Global Electronic Commerce will only deliver maximum benefits to consumers and businesses if the underlying information infrastructure is sufficiently robust and reliable enough to handle virtually continuous, high-volume, high-capacity data, voice and video traffic. The explosive growth in the use of information networks and technology demands immediate action to develop and widely deploy an advanced infrastructure in the U.S. and around the world.

The potential benefits of an advanced infrastructure and marketspace for consumers and businesses are fairly well articulated and understood. However, less emphasis has been placed on the equally important potential benefits they can convey to particular states or regions. For example, the region that develops an advanced information infrastructure capable of meeting market demand and that creates a favorable policy environment where Global Electronic Commerce can flourish is likely to be a more compelling site for innovative Internet-based businesses.

CSPP strongly believes that marketplace competition is the key to developing the required advanced information infrastructure. For example, in the United States, the telephone system is the primary transmission mechanism for Internet traffic to consumers. While competitive long-distance carriers have widely deployed broadband (digital) lines able to carry high-speed data and video traffic, the local exchanges are still focused on analog (voice) traffic. Until there is competition in the local markets for data or digital traffic, there will be no pressure on the incumbent telephone carriers to deploy new technologies. Rapid implementation of the Telecommunications Act of 1996 is necessary to increase local competition, but special efforts may be needed to ensure that providers of data transmission services benefit from the Act’s pro-competitive approach.

Global markets must be opened to new network operators and service providers, as well as to new information technology. Through the General Agreement on Basic Telecommunications (GBT) reached in the World Trade Organization (WTO) in February 1997, major nations made a commitment to foster competition in basic telecommunications services. Implementation of the GBT is an important first step. However, further international agreements may be needed as other barriers to a global information infrastructure emerge.

CSPP Policy Agenda

CSPP’s objective is to promote growth of Global Electronic Commerce by encouraging competition and the deployment of the high-capacity infrastructure that makes such commerce possible. CSPP believes governments and regulators must take action to remove the barriers to competition that now prevent the development and deployment of the necessary infrastructure.

CSPP believes the following opportunities to encourage competition are critical:

1. In the United States, there is an urgent need to open up the local telephone exchange monopolies to competition. CSPP has and will continue to urge the Federal Communications Commission (FCC) to aggressively implement the Telecommunications Act of 1996 and to encourage competition for data service transmission specifically. At both the federal and state level, regulators should articulate and enforce the rights of competitive data service providers to access the existing local networks, to interconnect, to collocate equipment, and to purchase unbundled network elements and sub-elements, at cost-based prices. This will promote deployment in the local loop of new technologies that enable high-speed digital services.



2. Internationally, CSPP will encourage the full implementation of the WTO/GBT. As part of this effort, CSPP will monitor steps taken by signatory nations to implement the agreement. CSPP also will confirm whether the agreement, as implemented, will be enough to enable dramatic expansion of the world’s information infrastructure. New areas for multilateral discussion may be presented by this evaluation.



3. CSPP will continue to advocate that market forces, not regulation, be the foundation for the electronic marketplace. The competitive market increases consumer choice, encourages innovation and decreases prices. Regulation that reduces choice, inhibits the deployment of new technologies, permits providers to price services without the influence of competitive pressure, or that makes assumptions about market behavior will harm consumers and may block the evolution of Global Electronic Commerce.