mayo clinic for esophageal cancer. i do not believe that the canadians go there because of problems with their system. it is just the fact that it is the mayo clinic. my question is that a lot of the advances in treatment and a lot of the advances in pharmaceuticals, come from the u.s. paying so much money, and if the u.s. creates a new system, how is it that those types of extremely advanced pharmaceutical development to get paid for? how do the canadian citizens pay for it when they go to the mikheil clinic, for instance? i think the states might be better this -- when they go to the mayo clinic, for instance? the cutting edge of medicine, how will that get paid for? >> well, i agree that u.s. institutions in the united states that are top notch, that

are the top of the world, the mayo clinic and some of them, and you need to keep that, because it is very important research, and you are doing some things that we are not doing in canada, but if the canadian citizens want to go to the mayo clinic, they have to pay out of their pockets to do that because it is not covered, or, at least, the park that would be covered is very small compared to the real cost, so people are paying out of their pockets if they want to have that, he but these are four very specific things that could not be done in canada, but we are doing most of the things. . those great institutions that you have. they are world class and you need to keep that. host: larry is joining us from pittsburgh. and some more information on canada and its health care system. caller: really great program. i'm originally from pittsburgh. i've lived in germany for three years, and my wife's family

comes from canada and i've seen all three systems. and i will tell you this, i do cancer research. and if you have cancer, you and if you have cancer, you want to live in canada they have 100% coverage. their women come for their pap smears, they have the lowest incidents of cervical cancer than any country in the world. they're the best at screening women for cervical cancer. and we have these statistics. american women do not come to the doctor as often as canadian women because they don't have insurance. if you want to talk about wait times, just go to any major city, where you have people without insurance. and go to the emergency room. you'll see three, four hour wait times. i think the canadian system is much better than we have here in american's on the whole because we have too many people without coverage. and germany, you pay 7.5% of your income for excellent insurance. it's very expensive but you get

great care in germany as well. letting these people with serious diseases like cancer in this country without screening for cancer is an abomb nation and something has to be done about it. host: thank you for the call. next, montreal. caller: hi, thank you for taking my call. doctor, thank you very much for being on. i'm from montreal and i'm living in connecticut right now taking care of my mother who has leukemia. doctor, you're being very modest, and i know that you're very smart. but you're being like us good canadians who are always saying thank you even when you know we're right. i know that you do not want to be in a situation that the americans are in like the gentleman just said, the call before this call.

the waiting list in canada, i have lived in three provinces, i have lived in new brunswick, ontario, and question beck. and i have never had more than a three hour wait, maybe a four hour wait in any er room. i have three children. we have four adopted children. we have never had any long waiting period in any hospitals. i have a large family. and i want to say to the american people that they do want a system like the canadian system in comparison to what they have right now. i have complex region al pain syndrome. the canadian take care of us beautifully. that's pain 24/7. we do not have anything compared to what you're looking

at without any type of medical system at all. host: doctor. guest: well, i think she's right. we have a good system. and this is what i've been saying. she was lucky enough not to wait but i can tell you that some people are waiting. we have to look at the situation like it is for some people. some of them are luckier than others but we still have a problem with wait times. if this patient could have all those services without wait times, thank god, that's fine. and i think that the most important thing is what she said about having access to those treatment even if you don't have money, even if you don't have to pay for that it's provide bid the state, provided -- the care is provided by the state because we believe in that. host: shirley joining us from pennsylvania. go ahead caller: good morning. thank you very much.

i wanted to know, with your health care system, is there a limit as to how many times that you would be allowed to go to the doctor, say you have something that is chronic and you're always -- say allergies, for instance. and from one time to another gets worse, gets better, gets worse and you need to make numerous calls to the doctor to try to get these problems solved. is there a limit as to how many times you're allowed to go? and if they see that you are making too many appointments, maybe they're going to say no more? i'm concerned about that because it looks like maybe we're going to be getting the same thing here in the united states and i'm truly worried about it. at my age, we're on medicare. we have a supplement. and we're very happy with what we have. now, i understand there are a

lot of people here in the united states who don't have any. host: how old are you if i may ask? caller: my husband and i are 70. and he has numerous problems. and he is back and forth all the time and has to have blood work done. and a lot of times, he couldn't wait sometimes say 15 hours or whatever, he could never wait like that. that would be absolutely terrible. host: thank you for the call. guest: well, i think that in canada you don't have that problem. even if you have a chronic disease and you need to see your doctor each week, you won't be denied. as you need care, you will have care. so this is not a problem. and no one will say, oh, you're coming too often. no. if you need that care, it's, you can come and you will receive it for free because the

system is like that. so it's available and it's there. and you won't be denied any procedure if you really need it. and you will have it. so people are not afraid about that. and so those people with chronic disease who come tuvene their doctor, they're not waiting 15 hours. we're talking about patients going to the emergency ward for something that is unexpected. but if you go to your doctor you won't wait 15 hours for that. if you have a chronic disease, you will be seen reg alreadyly by your doctor -- regularly by your doctor. and you don't have to pay for a team of say social workers and nurses. this is included in our system, and you will have the care that you need. host: to our radio audience, our conversation is with dr. wolet, former head of the canadian association. caller: good morning. i would like to ask the doctor,

