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                      THE ICEBERGS OF SILICON VALLEY:
              SOME BACKGROUND FOR AL GORE'S NEXT NII SPEECH
                    (AN OPEN LETTER TO THE WHITE HOUSE)
**************************************************************************
 
Getting Peoria and Muskogee online is just a start. How much will e-books
and educational software cost when Americans connect? Will cybergreed
prevail? The open letter below--to Greg Simon, domestic policy advisor to
Vice President Gore--raises such issues. One encryption company now talks of
35-percent charges on the sales revenue of information providers. When Al
Gore speaks this month on the National Information Infrastructure, he'll do
well to go on record against such outrages and promise specific remedies.
Aren't 35-percent encryption charges as loathsome as loan sharking?
 
Commendably, Mr. Gore has already warned of the need for some regulation. He
has said that data highways without any government role would be like the
radio rooms of the Titanic era--when laissez-faire reigned supreme, when the
wireless business placed profits ahead of safety, and when receiving word of
distant icebergs mattered less than tapping out the messages of wealthy
passengers.
 
A major question for Mr. Gore, then, is this: Are there better alternatives
to the usual pay-per-read plans for e-books "protected" by encryption?
 
The standard actions suggested--for example, special license fees for
libraries and user-to-user subsidies--just won't work out and could even
undermine trust in government. Building up false hopes is a recipe for
social unrest. Washington knows that the money isn't there, or at least not
enough to avoid "savage inequalities" between the rich and poor. The
well-off hate subsidies that do not benefit them. Even some middle-class
communities cannot raise enough funds for good library systems. In the
California of the Proposition 13 era, certain cash-strapped counties have
shut down libraries, prompting a nine-year-old girl to say: "I want to grow
up to be a librarian, if there's still a library."
 
Just the same, if we start slowly and plan well, we *can* bring e-books and
educational software to all Americans by using multiple applications that
would benefit business people along with schoolchildren. For specifics,
readers may e-mail me at [log in to unmask] for a copy of the latest
teleread.txt (170K). Please take care not to address requests to the entire
list.
 
People who have already seen teleread.txt might want to read this post for a
new twist, "How to Use Encryption in Ways that Would Not be So Threatening
to the Public Interest." Although I much prefer a national library online
with as little reliance as possible on encryption, I suggest an interim
solution if need be. Under it, local libraries could offer encrypted e-books
and software on their own servers; what's more, we could keep the multiple
application approach. No, readers still wouldn't pay for eligible books.
The encryption would simply be for dependable reporting of accesses, so that
the TeleRead program itself could compensate the publishers and writers
through a national fund.
 
This solution would also permit transmission of "free" e-books via the
Internet, America Online, CompuServe, Delphi, GEnie, Prodigy, and other
commercial networks, with proper compensation to writers and publishers.
Even CD-ROM could be used for distribution.
 
   --David Rothman, [log in to unmask]
 
**************************************************************************
 
To Greg Simon:
 
The attached clip from PC Week of December 13 might be helpful to the
Office of the Vice President as Mr. Gore prepares his next speech on the
NII. It turns out that a well-funded encryption company started by
influential people wants to bill information providers 35 percent of sales.
The head of Wave Systems is Peter Sprague of National Semiconductor fame,
and among the investors is none other than the journalist George Gilder,
whose writings helped set the tone for some of the NII debate. The
35-percent charge raises major questions, needless to say, if your main
criteria are efficiency and fairness. Such money would come from the pockets
of publishers, writers, and other creators, Too, the fee just might add to
the cost of information for Mr. Gore's young neighbor in Tennessee, the
child he mentioned in his appearance at the National Press Club.
 
Worst of all, metered information would discourage browsing and
intellectual curiosity. The whole philosophy reflects a short-sighted techie
mindset at great variance with the traditions of democratic government and
our schools and libraries.
 
