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WIRED 1.3
Where Is the Digital Highway Really Heading?
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The Case for a Jeffersonian Information Policy

By Mitchell Kapor


First the visionaries sketched it out, then the computer literati caught
on. Now the mainstream media is hyping it to the masses: a seamless
high-speed network carrying voice, data, and video services to everyone.
This information highway, we are told, will be used as a pipeline to bring
an expanded universe of information and entertainment into the home and
the workplace. Thousands of movies, mail-order catalogs, newspapers and
magazines, educational courses, airline schedules, and other information
databases will be available with a few clicks of a remote control. Two-way
video conferencing - which would allow you to hold a business meeting or
check with the doctor, for example - will become integral to the family,
social life, and to business. The information and communication
infrastructure of the future, based on fiber optics, will provide the
principal conduits for global entertainment, commerce, information, and
communication in the next century.

This dream has been promoted extensively, but until recently little
visible progress has been made toward its realization. In the past,
political gridlock has snarled telephone companies, newspaper publishers,
cable television operators, and other potential players in lengthy and
fruitless congressional and court battles. A justifiable cynicism
developed to fill the gap between vision and reality.

Meanwhile, the pioneers of the computer-mediated communication networks
collectively referred to as cyberspace are not willing to wait. Employing
whatever tools they can find, they are constantly pushing the
techno-cultural envelope. Life in cyberspace is often conducted in
primitive, frontier conditions, but it is a life which, at its best, is
more egalitarian than elitist, and more decentralized than hierarchical.
It serves individuals and communities, not mass audiences, and it is
extraordinarily multi-faceted in the purposes to which it is put.

In fact, life in cyberspace seems to be shaping up exactly like Thomas
Jefferson would have wanted: founded on the primacy of individual liberty
and a commitment to pluralism, diversity, and community.

While the online pioneers press on, a broad consensus on key business,
technological, and political aspects of a National Information
Infrastructure, or NII, is emerging. The creation of high-capacity
broadband networks by cable and telephone companies seems imminent. Yet
even as the necessary agreements between business and government are
forged, crucial doubts remain as to whether the re-wiring of America will
result in Jeffersonian networks promoting the openness, freedom, and
diversity that is the true promise of this technology.

In the worst case, we could wind up with networks that have the principal
effect of fostering addiction to a new generation of electronic narcotics
(glitzy, interactive multimedia successors to Nintendo and MTV); their
principal themes revolving around instant gratification through sex,
violence, or sexual violence; their uses and content determined by
mega-corporations pushing mindless consumption of things we don't need and
aren't good for us.

What could prevent such a fate? The purveyors of network services could
simply decide that a business strategy that encourages the widest variety
of content sources and originators will dramatically increase network
usage. A few pennies per transaction will eventually add up to billions of
dollars in revenue.


The Consensus

The emerging consensus between business, government, and policy watchdogs
has three main points:

*Private, not public: The private sector, not the government, will build
and operate the NII. Despite extensive reports to the contrary, the
government's role will be limited to funding research, leading experiments
with ultra-high-speed networks, helping promote standards, and protecting
the public interest in privacy, freedom of speech, and other areas.
Telephone companies and cable television operators, not the government,
will be the principal carriers of traffic into the home.

*A hybrid Net: Networks that reach into the home will be hybrids of the
fiber-optic cable and existing copper wire and coaxial cable used by
telephone and cable television companies. Fiber-optic cables will be used
in the major arteries and portions of the distribution system, while
existing copper and coaxial cable will be used in the last hundred yards.
To achieve a broadband network capable of delivering high-quality video,
voice, and data, it is both unnecessary and too expensive to replace the
last segment into the home with fiber optics.

*Video driven: In the near term, the principal business opportunity
driving investment in a broadband network is the delivery of movies on
demand to the home. Government regulators are trying to orchestrate an
overall path towards less regulation and more competition in bringing this
key competitive service to the home. More broadly, both cable and
telephone companies want a piece of other network services such as voice
telephony, video conferencing, and database access.


The Happy Accident?

An optimist's view of the next decade is that by some happy accident, the
cable and telephone industries will be persuaded by a logic of
self-interest to build broadband networks consistent with Jeffersonian
ideals, even if they are unaware of or uninterested in the full range of
democratic goals. They will come to see that networks which permit the
greatest diversity of content and services - be it video programming,
computer software, or whatever can be dreamt up by the mass media and
individual users - will create the largest sustainable business
opportunities.

