[kictanet] Head of U.S. Delegation to WCIT: Creating an Environment for Future Success:

[Alice Munyua]

Dear all,

See below remarks made by the head of delegation to WCIT 2012. He 
discusses Kenya's successes.

Best

Alice
---------------

http://www.state.gov/e/eb/rls/rm/2012/196035.htm


    Creating an Environment for Future Success


Remarks
Ambassador Terry Kramer, Head of Delegation, U.S. Delegation to the 
World Conference on International Telecommunications
Information Technology Industry Council
Washington, DC
August 1, 2012

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*As prepared for delivery*

First, let me say "thank you" to ITI for your leadership and engagement 
in a critical and high impact area. I am honored to have been appointed 
to this role as Head of Delegation for the United States at the World 
Conference on International Telecommunication -- or, as we often call 
it, the "WCIT."

I am drawn to the WCIT because it presents an important opportunity for 
the United States and the world:

  * We have all seen, over the past 25 years, incredible successes and
    growth in telecommunications and the Internet universe;
  * Now, we face a pivotal question: How do we create an environment for
    the future /global /success of telecommunications and the internet?

In my career in telecommunications, domestically and abroad, I have had 
the good fortune, as many of you have, to witness the rise and societal 
impact of two phenomena: the birth of mobile communications and the 
advent of the Internet.

When I look back at my time in the mobile communications industry, it 
was a "beeper" business, which then transformed into a "cell phone" 
business. That cell phone business then went from a high-end market, 
initially targeting wealthy individuals, to a mass-market, "must have" 
service. And finally, it went from a developed-country business into a 
truly global one.

Meanwhile, the Internet ecosystem has evolved, thrived and changed the 
very nature of human interactions and connectedness. The Internet is now 
flourishing with unimagined capabilities and uses, from advanced search 
to location services incorporating user preferences and social 
media---all of these focused on providing highly personalized and 
relevant services and user experiences. We can literally look to the 
stars -- and have our smartphones tell us what constellations and 
planets we are seeing.

The development of the Internet is truly inspiring -- but that's not why 
I am here. What I want to talk about today is the opportunity we have, 
through the WCIT, to build the /environment for success/ for the future 
global telecommunications and Internet universe that everyone wants and 
needs.

*Mobile*

The foundation of that environment for success can be found, I believe, 
in the consumer-driven, competitive growth of the mobile service 
industry. That industry has pioneered an entrepreneurial spirit, 
engineered the rapid and cooperative development of industry standards, 
promoted market liberalization and driven an intense focus on satisfying 
customer needs.

In just 25 years, we have come from no cell phones /at all/ to more than 
5.3 billion mobile subscriptions worldwide.

  * Today, the world's developed markets have achieved, on average, 116%
    mobile penetration, and even developing markets average about 70%
    mobile penetration -- a figure estimated to reach 100% in the next
    3-4 years.
  * Or consider this: roughly 90% of the world's population -- and even
    80% of its rural residents -- now live in areas that have mobile
    network coverage.

Around the world, 3G and 4G services are increasingly available, and 
millions of users now will likely obtain Internet access -- for the 
first time -- using their cellphones. How did the mobile revolution 
become so successful, so fast?

  * A wave of liberalization and competition driven by national
    regulators who opened their markets to multiple service providers;
  * Regulators who moved proactively to make spectrum available for
    commercial use;
  * Industry-driven standards-setting which brought technological
    innovation to market at accelerated speeds;
  * A new, consumer-oriented outlook -- adopted by industry and
    government alike -- that drove innovative services and business
    models, such as pre-paid services, text messaging and handset
    subsidies; and
  * Mobile operators, device makers, internet players and infrastructure
    providers who all worked together to form a healthy, vibrant
    ecosystem to deliver customer relevant mobile internet services

Innovation was unchained to meet and promote demand, and the result has 
been growth at hyper-speed -- well beyond what any ministry or monopoly 
could have planned or directed.

*Internet and Broadband*

Meanwhile, as the mobility revolution was gathering steam, the Internet 
also was becoming a global phenomenon, on both mobile and fixed 
platforms. The adoption of the World Wide Web -- as we called it then -- 
gave the Internet a user-friendly interface, while the open and 
decentralized architecture invited content and easy, cost-effective 
access. And look at the results: There are now about 2.4 billion 
Internet users worldwide -- a number predicted to rise to 3.5 billion by 
2016. At least 1.2 billion of those Internet users today are in 
developing countries.

Moreover, demand for Internet access and other IP-based applications 
have fueled the growth of broadband networks. Fixed broadband 
technologies, including DSL and cable modem services, make it possible 
to download rich video and internet content, as well as voice calling 
through VoIP services.

