Mark Chandler, Senior Vice President and General Counsel of Cisco Systems, offered testimony today before the House International Relations Subcommittee on Human Rights at their hearing, “The Internet in China: A Tool for Freedom or Suppression?”His written testimony follows (Please click on permalink to read in full)Full hearing testimony can be found at: http://wwwc.house.gov/international_relations/afhear.htm Read More »
I was just perusing some broadband penetration rate figures and noticed that the US continues to fall further behind our international competitors. At the end of the 3rd quarter of 2005, we had fallen to 19th in the world, barely ahead of Slovenia. Former broadband laggard like France and the UK have now surpassed the US and we may fall out of the top 20 entirely soon. This is a slow building national crisis. As we continue to fall further behind, we may be crippling our economy in the long run.Now I know that the naysayers will say that it isn’t fair to compare the US to Korea and Japan in broadband penetration because of the higher population density. Fair enough. So let’s compare the US to Canada, which also has a huge rural hinterland. And what do we find? Canada’s broadband penetration is a full 1/3 higher than the US. Maybe it has something to do with the fact that the Canadian government made broadband deployment a priority long ago.One other interesting statistic I found was that Korean broadband penetration actually fell from Q2 to Q3 of 2005. Of course that still left Korea with 67 broadband connections per 100 households compared to 33 in the US. But it might be a sign of market saturation for broadband. If so, it just shows how far the US has to go to be internationally competitive in broadband.
The core regulatory work of the European Commission revolves around the creation of a working single market across the 25 member states of the European Union. The EU has developed a lot of other areas of interest but the economic issues have been a prime concern since its inception.A discussion I was involved in last week highlighted for me the challenges of trying to do this against a backdrop of a rapidly evolving global information society. This was on proposals to revise something called the Television Without Frontiers Directive. The Commission is seeking to impose a basic tier of regulation on all audiovisual services, including those delivered over the internet or mobile phones. Their rationale for this is that it is necessary to ensure that suppliers of these services can sell across the single market without further regulation. The regulatory process will take a while to complete so any new rules may come into force from around 2008-9. This is against a backdrop of Google launching the beta of video.google.com which we can expect to develop significantly, along with a host of other competing services, between now and the new regulations being completed. When the new regulations come into effect these video services will presumably be told that they must comply with the EU-wide regulations or be subject to 25 different sets of national regulation or cease operating in the EU. If, as is likely, there are by then mature global services that are popular with European customers then we can anticipate an interesting power-play between regulators and service providers.The current situation in respect of online gambling may offer pointers as to how this could play out for audio-visual services, with an element of role-reversal between EU and US. UK-based gambling companies offer their services globally and say that it is up to local regulators in countries like the US to enforce their gambling rules on their own citizens. The stock market has expressed its view of the likelihood of gambling regulators effectively controlling behaviour by pouring hundreds of millions of pounds into gambling companies that draw revenue from a sizeable US user base. Investors in US-based audio-visual content services may make a similar judgement about the ability of EU regulators to impose rules on how their content is delivered or presented.
The Congressional Human Rights Caucus had a meeting in Washington, DC today and Cisco offered the following handout to the attendees of the meeting:Cisco Systems Information Sheet for House Human Rights Caucus MeetingOn China and Access to InformationFebruary 1, 2006Cisco Technology and ChinaCisco products (primarily routers and switches) enable the transfer of Internet traffic from point A to point B. Our main customers are enterprises of all sizes, from large corporations to small businesses. We also sell products to telecommunication service providers, including government owned telephone companies, and government end users. Cisco does not configure, operate or manage customers’ networks. The equipment we sell in China is the same equipment we sell worldwide -it is not altered in any way. The router features that the Chinese government may use or insist that Chinese companies use to limit accessibility to some web content are the same features that are currently used by companies, libraries, and schools around the world to block certain sites they decide it is not productive or proper for their employees, clients or students to access. These features are inherent in routers and also function as a security feature to protect against sites that may contain viruses or foster denial of service (DOS) hacker attacks. Similar router functionality is widely available around the world from both hardware and software vendors. The functionality can be used for many purposes -but it should be clear that it is content neutral.We comply with all U.S. Government regulations prohibiting the sale of products to certain destinations or to users who misuse products or resell to prohibited users. Cisco has been and hopes to continue to be a key driver of Internet growth worldwide. House International Relations Committee, Subcommittee on Africa, Global Human Rights and International Operations: Hearing on February 15, 2006We intend to have a Cisco representative at this hearing.More information on this subject is publicly available at:News@Cisco: http://newsroom.cisco.com/dlls/2005/hd_072505.htmlCisco Government Affairs Website: http://www.cisco.com/en/US/about/gov/people/network_management.htmlCisco Investors Relations”Investors’ Corner”:http://investor.cisco.com/phoenix.zhtml?c=81192&p=irol-governancecorner
As always, this is just me talking, but I have to agree with Google on their recent positions with regards to their China site as well as not complying with the subpoena from the U.S. Justice Department for search information, even though it calls their corporate mantra of “Do No Evil” into question. Here’s why: Agree or disagree with China’s censorship policies, some internet in China is definitely better than no internet. They are a sovereign nation and while I may disagree with them keeping information from their citizens, that is their right under their own laws. We cannot place our U.S. or French or German or British sensibilities or values on them. Further, Google (any other company) has to comply with the local laws where they want to do business. I would also argue that in order to change a situation you disagree with (if that is your goal) it certainly helps to have a seat at the table so that your voice can be heard.The reason I don’t think they should comply with the Justice Department subpoena is because it could ultimately end up harming the very thing that generates revenue for them…eyeballs. In my view, this subpoena business is a slippery slope. If I as a user of Google (they, who are clearly moving to more and more personalization so they can further target ads at me) rightly or wrongly feel that they might give up any of my personal information to the government if asked, I might be a little less confident in using their sites and services…I might even leave altogether if I felt that I couldn’t trust them to protect my e-mail, my pictures, my searches, etc. If they are made to comply with the subpoena, I’m sure they will and they should, but since they aren’t even a party to the underlying investigation that Justice is conducting in the first place, it makes it a little easier for them to respectfully not comply. (Disclaimer: I am not an attorney and don’t know the law in this area, but that clearly is not stopping me from having an opinion).So, those are my two cents on this. I understand the unenviable bumper sticker position that this puts Google in (“Google complies with Chinese Law, but not U.S.”), but I believe they are doing the right thing. Google CEO Eric Schmidt said at the World Economic Forum today that they felt that offering a censored version of their search engine would be “less evil” than boycotting the country altogether. With internet users in China having grown from 80,000 in 1995 to over 130,000,000 in 2005 it looks like the insatiable appetite for information continues and also helps validates his point. A seat at the table is better than not having one at all.