Furthermore, if the communications industry is responsive to key ideas
about openness (in technical architecture, industry structure, and access
to networks), then the chances of Jeffersonian vision winning are even
greater. If adopted as a guiding principle, openness, as exemplified by
the personal computer and the Internet, can be a driver of prosperity and
diversity in any new market.

On the other hand, a pessimist would insist that the owners and operators
of broadband networks will never voluntarily give up control over the
terms of access, use, and content. Bringing the Net to everyone is too
important a matter to be left to the private market, the argument
continues, so the government therefore must either take control of the
process, or, in the extreme view, build the Net itself.

By mechanism and by policy, networks will be much more closed than open,
the pessimist would say. Old ways of thinking die hard, particularly when
they were weaned by legally enforced monopolies. Content will be supplied
only by a carefully chosen set of providers, barriers to entry will be
created for everyone else. Programming will still seek the least common
denominator, and the population will be divided by income into information
haves and have-nots. This scenario owes more to Huxley's Brave New World
than to Jefferson's vision of democracy.

The future lies somewhere between the optimist's and the pessimist's
views. Optimism, combined with vigilance and a commitment to seek
government intervention for redress of private enterprise's failures, is
the best prescription for coping with the NII's uncertain future.
Organizations like the Electronic Frontier Foundation (of which this
author is a co-founder) are committed to developing detailed public policy
recommendations and political strategies necessary to close the gap
between optimism and emerging reality. But before the government commits
to any policy, it must first arm itself with an understanding of the
situation at hand.


The Government's Role

From the outset, the Clinton Administration took an activist approach to
high-tech policy as a means of promoting economic growth. Indications that
the new administration might reshuffle the infrastructure deck became
evident even before the inauguration. At the Little Rock economic summit,
AT&T Chairman Robert Allen voiced serious concerns that the government
itself was planning to build and operate the "information super-highways"
being promoted by Vice President Gore.

The Vice President made pointed comparisons during the campaign between
his father's role in sponsoring legislation for the interstate highway
system and his own desire to create a system of information
super-highways. The information super-highways sound bite took on a life
of its own in the media. But taming the huge budget deficit made the idea
of a government-backed network costing hundreds of billions of dollars
beyond practical consideration, and the ideological debate about public
versus private financing was never fully developed.

In an interview in the National Journal last March, the Vice President
attempted to lay the matter to rest: "The idea of the federal government
constructing, owning, and operating a nationwide fiber-optic network to
the home is a straw man.... It is a phony choice that some people see
between a federal public network and no federal involvement at all." Gore
instead laid out a vision for government involvement that focuses on
coordinating network standards and funding advanced research in high-speed
networks, applications development, and pilot projects for education.

The Administration's face-saving retrenchment came at a propitious time
for cable and telephone companies, both of which have been gearing up for
major broadband investments of their own. By focusing on public and
private cooperation, with the private sector in the lead role of building
the actual networks and government in a supporting role, the
administration's communication technology initiatives have gained favor
among the titans of the communication industry. In a complementary
statement last March, the CEOs of leading local and long-distance
telephone companies and other communication industry executives announced
their support for the Clinton-Gore agenda.


The Private Sector Steps In

Both desire and fear are pushing cable and telco to accelerate broadband
deployment. The desire to develop and penetrate the multi-billion-dollar
markets of video-on-demand and interactive shopping is felt more keenly
within the entrepreneurial (some would say piratical) cable industry than
within the telephone companies, still waking from their long slumber as
protected monopolies.

When regulations restricting competition are relaxed, nobody's market
share is protected. If telephone companies can offer video programming,
cable revenue will surely drop. If cable companies can offer local phone
service, the Regional Bell Operating Companies (RBOCs) will be hit where
it hurts. As the public policy continues to enable more and more
competition, the regulatory barriers that have kept cable and telephone
companies out of each other's base businesses are surely going to fall.

In the past six months alone, both TCI and Time-Warner Cable, the two
largest cable operators, have announced major infrastructure upgrades. TCI
plans to increase the channel capacity in its systems from 50 to 500
channels through the use of digital compression. Time-Warner is developing
a full-service network in Orlando, Florida, which will offer cable
television, video on demand, and fully interactive capabilities.

The RBOCs are not standing still either. This year Bell Atlantic will
begin testing an interactive, switched broadband network for delivering
cable television, telephone, and other services over the same wire. At the
other extreme, Southwestern Bell, in the first transaction of its kind,
purchased two major cable television systems in Virginia.

