Japan and GII (Shumpei Kumon) - the text of a talk

[David Farber <farber () central cis upenn edu>]

The GII Initiative:
Its Significance and the Challenges for Japan


by Shumpei Kumon


Center for Global Communications
International University of Japan




Overview


Today's "Information Revolution" consists of two key dimensions:
super-industrialization (the third industrial revolution) and
trans-industrialization (the "netizen" revolution). The proposed global
information infrastructure (GII) bears significance as an essential
foundation for both. In America, pilot projects under the GII development
initiative have been shaped and driven by a perspective that takes these
two dimensions into account. Japan should strive to develop a clearer
understanding of these critical features of the Information Revolution
under way, and upon that improved awareness, work to foster the development
and use of its own national information infrastructure (NII) while
cooperating with efforts to realize the goals of the GII initiative at
large.




1. U.S. Trends
Around 1992, America witnessed an emerging consensus on three specific
points: namely,
  (i) that digitization is powering a trend toward the fusion of
information-processing and communications;
  (ii) that the national information infrastructure will determine the pace
of progress in that overall process; and
  (iii), that these developments in the digitization and NII arenas will
form multimedia as the "break-through industry."


Nonetheless, despite the level of unity attained on these themes, views
diverged widely over such issues as the actual architecture that the NII
will assume, and the commercial fields that hold the most promise for the
multimedia industry over the near term. Hence, 1993 proved to be a year of
contention for an array of competing views and ideas. By early 1994,
though, it had become generally accepted that
  (i) the architecture of the NII will ultimately be modeled on the
Internet; and
  (ii) that business applications will be the best market for multimedia,
followed by applications in education, health-care, and welfare services,
with recreational applications further down the list in significance.


Amid these developments, in late 1993 the Clinton administration unveiled
five core principles for the drive to establish a national information
infrastructure. Not long thereafter, at the ITU world development
conference in Buenos Aires in March 1994, Vice-President Gore delivered
what amounted to the "Gore Doctrine" on the GII.


First, he noted that the GII will be key to future economic growth at both
the national and international levels. In essence, work to build advanced
information infrastructure counts as one of the most pressing challenges
developing countries now face. If they successfully address that challenge,
Gore concludes, new gains in economic development will be within their
reach.


Second, Gore maintained that the GII will also be instrumental in promoting
constructive democracy. In effect, by vastly enhancing the public's
participation in policy making and decision-making affairs, the GII can be
expected to contribute significantly to the functioning of democratic
processes as well as the ability of nations to cooperate with each other.


In setting forth these "doctrinal" positions through his Buenos Aires
address, Gore called on all nations to assume a cooperative role in the GII
initiative, and identified that as a special challenge for the advanced
industrial nations above all. He then added that the five guiding
principles behind the U.S.'s own NII program could be applied to the GII
drive in unaltered form.


Those five principles are as follows:


i. Encourage private investment.
ii. Promote building through private-sector competition.
iii. Make the regulatory framework as flexible as possible.
iv. Provide open access.
v. Ensure universal service.


The first two principles can be understood as having to do with the process
of super-industrialization, which I shall discuss later, while the last two
can be interpreted as having to do with the trans-industrial dimension of
the current Information Revolution.




2. The Two Dimensions of the Information Revolution


The Information Revolution has taken on two parallel dimensions.


(1) The first is "super-industrialization," that is, the third industrial
revolution. The GII will be an essential foundation for that ongoing
process.


The digitization of information has made it possible for computer networks
to merge, process, and transmit text, sound, video, and other forms of
expression as electronic data. This achievement has spawned dramatic and
far-reaching increases in productivity in factory and office work
environments alike. These productivity gains stretch across the entire
industrial spectrum, including even the traditional "low-productivity"
sectors. Further, they have begun to appear in practically all domains of
business activity, from administration to health care to education.
Improved productivity translates into lower costs and cost/performance
ratios. In effect, then, the computer industry's own model of the "Moore
Principle" seems poised to impact other fields of industrial and business
endeavor. Should that prospect materialize, it can be expected to not only
pave the way for lower-priced manufactured goods, but also bring reduced
fees for public services, more affordable health care and education, and
lower tax rates, all combining to usher in a new era of inflation-free
economic growth.


Heavy and chemical industries were the "break-through industries" during
the first half of the second industrial revolution, which began around the
end of the 19th century. These in turn supplied the engines (internal
combustion engines and electric motors) and materials (plastics and other
synthesized chemical products) for an array of entirely new industrial
pursuits. In the U.S., such products led to immense productivity gains in
the primary industrial sectors--agriculture in particular--thus freeing up
a sizable portion of the labor force for work in other fields. Much of that
labor was then assimilated by manufacturing ventures focused in the
"matured" industries that led the last half of the second industrial
revolution: namely, passenger cars, consumer electronics, and other
consumer durables.


