"The End of an Era:  Where We Go From Here"

                    Remarks by Larry Irving
    Assistant Secretary for Communications and Information
The National Telecommunications and Information Administration
                    Department of Commerce

                            at the
        Minority Media and Telecommunications Council's
                  Annual Luncheon and Meeting

                       Washington, D.C.
                         June 16, 1995

                         [as prepared]

     On Monday, June 12, the Supreme Court issued an opinion
that ended an era.  The Court handed down its opinion in
Adarand, declaring that "federal racial classifications, like
those of a State, must serve a compelling government interest,
and must be narrowly tailored to further that interest," and
thus adopting the so-called strict scrutiny test. 

     For those of us who agree with Justice Marshall's
statement in an earlier case concerning minority-owned
businesses (Fullilove), that strict scrutiny is "strict in
theory, but fatal in fact," Adarand has closed the door on
opportunity.
     
     Moreover, we are in the midst of watching Congress reform
our national telecommunications law, and while there is
absolutely nothing in the legislation that supports minority-
ownership and participation, there is much that could
undermine gains made to date.

     These are dark days.  Despondent and discouraged, some
are tempted to throw in the towel.

     However, our efforts to create opportunities for
minorities must continue.  As President Clinton said this past
Tuesday,

     "The Supreme Court's decision [in Adarand] sets a
     new legal standard for judging affirmative action,
     but it must not set us back in our fight to end
     discrimination and create equal opportunity for all.

     It is regrettable that already, with the ink barely dry,
many are using the Court's opinion as a reason to abandon that
fight.  Exaggerated claims about the end of affirmative action
-- whether in celebration or dismay -- do not serve the
interest all of us have in a responsible national conversation
about how to move forward together and create equal
opportunity."

     The President is right.  The current outlook for
minorities may be dimmer and grimmer, but while these are not
the best of time, they certainly are not the worst of times
either.  Times such as these demand that we take the
initiative.  We must be determined not merely to survive, but
thrive.  As the saying goes, where there is a will, there is a
way.  We must have the will.

     This group has already shown that will by rapidly coming
together and meeting last night to discuss the impact of
Adarand on the upcoming Block C auctions.  Bill Kennard gave
graciously of his time to join you.  This is a tough issue --
as I have said before, I'm glad I don't have Bill's job.  Bill
is by far the best person for that job.  But a serious reading
Adarand leaves one with the impression that it would be nearly
impossible, in my opinion, for the Commission to pass the
strict scrutiny test.  It is important that the Commission
knows the positions of minority players on this issue as it
reassesses its rules.  Thus, NTIA supports Bill's idea of
possibly doing a rulemaking at the Commission on this issue.

     I have heard the statements that minority entrepreneurs
cannot survive in the new hostile environment.  The feeling is
that Bob Johnson, Percy Sutton, Stan Thomas, Eduardo Gomez,
and other successful minority individuals had the benefit of a
less hostile environment in which people recognized the
importance and benefits of diversity and were open to notions
of change.  Now, some in the political leadership of this
country does not want to listen, thereby making compromise or
reasoning unlikely, if not impossible.

     Many of us in this room today, including myself, have
benefitted from a more supportive environment and from
affirmative action programs.

     But, I think that we can all agree that there has never
been a time when there has been no hostility.  That past has
created in us a toughness or strength, which can assist us in
the future.

     I believe that an era has ended; but not everything is
over.

     Today, I want to talk about opportunities, focusing on
those in the telecommunications arena.  I will focus first on
economic opportunities, and then talk about opportunities to
influence policy making.
Economic Opportunities
     It is now clear that opportunities won't be given to us;
they must be created.  I know that there are minority
entrepreneurs out there who have the ingenuity and the drive
to create them.

     Minorities can find economic opportunities in the
telecommunications and information industries.  There are four
areas where African Americans, Hispanic Americans, Asian
Americans, Native Americans, and all ethnic minorities can use
the National Information Infrastructure (NII) to create new
business opportunities and enrich their communities:  (1)
constructing the information superhighway; 
(2) developing the content -- the information that will travel
over the superhighway; (3) using the information superhighway
to expand opportunities in every line of business; and (4)
preparing our youth through education and training to take
advantage of the opportunities that will be created.

     First, let us take a look at some of the opportunities
for minorities in constructing the information superhighway. 
The development of new personal communications services (PCS)
could bring thousands, perhaps millions, of dollars to
minority companies and entrepreneurs.  And minority ownership
of PCS is likely to do more for minority communities in terms
of employment, training, community investment, and community
enrichment than majority ownership.

     I recognize that meaningful and long-term ownership
opportunities may be difficult for many minority firms to
acquire, particularly because of legal challenges to broadband
PCS significant preferences for "designated entities," as well
as access to capital issues.

