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Keynote Speech by Lawrence E. Strickling Assistant Secretary of Commerce for Communications and Information U.S. Chamber of Commerce Telecommunications and E-Commerce Committee

Washington, D.C.
June 15, 2012

As prepared for delivery

I am pleased to be invited to address today’s meeting of the Telecommunications and E-Commerce Committee at the U.S. Chamber of Commerce.  Today is a particularly timely opportunity to address the multistakeholder process of policymaking for the Internet as it has been a busy spring for developments in this area.

Nations around the world are preparing for the World Conference on International Telecommunications (WCIT) to be held in Dubai later this year under the auspices of the International Telecommunication Union (ITU). We all took note this week of ICANN’s release of a slate of nearly 2,000 proposed new top level domain names. As ICANN moves forward to process these applications, we can see both great opportunity to transform the Internet as well as the potential for serious unintended consequences. And closer to home here in the United States, the Administration released its comprehensive blueprint for the protection of consumer data privacy this spring and we are ready to start the process to develop codes of conduct to implement the elements of the Consumer Privacy Bill of Rights set out in the blueprint.

These may seem to be disparate, unrelated topics but in fact there is a common policy imperative for the United States that runs through all of these issues. Our overriding goal in the Obama Administration is to the preserve an open, interconnected global Internet that supports continued innovation, economic growth and the free flow of information.

As we address all of these issues, we are guided by two dominant principles. First is the idea of trust. It is imperative for the sustainability and continued growth of the Internet that we preserve the trust of all actors on the Internet.

Our second key principle is that we want to preserve and enhance the multistakeholder model as the preferred tool for dealing with Internet policy issues. Multistakeholder organizations have played a major role in the design and operation of the Internet and are directly responsible for its success. Within the Obama Administration, we believe that maintaining and extending this model is important for ensuring the continued growth and innovation of the Internet.

Our support for the multistakeholder model of Internet policymaking is shared by many countries. Last year, the Organization for Economic Cooperation and Development (OECD) adopted a set of principles for Internet policymaking that strongly endorse multistakeholder cooperation.  The OECD principles state that “multistakeholder processes have been shown to provide the flexibility and global scalability required to address Internet policy challenges.”

A key factor in the success of multistakeholder processes is participation—the fact that policy development is open to all interested parties.  Such parties can include industry, civil society, government, technical and academic experts and even the general public. Contrast this approach with more traditional telecommunications regulatory processes which, by their very construct, have a more limited set of stakeholders and are often designed to limit direct participation, or at least make it difficult for others to participate.  Top-down regulatory models too often can fall prey to rigid procedures, bureaucracy, capture by incumbents and stalemate.

Internet policy issues, on the other hand, draw a much larger range of stakeholders given that the Internet is a diverse, multi-layered system that thrives only through the cooperation of many different parties.  Solving policy issues in this space requires engaging these different parties. Indeed, by encouraging the participation of all interested parties, multistakeholder processes encourage broader and more creative problem solving. This is essential when markets and technology are changing as rapidly as they are.

Today, as I review the recent developments in the Internet, my theme is that widespread participation by all flavors of stakeholders will be important to the ultimate success of these initiatives. Our role in the federal government needs to be one of supporting more inclusion and standing firm against the efforts of one faction or another to allow decisions to be made or unreasonably influenced by only certain stakeholders to tip the outcomes in their favor.

Let me start with our implementation of the Administration’s blueprint to protect consumer data privacy. The blueprint calls on NTIA to convene a multistakeholder process to develop legally enforceable codes of conduct to provide specific guidance to companies to implement elements of the Consumer Privacy Bill of Rights.

I am pleased to announce that we will convene the first of these processes on July 12 in Washington, D.C. The topic will be transparency in mobile applications. We selected this topic based on the input we received from stakeholders around the country. We think it is a relatively discrete issue on which stakeholders can make significant progress in a reasonable amount of time. It is also timely. Mobile apps have exploded in popularity and are now providing substantial benefits to consumers and tools for innovation to companies. But they clearly pose distinct privacy challenges such as how to disclose relevant privacy information on a small display.

Right out of the gate, we want to be clear about who can participate in the process. As convener of the process, NTIA needs to ensure that all interests are fairly represented. Certainly, industry will participate—after all, companies will have to decide on their own whether to adopt a code once it is developed. But the process that starts on July 12 will go beyond past self-regulatory efforts of industry to develop codes in terms of participation. Our process will invite diverse participation—where consumer groups, civil society and academic experts can participate on an equal footing with industry. While the logistics of this approach will be a challenge, we think the investment in widespread participation will pay off in the quality, credibility and acceptance of the codes developed through this process.

Let me turn next to the current situation at ICANN. ICANN represents a practical working model of the multistakeholder approach to Internet governance. When I signed the Affirmation of Commitments with ICANN in 2009, the United States reaffirmed its commitment to the ICANN model and its mission to preserve a single, global interoperable Internet that supports the free flow of information and global electronic commerce.

The Affirmation was historic because it established mechanisms and timelines for the multistakeholder review of ICANN’s execution of its core tasks. What had once been a unique role for the U.S. government was expanded to include the participation of the international community through review teams. This model of enhanced global cooperation on Internet public policy issues offers a constructive example for the continuing international debates about Internet governance.

In 2010, I served on the first of these review teams which focused on evaluating ICANN’s accountability and transparency. Our team, which included representatives from the governments of China and Egypt as well as representatives from South America, Europe and Australia, made a series of recommendations to the board, all of which were adopted. ICANN will soon be reporting out on the implementation of these recommendations and a second accountability and review team will convene next January to evaluate ICANN’s performance in integrating the recommendations into the culture of the organization.