Both cable and telephone companies want to offer video-on-demand services
to compete with video rental stores (a $12-billion market). The viability
of the video-on-demand market has become an article of faith, based on
extrapolation from the law of nature that says regardless of how many
copies of a hot movie a video store has, there's never one left on the
shelf when you get there. With video-on-demand, this will never happen,
because individual digital realizations of a stored film image can be
generated as needed. Add the convenience of skipping the trip to get the
movie and being able to make a last-minute decision about what to watch,
and you have a compelling case for the inevitability of movies on demand.

Cable also wants to protect itself from new competition from Direct
Broadcast Satellite (DBS) services like Hughes DirecTV, which will offer
150 channels of video through an inexpensive and convenient antenna
system. (DBS today is a one-way service threatening cable's $20-billion
base business. In the future, given new research at MIT and elsewhere,
interactive television delivered without wires is not out of the question.)

Besides providing video on demand, cable companies want to compete for a
share of local telephone business (an $80-billion market) by offering a
new generation of cordless phones that can enable communication with a
cable set-top converter. Conversely, telephone companies want into the
market for providing basic cable television service. And everyone is
hoping major new markets for interactive shop-at-home services will open
up.

There are great differences in RBOC strategies on a region-by-region
basis, indicating a lack of consensus on the winning broadband formula.
Some RBOCs may not survive the transition to competition in local
telephone service - others, cognizant of the threat to their installed
bases, have bought into cable franchises. Telephone companies are clearly
playing catch-up when it comes to providing entertainment services over
our networks. In addition to the technological risks they face (which
cable also faces) they are hindered by a regulatory environment that still
contains substantial prohibitions.

Local exchange carriers also lack the kind of entrepreneurial culture
capable of making rapid strategic adjustments in dynamic environments,
placing big bets, and having the will to see those bets through. This puts
them at a disadvantage relative to cable operators. When TCI CEO John
Malone (the Bill Gates of cable) makes up his mind to pursue a certain
course, it is certain that course will be pursued - swiftly and ardently.
To their credit, some LECs have recognized the need to reinvent themselves
for the bloody competition of the open market, but rebuilding a whole
culture, whether that of the failed socialist regimes of Eastern Europe or
the dead-end of regulated monopolies, is a supreme challenge.


Hybrid Networks

Infrastructure rhetoric of the 1980s called for end-to-end fiber, so much
so that politicians and press alike have been led to assume a false link
between fiber optics and broadband networks. But telephone carriers and
cable operators are learning more about the skillful use of technology in
a competitive, market-driven environment, leading to a general consensus
that tomorrow's broadband networks will be hybrids of fiber optics,
coaxial cable, and copper wire.

With some modification to the existing infrastructure, hybrid networks can
deliver a full range of high-bandwidth interactive services at a fraction
of the cost of fiber to the home. Digital compression, storage, and
transmission will reduce the cost of rewiring a neighborhood to a
manageable burden. In Virginia, New Jersey, and Florida, the first hybrid
networks serving actual customers are being constructed. These test
projects will serve only a few hundreds or thousands of customers, but
from these first baby steps, mature networks serving tens of millions of
households will emerge.

To accommodate an interactive network, cable television's physical
infrastructure will be re-invented and re-implemented. Today's separate
cable systems will be joined via regional hubs, which, in turn, will be
interconnected to form a national network. High-capacity video file
servers capable of storing thousands of hours of programming will be
attached at the regional level.

Existing cable systems will be replaced by high-capacity, noiseless
fiber-optic cable that will reach from the system's head into each
neighborhood. This "fiber-to-the-node" architecture will serve groups of
200 to 1,500 homes. The last segment of the network, from the node to the
home, will use existing coaxial cable. Time-Warner and TCI both plan to
use this arrangement.

This network architecture will be capable of carrying hundreds of channels
of programming into every home, as well as custom programs selected by
individual households. If the networks are engineered properly, every
subscriber should be able to view a different program, even if all are
watching at the same time.

Initially, almost all of the bandwidth will be used to bring signals into
the home, with very little being used to carry traffic back "upstream."
With proper upgrades, a hybrid network will also be capable of accepting
and switching telephone traffic. Over time, the network can be expanded to
support full two-way communication applications like video telephony.


Video Over Copper Through ADSL

Broadband networks for telephone systems have been under development far
longer than the cable infrastructure. Phone companies are rapidly
converging on delivery of the same set of services as the emerging cable
network.

