I certainly applaud the realism of the ITU for including the Internet on its agenda at Telecom '95. I think THAT-more than anything-speaks volumes about just how far this technology has come as a component of the global telecommunications and information infrastructure.
My job this morning ...along with my distinguished colleagues on this panel... is to spend a few moments talking to you about the Internet and how it is reshaping the way businesses and consumers worldwide communicate, compute, learn, entertain, shop, commute and even heal.
At the same time, I would like to shed a little light on how the MCI/News Corp. Online Joint Venture fits into this picture and how we are positioning ourselves to become major players in the Internet business.
And finally, I'd like to address some issues and challenges that we must deal with to ensure the continued growth of this remarkable medium.
In 1988, MCI became a key player in support of Internet development through its involvement in the NSFNET backbone with partners MERIT and IBM. MCI provided the transmission plant for the 1.5 megabit/second NSFNET.
In 1989, as part of the Gigabit Testbed program organized by the Corporation for National Research Initiatives with the sponsorship of the Advanced Research Projects Agency and the U.S. National Science Foundation, MCI began providing gigabit speed fiber optic links as part of two research consortia.
By 1990, usage on the NSFNET backbone was exploding, and in 1991 MCI was asked to upgrade the backbone to 45 Megabit/second transmission links. This was accomplished at the same time that the non-profit Advanced Networks and Services organization was formed by MCI, MERIT and IBM.
In 1994, MCI built an alternative, fully commercial 45 Megabit/second backbone it calls internetMCI and in April 1995, with the retirement of the NSFNET backbone, MCI began carrying the Internet traffic of a dozen intermediate level networks that had been linked to the NSFNET backbone.
There are an estimated 23 million users of the Internet today and by the time I finish talking this morning, another 250 people will have "surfed the net" for the first time. New business domains are being added at the rate of one every nine minutes.
We feel this impact every day at MCI, as vast quantities of the U. S. Internet traffic pass through internetMCI's backbone.
Just a few months back, MCI rolled out a supernetwork for the National Science Foundation known as the very broadband network service or VBNS. Based on ATM technology, this network operates at 155 Megabits/second and permits the combining, of audio, video and data traffic in an Internet setting.
VBNS is being used as an experimental platform for developing new national networking applications and currently links five NSF supercocomputing sites around the U.S.
In the coming months and years, VBNS will be used by federal researchers to help apply interlinked supercomputers to solve some of the great challenges in science, medicine and education...tackling problems such as heart disease, global warming, distance learning and telemedicine. There's also great potential for the technology of many of these high-speed VBNS applications to be transferred into commercial use.
But now, let's head back to the present and take a quick look at just how pervasive the Internet has become as a critical business tool.
Already, the various types of marketing, advertising and public relations applications on the Internet span a wide and creative spectrum.
In the U.S., for instance, there's hardly an industry or government service that's not represented on the Net. Retailers, travel firms, hotels, restaurants, manufacturers, banks and health care providers are just a few of the businesses that are using the Net strategically to promote and sell their goods.
The digital technologies behind the Internet are not only altering business marketing and advertising philosophies, but they're having a dramatic effect on corporate communications structures, physical plants and even geography.
More companies are learning to leverage the Internet to create virtual offices and factories supported by 24 hours/day research or development facilities.
A software engineer in Geneva, for example, now can collaborate in real-time with developers and technicians in San Francisco by using the Internet to log on to a shared server - each working simultaneously on an image they both see.
Chrysler, among other auto manufacturers, is engineering automobiles around the clock in a similar fashion by sending information back and forth through the Net among, work sites in Detroit, Europe and Asia.
Virtual factories allow a company to build any product at any time just about any site around the globe. A computer manufacturer, for example, can send designs and equipment set-up instructions alone, its network to automated factories around the globe...moves that can dramatically reduce the cycle time from order to delivery.
Texas Instruments is doing just this with some of its products - and is reporting dramatic reductions in delivery times.
Today it's estimated that 40 percent of all U.S. manufacturers are electronically linked to their suppliers, partners and customers. This creates not only, greater efficiency but also closer bonds.
Large mass merchandisers, such as Wal-Mart in the U.S., have even gone so far as to place some of the responsibility for inventory management in the hands of their manufacturers - thus reducing processing, warehousing and administrative delays and costs.
Perhaps no other industry today is looking to the digital revolution with more anticipation, however, than the medical sector.
Media convergence is redefining health care by making the virtual hospital and doctor's office an immediate reality.
Health care professionals, whether across the street or around the world, can eclipse the boundaries of time and distance to conduct medical examinations and even surgical procedures whenever and wherever needed.
Soon, interactive multimedia networks will link hospital administrators, physicians and health care providers around the world.
We may even see the return of the "house call," only this time the family doctor will arrive via a home workstation rather than by horse and buggy.
Equally exciting are the opportunities of telelearning, which brings the promise of quality education to all parts of the country...to rich school districts and poor ones...urban and rural.
Telelearning also extends beyond the classroom...to the factory floor, and even the boardroom itself. With telelearning applications, corporate training possibilities are unlimited, bringing instant knowledge and learning resources to any type of company, anywhere in the world.