This content can be created, cached and transmitted anywhere in the 
world -- and increasingly, that includes developing countries that are 
linked regionally through new undersea cables and Internet Exchange 
Points (IXPs). As a result:

  * Broadband service is now available in 208 economies -- virtually
    every country in the world.
  * Fixed broadband subscriptions have more than doubled in five years,
    from 284 million in 2006 to an estimated 591 million at the end of
    last year.

Of course, the growth of broadband capability is not confined just to 
fixed services. The marriage of the Internet and mobility -- embodied in 
3G and now 4G networks -- is a growing reality. The number of mobile 
broadband subscriptions is believed to have surpassed 1 billion 
worldwide in 2011, and 3G service is available in more than 143 
countries around the globe.

Not surprisingly, we are seeing an explosion in the amount of data -- 
much of it in the form of VoIP and video -- circling the globe. Roughly 
369 exabytes (an Exabyte is 1 million terabytes) of IP data were 
exchanged around the world last year -- a number that Cisco predicts 
will rise by 2016 to 1.3 zettabytes annually -- a figure equal to 1.3 
/billion/ terabytes. Overall, IP traffic is forecasted to grow at a 
compound annual growth rate (CAGR) of 29 percent from 2011 to 2016.

Operators, meanwhile, have abandoned the old 'walled gardens" that 
restricted non-proprietary content -- and they have done so with the 
customer in mind. Like the mobile industry -- and perhaps even more so 
-- the Internet is created, maintained and driven, in an organic, 
bottom-up way, by the people who need it and use it.

Again, we have to ask ourselves: Who created this phenomenon? And the 
answer is both "nobody" and "everybody." The Internet is truly a 
decentralized ecosystem, pulling in network operators, applications 
designers and content creators from all over the world.

*Societal Benefits*

The beneficiaries of the mobile and internet industry growth are 
individuals and societies all around the world. The Internet creates:

  * *Economic benefits* -- Jobs--beginning with mobile network expansion
    and jobs created through online commerce and content delivery
  * *Commercial benefits* -- illustrated by farmers can use cellphones
    to link with buyers, check weather conditions and determine
    commodity prices in real time;
  * *Social benefits*/--/ Health care providers can use mobile
    technology to do remote diagnostics and treatments as well as
    training of health professionals. Governments can now make services
    available online, and people can inform themselves about political
    events and proposals;
  * *Human benefits* -- Groups can organize themselves online, friends
    can re-establish contact after years of separation, and everyone
    explores new meanings of connectivity and /connectedness./

In a global marketplace battling for growth, telecommunications and 
Internet industries have acted as multipliers of productivity, 
translating into greater employment and social benefits. In the OECD 
countries, the Internet now accounts for an average of 4.1% of GDP -- 
and up to 7-8% in the most "wired" countries, such as South Korea or the 
UK. Moreover, a University of Munich study, reported by the ITU, found 
that a 10% increase in broadband penetration yields an increase in GDP 
of .9% to 1.5%.

With the Internet, we have benefits that are as concrete as a labor 
statistic and as ephemeral as a smile on a laptop screen.

*The Internet Is Global*

One thing also is clear: this phenomenon belongs to the entire world. 
Internet business ventures, social media companies, and enterprise 
applications are sprouting up all over the globe.

Meanwhile, national broadband plans and policies which lower 
market-entry barriers, allow competition, encourage 
infrastructure-sharing, reallocate and re-farm spectrum, and provide tax 
incentives for investment are being implemented in both developed and 
developing countries alike.

In Kenya, the government:

  * Articulated a clear national policy for its communications market,
    called Vision 2030;
  * Leveraged its geographic location to develop access to international
    fiber-optic cables, reducing wholesale bandwidth costs by 80%;
  * Used public-private partnerships to attract investment; and
  * Pioneered online banking services, such as the M-Pesa service, which
    is used by more than 80% of subscribers (13.5 million people) of
    Safaricom, Kenya's largest mobile operator.

One of the so-called "BRIC" countries, Brazil, has also initiated a 
national broadband plan that:

  * Seeks to maximize competition in the mobile and broadband markets;
  * Fosters investment in the incumbent provider Telebras as a
    competitor in the wholesale broadband service market;
  * Employs technology neutrality in regulating networks, while
    encouraging network buildouts, and
  * Provides tax and financial incentives.

Hong Kong, meanwhile, has leveraged a private-sector, market-oriented 
strategy to achieve:

  * A successful auction of LTE and WiMAX spectrum in 2009 -- even in
    the midst of the global financial crisis; and
  * Sustained private investment in broadband infrastructure, resulting
    in a broadband penetration rate of 83% at the beginning of last year.

Developing countries are acting now to facilitate the development of the 
Internet. The key is to adopt nationally specific policies that leverage 
the broad-based nature of the Internet and mobile environments and 
create a "virtuous circle" of higher demand, economies of scale and 
greater supply.

