Asia in the Global Information Economy:
The Rise of Region-States,
The Role of Telecommunications

An Address by
John M. Eger, Esquire

Lionel Van Deerlin Endowed Professor
of Communications and Public Policy, and
Executive Director
International Center for Communications
San Diego State University

Of counsel, Morrison & Foerster LLP

Presented to the International Conference on Satellite and Cable Television in Chinese and Asian Regions

Sponsored by

Communication Arts Research Institute
Government Information Office, R.O.C.
Department of Communication Arts
Fu Jen Catholic University

June 4-6, 1996
National Central Library
Taipei, Taiwan


One would have to be a recluse living in solitary confinement not to know that there is indeed a revolution taking place everywhere in the world given the convergence of technology, the technology of telecommunications, and economics, the economics of a global economy. And in the wake of this convergence, power is being realigned and wealth redefined. These two global trends -- the realignment of power and the redefinition of wealth -- again propelled by the convergence of technology and economics, will likely permeate life and work throughout the world, well into the 21st century.

Let me be more specific by providing a certain historical context. Take Abraham Lincoln, one of America's well-known presidents. In addition to ending the Civil War between the North and the South, he is also widely credited with abolishing slavery. A lawyer and well-known orator, in fact he had a very squeaky voice, and probably would not survive as a modern day media figure. At his most famous address in Gettysburg, Virginia in 1863, there were some two thousand people in attendance, according to published reports.

But there was no radio or television. No audio/visual systems. No public relations agents, or "handlers" or advance men, as they are called today, to tell us what the President was likely to say outside of Gettysburg well before the actual event. As a consequence, not many people knew of the so-called Gettysburg Address. Yes, there were bits and pieces picked up by the daily newspaper, the Gettysburg Gazette and a handful of other newspapers, but it was months and years before the full impact of that historic address was known throughout the world.

Fast forward one hundred years to 1963. The place is Dallas, Texas. John F. Kennedy is shot, and within twenty-four hours, two-fifths of the world's population, or 2 billion people knew, read, heard or saw replays of the assassination. Fast forward again to just the last few years. Let your imagination quickly review the events that pop to mind: The fall of the Berlin Wall; the war in Bosnia; the tragedy in Tiananmen Square; the opening shots of the Gulf War, and in all likelihood you were there, or could have been, along with four-fifths of the world population, 4 billion people.

You were there because CNN was there, UPI was there, the Spanish International Network was there. You were there, thanks to a vast network of satellites orbiting at twenty-two thousand miles in space, underseas fiber optic cables, wired and wireless networks, cellular phones, palmtop and laptop wireless computers. Thanks to this electronic nerve system which spans the globe, there is nothing of importance that happens anywhere in the world that isnÃt instantly reported everywhere.

The global village Marshall McLuhan first talked about is here. It's not the world community he envisioned perhaps; but nonetheless a new mosaic is taking place and as I mentioned earlier, some very definite trends are becoming clear.

First, there is a major realignment of power taking place in the world. No government, no matter how popular or dictatorial, can set its nation's public policy agenda. No, it is world public opinion that does that.

As Charles Wick, Ronald Reagan's Director of USIA once pointed out: "How else could a dock worker in Poland, not a General, create that great force for change, Solidarity? How else could an ordinary housewife aspire to the dreams of her country and rise to be President of the Philippines? How else could a black woman say no to the ravages of apartheid, and the world stop and listen?"

This power of the people to shape public opinion and thus public policy is clearly evident in last year's U. S. Congressional election; the elections in Mexico; even the race for Governor in Tokyo and Osaka, and most recently the general election in India. In a larger sense, people everywhere in the world are garnering power as never before. And, are beginning to exercise it.

A major redefinition of wealth is also taking place. Walter Wriston, former Chairman of Citibank, likes to point out what happened when Great Britain entered into an agreement with the People's Republic of China for control of Hong Kong. Trading screens began to light up all over the world and the traders began to trade. Their trades -- like a global plebiscite -- reflected world public opinion that it wasn't a good treaty. Overnight, billions of dollars left Hong Kong. Information, Wriston believes, has replaced gold as the new monetary standard. In the post-industrial information age it is information or knowledge that is the new wealth. And it is information technology that are the tools of wealth creation.