     Access to capital for minorities is a problem, especially
with respect to the new wireless technologies.  In the
aggregate, narrowband and broadband PCS licenses went for
billions of dollars, far exceeding expectations.  In addition,
building out advanced, digital systems for personal
communications services involves tens of millions, perhaps
even hundreds of millions, of dollars.

     As most of you know, in April, NTIA released a report
entitled, "Capital Formation and Investment in the
Telecommunications Industries," better know as Telecap.  The
report confirms what most of us believed and identifies
financial barriers faced by minority entrepreneurs and
businesses seeking to compete in these industries.  The
evidence presented in this report indicates that there are
real barriers to minority participation in telecommunications
and that minorities often lack access to the types and amounts
of capital required to form and expand telecommunications
businesses.  The report suggests possible solutions to the
access to such problems.  Overall, this brings us back to one
basic point: going forward, we have to be creative in our
entrepreneurial ventures.  The same types of opportunities
that existed over the last decade, are no longer there.

     A second set of opportunities exists in developing the
content -- the information that will travel over the
superhighway.  In the very near term, we are going to have
more bandwidth than ever before, much of which will be filled
with video programming.  There will be increased opportunities
for minorities to be providers of video.  Currently, we have
only one television network that is owned and geared to an
African-American audience -- Black Entertainment Television --
and no Hispanic, Asian, or Native-American owned national
networks.  When you talk about having 500 cable channels, 150
channels via direct satellite broadcasting, and an infinite
number of channels from your telephone company, there is a lot
of room for more providers.  And there is demand.  African
American culture is universal -- jazz in the '50s, Motown in
the '60s, Funk in the '80s (I won't mention disco), and now
hip hop in the '90s.  Latinos are the nation's fastest growing
consumer group.  

     Or, look to the booming computer industry.  If you browse
on-line or go to your nearby software store, you will find
that there are few on-line services and software products
geared to minority populations.  Currently, there are niche
on-line systems that appeal to women (Women's Wire and Echo),
the digitally hip (Transom, Pipeline, and @Wired), older
hipsters (SeniorNet), and sports fanatics (ESPNet Sports
Zone).  This is where great opportunities lay.  There are
countless of niche markets to be served in the minority
community.

     An entrepreneur named David Ellington capitalized on this
idea.  A little over a year ago, Mr. Ellington, a young,
bright African-American came to NTIA to describe his vision of
an on-line service geared to the African-American community. 
Next Monday, Mr. Ellington will launch "NetNoir," an on-line
service, in conjunction with America On-Line.  NetNoir offers
content with a focus on global Afrocentric culture.  LatinoNet
is a similar endeavor.  The reality is that there are hundreds
of thousands of African-American families and Latino families
who will buy computers if they have services like NetNoir and
LatinoNet.

     However, as I have noted before, you do not have to be a
telecommunications or information supplier to take advantage
of the NII.  Whatever your business, you need to think
imaginatively about how these new technologies can open up new
markets, reach new consumers, and lower your costs of doing
business.

     If you are in retail, you need to realize the power of
using the Internet to expand your customer base.  Many
companies now offer catalogues with pictures of their products
that allow for home shopping for everything from books to
earrings to homes.  I can get on the Net any hour of the day
and order Navajo blankets, hot salsa, . . . .

     People around the country are using the Internet to
expand their customer base.  New 3-D imaging allows artists to
exhibit their pottery and sculptures, as well as builders and
realtors to walk you through a house. 

     And for those concerned about network security (an
oxymoron?), the Net will soon be a safer place in which to do
business.  A new alliance announced in April involving Terisa
Systems, America On-Line, CompuServe, EIT, IBM, Netscape,
Prodigy, and RSA will create a single, open security platform.

     Whatever business you are in, or would like to be in, the
information superhighway will make a difference.  If you are
in construction, there are opportunities to help build the
information superhighway.  New emerging wireless technologies
provide a chance to get involved not only in the ownership but
also in the construction of facilities.  For minority
companies in the construction business, the focus must be on
cell sites for cellular and new personal communications
services, not on FM-stations.  Yet, I do not see many minority
firms or entrepreneurs approaching the A and B lottery
winners.

     Moreover, those skills that you learn and services you
provide here will be transferable and invaluable as we venture
into overseas markets.  As China, Brazil, Argentina, South
Africa, just to name a few, open up their markets, U.S exports
could soar.  And Secretary Brown and I want to introduce
people with the skills and experience to our international
counterparts.

     I do not mean to be harsh, but the reality is that there
will be little, if any, direct government financial assistance
to minorities.  We must turn to other private sector
resources.

     I am probably preaching to the choir, but I cannot
emphasize too strongly the need to take the offensive. 
Minority firms and entrepreneurs must promote their ideas,
products, and services.  Generate your own partnerships with
other companies, both minority and majority.  The idea of the
Telecom Development Fund, created by members of the MMTC, is
exactly the type of thinking we need to be engaged in.  My
staff at NTIA is working with its creators to try to make this
or something like this project work.