*Sustaining an Environment for Success*

Another way to describe these market developments is what I call 
/innovation supply and demand/ -- the ability of innovators and 
entrepreneurs worldwide -- big and small -- to create new products and 
services on the foundation of a healthy telecom and Internet industry. 
This creates a supply of thousands of new products and services for a 
"demanding" set of customers who are anxious and willing to consume 
these new services in a world of greater mobility and connectedness.

Governments work best when they implement an environment conducive to 
innovation supply and demand -- then step back and avoid 
counter-productive interventions.

We should be clear about the specific ingredients for a successful 
Internet ecosystem:

  * The presence of a consuming public that is keen to learn, to be
    mobile, to achieve and to be connected;
  * Markets that foster innovation and competition, forcing providers to
    improve and become more efficient to attract and keep customers;
  * Notable economies of scale in all aspects of new products and
    services -- whether it be infrastructure, consumer devices or
    services -- driving down costs and permitting widespread adoption;
  * Intuitive service offerings that make simplicity and ease-of-use the
    top priority in driving market uptake;
  * Standards that permit interoperability between a burgeoning set of
    devices and services within an increasingly global marketplace;
  * Availability of spectrum for an increasingly mobile world;
  * And perhaps most importantly: /freedom/. This includes the freedom
    of ideas, the freedom of information and the freedom to take
    entrepreneurial risks in an increasingly vibrant and decentralized
    environment.

We should recognize that the innovation we have seen in the mobile and 
Internet environments was not implemented in a top-down fashion by 
policy-makers. It was driven by multiple players and stakeholders around 
the world. There are thousands of social media companies, Web designers, 
retailers that market their own e-commerce offerings, analytics 
companies that break down complex data patterns to drive customer 
relevant offerings, mobile phone distributors, Internet cafes and 
community centers -- all of them with a role in shaping products and demand.

The Internet has grown precisely because it has NOT been micro-managed, 
regulated or "owned" by any government or intergovernmental 
organization. Let's be clear about this: the Internet continues to 
demonstrate the effectiveness and success of the current 
multi-stakeholder structure -- and its own independence. No government 
or single organization can or should attempt to "control" the Internet.

Sustaining this environment, I believe, offers the best chance to 
continue achieving our mutual goal of making an innovation-driven 
Information Society a reality all over the world.

*WCIT*

This brings us to the WCIT, which is the International Telecommunication 
Union's first conference to review the International Telecommunication 
Regulations (ITRs) since 1988. As we look back on what the delegates 
accomplished that year, we should appreciate the environment for success 
that they created. The genius of that work can be found not just in what 
the delegates chose to do back in 1988 -- but what they refrained from 
doing.

The true "magnetic north" of their compass was to create a framework for 
interoperability and connectivity. But they did so without 
over-burdening the ITRs with rigid "fixes" for specific issues or 
perceived inequities. Within the scope of the ITRs, the 1988 delegates 
created an architecture for innovation, flexibility and broad-based 
consultation.

The world has changed and, as with any successful organization, it is 
wise to consider how that change should be reflected in the ITRs. But it 
is critical to acknowledge the flexibility and guidance that the ITRs 
have provided, in light of our new environment.

It is also vital to see the differences between the Internet and the 
structure of international telecommunications backbones, circuits and 
gateways that have been addressed in the ITRs. The Internet is a new and 
different phenomenon, entirely. It is not the legacy of common carriage 
and "bent-pipe" transmission; it is an ecosystem of content providers, 
application developers, social media companies, and data and video 
transmission providers -- and ultimately, ideas and knowledge. There is 
no Internet "central office" or headquarters. Its openness and 
de-centralization are its ultimate strengths.

Now that the Internet is here and established, we need to nurture it as 
an environment that is:

  * Highly data driven;
  * Characterized by a free flow of information and commerce, happening
    at light speed,
  * Where innovation is organic and distributed worldwide, and
  * Where consumer interests continue to be met even where they differ
    from country to country and within countries.

*Opposing Content Restrictions or Censorship*

Several proposals have been made for the upcoming WCIT that, although 
seemingly well-intentioned, fail to acknowledge this "new world" we live 
in and what is required for future success.

In particular, proposals to control content transmitted over networks 
run counter to the foundation of a free and vibrant telecommunications 
and Internet society.

The ITRs serve to set an international framework for linking 
international telecom facilities. They should not be inappropriately 
stretched to cover any aspect of content routed over those facilities.

Throughout the WCIT process, the United States has, and will continue 
to, express opposition to proposals that would place governments in a 
position of greater power to censor the Internet, track content or 
target end users -- even under the guise of combating spam, controlling 
traffic routing or identifying calling number information as a way to 
defeat alleged fraud and "misuse" of networks.