NTIA’s commitment to expanding participation in Internet governance was tested earlier this year with respect to the IANA functions contract. Last year, in anticipation of the expiration of the IANA functions contract, NTIA undertook two consultations of stakeholders, both domestic and international, on how to best enhance the performance of the functions. Based on input received from stakeholders around the world, we added new requirements, including the need for a robust conflict of interest policy, heightened respect for local country laws and a series of provisions to increase transparency and accountability. Earlier this year, we took the unprecedented action of cancelling the initial request for proposals (RFP) because we received no proposals that met the requirements requested by the global community. We then reissued the RFP and I am hopeful that whatever responses were submitted more clearly satisfy the needs of the global Internet community.

It should be clear from my comments that while NTIA continues to be a strong supporter of ICANN’s multistakeholder approach, we do not shy away from offering constructive criticism and speaking bluntly about the challenges facing ICANN and the improvements it is needs to make. In the end it only makes for a stronger ICANN. In that regard, a lot has been said in the last seven months here in Washington, DC regarding ICANN’s new generic top-level domain name (gTLD) program. While we have defended the process used to reach the decisions regarding the program, we have listened and are sensitive to the concerns expressed by some stakeholders about the potential for unintended consequences of the expansion. The details of the 1,930 applications were revealed two days ago and NTIA, along with our interagency partners, are actively reviewing the list of strings and the publicly available information associated with each application. Now that the facts are in front of us, we will meet with stakeholders in July to discuss, among other things, if additional protections are warranted at the second level.

In addition, we continue to believe it is critical that ICANN complete three work streams that will further enhance the tools available to law enforcement and consumer protection officials as the new gTLD program unfolds. The first of these is a strengthened Registrar Accreditation Agreement that takes into account the proposals of law enforcement agencies as endorsed by ICANN’s Governmental Advisory Committee (GAC). Second is the need for ICANN to address a range of deficiencies in the implementation of WHOIS policy. Third is the need for ICANN to fully staff and enhance ICANN’s contract compliance division. Among other things, ICANN needs to take steps to centralize and automate the complaint process as well as make it more transparent by the end of the third quarter 2012.

I want to emphasize that as we raise these concerns with ICANN, we do so respecting the multistakeholder processes of that organization. We bring our concerns to the GAC and discuss these issues with other governments to formulate formal advice to the ICANN board as set out in its bylaws. We have worked hard in ICANN to strengthen the role governments have, as one group of stakeholders at ICANN, to demonstrate to governments that they can be heard and their issues dealt with in this multistakeholder process. I believe increasing the meaningful engagement of governments in multistakeholder organizations such as ICANN is one of the strongest arguments we have, and indeed is a necessary precondition, to opposing the views of some nations to have international intergovernmental bodies replace multistakeholder organizations in important areas of Internet governance.

Which brings me to my final topic—these initiatives of some nations to have the United Nations or the ITU play a greater role in Internet governance. For example, many governments have called for the ITU to play a role in regulating Internet peering and termination charges. Some authoritarian countries have proposed to include cybersecurity and cybercrime provisions in treaty text. Some countries have proposed moving oversight of critical Internet resources, including naming and numbering authority, into an intergovernmental body. Each of these proposals, when viewed in isolation, would undermine a critical part of the diverse, multi-layered Internet. Viewed together, these proposals represent an attempt to bring the Internet under supranational regulation. As FCC Commissioner Rob McDowell said at the recent Congressional hearing on this issue, “patient and persistent incrementalism is the Net’s most dangerous enemy.”

I am pleased that this issue is receiving so much attention in this country. Protecting the free and open Internet is one of the rare bi-partisan issues on which the United States can present a united and unambiguous argument—we oppose the extension of intergovernmental controls over the Internet. We support transparent, inclusive multistakeholder discussions to achieve international public policy goals and to strengthen international cooperation on Internet-related issues.

I have heard some commentators question why the United States is taking such a strong and vocal position on this matter. After all, they ask, is there really much chance the ITU will seize control of the Internet in Dubai this year?

My response is as follows: Whatever odds you give for the likelihood the ITU takes over the Internet, it is absolutely imperative for us to keep speaking out on the need for multistakeholder processes and, just as important, the opportunity for increased participation by developing nations and their citizens in these processes. This is not just an intramural dispute with the ITU—this is a question of how we as a global community continue to grow and expand the Internet to create wealth for all global citizens.

Those people who call for a “light touch regulatory approach,” such as imposing a fee structure on Internet traffic entering countries in order to fund the investments to keep the Internet growing, need to understand that an Internet constrained by an international treaty likely will stifle the innovators and entrepreneurs who are responsible for its awesome growth.

Returning to my theme of participation, we need to reach the hearts and minds of developing countries—and the budding entrepreneurs and innovators in these countries—to build their support for the multistakeholder model of Internet governance. We need to show them the evidence, such as that developed by the Internet Society, showing the benefits to a developing country of building its own Internet capacity through the creation of Internet Exchange Points, which can dramatically drive down costs. We need to assemble whatever other evidence we can to convince governments that the way to create wealth in their countries is to choose openness and inclusiveness in their policies towards the Internet.

In this, as in all other matters of Internet governance, the key to success is giving all stakeholders the opportunity to participate. I ask for your help in the process—get involved yourself; get your company involved; work to the get like-minded countries involved. What is at stake is that important! Thank you very much.