Already, the production, transmission and use of information is replacing industrial processes as they replaced an agrarian economy centuries ago.

That is the reason, I would argue, that Singapore launched its aggressive plan, IT 2000, also known as the "Intelligent Island project." By wiring every home, school, office, hospital, businesses large and small, connecting every institution to every other and educating their populous nation, Singapore hopes to leap-frog well into the next millennium as an international information region, an intelligent hub, if you will, for the emerging Pacific. That is why, too, Japan some years ago launched a two hundred and fifty billion dollar initiative, now up to four hundred billion by last count, called Technopolis and Teletopia, for telecommunications utopia. Both initiatives are designed to do for their more populous nation, what Singapore plans to do for its relatively smaller "city-state." That, of course, is what gave birth to the Clinton Administration's National Information Initiative.

Today, almost every developed country has its own national information strategy, whether it is called a National Information Initiative, or a National Information Strategy such as France's Telematique or Informatique, launched in the mid-70's. The goal is the same: to mobilize resources and intellectual capital to transform the way life and work is done within the region, and in the process, to attract the new, valuable, high tech information-sensitive jobs, and to create a skilled workplace to take advantage of the movement toward a global information economy, an economy based, not so much on agriculture or manufacturing, but on the production, storage, transfer and dissemination of knowledge or information itself.

What I want to talk about today is how the spread of technology is changing not only the world we live in, but the way foreign policy is conducted, the way people relate to their government, the very fundamental way we relate to each other; and I want to explore what the future holds in this escalating technology-driven world. What it means for corporations, government, and individual citizens living in a new truly global communications community, and importantly, what it means for the birth and rebirth of the "region-state."

Looking at the broadcasting business alone, where I worked over a decade ago, the impact of information technology on every aspect of the production, distribution and reception of programming, is already evident.

In 1970, for example, there were three national commercial networks, about 73 independent stations, 128 public television stations, and a mere 5 million homes using cable.

Today, we have six national networks; over 300 independent television stations, and 350 public television stations representing an increase overall of over 300 percent. Perhaps more importantly, 80 percent of the country is now wired for cable television, and 60 percent of the homes subscribe to a service with anywhere from 30 to 120 channels of programming. We also have 46 cable television networks, including eight so-called "super stations", like Ted Turner's WTBS TV, 25 national pay television systems, and 74 million videocassette recorders. VCR's didn't exist just fifteen years ago, nor did personal computers. Low-tech devices like the fascimile machine were around, but not in general commercial use. All that has changed, and more change is on the way.

For here's a technology that knows no barriers, no national boundaries and does not recognize any of the artificial divisions between the different people and places of the world. Here is a technology that does not recognize color, creed, race, or nationality. It is a technology that is supernational, acultural, alingual, a technology of sight and sound, of binary digits that can indeed saturate the world. It is a technology that creates simply by providing the means - a flow of information and ideas - a force throughout the world that simply will not be stopped however we may resist its flow.

What we are dealing with is a technology involving social change - something technology has always done - but on a scale and at a speed never before experienced by human beings or their institutions. As this happens, your generation in particular will find yourself immersed in an age of truly vast and revolutionary change propelled by our technology towards acceptance of the concept that we are indeed one people on earth, one family living in one home, a family with common problems, concerns, and interests.

A fundamental question is whether we are ready for this. Are we human beings and are our political institutions ready to think of ourselves as one family, to address common problems and work toward common global goals and solutions. Or, as some have less optimistically suggested, are we so inexorably, so tightly bundled in national, economic, cultural and racial security blankets that we cannot reach out and communicate with the freedom our technology allows. This is the real challenge of the twenty-first century.

Already our technology is providing the means for a vast flow of information, data and new ideas throughout the world, and thanks to a vast and complex network of underseas cables, and satellites orbiting the earth, and readily available and affordable receiving and sending equipment, the world is bound together by an electronic nerve system carrying news, money, data and information almost anywhere in the world in microseconds; from the evening television news and the international electronic funds transfer of payment systems to the almost routine exchange of data between computers in one part of the world, and those in another; drawing airline reservation information, or in the universities, drawing scientific or economic data to and from a terminal in Tokyo, London or Kuala Lumpur.