There is an overriding issue of freedom of information that the United 
States recognizes as a core tenet of human rights. This is embedded not 
only in US constitutional law and tradition, but also within the 
founding documents of the United Nations. Both the Universal Declaration 
of Human Rights, and the International Covenant on Civil and Political 
Rights contain provisions (Article 19 and Article 19.2, respectively) 
that recognize freedom of expression, as well as the right to receive 
and impart ideas, in any medium and across borders

Proposals to control content and routing, or to expand the definitions 
of international telecommunications to cover the Internet, ultimately 
will not work. Such proposals will only:

  * Stifle innovation, promote customer cynicism, and breed
    "work-around" solutions to undermine flawed policies;
  * Undercut the free flow of information and ideas, defeating the
    entire purpose of the ITRs themselves.

Similarly, proposals that seek to artificially mandate pricing terms -- 
such as "transfer payments" between content providers and network 
operators -- will only result in failure. With regard to 
transfer-payments on data traffic, the U.S. would raise the following 
questions:

  * How would transfer payments be implemented in the current environment?
  * Who would determine the transfer prices and how to apply them?
  * Is the originator of an Internet search a sending or receiving party?
  * Finally, what happens if network operators refuse to transmit
    downloaded content because the "termination rate" to a certain
    country or ISP is excessive or uneconomic?
  * And probably most importantly, would such pricing lead to increased
    freedom or flow of information -- or less?

To be clear, the United States will oppose changes to the ITRs that (1) 
restrict the free flow of content, (2) broaden the scope of the ITRs, 
however subtly, to impinge on the Internet's natural growth and 
evolution, or (3) impose uneconomic pricing or transfer-payment 
obligations on Internet content providers or backbone operators.

In its initial tranche of contributions, the United States will make the 
following proposals, which are consistent with this approach. We will:

1) Consider only minimal changes to the preamble of the ITRs;

2) Seek alignment of the definitions in the ITRs with those in the ITU 
Constitution and Convention, including no changes to the definitions of 
/telecommunications/ and/international telecommunications service;/

3) Approve ITR's which maintain the voluntary nature of compliance with 
ITU-T Recommendations;

4) Continue to apply the ITRs only to /recognized operating agencies/ or 
RoAs; i.e., the ITRs' scope should not be expanded to address other 
/operating agencies/ that are not involved in the provision of 
international telecommunications services to the public; and

5) Promote revisions of Article 6 to reflect the variety of flexible and 
innovative interconnection and termination arrangements found in 
competitive markets.

There will be subsequent opportunities for the U.S. to make additional 
proposals, and meanwhile, I am engaging in bilateral discussions with 
other governments to hear their views and how they believe their own 
proposals will drive continued success of the telecommunications and 
internet industries

For the United States, our approach is based on recognition that the 
existing environment today works amazingly well, and it is empowering 
telecommunications -- and human -- development by quantum leaps. In 
cases where imbalances occur, they can be addressed through market 
forces and consumer-focused /national /policies that empower local 
content development and stimulate local and regional traffic and demand.

So what should be the focus of our unique opportunity to drive a new set 
of ITRs at the WCIT?

  * To reaffirm our belief in what will drive future market success;
  * To recommit ourselves to the goal of maintaining and promoting
    global telecommunications connectivity in the 21^st century;
  * To create an unfettered, free flow of ideas, information and commerce;
  * To establish high-level principles that foster an open and secure
    Internet and network operating environment; and
  * To be pragmatic in understanding that telecom and Internet economies
    are too large, too distributed and too diverse for any one
    organization to control.

In more practical terms, this means preserving the principles of the 
ITRs' preamble -- including the value of connectivity -- maintaining the 
stability of the ITRs, as well as the voluntary nature of compliance 
with the ITU's standards recommendations, and preserving the definitions 
in the current treaty that have served the world well. It means avoiding 
changes to those definitions -- and to the overall ITRs -- that would 
broaden their scope, dilute their meaning and amount to "mission creep" 
for an international treaty that has been so effective in establishing a 
platform for growth and innovation.

So, in summary, we should congratulate ourselves on the 25-plus years of 
success in building a vibrant telecom and Internet economy, driving 
economic growth, and empowering individuals with information, 
connectedness and commercial opportunities.

Our challenge now -- more than any other -- is to maintain an 
environment for continued success, and to continue creating that 
environment around the globe, in all countries. We need to acknowledge 
how innovation is best created, through consumer demand, and realize 
that the Internet is beyond the scope of any one nation or regulatory 
authority to control or manage.

By following these principles we will enable the telecommunications and 
Internet phenomenon to become our lasting legacy and platform of success 
for future generations. Thank you.



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