Telephone company plans have been scaled back in complexity and expense
from the vision of fiber to the home. They've have realized that the
existing copper local loop can be used to deliver video through a
transmission method called ADSL (asynchronous digital subscriber loop).
ADSL permits transmission of a single compressed, high-quality video
signal, at a rate of 1.5 Mbits per second, in addition to an ordinary
voice phone conversation (see _Debunking Bandwidth_, WIRED 1.3 ,page 112).

This technique was developed at Bellcore, the research arm of the Bell
Operating Companies, and is being tested by Bell Atlantic in Virginia.
ADSL is not yet capable of providing a complete substitute for cable
television, because it can only send one channel at a time and will not
serve households where more than one television is in use at a time.
ADSL's technical limitations are temporary, and within a year or two ADSL
will be able to carry live news and sports and serve multiple televisions.

Viewed as utterly heretical in the fiber-or-bust mentality of the 1980s,
ADSL is gaining currency as a way to leverage the use of existing
facilities and serve as a transition to higher-capacity networks. ADSL
came out of the same work that produced ISDN - research from Bellcore and
other labs that examined digital transmission of information over the
telephone network (see _What About ISDN?_ in WIRED 1.3, page 59).


New Alliances and Caveats

All these plans are ambitious. The cable industry has the daring and the
wherewithal to bring this about, but it does not have the technical
culture or experience. It faces a very steep learning curve bound to be
filled with painful lessons. Most of the technology used in today's cable
systems comes from outside suppliers like General Instrument Corporation
and Scientific Atlanta, which provide not only converter boxes for the
home but satellite dish receiving equipment and transmission facilities at
the head end as well. The in-house capability of system operators is
modest.

Recognizing this, the major cable operators like TCI and Time-Warner are
seeking partners who can bring the necessary technical capabilities to the
party, even as they begin to develop their own. Telephone companies, which
have long prided themselves on engineering expertise, also recognize they
do not have all of the necessary talents to develop viable broadband
networks. Bell Atlantic's broadband network, for example, is based on a
platform developed by Broadband Technologies, a venture-capital-backed
start-up firm in North Carolina.

Now the computer industry has joined the fray. In April of this year,
Microsoft and General Instruments announced their intention to work
together to create the intelligent set-top converter this new network will
require. Really a computer in disguise, this next generation cable box
will contain an Intel '386 or higher microprocessor and multiple megabytes
of ROM and RAM.

In this mad scramble, strategic announcements are being driven by a
complex series of forces mixing serious intent with hopeful or even
wishful thinking. More alliances are inevitable as the players jockey for
position to form teams with the critical mass of skills and resources to
open up new markets. Public statements are driven not only by realistic
internal commitments, but by defensive public relations - "strategic
positioning" - to counter an impression of lagging the competition.


A Policy Prescription: Openness

Let's assume all the technology and all the alliances shake out in
unpredictable ways by the end of the decade. Attention is likely to focus
on the winners and the losers, among businesses and in technologies. While
the outcome of battles between cable and telephone superpowers is going to
make a difference to the consumer, more important are the design
principles (both in technical architecture and public policy) under which
the winning entry or entries operate.

The kind and degree of network openness will determine the likelihood that
industry will choose the Jeffersonian path. Openness is either present or
absent in every aspect of the network. A network is either open or closed
with respect to who may have access to it, who determines its specific
uses, who may supply content, who can provide the equipment used, how
interfaces and standards are determined, and whether the technical details
are public or private.

In its fundamental architecture and, increasingly, in its policies, the
Internet is an ideal example of an open network. It is an interactive
medium based on two-way communications, where people can fluidly shift
from position of listener to that of speaker, from role of consumer to
that of provider. The public switched telephone network, on the other
hand, is substantially closed in its architecture, but, by virtue of being
common carriers, telcos are required to be open in access, use, and
content. And cable systems have no such obligation, they exercise very
tight control over both content and use.

The Jeffersonian option requires a commitment to openness in all of its
dimensions. We should be paying attention to issues of openness today
because while it is easy to build openness into networks, it is difficult
to add it after the fact (see _Keep the Switches Open_, WIRED 1.3, page
57). Policy makers and business leaders need to ask themselves these key
questions before committing to any one path:

Who has access to the network? Is it affordable? Many basic human services
transactions - in health care and social welfare for example - could be
handled far more easily over a ubiquitous voice, data, and video network,
saving the elderly, the infirm, and young mothers with small children a
trip on public transportation downtown to municipal, state, and federal
office buildings. But unless there is a safety net that guarantees an
affordable connection, the network will further stratify society, not
bring it together.