From the ubiquitous computer-satellite-TV link to the inexpensive handheld Sony Walkman, the steady stream of news and information is increasing at an unparalleled rate.

How and why did this happen and what does it mean to those of you living in Asia, indeed everyone in this new global arena? Well, you already know a little about the American experience, so let's start in Europe where private systems of television and telecommunications are springing up everywhere.

Most observers feel it all started in Italy in 1977. Italy's constitutional court held that freedom of speech could not be limited to just print. Only in Italy, overnight there were 300 television stations dotting the landscape. Now where TV used to be a state monopoly, you have private TV, cable and satellite television in France, Germany, Belgium, Norway and Spain and new channels coming on stream in Portugal and Greece, and whole new systems of regulations coming out of Brussels that since 1992, the official year of the European Union, are changing the character of all audio-visual communications and telecommunications in the new Europe forever. For the freedom to communicate is not limited to just media. It encompasses the whole array of technologies essential to everyday life and a robust economy.

More recently, deregulation is taking place in Asia as well, in Hong Kong, in New Zealand, in Australia, and some form of commercial television is taking hold in India, in Indonesia, Malaysia, and the People's Republic of China. I was involved in helping China adopt a commercial system of broadcasting in 1983 when I worked for CBS. It was such a success, in 1987 the Chinese held the first Third-World Advertising Congress in the Great Hall of the People in Beijing for over 40 developing countries. Perhaps if the experiment had had a few more years, China would be further along the path to globalization than where it is today.

But let's move beyond terrestrial broadcasting as we know it today. What will happen when voice recognition, for example, and the fax, the personal computer and the VCR are built into every television set, and video and data of all kinds are available on demand from thousands of data bases around the world; when every rooftop has its own .9 meter aerial or earth station capable of receiving hundreds of high-definition signals from anywhere there is a satellite dish; when three satellites are interlinked in orbit, capable of delivering any signal from any point, to any other point in the world, or from one point to millions or billions of other points on earth, at sea or in the air?

Science fiction? Hardly. Given the rate of advances in electronics and photonics and the current trend toward privatization and commercialization, that future is just around the corner.

But this is only the beginning. What we've seen so far is a technological revolution, the first wave of yet another shift of the tectonic plates of our communications infrastructure. What will happen when the system is truly global and broadband, with infinite capacity? What will happen when the system integrates all kinds of digital networks into it, and when our advances in computer and telecommunications intertwine to provide new pathways into every home and office, in the air or at sea, giving the user, whether it be corporations or individuals, a highly interactive, unlimited capability?

Take DBS, or direct broadcasting by satellite, for example. It was only in 1977 that the world decided, under the auspices of the United Nations International Telecommunications Union, that every country ought to have the right to have an orbital slot, or a parking spot if you will, at 22,000 miles above the earth to relay signals and other information back to their own country. At the time, Luxembourg, which is entitled to its own orbital slot, recognized the power of the satellite, coupled with the sophisticated receiving station which often had to be 10 feet or more in diameter, would give Luxembourg a signal covering Luxembourg with a little bit of spillover to France and Belgium and Germany.

In less than five years, because of advances in technology, the footprint of the signal from that satellite covered all of Western Europe. Today it covers one-third of the earth. Because those satellites can be interlinked in orbit, any uplink, let's say out of Luxembourg, can send a signal theoretically to any point, anywhere on the earth.

A major driver for the development of these global systems is the globalization of markets and the development of a truly global corporation.

Unlike the multinational corporation, the global corporation is one that recognizes, as the New York Times put it, that "as the world becomes smaller...markets are now driven more by what they have in common than by what sets them apart". Ted Levitt, Professor of Marketing at Harvard said this means that, "companies must learn to operate as if the world were one large market -- ignoring superficial regional and national differences".

Nobody said it better than Saatchi and Saatchi (at one time the world's largest advertising agency), "there are probably more differences between midtown Manhattan and the Bronx . . . than between midtown Manhattan and the 7th Arrondissement of Paris".

