Agencies, Trade Groups Plot Internet Reforms

Agencies, Trade Groups Plot
Internet Reforms

By John Makulowich

As the global matrix remains mired in gossip about the Justice Department's antitrust investigation of Microsoft, abuzz over the controversy between the Redmond, Wash.-based giant and Sun Microsystems on the Java programming language, government and trade executives are quietly setting in motion programs or setting goals that are likely to significantly transform the Internet landscape in the months and years ahead.

Among the three more noteworthy now are the efforts of the National Science Foundation, the U.S. Department of Education and the Direct Marketing Association.

"There's no question that the computation and communication evident on the Internet are changing the process of our intellectual activities. You can break them down into three components," says Juris Hartmanis, assistant director of the National Science Foundation, Arlington, Va.

Five minutes into a conversation with Hartmanis, you find yourself echoing his multisyllabic mantra for the Age of the Internet: communication, computerization, digitization. It's his way of explaining the radical changes ahead. They are immense computing power; communications capacity, with high-powered cable and increasing bandwidth; and the momentum of digitizing all the world's information.

The former professor of engineering and computer science at Cornell University and the first chair of that institution's computer science department (1965) strongly believes that the basic process of doing science and engineering is being fundamentally changed by information science. That is, how we work, how the process of science discovery is pursued and how engineering is done.

NSF photo

Juris Hartmanis, assistant director of the National Science Foundation

For example, he points to the research under way at the University of California San Diego Supercomputing Center on how individuals do science, specifically, how scientists collaborate. At that facility, in work between the National Institutes of Health and the National Science Foundation, researchers can access an electron microscope from remote sites. Such an effort reveals the demand and need for significant bandwidth for networking as well as for tremendous computing power.

On another level, he draws attention to the ways we now access information, mainly searching on words in text with Boolean logic thrown in now and then for good measure. He feels that we need new methods to search, for example, on video and multimedia in general.

"In the near future, we need to search not only on words but also on concepts and unexpected patterns. In fact, we should be able to postulate hypotheses and test them via the Internet," notes Hartmanis. "In many cases, we know how things begin and end but have no clear understanding of the process. We have the potential to automate high-level intellectual processes. But before you automate, for example, language translation, you must understand the intellectual process much deeper and more functionally than ever before. Further, we must develop much, much better methods in data mining, for instance, to find phenomena which are original."

Much of the work described by Hartmanis can be grouped under one of the three major NSF themes known as KDI, that is, Knowledge and Distributed Intelligence. It is segmented into areas on Learning and Intelligent Systems, Knowledge Networking, New Computational Challenges and Next Generation Internet. The other two themes are Life in Earth's Environments and Education for the Future. The latter is a systematic effort to integrate education and research at all levels of education.

For example, among the strategic goals for Knowledge Networking are computing and communications to support radical advances in data, voice, video and graphics connectivity. The approach called for involves nothing less than the systematic application of computing, networking and information capabilities to the process of science, engineering and educational scholarship.

In the future, this will allow individuals to communicate across disciplines, languages and cultures, to integrate and process knowledge rapidly and to enable telecollaboration, that is, people working together over distance and time in teams, organizations, classrooms and communities.

Among the challenges ahead, according to Hartmanis, are to endow our computers and communications with much higher intellectual capabilities, for example, in language translation. Another area of major importance is the computer-human interface, which can be translated into universal access or permitting all citizens with whatever abilities and backgrounds to participate in information technology.

Universal access is also the broad-based theme of the technology initiatives at the U.S. Department of Education. According to Linda Roberts, director of the Office of Education Technology, the top three initiatives vis-à-vis the Internet are the Technology Innovation Challenge Grants, an intergovernmental activity that President Bill Clinton asked the Education Department to chair and the E-Rate program, which amount to discounts to schools and libraries to acquire telecommunication services.

"The Technology Innovation Challenge Grants are for five years and target consortia of local groups to develop and demonstrate innovating applications of technology. Now into the third year of the program, we have funded 62 of these," explains Roberts.

According to the Education Department, states and local school systems will invest more than $4 billion in new technologies for schools this year. To help ensure that teachers and students know how to use these tools to improve education, the Technology Innovation Challenge Grants encourage the development of applications and practices that can be adapted in other schools and communities. The program received $200 million last fiscal year and is seeking $425 million in this year's funding request.

A second aspect of the Technology Literacy Challenge initiated by President Clinton and Vice President Al Gore in February 1996, the Technology Literacy Challenge Fund gives formula grants to state education agencies. These grants help the agencies put in place technology plans through competitive funding to local education agencies that use new technologies to improve schools. Every state has submitted a comprehensive plan and the Education Department is now in the process of providing competitive grant funding. Much of the money is used for training, acquisition of software and hardware upgrade and connection.

The so-called Clinton and Gore challenge called on business and community leaders to join with educators in guaranteeing students in America the ability to use computers and the information superhighway in preparation for responsible citizenship and employment in the next century. It has four key goals: equip all classrooms with modern computers; connect them to the Internet; develop software and networked learning content to help students achieve high standards; and prepare all teachers to integrate these new technologies into the curriculum.

