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Opening Session, “UN meets Silicon Valley” Event
Mountain View, California, USA
28 February 2007

Opening remarks by ITU Secretary General Dr Hamadoun I. Touré


Introduction

As the newly-elected Secretary-General of the International Telecommunication Union (ITU), I am honoured by the invitation to address you here today. Some of you here today will be familiar with ITU's work and have participated in our Study Groups and Conferences, I am pleased to have this opportunity to share my views with you here in Silicon Valley, the world's foremost technology cluster for leading-edge innovation.
 

There is no doubt that these are challenging times for the the information and communication technologies (ICTs) sector, which is in a state of flux. I wish to talk to you today about three main trends that arer shaping our industry: First, innovation and cybersecurity, second changing business models and finally the development of new markets.

 

Innovation and cybersecurity

In industrialized countries, innovation is a key source of new products, added value and fresh growth in revenues. This is especially true of the ICT sector, where innovation is one reason why the sector continues to be so dynamic and exciting.
 

In the advanced economies, it is the private sector that is the engine of innovation and growth, accounting for between half and two-thirds of total spending on R&D in America and Scandinavia. So your decisions count – the investment decisions in Silicon Valley today dictate the technologies we shall be using worldwide tomorrow.
 

Some of you here are already working to realize the vision of convergence. The integration of multiple delivery platforms into unified Next-Generation Networks (NGNs) delivering many different servicesand applications will transform today's communications, in both the public and the private spheres.
 

NGNs promise to deliver many different services over a single, unified platform offering generalized mobility. They are already transforming the way in which telecom networks and services are designed, implemented, used and billed. Many communications carriers are redesigning their voice networks on the basis of Internet Protocol, with some operators planning to decommission their PSTN networks by as early as 2010.
 

The development of NGNs will focus more attention on the critical issue of cybersecurity. Today's networks are ever more complex, and contain several different generations of code, creating inevitable weaknesses that can be exploited by hackers and cyberterrorists. The move to a single unified platform should make these cybersecurity threats more manageable. Cybersecurity will be a major priority for ITU in the coming years.
 

The ITU's Telecommunication Standardisation Bureau has achieved notable success in steering work on international standards in areas like 3G mobile, DSL modems, multimedia decoders, cybersecurity and NGN. The ITU offers an impartial and flexible forum where experts in different disciplines can come together. In particular, because of intergovernmental status, ITU can establish truly global standards that will work just as well in Shanghai and Senegal as in San Francisco or Spain.
 

ITU is also involved in helping Member States and Sector Members to decide upon the most profitable and efficient ways to exploit the frequency spectrum. Spectrum will be a critical and increasingly valuable resource for the development of the global economy in the 21st Century. The ITU's World Radio Conference in October will decide the allocation of spectrum for mobile communication systems beyond 3G, such as WiMax. For that reason, it is important that the private sector ensures that its voice is heard in the preparations for this Conference.
 

Unlike other Intergovernmental Organisations, ITU is open to the private sector through our unique system of “Sector Membership”. More than 650 private companies help to guide and strengthen ITU's work in standards harmonization, spectrum management and development. Our Sector Members and Associates help to ensure that strong, versatile and future-proof technologies emerge, that can inter-operate at a global scale. We need the benefit of Silicon Valley's expertise and experience to ensure that ITU standards remain at the leading edge. If your company is not already a Sector Member of ITU, I would therefore appeal to you to join, so as to ensure that your views are represented.

 

Changing Business Models

The second area I wish to discuss are the changing business models that are reshaping our industry in response to rapid technological change, and the availability of new, high-performance networks.
 

The dot.com bubble that grew up here in California generated a myriad of new business models. But the dial-up Internet access of the late 1990s was too slow to keep up with the visions of the dot.com entrepreneurs. Many of them disappeared in the crash of 2000-2002, but the more robust business models survived.
 

Times have changed. There are now more than 500 million people worldwide that can access the Internet at broadband speeds, from either mobile or fixed-line networks. Furthermore economies of scale have reduced marginal costs of service provision. The status of voice services -- the foundation of the telecom industry since the 19th Century -- is changing as marginal costs plummet. Voice is now frequently bundled as an application with other services. Indeed. in some countries, voice may be given away for free or included in a flat-rate “bucket” of monthly services.
 

The trends towards flat-rate pricing, bundling of services and the death of distance represents a challenge for traditional public telecommunication operators. In San Francisco, virtually the whole city will soon have access to free or low-cost wi-fi service, and the infrastructure provider is not a traditional telco. The likelihood that telcos will survive these changes will depend on their ability to offset falls in voice revenues with other sources of new growth, such as video and data, that exploit the broadband capacity of today's networks.
 

Here again, ITU can offer some assistance. ITU has traditionally provided a forum where equipment manufacturers, network operators, service and application providers and others concerned with the development of ICTs can discuss together the development of profitable new market opportunities, and learn from each other's experience. The debates currently taking place in the United States – over Net Neutrality or the future of Universal Service – have been taking place in ITU for more than 140 years. Technological change is our business.

 

Developing New Markets

Finally I want to challenge you to think beyond the borders of Silicon Valley, and beyond even the United States, to the emerging markets of the rest of the world.
 

It took the world 125 years to accumulate the first billion fixed lines. The first billion mobile phone users were achieved in 21 years, with the second billion added in just three years until 2005.  ITU predicts that, by the end of 2008, more than half the world's inhabitants will have access to a mobile phone.
 

Where will this growth come from? With markets in the developed world approaching saturation for basic mobile phone service, the new growth can only come from the developing world, which is home to more than four-fifths of the world's population.
 

In Asia, which is already witnessing phenomenal growth, this growth will come from a wider spread of technology among lower-income consumers, using so-called “bottom of the pyramid” models. The classic example of this is the Grameen village phone business model pioneered by Mohammed Yunus, the Nobel Prize winner and the recipient of ITU's first ever World Information Society Day award.
 

Growth is now occuring too in other parts of the developing world. In Africa, for instance, there are now more than six times as many mobile phones as fixed line telephones. Chinese companies are already responding to the investment potential of Africa and are investing heavily in African firms, networks and natural resources, backed by political support at the highest level. If Chinese companies, are willing to take risks in investing in Africa, despite having a huge untapped domestic market, then companies from Silicon Valley should certainly follow their lead.
 

In conclusion, ITU has a noble ambition: to Connect the World. For us to achieve that goal, we need to work in partnership with governments, the private sector and civil society, and to exploit the dynamism of regions like Silicon Valley. For that reason, I would encourage you to join with ITU, either through Sector Membership or through other multistakeholder partnerships, so that we can together repsond to the challenge of Connecting the World. Only then can ITU achieve its mandate to extend the benefits of new telecommunication technologies to all the world's inhabitants. As the newly-elected Secretary-General, I can assure you that that is a mandate I take very seriously and one which I will do my utmost to fulfill, within our lifetimes.

Thank you.

 

 

 

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