In much the same fashion, multimedia now appears positioned to become the
first "break-through industry" of the third industrial revolution. As such,
it can be expected to supply the "engines" (computer networks for the
processing and transmission of information) and "materials" (information
and information services) for a range of new industrial undertakings yet
further down the road. Also, by assimilating and exploiting
multimedia-inspired goods and services, existing sectors of the secondary
and tertiary industries will likely witness their own leaps in
productivity, again freeing a segment of the labor force for work in other
fields. Though the prospects are still quite distant, that surplus of labor
could ultimately wind up serving "matured" industries focused in such
futuristic areas as virtual reality and artificial life.


The first stage of the Information Revolution as the third industrial
revolution arrived in the 1970s, driven by the "economy of cumulation" or,
as George Gilder has expressed it, "technical innovation in the microcosm."
The second stage arrived in the 1990s, led by achievement of the "economy
of networking," or technical innovation in the "telecosm."  In Gilder's
view, a single computer in and of itself is not capable of spurring
substantive gains in productivity. Only when networked with myriad other
types of computers is it ready to demonstrate its real potential. From that
perspective, the Information Revolution also bears description as the
Communication Revolution. To be sure, it is this networking revolution--the
wide-area linkage of computers through digital and wireless
communications--that has become the nucleus of the innovation in the
telecosm now under way. Wireless communications, especially, will likely
fulfill an enormous role in the development of the GII.


The second industrial revolution prompted a shift to hierarchically and
bureaucratically huge organizations: namely, giant corporations and
conglomerates. The third industrial revolution shares that feature, in that
it, too, is fostering an evolutionary transformation in organizational
structure, as is already evident in the debut of horizontal, networked, and
virtual corporations.


For instance, top levels of management can now work together with their
production lines in the arena of advanced data processing, drawing on raw
data direct from the assembly line. This has drastically diminished the
need for intensive data processing at intermediate levels, thus affording
companies the potential to eliminate several layers of their management
hierarchy in a single sweep. Reducing levels of vertical control and
hierarchy and adopting a network-driven organizational structure have
enabled companies to put together or reorganize project teams that have
more flexibility in achieving their assigned mission. In addition, such
steps have fostered heightened cross-industrial cooperation among a broadly
diverse array of companies in different fields. Not least important, it has
also become much easier to establish direct and permanent channels of
communication with clientele and maintain a close and steady exchange of
information with them. Now, employees can even conduct wide-area data
communications or sophisticated data processing while off at a customer
site or on-the-go. These capabilities are giving rise to the "virtual
corporation," an entity that effectively obviates the need for physically
placing company headquarters or satellite branches in any specific locale.


The transformation under way in organizational structure also enables many
firms to deal more effectively with the changing nature of their markets
and products. For instance, in the electronics industry, the mainstream
trend now is away from stand-alone products (e.g., television sets or video
cameras) to composite products (such as workstations and LANs). In the
process, the market has become increasingly horizontal in its composition.
Many big companies have moved to shed operations outside those that support
their core technologies and become system integrators for their own product
lines. This has led to strategies aimed at supplying the market with
customized, open-architecture solutions that combine the best technologies
for any given application.


Headed up chiefly by developments in the U.S., the third industrial
revolution has been demonstrating dramatic headway. This is one defining
feature of the global economy today. Another, though, is the recent
procession of East Asian economies that have successfully steered into the
fast lane to industrialization. These economies are steadily growing as
global sources of skilled labor and quality, low-cost industrial goods
based on intermediate technologies. Assuming there is validity to the "Gore
doctrine" that utilizing advanced telecommunications systems will foster
sustainable economic growth, it seems reasonable to expect that the
economies of East Asia will be able to continue supplying the world with
cheaper yet higher-quality industrial goods by importing and harnessing
advanced telecommunications systems and information services. As long as
the fast-paced advances of today's Information Revolution maintain firm
momentum, chances are that the community of industrialized nations, led by
the U.S., will continue exporting sophisticated information systems and
services to East Asia on into the distant future. Since the mid-1980s,
America has clearly been moving toward its long-stated goal of creating a
global economic system. That presents the Asia-Pacific region with vastly
stronger prospects for a new era of mutually complementary, inflation-free
growth.


(2) Trans-industrialization is the second key dimension of the Information
Revolution. That is to say, the modern civilization is properly turning
from militarization and industrialization to the third phase of its
evolution, namely, the "informatization" or formation of the "information
society." The GII will be essential to this facet of the evolving
informatization as well.


"Modernization" has been described as a process in which humans or human
groups compete in acquiring and amassing the means to better pursue their
own interests and, in particular, the means to control others. Given that
interpretation, modernization can be divided into three phases, depending
on the means of control sought the most. Since ancient times, three
categories of action have comprised the means utilized to control others:
(i) threat and coercion, (ii) trade and exploitation, and (iii) persuasion
and inducement.


According to this classification, the first phase of modernization was one
of militarization and state-formation, beginning with the feudalization of
the late middle ages and moving into its heyday around the end of the 15th
century. During this period, the sovereign states, who had championed their
national sovereignty through innovations in military technology, engaged in
militaristic nation-building, i.e., competitive power games on an
international level and under a set of common rules for the abstract,
generalized means of threat and force, namely, state prestige.