Obviously the Wave plan isn't the only encryption scheme out there, but
if this is the best that the Silicon Valley elite can do, then we're in
trouble. If nothing else, the plan illustrates the gouges that will await
Americans if our data highways are like the radio rooms of the Titanic-era.
Government policy should encourage people like Messrs. Sprague and Gilder to
work to reduce the cost of information, not jack up the price. Hooray if
they can make money. But Washington should help them to do it without
harming Mr. Gore's neighbor.
 
I'd also hope that Messrs. Clinton and Gore would look beyond the usual
regulation- and subsidy-based schemes for bringing e-books and ed software
to the masses. Especially I'm referring to the talk of freebies or reduced
license fees for local public libraries. Such plans would only pit rich
against poor. The money just wouldn't be there to live up to all of
Washington's promises and overcome disparities in the funding of local
libraries. Apple's Steve Cisler found that in one year the Shasta County
library system in California was spending just a few dollars per capita on
library materials while Beverly Hills was spending more than $80. Badly
thought-out policies and unkept promises would help foment social unrest,
not prevent it.
 
Today these issues remain mysterious to most rural people, Afro-Americans,
and Hispanics, but sooner or later the truth will get out. Please see
TeleRead's Addendum Nine, "Of Trolleys and 'Savage Inequalities.'" As you
know, 70 percent of Afro-American and Hispanic children are now in mostly
minority classrooms, and even if they are cut off from the white elite, we
can at least make certain that they can eventually dial up just as many
books and educational programs. Bear in mind the current demographical
trends in California and many other places. One California journalists was
recently quoted in Money: "Eventually the have-nots are going to win and
seize control of the political mechanisms. I would not want to be an old
white person in California 30 years from now." The same could be said in
other communities across the nation where today the older whites just will
not pay for the educations of black and brown children.
 
TeleRead's common library for all Americans, however, would help create a
constituency for equality and even aid the elite, since it would also
increase the number of e-books available to them. At the same time TeleRead
is fiscally realistic. The current version of the proposal suggests that we
might start with public domain material, at first limit the subject matter
of copyrighted material, and perhaps also begin with old books that
otherwise would be just remaindered. That way, government and industry would
learn dial-ups patterns gradually and plan ahead, rather than waste money on
a high-tech boondoggle.
 
As before, TeleRead explains how we could use multiple applications to
make the plan affordable. Mass use of electronic forms could help justify
TeleReader-style computers for e-books, and e-books could help justify the
e-forms. We all know that the real cost of government isn't just in taxes
but also in the hundreds of billions of dollars that Americans spend on
federal, state, and local paperwork. If TeleRead reduced this amount by just
a fraction, it would more than cost-justify the e-library. In effect
TeleRead would shift resources from wasteful, paperwork-related activities
of business and government to knowledge-spreading activities in the private
sector. And, of course, the schools would benefit as well. By using high-tech
to save money and increase government services, TeleRead would certainly
further the Administration's economic goals.
 
I was delighted to see Tom Kalil, out of the blue, request a copy of
TeleRead when he read one of my postings on the Internet (no endorsement
implied here). TeleRead is very consistent with Robert Rubin's simultaneous
concerns with (1) the cost of government and (2) the need for equal
opportunity for all Americans. The NII and NPR are more intertwined than
even you at the White House might think.
 
Besides hearing from Tom Kalil, I've also received a letter from Mr. Gore
himself; it was written Nov. 19 and shows an open mind: "I am impressed with
this detailed and very professional presentation." (Ideally you can forward
the latest TeleRead to his office to replace the version sent to Mr. Gore
many months ago. As I recall, the document that Mr. Gore saw did not include
the idea of using TeleReaders for electronic forms.)
 
In addition I've been able to testify at an interagency NII hearing,
the one held November 18. The cast of characters there was about what I
expected; the room was packed with industry lawyers and lobbyists, mostly
representing rather narrow interests. I didn't notice any Afro-Americans or
Hispanics in the room except perhaps for a stray janitor. No, I'm not
beating up on the hearing's organizers. Quite the contrary. They just put
out the usual notices and worked with the people who came. I myself was
delighted to be able to participate; and I applaud people at Commerce for
posting the transcript on the Internet. It's a good example for all agencies
holding public hearings, especially those on information issues.
 