     We also need to ensure that our youth have the education
and training to take advantage of these opportunities.  In
order for them to compete in the Information Age economy, they
will need to be computer and technology literate.  By the year
2000, 60 percent of the new jobs will require skills held by
only 20 percent of the existing population.  Get the companies
that you work for to partner with area skills.  Work with your
local school board.  Make sure your local communities do not
get bypassed by the information superhighway.

Policy Making Opportunities

     The changes in the judicial and legislative landscape are
causing many to leave the political arena.  I urge you to
remain active politically.  Those of you who are in corporate
America, use your influence on the Hill.  More than ever, we
need to voice our concerns about the impact of policies on our
communities.  You cannot win the game if you do not play the
game.

     Last night's passage of the Senate telecom bill was a
major defeat for those of us who want a bill that will promote
true opportunity for all Americans, not simply increased
profits for multinational companies.

     We need to be heard.  For instance, when Congress debated
the multiple ownership rules, there was an unfortunate absence
of the minority community's voice.  Media concentration is not
our friend.  The concepts of localism and diversity have
served minorities well.  Open systems matter.

     In this battle, do not forget us at the Department of
Commerce.  As many of you know, Secretary Brown is deeply
committed to ensuring that minorities have opportunities.  He
ensures that he is accessible to members of the minority
community.  The Secretary, as well as myself and my staff at
NTIA, want to hear from you -- of your concerns and your
ideas.  I have a very hectic schedule, especially now that I
am trying to save the agency, but I am always available to
hear your views.  My staff informs me of everything --
everyone who calls, visits, writes.  Please, we want to hear
from you.

     Let there be no mistake.  NTIA remains committed to
helping minorities in the telecommunications industry.  Right
now, NTIA is in the process of expanding the mission of NTIA's
Minority Telecommunications Development Program (MTDP). 
Historically, it has been exclusively focused on minority
participation in broadcasting.  I am broadening its focus, to
include minorities' roles in the new emerging technologies,
including wireless technologies.  In addition, we are
expanding ComTrain and the ownership report, and we are
reenergizing our newsletter.

     As I have said before, for more than ten years of my
professional life I have been deeply involved in all telecom
issues involving minorities.  I remain steadfast in my resolve
to continue to help ensure that minorities' issues are heard.

     Beginning next month, MTDP will host monthly informal
round-table discussions so that I and my staff can hear from
you about your needs and your positions on key
telecommunications and information policy issues.  These
discussions will be open and I will personally sit and listen
to your concerns.

     Of course, all of this is dependent on NTIA's continued
existence, which at the moment is under attack.

     As you know, my agency -- NTIA -- and the entire Commerce
Department is at risk.  Let us our recognize that what makes
for good sound bites, does not make for good policy. 
Eliminating NTIA and the Department of Commerce may sound good
in a press release, but what does it mean?

     It means that as we enter the 21st Century -- the
Information Age -- and encounter critical issues such as
privacy rights and copyright protections in cyberspace or
universal service or electronic commerce, the President will
not have the benefit of a telecommunications policy shop to
advise him on how to resolve these issues. 

     Moreover, NTIA is playing a critical role in ensuring
that the National Information Infrastructure (NII) will
connect all Americans, especially low-come Americans,
minorities, rural Americans, individuals with disabilities,
and children.

     NTIA is at the forefront of designing a new concept of
universal service, one that allows us to bring all Americans
into the 21st century.  And we are actively promoting
community partnerships through such means as our NII grants
program -- called the Telecommunications and Information
Infrastructure Assistance Program (TIIAP).  TIIAP funds
planning and demonstration projects throughout the country by
public institutions -- state and local governments, schools,
libraries, hospitals, and other nonprofit groups.  The grants
require at least a 50 percent match from private sources of
funding, which has led to many public-private partnerships.

     At a time when telecommunications policy is increasingly
important to the competitive health of the U.S. economy, it is
short-sighted to abolish the one Executive branch agency
devoted to domestic and international telecommunications and
information technology issues.

     Indeed, it is extremely short-sighted to abolish the
entire Commerce Department.  The Department provides tools
that enable American firms and workers to build, trade,
discover, compete, and prosper.  And it does its job well. 
Down-sizing and right-sizing are important if we are to be
strong domestically and globally.  But so is investing in the
sources of future growth.

      As Secretary Brown has said, "Calls for the elimination
of the Department -- or its essential technology programs --
are just plain shortsighted.  They amount to unilateral
disarmament in the battle for global competitiveness.  They
will deprive the business community and America's working
families of the clout, the critical cooperation and the
support needed to create the jobs of the future."

     That goes to the heart of the matter -- we are a
Department and an agency that is preparing our nation for the
Information Age.  Our country needs a strong Department of
Commerce and a strong NTIA.

Conclusion

     Where do we go from here?  As minorities enter this new
era, we need to rely on ourselves -- our creativity, our
perseverance, our self-initiative.  With these tools, we can
create our own opportunities.