INTERNATIONAL TELECOMMUNICATION UNION

The ITU and Geneva: Technological revolution and market liberalization

Dr. Pekka Tarjanne, Secretary-General
International Telecommunication Union

18 June 1997
Institutional Seminar of Darier Hentsch & Cie
Genève - Switzerland

Distinguished Guests,
Ladies and Gentlemen,

It is a pleasure to join you during this seminar, to express my thoughts on the role of Geneva in the global information society. At the ITU, today saw the start of the annual session of our Council, therefore my presence here has to be brief.  But, I feel it is important to contribute to this debate, as a representative not only of the ITU but also of the other international organizations based in Geneva.
During the course of today’s programme, you have already heard earlier speakers addressing the broader issues of communications in the next millennium and the importance to Geneva of keeping up with the pace of these rapid changes taking place all around us. They will affect not only the commercial, social and economic life of Geneva, but relations between nations too, which are of major importance to the international community. 
I should like to take this opportunity to look briefly at the technological revolution that is driving the telecommunication sector in the broader information economy, and to offer some examples of the perspectives for global electronic commerce, and of how market liberalization is relevant to the issues you are discussing here today.
Starting with the technological revolution, the ITU has witnessed enormous changes in the field of telecommunications since it was originally founded in 1865 to manage the interconnection of telegraph traffic. 
A fresh period of rapid evolution is facing mankind today, as fundamental as the development and popularization of the telephone. You have all heard about the new technologies, applications, products and services that are making it possible to do all kinds of business electronically, using computers, telecommunication networks, and the Internet. In fact, the ways in which people define and use communications bear the mark of the intensifying convergence of telecommunication, broadcasting and computing technologies. Today’s telecommunication system has become a complex web of increasingly intelligent networks made up of fibre optic cables, traditional copper wires, satellite systems, wireless-based systems and high-speed computer communication networks.  The Internet is the precursor of a new paradigm which will fundamentally change the way people communicate. State-of-the-art networks are capable of transmitting voice, text, data, images and full motion video, anywhere in the world. 
This technological revolution is leading us to a completely new era, often described as « the global information economy », or more generally the « global information society ».  In this new age, the conception of communications and information is quite different from the past.  But the information society is still an aspiration and by no means a fait accompli. Although many of the enabling technologies, such as the Internet and high speed broadband networks, are developing rapidly, no single technology can more than partially deliver the necessary capabilities. It all depends on how technology will be used, and on the choices we make. The future is not as simple, clear or certain as it is often portrayed. Noone knows what form the Information Society will finally take.  There are many different actors involved, including traditional players such as telecommunication operators, regulators and service providers, but also content suppliers, Internet Service Providers, and a very large spectrum of users, ranging from large international corporations to small and medium-sized businesses, not to mention the residential consumer. 
Emerging technology has already made it possible to do some things very differently and at a global level. Let us take the example of electronic commerce, which has enormous potential to change the way we buy and sell products and services.
Electronic commerce is set to become one of the most successful applications of telecommunication and information technology. We areall aware of the popularity of the Internet and other  online services that are being provided through the World Wide Web.  The Internet represents an ideal environment for electronic commerce, for exchanging goods, services and money. It has already connected around 60 million of the world’s population regardless of where they live and what time zone they are in. 
The Internet is also very attractive in the way it makes geographical and commercial boundaries disappear. Using the Internet, people living in Geneva can browse through an Indian newspaper, make reservations at a resort in Thailand, trade shares on different world stock exchanges, and even order French wine from a specialist retailer. For consumers, the emergence of electronic commerce offers greater freedom of choice as well as better documentation on available products and services. Multiple business models are likely to emerge. The ability to accurately track and analyze consumer behaviour will make electronic communities a market researcher’s dream.
But global electronic commerce is still in its infancy. Just as the cinema did not replace the theatre, and just as the industrial revolution did not supplant the agricultural revolution, today’s electronic commerce is not intended to replace traditional commerce.  However, there is no doubt that the growing use of networked intelligence heralds a big change in the way business is conducted, particularly in the way firms trade with one another.
Let us look at another example of how computer and communications technology are changing the way people are doing business- even at the ITU ! 