And with satellites, according to Bob James, then C.E.O. of McCann-Ericsson, the world's largest advertising agency, you can tie these markets together. "The global marketing movement," he said, "is propelled by satellite communications, faster-than-the-speed-of-sound, air travel and computers talking to computers even as we sleep. Cultures are merging, borders are blurring and markets are becoming more and more like each other everyday."

Total advertising expenditures now exceed 250 billion dollars a year. Of that, more than two-thirds is spent by less than 200 companies. You know who they are; it's McDonald's, Coca-Cola, Toyota, Gillett, Sony, Nissan and others. These of course are the new "global corporations" I am talking about. As they begin unfolding their global media strategies, we will see, I believe, a steady convergence of economics, technology and public policy likely to result in the development of truly global networks, truly global integrated systems of information and communications.

Meanwhile, while satellites are shrinking the globe even further, on the ground there is fiber optics -- thin strands of glass fiber (and now even plastic) capable of transmitting thousands of high-definition, two-way or interactive channels of programming into homes, schools and businesses on beams of light.

Arno Penzias, the Nobel Laureate and head of research at Bell Labs tells us what makes light or laser technology so fascinating is the photon, a unit of energy like the electron, but having no electrical charge, and not subject to any form of interference. Together with its indefinitely long lifetime, this will revolutionize the next century of communications and much more dramatically change the face of the communications landscape. The number of new futures that photonics or optical fiber offers is astonishing. It's no surprise that billions of dollars have already been invested in the technology.

The first efforts are already evident in such conveniences as fiber optic telephone lines, laser printers, laser scanners in supermarkets, compact disc players and credit cards with readable holograms.

With each innovation, the cost of building fiber systems and providing fiber to the home drops dramatically. In 1977 for example, fiber cable was about seven dollars per meter. Today, it's pennies. Light-emitting diodes, or LEDs, essential elements in the optical switches of any fiber system cost $2000 just a few years ago. Today they sell for about ten dollars. Calculations now are that it is actually cheaper to lay fiber directly to the home than it now costs cable TV companies to lay copper coaxial cables.

But with a difference. Copper wire carries information at 64,000 bits per second. Fiber carries information at billions of bits per second, and one thin strand can easily carry as many telephone conversations as 625 copper wires, all with greater clarity, accuracy and speed.

Perhaps for that reason there are more than 10 million miles of fiber in the United States connecting almost every telephone switching office with every other office throughout the country. Now it is that last mile, that last link directly into the home, school, library and business that has to be made. And given the recent wireless explosion in our country, a combination of wireless and wired networks are rapidly developing so that almost everyone will have broadband access.

There are literally hundreds of experiments using optical fiber around the United States. In Queens, Time Warner built a system with 300 channels using fiber optic cable. Now with digital compression and innovations in new programming, that number could jump to 500 channels or more.

Already in Orlando, Florida for example, you might watch the French Open on Channel 1, or just follow Andre Agassi if he's the star you're most interested in on Channel 2. Channel 3 will give you Steffi Graf. Channels 4 through 7 might give you different angles, or you can skip to one of the other twelve cameras covering other matches that day. There are other programs like news that will let you dig deeper into archival data bases for video on demand, texts or audio as you wish, and there are experiments in education linking schools with post offices or other public buildings for distance education purposes, and interactive learning experiments using a combination of computer data bases, video, voice and even facsimile systems to provide multi-media learning experiences.

And there are other experiments, medical systems for example, that will save your life. It has been theorized that if we can bring high-definition broadband systems into the home, perhaps to provide cinema-like quality television, we can bring high-definition medical images out of the home to hospitals and clinics where it can be analyzed. It may soon be cheaper and more efficient to send the cardiac outpatient home after surgery and watch them with an electronic eye, rather than a hospital attendant who comes by only once every hour.

It's easy to see why these new "Information Highways" will change not only the way we view television and receive news and information, but also our systems of transportation, banking, health care, education and everything else in our lives. Of course, there are some regulatory hurdles in the U.S., and elsewhere, but most people expect within the next ten years, hundreds of thousands of communities, rural and urban around the world will be connected.