The second phase of modernization is thought to have begun with the
"revival of commerce" in the 11th and 12th centuries and hit its peak
around the end of the 18th century. This was the age of capitalism. In
effect, the private enterprises, who had championed their right to the
ownership of property through the advances of the Industrial Revolution,
engaged in "industrialization and enterprise-building" i.e., competitive
power games within global markets and under a set of common rules for the
abstract, generalized means of trade and exploitation, namely, wealth.


Now, in the waning years of this 20th century, we find ourselves nearing
the crest of the third phase of modernization, a phase that had its origin
in developments of the 14th to 16th centuries, namely, the Renaissance, the
invention of the printing press, and the Reformation. This is the age of
information, of reason, of "wisdom games" (or the cult of information and
knowledge), and the key players are emerging as a suitably adapted grouping
of innovative organizations perhaps best described collectively as
"intelprises." These organizations, who are now championing their newfound,
socially ordained right to information through societal changes powered by
the Information Revolution, are gearing up to compete within the arena of
the global "intelplace," and under a set of common rules, for the abstract,
generalized means of persuasion and inducement, namely, wisdom. At present,
though, these competitive games for the acquisition of wisdom are still in
their infancy. Indeed, the tasks of establishing the "information rights"
and properly balancing or reconciling them with the interests of national
sovereignty, private property ownership, and other rights, not to mention
the task of drawing up a set of common game rules, are all challenges that
lie ahead.


As it happens, the second phase of modernization created an urban citizen
bourgeois that was engaged primarily in commerce and industry. This
emerging middle class became the driving force not only for popular
democratization movements in the modern sovereign states, but also for the
industrial revolution itself. In like manner, the third phase of
modernization would appear to have created a class of "netizens,"
individuals or groups who dwell within the virtual world of the
computer-networks (cyberspace) and engage themselves in the task of sharing
information and knowledge.  From that standpoint, "netizen" rather than
"citizens' group" might be a more fitting moniker for some of the
nongovernmental and/or non-profit organizations (NGOs and/or NPOs) and
advocacy groups that have amassed such enormous influence in just the past
few years. The percentage of groups who readily utilize computer networks
to conduct their activities on a global scale is growing by the day.


Ultimately, this new netizen class could become a leading voice for direct,
participatory "electronic democratization," as well as the vanguard force
for the Information Revolution. Actually, it might even be possible to
maintain that the Clinton-Gore duo, themselves active users of modern
communications and networking gear, have already made the netizen-backed
drive for credibility a success, at least in America. Indeed, from that
angle, the fourth and fifth principles Gore outlined as guidelines for the
GII-NII initiative would seem to be goals relevant to this dimension. The
fourth principle--open access--appears aimed at ensuring members of the
netizen caste freedom in their information-related activities. The fifth
principle--universal service--can be construed as a position designed to
help pre-empt any new rifts along class lines, namely, between the
"information-rich" and the "information-poor."




3. The Current Scene in Japan and Some of the Challenges Ahead


Cast against the controversies and developments I have outlined in my
remarks to this point, it can be seen that Japan quite simply lags far
behind America in terms of either dimension of the modern Information
Revolution, as well as in its efforts to address issues of importance in
either theoretical or practical terms. In the 1960s, Japan actually led the
world in coming up with such concepts as "informatization" and the
"information society." It is thus all the more disheartening to see it fall
so far behind, especially since the late 1980s.


For now, Japan should devote all its energy to the task of closing this gap.


Toward that end, first of all, it is imperative that Japan develop a clear
understanding of the implications behind the GII initiative, and in
particular, of the insights and strategies behind America's actions in that
undertaking. Viewing America as a country bent on imposing its own
standards on the rest of the world in a bid to dominate global markets is
one interpretation that is probably mistaken. Washington's apparent
reluctance to commit itself to international regimes to reign the
telecommunications that have existed up to now should be seen not as a
manifestation of American "unilateralism," but rather as an acknowledgment
that the dynamics of the Information Revolution are prompting qualitative
changes in the very mechanisms for the cultivation of global standards, not
to mention the nature of cooperation itself.


Second, Japan must on the above awareness move swiftly to build a national
information infrastructure of its own that is open to the world at large.
In parallel with that effort, moreover, it should study effective methods
of putting its infrastructure to work. Over the longer term, we should
seriously contemplate changes in our models of society and language and
experiment with educational and administrative strategies that could
conceivably pave the way to innovative new breakthroughs in technology.




Third, Japan has to be determined about how it is going to involve itself
in efforts to establish the GII. Ultimately, this will demand that it be
definitive about its role in the Asia-Pacific, a region destined to be a
key global center of growth on into the century ahead. In other words,
while the time for these decisions does not as yet appear ripe, Japan will
be compelled to more clearly identify its stance relative to America in
regional and world affairs.