# Presentation: 522773

##  Consumer Electronics Association 2004 International CES Conference

-  **Consumer Electronics Association ****2004 International CES Conference**

**Michael D. Gallagher**
**Acting Assistant Secretary for Communications and Information**
**U.S. Department of Commerce**
**National Telecommunications and Information Administration**
- _[www.ntia.doc.gov](http://www.ntia.doc.gov/)_

## Economic Indicators

- Thanks to the President’s policies, America is once again growing robustly:
- “Real” personal consumption expenditures rose 6.4 percent in the third quarter this year compared to a 3.8 percent growth rate in 2Q 2003.
- “Real” GDP grew at an 8.2 percent annual rate during the third quarter.
- The manufacturing sector enjoyed a 9.0 percent increase in productivity in the 3Q.
- This year, the S&P 500 is up over 20 percent.
- The NASDAQ Composite is ahead 42 percent.
- The President will not be satisfied until every American who **wants a job **has a job.

## Administration Commitment to Technology Development

-  *"The role of government is not to create wealth; the role of our government is to create an environment in which the entrepreneur can flourish, in which minds can expand, in which technologies can reach new frontiers."*
-  -- President George W. Bush, Technology Agenda, November, 2002.

## Broadband Household Access

- Source: Leichtman Research Group as reported in USAToday on 11/14/2003.

## Broadband Market Share(Residential Users)

- Source:  Pew Internet & American Life Project (August, 2003)

## Voice Over Internet Protocol (VoIP)

- VoIP is like gravity – it is an irresistible force
- 10% of international minutes were IP in 2002; projected to be more than 50% by 2007. (Source: Probe Research 2002)
- About 1 billion business phone lines worldwide were IP by the 2Q 2003, or about 12% of the total; numbers are projected to be approx. 1.8 bill. (17%) by year end 2003. (Source: Wall Street Journal, Oct. 9, 2003)
- VoIP could increase competition in equipment and services
- Business spending on IP phone equipment worldwide more than doubled between 2002 and 2003 to approx. $1 billion (nearly 20% of all business phone equipment purchases).  (*Id*.)
- Need sound regulatory approach to VoIP – should not be a “grey market” service

## Spectrum Policy 

- Spectrum Policy:  The who, what, where, when, and why of access
- Great potential for government 	action towards a positive effect on economic and national security
- NTIA and FCC share joint jurisdiction over spectrum
- NTIA authorizes use by Federal Government Agencies
- FCC authorizes all other spectrum use, by license or by license exempt operation
- NTIA and FCC work together to determine national and international allocations

## WiFi Market

- WiFi investment is growing rapidly.
- Venture capital firms pumped over $2.8 billion into 296 wireless startups in 2002.
- Projections for WiFi spending on hardware and subscriptions are $3.4 billion in 2003.
- Network build outs over 2004 and 2005 are expected to be $8.2 billion.

- Source: BusinessWeek Online

## WiFi in Schools & Hospitals

- One third of K-12 public schools and 85 percent of colleges in the US now use wireless networking technology. (Source: WiFi News)
- Public schools spend $6.2 billion on IT needs each year, including $500 million on wireless technologies, which is expected to quadruple in 2004. (Source: SBC Press Release)
- U.S. hospitals are projected to spend nearly $295 million on WLAN technologies by 2005.  (Source: SBC Press Release)

## WiFi In-Flight

- Boeing’s Connexion service will provide airline passengers with in-flight broadband connections to their computers and PDAs. (Source: PR Newswire)
- Connexion uses WiFi connections inside the airplane to provide 5-10 Mbps downstream and 2 Mbps upstream.  Some airlines plan to switch the link from satellite to a ground-based WiFi access point when the plane is at or near the gate. (Source: EDN, 12/25/03)
- Boeing has agreements with several foreign airlines (including Lufthansa, Scandinavian Airlines (SAS), and Japan Airlines) to roll out the service in 2004. (Source: CBS MarketWatch)
- The U.S. government worked at the 2003 World Radio Conference (WRC) to gain approval for use of the 12-14.5 GHZ frequency band on a global basis.

## WiFi On The Road

- A close cousin of WiFi, DSRC is a short to medium range communications service that supports both public safety and private operations in roadside to vehicle and vehicle to vehicle communication environments.
- The FCC recently adopted DSRC licensing and service rules in the 5.9 GHz band to facilitate provision of public safety and Intelligent Transportation Systems (ITS).
- NTIA coordinates frequency use with DSRC operators to avoid interference with governmental operations.
- DSRC technology is currently used in automatic toll collection applications such as E-Z Pass.
- Future applications may include intersection collision avoidance, work zone warnings, road condition warnings, and even electronic payment of gas, parking and fast food.

## Other New Wireless Services

- Ultra-wideband: phenomenal capacity to deliver rich media to many devices, at low-power and low-cost.
- Third Generation (3G) Service: current generation of service provides speeds up to 300 Kbps.
- WiMAX (802.16): enables wireless networks to extend as far as 30 miles at speeds up to 70 Mbps.

## Administration’s WiFi Approach

- Create a low tax and limited regulatory environment that promotes our growing economy.
- Work with industry and government engineers to reduce interference and promote spectrum “best practices”.
- Remove government obstacles to development of new communications technologies and applications.
- Use sharing where technically feasible to increase the amount of spectrum available for wireless services and streamline the process of licensing when licenses are required.

## Conclusion

- The American economy is recovering and expanding.
- WiFi is an important and growing part of U.S. productivity and consumer enrichment.
- The Administration has developed successful policies to advance new wireless technologies while protecting existing critical services.
- Technology will continue to challenge our policy framework – and your input is critical to finding the answers.