's Basic
Telecommunications Agreement.

Vice President Gore laid out the principles for how each country can
become part of a Global Information Infrastructure, or "GII," a
worldwide network of networks - - and how each country can participate
in the new information economy.

To advance these principles, we have signed agreements with South
Africa, Uganda, Ghana, Argentina, Jamaica and Peru, and today we
announce that we have signed an agreement with the Telecommunications
Regulatory Authority of India. We also will begin to work cooperatively
with Thailand under the Initiative in the next several days. And we are
also very near to finalizing an agreement with regulators in the
Philippines.

As I said, we selected these nations because we believe they can serve
as catalysts for change in their regions, and because their
telecommunications environments are receptive to the kind of change
envisioned by the GII.

The agreements we are entering into are two-way partnerships in which we
share ideas and experiences on, among other things, open markets,
competition, spectrum management, licensing, and agency procedure and
process. These partnerships allow us to demonstrate the critical links
between privatization and investment, and competition and universal
service. They also allow us to discuss practical ways of implementing
good policy in these areas.

We also have designed a set of courses that highlight the practical
aspects of these topics. I'm pleased to announce that we have just
entered into an agreement with Cisco Systems to make this regulator's
course available on-line in the future.

Finally, we have made sure that we consult with our partners on a
regular basis to ensure steady progress toward our goals.

Turning centuries of monopoly into competitive markets is one of the
hardest tasks the modern regulator can undertake.

No incumbent monopoly yields to competition willingly. Regulators must
fight for cost-based interconnection, and for the end of hidden
subsidies. They must demonstrate that competition and universal access
can coexist, and that privatization stimulates needed foreign
investment. Spectrum also must be aggressively managed in the interest
of consumers and competition.

These principles have worked in the U.S.

Domestic long-distance rates in the U.S. have dropped nearly 56 percent
in real terms since competition was introduced in 1984. Some companies
are offering services for as low as five-cents-a-minute.

Universal service subsidies have helped us to attain 94 percent
telephone penetration.

Spectrum auctions have decreased by two-thirds the amount of time it
takes to assign licenses, and ensure that the spectrum goes to those
most eager to use it. Now seventy-five percent of Americans have a
choice of five or more mobile carriers. Americans enjoy the lowest
wireless rates in our history.

After we deregulated the equipment market in the mid-1970s, that market
exploded with innovation. Instead of being tied up with burdensome
technical requirements, equipment such as telephones and answering
machines, and computers and modems, proliferated to meet consumer
choice. The policy was so effective that by the mid-1990s, the entire
telecommunications equipment industry had moved from a negative to a
positive trade balance.

These policies gave the Internet the launching pad it needed in the
mid-1990s to get off to such a dramatic start in the U.S.

Competitive long-distance services provided the fiber-optic backbone
needed for the Internet, and local competition provided alternative ways
to reach that backbone.

Our equipment and data information decisions provided the computers,
modems and software needed to feed a hungry Internet.

Our flexible wireless policies have allowed the Internet to migrate from
our desktops to the palms of our hands, setting the stage for lower cost
broadband access.

The number of Internet users in the U.S. has jumped from 27 million in
1996 to approximately 123.6 million today . . . a 350 % increase, or
about 100 % a year.

Our universal service subsidies have been expanded to help connect over
1 million school classrooms to the Internet.

I am convinced that this story can be replicated world-wide to benefit
consumers on every continent. The GII will be truly global, and include
an African information infrastructure, a Latin American/Caribbean
information infrastructure, an Asia-Pacific information infrastructure,
and a Central/Eastern European information infrastructure.

India is no stranger to success in the information technology and
telecommunications industries. After all, your revenues for 1998-99 from
these sectors totaled nearly \$6.4 billion.

We in the United States note with great admiration Prime Minister's
Vajpayee's statement in January of this year that "the entire
government, indeed the entire country, has now adopted promotion of IT
as its strategic goal." We commend the government of India for its new
telecom law, its National Task Force on IT and Software development, the
task force's bold action plan, and the venture capital fund. We also
applaud the courageous decision to open the long distance market to
competition, and the decision to reform your cable landing policy, to
allow ISPs to use their own international gateways.

The fact that the government has already set up 12 software technology
parks and along with the private sector is establishing the first
hardware park in Hyderabad clearly signals that the importance of IT and
telecom development.

India's success in the software market, though relatively recent, is
already legendary. With an annual growth rate of more than 40%, and
1998-99 revenues of \$2.65 billion, the sector boasts 10% of the value
of all Indian exports, and 20% of the global market for cross border
customized software. India has emerged as an IT superpower. I believe
that your challenge now is to replicate that success by creating a world
class, open, competitive telecommunications infrastructure.

In this area, we have a clear interest in working together. Our
collaboration can help address some of the major hindrances to India's
telecom development - bandwidth scarcity, service quality issues, and
high interconnection prices.

Our driving vision is an eventual world network of networks, affordable
and accessible to all, with multiple broadband platforms, giving the
people of the world the option of many digital platforms, including
cable, high-speed copper, wireless, satellite, and broadcast.

Earlier this year, I had the honor of travelling with President Clinton
to a number of cities and towns in the United States to highlight his
effort to close the digital divide in the United States.

Again and again, he told stories about his trip to India and how he
believes technology will uplift your country.

He talked about a woman in a rural area who used the net to find health
information. And he talked about a young man who used the money from a
micro-loan to start a business creating web pages.

He believes, as your Prime Minister believes, that the true power of the
technology revolution that is sweeping the world lies not in its power
to create unimaginable wealth in the hands of a privileged few. No. The
true power of the Information Age lies in its power to uplift our
people; to educate our children; to bring better health care to all
people; to repair the fabric of communities torn apart by poverty and
despair. That is the true power of the new economy.

I know our leaders share this vision. Together we must work to make it a
reality in India and in the United States. Together we can make this a
reality. And I believe we are off to a great start.

Thank you.

\- - FCC - **-**