Taken together with high-powered DBS satellites circling the globe, a new web of communications will be in place, and for the first time in history, we will build a distribution system befitting the post-industrial Information Age. Of course, all this may take a few years, but the outlines of what this latest revolution means are already in view.

What is not so clear is the role of the nation-state.

The fact is the influence of global media, the demand for global markets and the pressure for national solutions to essentially global problems are changing the role -- indeed, some would say the existence -- of the nation state, changing the conduct of foreign policy and compelling a rethinking of existing institutions, structures and relationships.

The nation-state, as Norman Cousins, the author and philosopher put it years ago, is still too big to solve the problems of the city, and too small to solve the problems of the world. It is struggling desperately to accommodate itself to the complexities of the global economy as it redefines its own basic national mission. The need for a sensible National Information Initiative or Strategy is a case in point.

More recently, for example, following on the heels of the launch of the U.S.'s ambitious National Information Initiative or NII, Vice President Al Gore went to the ITU's Plenipotentiary Conference in Kyoto to launch a GII, or Global Information Initiative. It was a heroic and bold effort -- although not much appreciated by those lesser developed nations who, but for a small percentage of their population, still don't have telephone service.

But the larger concern I have is not that NIIs or a GII are faulty or ill-timed. It is that such lofty global or national policies wonÃt work. Why? Because of the reverse flow of power taking place in the world. What we need is to have local and regional communities -- however we define them, those governments closest to the people -- take ownership of this effort to transform the region, to build their local information infrastructures and in the process, the city-states, and region-states of the new economy.

In San Diego for example -- itself a region-state in the making -- we started five years ago with an observation that 65 of our top 100 cities in the U.S. were dying today because "cities" are no longer functional. Cities prospered because of their location aside major transportation routes or because they developed profitable specialties in the American industrial economy. But "telecommunications" -- telephones, faxes and the electronically-linked computer -- make it possible for service-sector firms to locate anywhere, and many are therefore moving out of downtown business districts.

Some had argued that San Diego would never be a major economic power because our city is not a "headquarters town." The fact is that, with today's communication capabilities, it really does not matter where corporate headquarters are located. We have entered a new post-industrial information age and, because of advances in telecommunications, as companies become global -- with a presence almost everywhere in the world -- corporate decision-making is becoming increasingly local. Sony Corp. calls it "global-localization," and headquarters, if they exist at all, are on a jet plane over one ocean or another, but constantly in motion.

Already, San Diego, with more personal computer users than any other county in the world, has the interactive, intellectual underpinning critical to becoming a region-state for the Global Information Age. With three major universities, a major naval installation and a robust biotech community, it is not surprising that the county also has more high-tech alliances with foreign partners than any other county.

All this suggested that San Diego may be ripe for a teleport, like Singapore, and a robust communications infrastructure to keep those information-sensitive industries and institutions connected to the new global information economy. It could also be a magnet for other information industries.

Given our geographic location and our links with Mexico and the Pacific, and the passage of NAFTA -- seen by many as more exciting than the unification of Western Europe because of the vast economic potential -- San Diego could take a giant step forward by adopting an aggressive telecommunications plan of development.

Increasingly San Diego is making the decisions it must to be a leader in the global information economy. It is doing it -- in most cases -- without aid or assistance, and certainly without legislation or even administrative guidance from Washington D.C. That is as it must be and increasingly will be in the U.S., and I would argue worldwide, as power continues to flow back to the community.

Yes, it's a brave new world, a world where new alliances are made, old ones changed or altered dramatically. Industry will change. The government will change too, as will the traditional role of the university which is uniquely positioned to serve as a bridge, a kind of private and public sector laboratory for exploring new ideas, a workshop for testing them and a forum for forging new alliances to implement them.

Since the universities are more concerned with learning and linkages, than power or politics, all this should lead us, hopefully, to a more "techno-global" world as opposed to a techno-national one.

I know that getting from here to there will not be easy, it will take both commitment and compassion: commitment to changing the way we do business in the world and compassion; for the revolution in communications is not really about computers or telecommunications or optical fibers, or bits and bytes, or about programming or advertising. It's about people, and the way these technologies help them in their work and their lives.