Everyone has the right to telephone service, and local telephone service
is inexpensively priced. Yet this universal service commitment has been
achieved through a system of regulation that draws no praise and is in the
process of being dismantled. Patricia Eckert, chair of the California
Public Utilities Commission, has spoken of the co-dependency of regulators
and the regulated. The cure for this addiction is the free market, but no
one is promising that competition alone will insure that everyone who
wants service can get it, or that if it is available, it will be
affordable. Universal service is the baby that must not be thrown out with
the bath water of a dysfunctional regulatory system. In truth, no one
knows how to accomplish this yet. It is therefore imperative that, in the
public policy debate about broadband networks and increasing competition
in local phone and cable service, the right to service must be given
priority.

Who can put content onto the system? In the "video dial-tone" model
developed for telephone companies by the FCC (which has already been
approved), telcos will be allowed to operate their own content servers.
They are also required, however, to allow third parties to attach their
own video servers to the network, and to charge on a non-discriminatory
basis for transport of the content to subscribers who request it. The FCC
went so far as to specify that the top-level menu which the user sees
(called a gateway) points to the third-party services.

In this respect, the terms of providing content under video dial-tone
would generally follow the practice on the Internet - there, anyone who
wishes to make information available is free to put up an FTP, Gopher, or
WAIS server, to which any Internet user can connect.

The model for cable television has been completely different. Cable
operators, in general, have control over which services they carry. While
cable operators are required to carry most local, over-the-air broadcasts
and a small number of public access channels, they are free to do what
they want beyond that. An industry structure in which major cable
operators are also owners of programming creates a further incentive to
restrict content. Time-Warner and TCI, for example, both hold major stakes
in CNN. They might just think twice before agreeing to carry another
24-hour news service.

The cable industry would need to substantially reconceive itself to let
anyone provide content. It is already re-inventing itself technically to
make this feasible. The federal government, through a 1992 re-regulation
act, recently gave cable a big incentive to think of itself differently by
putting a tight cap on revenue growth from basic cable services. Now new
services will have to be the basis for growth. These new services might
eventually include the use of cable as a carrier for unrestricted
provision of third-party content. In this scenario, enlightened
self-interest will eventually drive cable to more openness in content.
Failing that, the government must develop a new type of legal regime that
obligates a carrier not to discriminate in content, and hopefully does not
make the carrier labor under the heavy burdens of regulation as a common
carrier.

Will novel uses of the network be allowed to develop? In Massachusetts,
Digital Equipment Corporation and Continental Cablevision conducted an
experiment using idle bandwidth on an in-place cable system as a
10-Mbits-per-second local area network. Technically, cable companies could
add a low-cost data-service option for Internet access and other computer
communication services to the home if they allowed low-level access to the
network as a type of fast, dumb data pipe. But cable system operators, who
think of themselves as vehicles for the delivery of mass-market
entertainment, are likely to overlook the opportunity here because it is
so far outside of their usual province.

New and potentially revolutionary services such as these should not be
overlooked or squeezed out of the market. If users have more control over
the uses of the networks, these new opportunities are more likely to get
the early nurturance they need to turn into big, recognizable business
opportunities. To accomplish this, we should consider a process for
setting aside experimental frequencies on broadband networks for
developing significant new uses. This approach is gaining favor in the
wireless world, where the FCC is now granting valuable Pioneer's
Preferences for such developments, and it should be considered for
adoption in broadband as well.

Where do services originate? Ideally, in any network, one should be able
to create and distribute programming from the home, not just receive it.
This requires a network with sufficient upstream bandwidth to carry at
least one compressed video signal (ideally, 1.5 Mbits per second or more).
Either the basic network itself should have this capability, or, if this
is uneconomical, it should be a option that is always available as an
add-on. Requiring the use of special facilities to originate programming
raises barriers to entry. It should be as easy to provide a service as it
is to use one.

In the online world, open and closed models exist. Commercial services
like Prodigy and, to a lesser extent, Compuserve and America Online,
tightly control who can put content onto the service. At the same time,
the existence of 45,000 individually-controlled bulletin boards testifies
to the fact that a lot of people want to run information services.
Networks must be designed to support sufficient upstream bandwidth to
allow service providers the maximum flexibility in point of origin.