Finally, I myself would be delighted if Walter Annenberg funded a
TeleRead-style pilot project to help government and industry learn dial-up
patterns for e-books so Washington could plan ahead. TeleRead itself
suggested that Andrew Carnegie, if alive today, would help refine the idea;
William F. Buckley Jr.'s TeleRead column ("The TeleRead in Your Future")
repeated my Carnegie allusion; and, on his own or otherwise, Mr. Annenberg
himself must be thinking, "Carnegie," in at least a generic way. But I'd
hope the White House would be realistic about the need for public funding as
the ultimate solution. We know that even Walter Annenberg cannot put every
e-book online for all or pay for maintenance and expansion of electronic
libraries.
 
To quote Andrew Carnegie on the topic of free libraries, "I think that
an institution has not taken root, and is scarcely worth maintaining unless
the community appreciates it sufficiently to tax itself for maintenance"
(page 816 of Andrew Carnegie by Joseph Frazier Wall). The same logic should
apply to a national library online; I was appalled when a Washington Post
lead suggested that Mr. Annenberg would single-handedly make e-libraries
available to poorest schools of Appalachia. Would that the knowledge crisis
be so easily solved.
 
The Post article, rightly or wrongly, also gave typical readers the
impression that Mr. Annenberg was aiming for a school-based approach, and
if nothing else, I'd hope that he and Washington would realize how wrong
this tack would be. Nonstudents also should be able to dial up the
Annenberg-sponored projects; for example, people upgrading job skills, or
simply those who love books or need educational software. That would be in
the true tradition of Carnegie and Jefferson, and consistent with the White
House's interest in self-improvement opportunities for people outside the
classroom. Assistant Labor Secretary Thomas Komarek, who helps set
information policy for his department, has written me that TeleRead is in
line with DOL objectives. Simply put, Americans are not just students. They
are also workers and professional people with needs of their own.
 
A gentle hint to Mr. Annenberg from the Administration, of course,
could do wonders in setting priorities for everyone's benefit. Andrew
Carnegie's public libraries succeeded because he and government pulled in
the same good direction. Time for a high-tech repeat? If Mr. Annenberg does
not want to cooperate--and that's his right since it's his money--then
perhaps other private individuals or the government itself could fund a
pilot project to research dial-up patterns for a national public library
online.
 
Such plans would send a powerful message to Silicon Valley that the
future isn't just home shopping for the masses and e-books for the elite.
The Valley would start to think more in terms of affordable, sharp-screened,
book-friendly computers that could also be used for other worthwhile
purposes such as e-forms, universal K-12 networking, and community nets.
TeleReaders would be tablet-style but work with detachable keyboards and
eventually include voice recognition. The goal would be to promote reading
and writing alike, not just passive consumption of information.
 
If we aren't careful, the knowledge crisis will be the next healthcare
crisis. Mr. Gore's Titanic example was all too apt. The last thing we need
is to let the Spragues guide us toward an iceberg; please don't sink the
children of Anacostia and Shasta County.
 
                                Sincerely,
                             David H. Rothman
                           805 North Howard St.
                           Alexandria, Va. 22304
                            [log in to unmask]
                            703-370-6540(o)(h)
 
**************************************************************************
 
              HOW TO USE ENCRYPTION IN WAYS THAT WOULD NOT
                BE SO THREATENING TO THE PUBLIC INTEREST
 
I am not opposed to encryption per se. Quite the contrary: I see it as
invaluable for safeguarding government records and privacy of electronic
mail. I do worry, though, about encryption of e-books. Technology is too
quirky to build a whole copyright system around encryption and risk having
it defeated. Copyrights go on decades after the deaths of writers. The last
thing we need is a Chernobyl of literary law.
 