Yet today, despite the efforts we have made as a people to harness technology, to solve business as well as basic human problems; despite the promising effort toward liberalization in the world and the gee-wizardry of optical fiber, DBS and Dick Tracy wrist watches, the public policy process is still dangerously behind the movement of technology and markets.

There are many barriers. Copyright infringement for one. Unlicensed use of copyrighted material on video cassettes, audio tapes and CDs is a severe problem in many nations of the world. Cultural restrictions, including restrictions on programming, and advertising; and on the use of foreign-produced commercials also constitute a pervasive nuisance. There are other trade barriers, including foreign ownership restrictions, transborder data flow restrictions, quantitative restrictions on the import of products or quotas or licensing, restrictions on earnings, discriminatory taxation or limitation of royalties, discriminatory customs valuation practices, local work and content restrictions, and hiring and immigration restrictions.

But the biggest barrier of all is the barrier in manÃs mind; the narrow view of the world, harbored by an increasing number of politicians, and policymakers and, frankly, everyday people about race, religion, language, and ethnicity.

Daniel Bell, author of The Coming Post-Industrial Society predicted this some years ago:

"Increasingly", Bell said, "the nation-state is under pressures that are cracking it. A striking thing if you look around is with all the talk of globalization and national integration, in almost every political arena of the world you will find factors for disintegration. In Northern Ireland it is religious, in Canada it is linguistic, in Belgium it is linguistic, in Nigeria it is tribal. These follow the fault lines of history and culture and therefore express themselves in these ways . . . what is emerging, although it is not inevitable, is the growth of new devices for adaptation."

The EC, NAFTA, APEC, it has been argued, are some of these devices -- new mechanisms for adaptation. And while some are concerned as we were in the United States with "EC 1992," that it was simply a lowering of internal barriers between nations in Europe as a precondition to raising external ones to Japan and the U.S., the truth may be that such economic unification taking place on a regional scale are simply important steps to political and social harmony; short steps to global markets and world community.

But how can this occur with the trends developing toward disintegration so strongly in the opposite direction? By the World Bank's prediction, we will likely see a doubling of new nations over the next thirty years. These new nations, however, are not the high tech region-states I refer to. Rather, these are the fragments of the new world information order, the remnants if you will from the growth of regional federations and the seemingly opposite megatrend in the other direction favoring local autonomy. This is, itself, a natural and understandable phenomenon. But the undercurrents of this tidal wave of change in geopolitical structures are troubling. For many of these new states are not founded on any desire for economic or political freedom, but rather on racial, ethnic and tribal grounds.

Benjamin Barber, author of The Jihad vs. McWorld, framed the issue this way: What Jihad -- the bloody search for bloodlines -- and McWorld -- the bloodless search for markets -- have in common, he said, is "anarchy . . . the absence of common will and that conscience and collective human control under the guidance of law we call democracy."

Everyone with a stake in the communications industry, indeed everyone with a stake in creativity and freedom, should take a position against these barriers to world community. Information and ideas will flow, will permeate the world. They must, say those of us who believe in the freedom of ideas.

And what of freedom and the free flow of ideas in Asia, a critical question to Taiwan. You know well, that there are other people in the world who do not share your belief in freedom. We must admit that there are people who fear that we can exercise our freedom only at their expense, and this is the heart of the problem. It is a problem of promoting privatization and commercialization without threatening national authority. It is a problem of encouraging creativity without undermining order or discipline of a democratic society. It is a problem of encouraging the birth of local autonomy -- the growth of region-states -- while preserving and enhancing the role of nation-states and multinational cooperation. Finally, it is the problem of finding a way to make the maximum use of our communications technology, while convincing others less optimistic that the global unity of man can be achieved without destroying manÃs diversity, that our technology will advance, and not retard the fortunes of mankind.

As I said at the outset, this is the real challenge of the twenty-first century. It is a challenge for Asia and for everyone else in the world. It is a challenge to our humanism. It is a challenge to our freedom and our basic existence. It is also marvelous time to be alive.

Thank you.



Return to the Japan-U.S. Telecommunications Research Institute page

Return to the List of Publications Page