he's being very tactful and i thank him for that. he said that the difference in attitudes between our two countries. but it seems to me that it's more of a difference in moral values. that is the fact here. i personally believe that every citizen should be entitled to adequate health care regardless of income or race or status in life. that's just a basic right of human beings. and it seems to me that is what canada feels. guest: well, i think you're absolutely right. this is how we feel and this is

what we think. i'm not saying that you're absolutely wrong. but i think a great country like yours should look at giving their citizens a full coverage on health care because this is fundamental. and this is what european countries have understood also, because they're giving full coverage to everyone, whether they have money or don't have money. and this is the principle that we have here in canada and we want to keep it like that. host: janet, former resident of toronto now living in indiana. go ahead. caller: it's not a question, it's more of a statement. i love the states and i love canada and i've lived in both. i came to the states for graduate school and when i came here, i did not have insurance here. i'm a student, i'm paying a lot of money to be here in school so i ended up getting injured in my dorm apartment and it became a problem where for the first time in my life i had to

be debating whether to go to the hospital to get care or whether to just stay there with it and try to figure it out on my own. that was the first time i was ever in such a predicament because it became about money and not about my health. and i remembered ending up going to a pharmacy to ask the pharmacist what ideas he had about what i could do to care for myself because i could not afford to go to the hospital. i also at the same time i have a 77-year-old mother in canada right now. for the past 25 years she's had multiple medical problems. her medical history is very complex. i thank god for the canadian system. she has been cared for thoroughly with no expense to her. what's sad to me is when someone has to lose their life savings to get health care. and i think that shouldn't be the fabulous country with

fabulous people. and i think that there's something that can be done about it. the money is there to make it happen and it shouldn't be about certain parties making money, such as h.m.o.s and so forth. so i find the canadian system fabulous. i thank goodness for it. that's what's keeping my mother going. in terms of wait time she has so many complex problems we have never had a wait time for surgery. she had to have back to back summerry last year and there was not anything about a significant wait time. she has to go to specialists all the time and there's not a problem. so i wanted to give both perspectives. host: as you were giving your comments, steve clark sent us this tweet. guest: in very specialized areas, you could do that. let's say in questionbeck, if we have some clinics with m.r.i. or ct where you can pay

out of your pocket and you will jump the cue. but this is a very, very small segment that exists in canada. and usually it's not that. usually as -- you don't have to pay anything. money is not the first concern. and the lady that spoke that she said i was not sure if i wanted to go to the hospital because i had to pay so i had to make a choice, we don't have to make that choice because you can go to the hospital because you know that you won't pay anything. so it's not a choice. it's something that people do. and they don't think about because the availability is there. host: final question is we can continue the debate on this issue here in the u.s., what advice would you give americans? guest: i think you really nide to look at your system and to look at those people that are uninsured, 46 million, and to

try to find a way. find it. it's your problem. but find a way to give health care services to those people. and i think it's a social debate but it's very important. it's, call it a right, a moral thing, call it whatever you want. but i think that you have to find a way to improve your system to give health care to those people that are not receiving proper health care right now. that's my advice. host: doctotor robert thank you for your time this morning. host: thank you. >> tomorrow, and gerald connolly will talk about town hall meetings and health care is playing out in those meetings. also we will talk about the -- talk with james cole and dr. john garrett about the health

care system and provide some context. this segment is the first part in a three day series that will air live from the hospital's emergency room. also paul rainwater. washington journal, live at 7:00 a.m. eastern here on c-span. coming up next, an fcc workshop on the expansion of high-speed internet. after that, a forum on the government's use of new technology and communications. and then, on "q&a," a discussion with dr. john garrett. >> as the debate over health care continues, c-span is health

care of is a key resource. go on line and watched the latest events, including town hall meetings and share your thoughts on the issue. including video from any town halls to have gone too. there is more. that is that c- span.org/healthcare. now, a federal communications commission form on broadband. at the economic stimulus package calls on the fcc to develop a plan. as part of the process, the sec is holding a series of workshops on national broadband. -- the fcc is holding a series of workshops on national broadband. >> thank you for coming. we are actually going to be speaking a bit more broadly, looking at the effects of broadband on the economy in

general. we have a really nice panel here today. i am scott wilson, i am the economics director for the broadband task force. we also have moderating with me, don stocks fell to is the deputy chief for the wireline competition bureau and jonathan levy who is the deputy chief economist for the office of strategic planning, both of whom are great economists and i look forward to working with them. i will introduce each person quickly just before they speak and i encourage you to read their mumbai no -- read their bios. he just finished a spending a

year here is a senior economist. he specializes in regulatory economics. he has written many articles on lots of issues, including issues such as cell phones and driving and the effects of the americans with disabilities act. if you have the questions, come see him afterwards. >> thank you, very much, scott. i want to thank scott and others for the opportunity to come back. it feels like coming back from the august vacation. i asked to speak first because what i will try to do is to provide an overview on the topic of today from the standpoint of academia. that will hopefully be useful. i wanted to start by looking at macro approaches that are taken to measuring employment.