"Another key initiative is an intergovernmental activity that the president has asked the Education Department to chair. It involves placing resources for teaching on the World Wide Web from the various different federal agencies. That Web site is scheduled to be up and running next year," says Roberts.

The third major program is the so-called E-rate, a universal service fund for K-12 and libraries that the Education Department worked on with the Federal Communications Commission. That fund, amounting to $2.25 billion, is targeted for discounted telecommunication services, internal connections and Internet access, and basically reduces the cost of getting online, wired and connected.

Universal access is also a key element of the Stars Schools Program. This initiative tries to improve instruction in mathematics, science, foreign languages, literacy skills and vocational education. Using telecommunications and distance learning, it also seeks to meet the needs of undeserved populations, including the disadvantaged, illiterate, those with limited English proficiency and individuals with disabilities. The program was first authorized in 1988 and was recently re-authorized through Title III of the Improving America's Schools Act. "Everything we are doing we hope will be tied to improve student performance. Schools have learned that you get results with technology where there is a clear educational focus and purpose tied to the use of that technology. I am encouraged by the growing number of programs that have strong content ties, such as the Bay Area Writing Project [a collaboration of the University of California at Berkeley and San Francisco Bay Area schools to improve writing and the teaching of writing at all grade levels and in all disciplines]. Our job is to never lose sight of what we are trying to accomplish educationally," says Roberts.

Among the most controversial topics on the Internet these days is the issue of spam, or unsolicited e-mail, and the steps, if any, needed to stem the tide. It is not surprising, given that U.S. consumer sales in all direct marketing media will top $630 billion this year, with consumer sales online approaching $1 billion.

One of the key stakeholders in the battle is H. Robert Wientzen, president and CEO of the Direct Marketing Association Inc., New York. Speaking last month on the emergence of cybermarketing and the importance of self-regulatory practices at the Privacy & American Business 4th Annual National Conference in Washington, he described the new DMA directive to ensure consumer information protection by direct marketers.

According to Wientzen, the DMA is beginning a process to make it mandatory for DMA members to comply with the association's ethical business standards. These include giving consumers notice of information practices used by marketers, offering consumers the opportunity to opt out of the process and honoring the wishes of those consumers who do choose to opt out.

This will be done through in-house name-removal programs and the industrywide Mail Preference Service and Telephone Preference Service national name-removal programs offered free to consumers through the DMA. These membership requirements take effect in July 1999.

He also mentioned DMA self-regulatory initiatives for the new media, including a consumer education workbook for parents called Get CyberSavvy!, a global e-mail preference service to let consumers receive less unsolicited marketing e-mail and programs with both the World Wide Web Consortium and an international federation of direct marketing associations to secure greater online privacy protections for consumers worldwide.

DMA photo

H. Robert Wientzen, president & CEO of the Direct Marketing Association Inc.

"We are not sure how fast our members are adapting, or suitably reacting, to the Internet and new technology such as CD-ROM. We do know they seem to be moving toward the adoption of some of the techniques as another media. That's important. Another medium alongside direct mail, telephone and TV. We see this as just another medium. About 86 percent of our members are in some way involved or using the media as part of their business. A little under half of those are attempting to transact, make a sale. Within that group, about 17 percent are actually conducting commerce. That's quite a bit versus a year ago, an amazingly deep penetration," says Wientzen.

While he admits that there are new issues for direct marketers to address with the Internet, such as intellectual property on a global level, the Uniform Commercial Code and international law, he does feel that many of the questions involve the same traditional basics presented in a different way.

"Many of the challenges are not all that unique. One of the biggest is often referred to as privacy, data security. How do you assure the maintenance of consumer trust? That's a 40-year-old problem, just presented in a new way," notes Wientzen.

Internet Market Revenue Projections
(Millions of dollars)
1996 1997 1998
Browsers $74 $85 $93
Internet Servers $979 $1,410 $1,777
Intranet Servers $2,674 $5,483 $9,210
Page Design $247 $277 $291
Connect Charges $2,365 $3,784 $5,297
Total $6,339 $11,039 $16,668
Source: Zona Research

What is also different is what he refers to as "a fundamental speeding up of the nature of the channels of trade."

"The concept over the years has been reflected in an 'I make, You take' mentality. You manufacture the goods and sell to distributors. There is now more a perspective of meeting consumer needs without considering the established channels. When all is said and done about the Internet, the bottom line is meeting consumer needs. It's not enough to just be convenient," observes Wientzen.

His trade group sponsored publication of a seminal study, "Marketing in the Interactive Age: A Management Guide to Strategic Uses of New Media in Direct Marketing." Prepared by A.T. Kearney, Cambridge, Mass., the study found, among other things, that new media have the potential to create significant disintermediation effects.

"Through new media, companies are able to communicate with and sell direct to customers. This technology can allow manufacturers to directly bypass intermediaries in the supply chain - such as wholesalers, retailers, and, most importantly, direct marketers. The management of new media's disintermediation effects is one of the most challenging issues that companies will face."

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