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- ISDN as an Enabler of Innovation
- Statement of Mitchell Kapor
- Electronic Frontier Foundation, Inc.
- June 13, 1991
-
-
- My name is Mitchell Kapor. I am the founder and former chief
- executive of Lotus Development Corporation and the designer of Lotus 1-2-3,
- the world's most successful business software application. I am here today
- representing the Electronic Frontier Foundation, Inc., a non-profit
- organization concerned with the development of information and
- telecommunications policy which promotes innovation and free enterprise.
-
- It is often said that computer and communications technologies are
- converging to the point that it is no longer meaningful to speak of two
- separate industries. At the same time, I can tell you from my own personal
- experience that while the the microelectronics revolution may be providing
- a common technical base that unifies computing and telecommunications, the
- cultures and industrial dynamics of the two are still alien to each other.
- This is a shame, because unless the cultural gulf which separates the two
- is successfully bridged, society as a whole will be the loser.
-
- I believe there are substantial and vastly under-appreciated
- entrepreneurial opportunities which would arise out of the wide-spread
- availability of ISDN at affordable prices. To understand why, it's helpful
- to appreciate a bit of history of the personal computer field.
-
- The most important contribution of the PC field is not a product,
- but an idea. It is the idea that a good computer system is simply a
- platform upon which other parties can exercise their ingenuity to build
- great applications. When Steve Jobs and Steve Wozniak conceived of the
- Apple II computer in a Silicon Valley garage in the mid-1970's, they had no
- clear idea what it would be used for. But they went to great trouble to
- make it attractive for software developers to use. They added graphics,
- sound, a low-cost disk drive, and a host of other capabilities. In 1979
- Dan Bricklin invented the first spreadsheet, Visicalc, for the Apple II.
-
- In 1981 IBM followed Apple's lead with the introduction of the IBM
- PC, an "open architecture" machine for which anyone could develop programs.
- The explosive growth of the PC industry which followed the introduction of
- Lotus 1-2-3 for the IBM PC can be directly attributed to the widespread
- availability of inexpensive personal computers.
-
- Perhaps ten thousand separate commercial programs were introduced
- in the span of a few short years. Only a few were successes, but it was
- the market and the market alone which was capable of selecting the winners
- out of the multitude. And it was only the conditions of low barriers to
- entry for software companies which made it possible to mount the vast
- numbers of offering necessary to spawn the small number of eventual
- winners.
-
- In short, it was the existence of open platforms for innovation,
- such as the Apple II and the IBM PC, which catalyzed the development of
- vast amounts of software necessary to the process of market-mediated
- innovation. Today, with the desktop PC a commonplace in business and the
- home, it's important to remember the basic dynamic by which this PC
- revolution occurred.
-
- Just as the desktop personal computer represented the revolutionary
- platform for innovation of the 1980's, it is my belief that ubiquitous
- digital communications media, such as are enabled by ISDN, represent the
- hope of the 1990's. With the proper ISDN platform, we can have another
- generation of explosive growth of services, led by a generation of
- information entrepreneurs.
-
- Today these information entrepreneurs enjoy a margin existence in
- the largely non-commercial world of bulletin boards and on the national
- research and education network called the Internet. Give them a commercial
- information infrastructure which can reach large numbers of people
- inexpensively, and I believe we will all be truly amazed at the results.
-
- The telecommunications industry, unlike computers, is, as you know,
- a highly regulated one, for very good reasons of social policy. In this
- regard, its heritage and the heritage of computing could not be more
- different. While Jobs and Wozniak could create the Apple II as a platform
- for innovation in a garage, without let or hindrance from anyone, creating
- the ISDN platform will require the wise administration of policies set by
- bodies such as this Department of Public Utilities.
-
- In order to become ubiquitous, ISDN access must be priced low
- enough that the average consumer finds it affordable. As a practical
- matter, this means that there must be a residential tariff comparable to
- the unlimited local calling plans available to residential customers. This
- is not the case with the tariff filed by New England Telephone which is
- under consideration here.
-
- It is my understanding that while ISDN access itself would be
- available for a fixed monthly fee to business and residential subscribers,
- there would always be a "metered" usage fee. Circuit-switched connection
- would be charged under the "Switchway" tariff, which carries a substantial
- per minute usage charge. Packet-switched connections would be charged
- under the "Infopath" tariff, which carries a substantial per kilopacket
- charge.
-
- It may well be the case that the usage assumed by New England
- Telephone in the preparation of the tariff under-estimates the demand surge
- which would be created by an appropriately low price.
-
- I therefore ask the Department to take appropriate action, not to
- approve the tariff, but require its reconsideration.
-
- It is also my understanding that fee-based information service
- providers who wished to provide packet-switched connections to business or
- residential ISDN customers would be required to connect to N.E. Tel's
- Infopath packet-switch network. This bundling of another telephone company
- service with ISDN unfairly restricts the ability of third parties to offer
- services competitive with Infopath at lower prices or with different
- arrangements, such as flat-fee connections. Private inter-networking
- carriers should be able to connect to ISDN access lines either in central
- offices or other access points in the network and should be able to set
- their own rates for charging service providers.
-
- If the Department acts now to insure the availability of ISDN
- services at an affordable price to consumers, it will help Massachusetts
- and the entire New England economy by helping create a new platform for
- telecommunications innovation.
-
-