Will system specifications and interfaces be publicly available and
defined in an open process? Both telephone and cable companies will
develop interface specifications for video servers. Will these be
available to the public? Or will the standards be proprietary and
controlled by whoever created them? In the past decade, most computer
networks have evolved to an open model, while historically, telephone
company central office equipment and cable head-end systems have been
quite closed. If specifications are obtainable only through special
pleadings, the garage-and-attic segment of developers responsible for the
most radical innovations will be overlooked or even excluded. This must be
prevented.


Diversity: 500 Channels and Nothing On

Even if we have simple, powerful, innovative gizmos in our living rooms,
we still have to face the question of whether there is anything worth
watching. For practical purposes, it's not enough just to say that a
diversity of sources and uses of information ought to be a public policy
goal. It is necessary to be more specific: A diversity of what? Diversity
is not just quantitative. It's also qualitative. It comes in degrees and
has dimensions. Achieving real diversity raises fundamental issues of
political control, architectural design, and business strategy.

One of the arguments used in favor of cable television development itself
was that the transmission of video through wire, rather than air, would
increase the number of channels and therefore would increase the diversity
of programming. The average cable system carries dozens of channels that
aren't available over the air. Yet when they are filled with 1950s
re-runs, shopping channels selling overstocked merchandise, and other
detritus of the vast wasteland, it's difficult to argue from a public
policy perspective that this usage represents the fullest realization of
video diversity.

Greater diversity does not arise simply from the availability of more
channels. In systems controlled by a single operator per market with any
limited number of channels, the desire to seek the highest economic return
per channel drives the creation of least common denominator programming
that seeks the largest possible audience. And as the number of cable
channels per system continues to rise, additional niche cable services,
like comedy, science fiction, and cartoon channels, are finding their way
to the market. All of this is just cutting the same old television pie
into new, thinner slices.

In Queens, New York, Time-Warner Cable has mounted an experimental cable
system that features 150 channels. About half of those channels are used
to show a handful of pay-per-view movies at staggered intervals so that
the viewer is never more than fifteen minutes away from the start of one
of the top ten movies of the week.

Such an arrangement, known as near video-on-demand, represents a
prodigious consumption of bandwidth. While the Time-Warner system may be
one step away from true video-on-demand, it again shows how the existence
of more channels or bandwidth does not guarantee diversity.

Greater diversity is achieved through a switched architecture in which
some channels don't carry fixed content the way they do today. Rather, one
given "channel" serving the home can be made to carry any particular
program in the same way that the telephone in the home today can be
connected to any other telephone in the public switched-telephone network.


Distribution Bottlenecks

The bottleneck to diversity in video is not in creation or production (see
_Video Beyond Hollywood, The Desktop Video Revolution_, WIRED 1.3, page
58) but in distribution. It should be a national goal to create an
infrastructure that removes this bottleneck and permits the unencumbered
distribution of video programming of all kinds.

A worthy model is the existing infrastructure supporting distribution of
print material (in other words, the postal system, roads and highways for
the transportation of bulk print matter, and so on). This infrastructure
includes a taxpayer-supported network of roads and highways for the
physical movement of printed material. It also includes subsidized postal
rates for various types of publications.

As a result, there has been a richness and diversity in print media that
serves as a role model. Provision of a national video infrastructure would
mean a shift from an ecology of a small number of instances of relatively
high quality to a large number of instances of wildly varying quality.
Over time, as a new generation of professional and non-professional users
learn to master the tools, and as the tools themselves improve, the
average quality of production will increase.

We should not assume that any of this requires a taxpayer subsidy,
however. Entertainment and other premium services alone will justify the
broadband investment, according to the cable and telephone companies that
are building them.

Without an inexpensive, accessible, affordable infrastructure for the
distribution of video material, the diversity of useful video material
will be limited, and the potential of the medium will not be reached.
Until now, there have been bottlenecks of expensive resources at other
points in the chain. But thanks to advances in video cameras and desktop
video, we're down to a single chokepoint: distribution. The design of the
broadband network will make the crucial difference in whether goals of
promoting diversity are met.

And diversity - support of non-mass ideas - is a good thing: more people
thinking their own thoughts, reaching their own conclusions. Today's
fringe idea is often tomorrow's mainstream.

Diversity will permit more raw, unfiltered sources of information to reach
the people. During the last presidential campaign, more people began to
turn off the blow-dried network TV anchors and turn on C-SPAN.
Professional pundits were shocked by how many people watched the
presidential debates and town hall meetings.

