1. Part 2: Universal Internet Access Robert Cannon Senior Counsel for Internet Issues Office of Plans and Policy US Federal Communications Commission

2. Standard Disclaimer Views expressed are Robert Cannon’s and do not necessarily represent those of the FCC, the Commissioners, or its staff.

3. “A Nascent Industry”

4. 1991

5. 1997

6. Source: Matrix.net Logarithmic

7. Distribution of ISPs September 1996 1996

8. Distribution of ISPs October 1998 1998

9. Number of Internet Hosts Source: Matrix.Net

10. 100-200% 50-100% 25-50% Decrease Source: Matrix.net

11. Online Populations Source: Morgan Stanley Dean Witter, The Global Internet Primer (June 2000) Million

12. North American Backbone Providers Source: Boardwatch Magazine Number of Providers

13. Backbone Market Source: OECD

14. Factors for Internet Deployment Telecommunications Pricing Universal Telecommunications Service Customer Premises Equipment Market (Modems) Computer Inquires: Telecom Safeguards –Open Platform / Bottlenecks –Anticompetitive Behavior

15. Telecommunications Pricing

16. 40 Hours US$ PPP (off-peak), September 2000 www.oecd.org/dsti/sti/it /

17. Internet subscribers and pricing

18. Internet Development and Pricing

19. At the beginning of 2000 five countries had unmetered access. At the close of 2000 there will be 12. ‘Traditional’: –Australia, Canada, NZ, Mexico, US. Introduced in 2000: –24/7: Germany, Portugal, UK. –Off-peak: Finland, Hungary, Korea, Spain. Close Call: –Japan (NTT for ISDN and late night) Unmetered but not from incumbent: –France, Netherlands, Ireland, Italy, Poland, Switzerland, Sweden. Source: OECD

20. US Telecom Universal Service Historical Telephone Penetration Estimates Source: FCC Great Depression

21. Deregulation of CPE Carterphone 1959: connects radio to telephone FCC overturns AT&T tariff that prohibits interconnection Standardize as Part 68 Result in vibrant modem market

22. Computer Inquires Recap Separation of Basic and Enhanced –Unregulation of Enhanced Services –Affirmative regulation of carriers to meet the needs of data processing to promote innovation and competition in the data processing market to assure equal access for computer service to essential communications services to prevent anticompetitive behavior Open communications platform

23. Resulting Market Low Barriers to Entry Telecom 7000+ ISPs Many 1000s of Content and Application Providers

24. Mistakes We Have Made...

25. I think there is room in the world for maybe five computers. - Thomas Watson Sr., Chairman of IBM Corp 1943

26. This 'telephone' has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us. - Western Union, 1876.

27. Source: Matrix.net Internet Bitnet ARPANet

28. Community Networks Bandwidth v. Content Training Community Empowerment Promote Local –Communication –Economy –Health E-Democracy Not a global shopping mall Creators not Consumers www.afcn.net Telecommunity Resource Center www.tcrc.net Gene Crick

29. ACLU v. Reno (Communications Decency Act) It is no exaggeration to conclude that the Internet has achieved, and continues to achieve, the most participatory marketplace of mass speech that this country -- and indeed the world -- has yet seen. The plaintiffs in these actions correctly describe the "democratizing” effects of Internet communication: individual citizens of limited means can speak to a worldwide audience on issues of concern to them. Federalists and Anti-Federalists may debate the structure of their government nightly, but these debates occur in newsgroups or chat rooms rather than in pamphlets. Modern-day Luthers still post their theses, but to electronic bulletin boards rather than the door of the Wittenberg Schlosskirche. More mundane (but from a constitutional perspective, equally important) dialogue occurs between aspiring artists, or French cooks, or dog lovers, or fly fishermen.... [T] the Internet may fairly be regarded as a never-ending worldwide conversation. The Government may not, through the CDA, interrupt that conversation. As the most participatory form of mass speech yet developed, the Internet deserves the highest protection from governmental intrusion. -- ACLU v. Reno, CA No. 96-963 (E.D.Pa June 11, 1996), affirmed, No. 96–511(S.Ct. June 26, 1997)

30. Strategy of Universal Access Through Local Access Points E-rate

31. Schools and Libraries Program Discount Matrix

32. Schools and Libraries Program Process Contract Forms Money School Service Provider Universal Service Administrator

33. Schools and Libraries Program What is Covered Covered –Wiring –Routers –Hubs –Network File Servers –Necessary Software –Installation –Maintenance –LANs Not Covered –Computers –Hardware –Non-network software (applications) –Fax Machines –Modems –Teacher Training –Upgrades to Electrical System –Asbestos Removal –Security Eligible Services List http://www.sl.universalservice.org/Reference/eligible.asp

34. Schools with Internet Access Percent E-Rate School and Library Internet Access Subsidies: 84% funding has gone to public schools $4B has been distributed www.sl.universalservice.org

35. Timeline 1970198019902000 TCP/IP Invented DNS IAB W3C TCP/IP Comp III

36. Concluding Thoughts... Internet Growth is Robust Telecommunications Policy is a key factor to Internet Deployment –Focus on bottlenecks Government Partnership –Research & Development –Universal Service Net is more than a global shopping mall

37. Potential Policy Solutions Texas Ability to Pay Population Density Low High Technology, Demand Aggregation Competition Loan and Tax Incentive Programs, Community Networking, Social Contracts Grant Development, Economic and Community Development Initiatives Source: Brett Perlman, Texas Public Utility Commission

38. Thank You... Robert Cannon Senior Counsel for Internet Issues FCC Office of Plans and Policy rcannon@fcc.gov

39. Schools and Libraries Program Resources FCC School & Libraries Program website www.fcc.gov/ccb/universal_service/schoolsandlibs.html Universal Service Administrator’s SL Website http://www.sl.universalservice.org/ Merit.Net http://www.merit.edu/k12.michigan/usf/ The New Universal Service: NTIA's Guide for Users http://www.ntia.doc.gov/opadhome/uniserve/univweb.htm