One of the most radical and exhilarating aspects of the Internet is that it is a truly egalitarian technology. Any company or organization - from a five-man shop to a Fortune 500 corporation to small community library - can create international presence and new and more productive paradigms for generating future wealth and knowledge by driving this prototype of the Information Superhighway.
The Internet is already providing small firms with volumes of previously inaccessible market data and business intelligence through these networks, little firms can form virtual teams or outright partnerships to do business on a global scale that rivals the big guys - all without the expense of outpost offices.
In Washington, D.C., for example, several small defense contractors have hooked up online to create "virtual corporations" - combining their resources electronically to compete - and win - against much larger firms.
This is just a sprinkling of what the Internet can do for businesses and consumers.
The MCI/News Corp. Online Joint Venture is excited about all these applications. With the online joint venture, we're not only bringing two like-minded companies together, but a world of extraordinary talent and resources.
Today, News Corp. is powerful content empire fans across the globe and includes, for example, The Fox Broadcasting Network, the BSKYB network here in Europe, 20th Century Fox Studios, TV Guide, and HarperCollins Publishers.
News Corp. is in the content business in a big way!
With the Internet... or any information system...there's nothing more important than content and connectivity.
We feel that by combining News Corp.'s assets with MCI's intelligent network, premier branding acumen, software capabilities and powerful direct sales force, we have the foundation for a very aggressive and profitable joint venture. A venture committed to bringing the best in online access and content to its customers.
I've been asked several times about what I see as the most pressing issue confronting the growth of the Internet.
Without a doubt, the answer is making sure we keep the Internet an open and vibrant system... Today, MCI and the NewsCorp Joint Venture offer their content through an open, non-proprietary Web-based service.
Openness leads to growth. If it were not for technical openness in the TV industry, for example, there would be no content.
In the U.S., we wouldn't expect someone to make a show for CBS if they knew they couldn't sell it to ABC or NBC or Fox if CBS backed out of the deal.
But that's exactly the case of what's going on in the classical online business today-standards are lacking and the systems are not interchangeable. And that's a problem for content providers. Of course, the online industry is discovering Internet and the Web, so perhaps they will "get it" sometime in the future.
Closely related to this point is another hot button issue confronting the Net: How do we regulate it? Or should it be regulated at all?
Again, I think we need to approach this from the viewpoint of openness. Before we rush to put shackles on the Net we need to make sure it has the freedom and flexibility to grow.
Quite frankly, despite its explosive growth, we're talking about a technology that's still in the fledgling stage.
We must be vigilant against the heavy hands of censorship and regulation which could easily destroy a fruitful future for this new technology.
Another issue is the market itself. We've all heard stories that up until just last year, the Internet was pretty much the domain of young, educated white males.
Of course, that's changing. As the Internet becomes easier to access and navigate and pay for, it becomes a mass market filled with richer, more dynamic and diverse content.
Another equally important issue is simply FEAR.
Behind the growing pervasiveness of the Net and information technology, there exists an undeniable apprehension among some parts of the population about jumping into the cyber world.
In fact, for many, the I-WAY might as well stand for the Intimidation Highway.
Part of that fear stems from security issues. And despite recent advances in encryption technology - and that it may now safer to put your credit card on the Internet than it is to it on a table in a restaurant - we in the Internet community have work to do to provide a trusted service.
Cyberphobias manifest themselves in many different ways...including the fear of losing privacy or personal contact with others...being overwhelmed by information...facing new learning curves... and fear of being passed over for a promotion because of insufficient cyberskills.
We also discovered that many white collar workers are not empowered by today's technology... in fact a Gallup Poll survey shows that:
91 percent don't use online information services that screen for news; 66 percent don't use email at work; 67 percent don't carry beepers; less than half use voice mail.
However...two thirds use PCs and calling cards.
All Internet access and content providers need to keep these facts in mind when they're developing products and services for the use on the Net.
In terms of context, people and businesses are looking for a simple, reliable, productive, entertaining, consistent, comfortable and easy Internet environment in which to work and play.
Where we're headed is ultimately to one home page for the customer - a place where the customer can go when he/she is in trouble, doesn't know where to go to get information, needs service, or starts surfing.
Context, at least at beginning, will be just as important as content. The context provider is the equivalent of a TV network in this new, non-gatekeepered and unlimited content world.
As we progress, the key components of Context will be
Of course, the other vital area we have to look at is Content. Content takes many shapes. As with telephones, consumer can do it themselves; you can chat, build personal homepages, or use information supplied by others. Content will change even more dramatically as broadband delivery changes the nature of the entire medium.
As context and content are shaped, branding becomes increasingly important. Brands will grow from "channels." The channels will be places people go to for targeted information and communications.
If you're on the Net or thinking about getting on the Net, it is also imperative that you start thinking about exploiting the uniqueness of this new medium...while processed content from other media has value, the Web is an environment where fresh ideas that exploit the new medium will be the winners.
A good example of this is cable: Even though cable was "just more TV," it invented most of the channels from scratch. Rolling Stone did not become MTV, Time Magazine or CBS News did not become CNN.
We're looking at an exciting new world out there, filled with new possibilities and unknown places. Our mutual efforts will discover new territories and help to create our own future.
I look forward to meeting you all on the Net!
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