If you consult the ITU home page on the World Wide Web, you can read my speeches (including this one) or learn about World Telecommunication Day, which we celebrated on 17 May on the theme “Telecommunications and Humanitarian Assistance” this year.  You can also order, via the Web, copies of ITU publications.  Indeed, more than a third of our publication sales are now downloaded directly from the Web, and most of the rest are ordered through the Web. Sadly, we have not yet been bold enough to charge people for reading my speeches!
Another recent event worth mentioning concerns the important three-day conference on restructuring the Internet domain name system, held from April 29 to May 1st at the Geneva International Conference Centre.  It culminated in the signature of a Memorandum of Understanding (MoU), which creates a new series of generic top-level domains that should contribute to preserving and strengthening the Internet. The ITU is to play an important role as the depository of the MoU, which is a sign of the closer links being forged between the telecommunication community and the Internet. This bond will certainly be reinforced later this year, in September, when ITU stages a new event at Palexpo in Geneva, Telecom Interactive. Telecom Interactive will focus specifically on the Internet and multimedia technologies and applications, following in the footsteps of the ITU’s World TELECOM, which is today the world’s largest telecommunication exhibition and forum. 
With regard to the Geneva community, I should also like to mention the Geneva MAN (Metropolitan Area Network) project, in which the ITU has played a leading role. This new network will arguably lay the foundations for a wired, digital and multimedia working environment for the international organizations of Geneva, and will bring new economic development opportunities for all sectors in the region. And it is gratifying to note that the Geneva authorities and other agencies in this city seem geared to recognizing the strategic need to establish an open communications framework, that will place Geneva at the crossroads of the information society. The fact that you are all gathered here today, debating and learning about the challenges that the information society represents, is a clear sign that Geneva is getting ready for the challenges of the 21st century. The Geneva information highway should be affordable, competitive and adaptable to the requirements of business and residential users.  In this respect ITU is now conducting a pilot project, in the context of its new Networking Technologies Center, to demonstrate the possibility of providing very high speed Internet access over the existing telephone wires.
Although the vision of an information society as a global electronic marketplace for goods, services and currencies, is very appealing, there are other aspects that are clearly more problematic. Some of these problems are essentially technical, for example in the area of network security and global reliability. The new global networks are shifting the communications paradigm from “tele-phony” to “tele-computing”.  This raises many fundamental concerns about the way the telecommunication sector is being restructured, the pricing of services and the regulation of international commerce, and the impact of these changes on national sovereignty, political institutions, and ways of living.
Today, the issues are of great interest to all nations. The world’s trading patterns are in a period of transition, because of the new “electronic trade routes” being setup over globally-linked computer networks. The trade routes of tomorrow will be built with sophisticated communication systems, that will provide almost instantaneous transmission of data, information, ideas and entertainment across the globe.  In reality, the world no longer sees telecommunication as only a public service provided by national administrations, by PTTs, and managed internationally on the basis of agreements between governments. On the way towards a global information society, telecommunication is increasingly a commercial service which can be traded on a competitive basis by domestic or international suppliers, both public and private. To this end, the ITU is working closely with the WTO and with WIPO to explore further the implications of free trade agreements and intellectual property protection within the context of national and international telecommunications.
What role is Geneva likely to play in this scenario ? 
Geneva as an international city can take advantage of its situation as home to many international and regional organizations, as well as to world class financial and multinational companies and other businesses, to become a city where telecommunications and the information age really matter.  Together, we must strive to ensure that the city's initiatives become an innovative model and a testbed that can guide the international community in its efforts to harmonize and coordinate the development of the information society at international level.
For its part, the ITU, as an intergovernmental body whose membership includes a unique mix of public and private enterprises, will continue to bring to Geneva those engineers, policy-makers and experts that are pioneering the way in to this era of global communications. I believe that, through this seminar, you are helping to build the mindset necessary for determining the needs, services, applications as well as the framework in which they can be provided, as Geneva heads into the next millennium. I am sure that together we can take on new responsibilities, and work not just to create a better city, but also to contribute to a better world, one which is fit for future generations.
Thank you.