Direct participation in the political process, an idea fueled by Ross
Perot and supported by Bill Clinton, would be well-served by open platform
for video. Coupled with the interactive capabilities of computer
conferencing systems, the dialogue, not the monologue, could once again
become the staple of political discourse.

Some argue that diversity will lead to social fragmentation. Print, the
medium of the greatest diversity, reflects our culture rather than
fragmenting it. Others argue that most content will be junk. Noise is just
the price we pay for signal. In fact, without junk, there is less of a
chance for real quality to emerge. Let the marketplace of ideas rule.


Broadband Policy

The critical public choice regarding the information highway is this: If
industry builds it, how happy will we be with the result? To what extent
will the Jeffersonian vision of diversity, openness, and decentralization
of control happen by itself?

The optimist in me thinks we should give telephone and cable companies
every opportunity to get it right. In fact, we should seek to educate and
enlighten, while developing contingency plans.

Here are some principles:

*Encourage competition. Competition does more to keep firms honest than a
roomful of regulators.

*Where necessary, government intervention should be minimal. It should not
take the form of heavy-duty regulation of operations, which is
self-defeating, but in the adoption, oversight, and if necessary,
enforcement, of certain principles.

The networks must be built as open systems intended to support the
greatest possible diversity in:

*Access. Everyone should be able to connect.

*Content. Users should be able to determine the content of the system.

*Uses. People should be able to choose the roles they wish to play,
whether as consumers, providers, or both.

*Architecture. Networks must be built as a series of inter-operable
components with well-defined published interfaces, which permit maximum
third-party competition.

*Protect free speech and privacy. Constitutional protections of personal
privacy and freedom of expression should be extended to the emerging
networks.

The Jeffersonian ideal - a system that promotes grass-roots democracy,
diversity of users and manufacturers, true communications among the
people, and all the dazzling goodies of home shopping, movies on demand,
teleconferencing, and cheap, instant databases - is composed of high
bandwidth, an open architecture, and distributed two-way switching. It's
our choice to make. Let's not blow it.


-----------
SIDEBARS
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Executive Summary

The Prescription: A Jeffersonian Ideal. A National Information
Infrastructure that promotes grass-roots democracy, diversity of users and
manufacturers, true communications among the people, and all the dazzling
goodies of home shopping, movies on demand, teleconferencing, and cheap,
instant databases - is composed of a high bandwidth, open architecture
incorporating distributed, interactive switching. It's our choice to make.

Bandwidth. No matter how it's delivered or what it carries, that bandwidth
will increase is a given for every channel. Movies, shopping, libraries,
e-mail, education - everything you've heard advertised - will sooner
rather than later find its digital way down the wires. Everything will
come in small bits on large platters. We don't have to choose this - it
will happen.

Openness. Open architecture and open standards promote competition,
quicker innovation, healthier industries, and more diverse technology.
Will we promote openness in the new territory of the NII? The answer
influences the economics of our future communications: What is cheap, what
is expensive, and who pays? We have a choice now.

Control. No matter how fast it comes, or by what hardware and path (by
wires or by air), no matter who is making money selling it, the crucial
political question is "Who controls the switches?" There are two extreme
choices. Users may have indirect, or limited control over when, what, why,
and from whom they get information and to whom they send it. That's the
broadcast model today, and it seems to breed consumerism, passivity,
crassness, and mediocrity. Or, users may have decentralized, distributed,
direct control over when, what, why, and with whom they exchange
information. That's the Internet model today, and it seems to breed
critical thinking, activism, democracy, and quality. We have an
opportunity to choose now.


Keep the Switches Open; Prodigy: A Cautionary Tale

Cable television networks have been built as unswitched systems in which
all content is carried to each end-point on the network. Without some form
of switched architecture, viewer choice, and hence diversity of content,
will be severely limited.

Just how much capacity for individual choice should be built into networks
is a crucial issue. If the estimates of needed capacity assume a bias
toward mass-market entertainment, which requires less interactive
bandwidth, then networks may be under-built with regard to supporting
choice. The resulting situation could recapitulate problems similar to
those confronted by the Prodigy online service and its users.

The designers of the computer network that carries Prodigy's traffic
created a system optimized for repetitive, one-way information flow but
failed to build sufficient capacity for two-way exchanges. In the original
Prodigy business model, "pages" of standardized information (airline
schedules, shopping catalogs) would be downloaded from Prodigy's central
computer installation to smaller computers on the periphery of the
network. Information requested by one subscriber would be kept in a
regional or local computer. If another subscriber requested the same
information, it would already be cached locally and would not have to be
fetched from the central site.