If, however, we *MUST* encrypt e-books, then we should use the technology in
ways that are not so menacing to the public interest. Here's one good
scenario:
 
We might follow Mr. Sprague's plan for computers with decryption-metering
devices that could unscramble information distributed in many ways such as
through cable cost or CD-ROM. Just as he proposes, users would have to use
modems to restock their accounts with credits to obtain more material.
 
*However*, as I envision it, the restocking would not be for the sake of
forcing users actually to pay for material such as e-books. Rather it would
be simply be to assure that authors and publishers received proper
compensation from the TeleRead program. To repeat, the encryption would just
encourage readers to report usage, not actually pay money for eligible e-books.
 
This way, even before the optimal network configuation for the national
library was in place, publishers could distribute eligible books by whatever
means they deemed fit. Books could also go out over the Internet and
services such as CompuServe and Prodigy. And even local libraries could run
servers with e-books. Because the actual payments to publishers and authors
would from be TeleRead--not the local libraries--this system would be much,
much fairer to the people of Watts and Appalachia. The ultimate goal, of
course, would be to have all books covered, obliterating the inequalities.
 
Yes, a well-integrated network is the best answer--in terms of the most
powerful search capabilities, the best hypertext possibilities, and other
considerations, including costs to publishers and other information
providers. But I, of all people, am certainly open to interim solutions, as
long as no one gouges readers or providers.
 
Let me also emphasize that I do not see all information as being free.
For First Amendment reasons, for example, I'm opposed to direct government
subsidies for fresh editions of electronic newspapers, which, as now, would
receive their main support from subscribers and advertisers. What's more, I
believe in the right of newspapers and other private companies to operate
two-way services. Also, I do not consider the TeleRead approach to be proper
at this time for high-cost, broad-band media such as commercial TV and
Hollywood movies. I'm simply trying to preserve the written word and avoid
the demise of our free libraries through misuse of encryption
technology.-D.H.R.
 
**************************************************************************
David H. Rothman                             "So we beat on, boats against
[log in to unmask]                            the current...."
805 N. Howard St., #240
Alexandria, Va. 22304
703-370-6540(o)(h)
NOTE TO PEOPLE REPLYING *PRIVATELY* TO MY LIST POSTINGS: PLEASE DIRECT YOUR
           RESPONSES ONLY TO ME ([log in to unmask]) RATHER THAN
 TO THE ENTIRE LIST. BE CAREFUL THAT YOUR SOFTWARE DOES NOT AUTOMATICALLY
                   SEND YOUR NOTE TO EVERYONE ELSE, TOO.
  I *encourage* online, noncommercial reproduction of my public postings.
       Permission hereby granted--implicit, explicit, whatever. Down
          with unnecessary restrictions on the flow of knowledge!
**************************************************************************
 
Sent to:
Greg Simon
ace
communet
com-priv
cosndisc
ednet
publib
Joe Abernathy (Village Voice & PC World)
Billy Barron
Steve Cisler
Laura Fillmore
Thomas Kalil
Arthur McGee
William Murrell
Arthur Oakley
Carol Risher
John Schwartz (Washington Post)
Connie Stout
Bill Washburn
And possibly others
 
%%% overflow headers %%%
To: "ACE" <[log in to unmask]>, "Communet" <[log in to unmask]>,
        "com-priv" <[log in to unmask]>, "COSNDISC" <[log in to unmask]>,
        "Ednet" <[log in to unmask]>, "Publib" <[log in to unmask]>,
        [log in to unmask], "Billy Barron" <[log in to unmask]>,
        "Steve Cisler" <[log in to unmask]>, "laura fillmore" <[log in to unmask]>,
        "Thomas A. Kalil" <[log in to unmask]>,
        "Arthur R. McGee" <[log in to unmask]>, [log in to unmask],
        "Robert Oakley" <[log in to unmask]>,
        "Carol Risher" <[log in to unmask]>,
        "John Schwartz" <[log in to unmask]>,
        "Connie Stout" <[log in to unmask]>, "Bill Washburn" <[log in to unmask]>,
        "Steve Bang" <[log in to unmask]>
%%% end overflow headers %%%