What the Prodigy designers had not counted on was that subscribers were
much more interested in two-way communication with each other through
electronic mail and bulletin boards. In one-to-one e-mail there is little
or no information re-use because each message is typically unique. The
network overloaded.

In an attempt to reduce what was viewed as expensive and nettlesome e-mail
traffic (which, after all, wasn't the purpose of the system), Prodigy
raised the rates on e-mail and attempted to impose a variety of controls,
sparking an enormous user protest.

Cable runs the same risk. To the extent there is a hunger for diversity
and choice, and to the extent it is permitted at all (as opposed to being
completely absent), it is likely to spark a hunger for more of the same.
Freedom begets more freedom, and cable may have a tiger by the tail.


Video Beyond Hollywood; The Desktop Video Revolution

If thousands of digitized, compressed feature films are stored on cable
and telco video servers, consumers will have more choices, but only in the
dimension of mass-market products produced by the entertainment industry.

With the widespread availability of low-cost, high-quality portable video
cameras and recorders, the means of capturing compelling footage is no
longer the sole province of Hollywood studios or network news teams. The
ubiquity of the Rodney King video and reality-based programming such as
Cops and even America's Funniest Home Videos is just the tip of the
iceberg.

Video is at last becoming a people's medium. Of even greater importance
than the development of the consumer camcorder is the emergence of desktop
video production tools based on the personal computer. The era of desktop
video - the ability to produce an entire video program from raw tape to
finished product on the desktop - is now upon us.

Desktop video will start with and be used by professionals as well, but
the revolution won't stop there. Desktop publishing sparked a revolution
in printing and graphics. Desktop video will have a similar effect,
enabling the creators of video content to produce high-quality
professional video for a fraction of the cost just a decade ago.

Certainly there will be a lot of awful, unaesthetic video, just as there
is a lot of poor-quality desktop publishing. But it is a mistake to think
that MTV-style production values are required to produce a compelling
video. If the content itself is compelling, as were the electronic town
hall meetings of the last presidential campaign, the production values can
be very modest.

Some of the most powerful video programming consists of school athletic
events, city and town council meetings, tours of contemporary art
galleries, and interviews with survivors of Nazi death camps.
Instructional programming is also very important to many people.

These types of programs provide meaningful content to narrow audiences,
not to a mass audience. They serve educational, social, political and
other interests, not just entertainment purposes. The current video
distribution system, however, does not provide or permit any way to
distribute such material into the home, other than through the cumbersome,
costly, and inefficient mechanism of recorded tapes, which must be
physically transported. A NII grounded in fair policy can change that.


What About ISDN?

Integrated Services Digital Network (ISDN) is a technology designed for
the public switched telephone network that allows low-cost communication
in data, voice, graphics, and video. It is designed to run over the
existing copper local loop that connects the telephone company's central
office to the home.

If offered nationwide and subject to affordable tariff rates, narrowband
ISDN can offer digital service to the home and office without requiring
the significantly greater time or expense of infrastructure conversion to
broadband.

ISDN is not an information service, but a transmission medium for
delivering and receiving information in a variety of forms. With the Plain
Old Telephone Service (POTS), copper-pair wires reaching into the home can
carry a single voice call or data at rates up to 14,400 Kbits per second.
With ISDN, bandwidth capacity is increased to 144,000 Kbits per second.
Standard compression techniques can push that figure even higher.

Problems that haunted ISDN in the past, such as a lack of standard
hardware and software protocols, and corresponding gaps in
inter-operability, are being addressed through the National ISDN-1
program, a national standard that proves the Bell companies, long-distance
carriers, and information providers can work together to provide the kind
of ubiquitous, standards-based service that is critical to the overall
success of ISDN.

Skeptics remain, however. There is concern among advocates of broadband
networks, coming from both technologists and policy-makers, that ISDN is a
dangerous diversion on the path to fiber. In reality, most of the money
needed for ISDN has already been spent or committed to upgrades for
digital switches in central offices. At issue is the availability and
pricing of the service.

ISDN is likely to find its place as a service for the last mile. There are
far more modern, more capable protocols to serve as the major highways of
an information infrastructure. Either ISDN will be widely deployed or not.
If ISDN serves its purpose, we can jump-start the information age, but in
any event we must turn our attention not only to ISDN, but to what lies
beyond it.

                                   * * *

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