do with productivity studies and there's, the smallest literature is that that deals with broadband if particular. stepping back, a lot of -- well, many mother studies have looked at communications technology and then there's a middle set of studies that have looked at communications more broadly than just broadband, so most of the results that i'll mention have to do with ict, because, to be honest, there are very few that look at broadband specifically, but many of the same issues pertain. so these studies disaggregate to different levels this way, but regardless of the type of study that they are, there are two main approaches. the first is to do a traditional growth accounting study and this is basically just the economist's version of an accounting exercise, where your try to disaggregate the sources of growth, product growth in this case, into growth of capital, growth of labor, growth of other input and in this case, broadband is treated as just a

specific type of capital. or ict more generally is treated as one type of capital that you look at or you can do an e econometric studies. look across countries or sector and do a macro-type study. regardless of which type of study is done, at this point, the effects of ict and broadband do show up quite strongly. it took a while for it to happen, there was a product paradox that happened until the mid 1990's, but since that time, tears been an unmistakable relatively large impact. to give one example from one study, i won't talk about a lot of specific studies this morning, but a typical study finds that during the boom late 1990's years, three quarters of the labor productivity growth, in other words, 1.8% of the 2.5% growth rate was due to ict. very large a amount. maybe too large. makes you wonder.

in the early 2000's, that number drops down a bit, but the key here is that ict is an enabling technology, it makes people do what they do better, faster, an cheaper, and so it, you know, these impacts should be there and they do show up. now, just as a warning, growth is not always a win-win situation. part of the growth at the macro level might come from less productive firms being forced out of a market, which makes room for more productive firms to come in. so you have to keep that in mind when you're looking at aggregate numbers hands other thing i want to emphasize this morning, there's a lot of het tremendous genomicsate in the impact. enclosurresults may vary. past performance is no guarantee of future ruts. it's not just dollars spent on ict that matters, so as we think about measuring impacts of national broadband plan, we have to do more than just measure the amount of inputs that we put out there and i'll return to this in

a moment, because there are certain in tangible factors that matter a lot. ok. so those are macro studies. you can also do microeconomic studies and you can get more out of the data if you have firm level data. now with firm level data, it's always tricky in united states and i'm not looking to europe to take our lead on these matters, but it is interesting to compare the data collection efforts and the differences there, so the european federal data effort, euro stat survey is well over 1,000 firms, they have plans to grow the survey, to grow the sorts of questions that are asked and they ask many different questions on many different things to do with ict's and broadbands in particular. it's a good data set. we should expect to see good studies coming out of that. u.s. census does a bit less at least with what i would find. they survey toúfind out what firms are spending, because they want to get there into the national income and product accounts, but he they don't have anything on what they're using

it for and what the results might be. more could be done being. as with the macro studies, they're generally positive results, when you look at the impact of ict on firm performance. but there are similar issues with these firm level studies that you need to be care if with. again, heterogeneousity and the impact. it matters very much in what countries you might be looking formings for example. there's a problem potentially with saying, well, what type of firms april don'ted broad bands? it's going to be the ones who got the most bang for their buck adopted it first, so if we only look at studies that have those sorts of firms in the sample, you'll get large numbers of the impact of broadband, but you might not be able to extrapolate that reasonably to the next round of firms or the subsidized important. and then intangibles again become important. let me just go an talk about what these are instead of just

wanting that term about. for example, human capital, education an training. we all know that if a new computer program or a new technology is plopped down on to your desk without any instruction or the notion of what it could be used for or how it might help, it will just sit there. the same is true of course with technology such as broadband, but it's more than just that. there is this whole new substrands on the literature on the complementary investments that have to take place. in other words, broadband needs to be used and coupled with changes in perhaps how the firm is organizedn for it to to be made use of. broad bands enables collaboration across firms, inside and outside of the firm. will the firm's organizational structure allow thats@ collaboration or are you silo'd into different unit that don't get to talk to each other or are encouraged to talk to each other. competitive pressure is always -- has been found if these studies to be important, to get the maximum gains out of the new technology.

how flexible is your labor market. is it liberalized in the european context, that becomes a question, because productivity gains might come from doing more with fewer workers. are you able to do that? that's the question. and that's one of the reasons why europe has probably lagged the united states if productivity growth. implications. why do these factors matter? well, what it points out is that broadband is not just a band aid that you can slap on to an ailing sector, an ailing market or an ailing economy. it has to be used intelligencely and in conjunction with other things. good example of this, this is not a panel about education, but just to use an example, the u.s. schools, schools provide an example where most of the intangibles work against having broadband make an impact. for example, lack of ict competency, it's knots what most of the teachers may have been trained if or trained for. training for the teachers might not be funded. they have might have rigid organizational structures, there

is a lack of competition, lack of flexibility in adjusting labor. as recently as a decade ago, a government panel reported to then president clinton that "the history of ict in schools was a 20 year story of unambiguous failure." i think things have gotten better since then, probably a lot better since then, particularly with broadbanding of funding for schools, but the point is you can't just measure an impact of broadband, slap it on to a new firm and expect all these things to change. ok. two minutes left. this is good. very quickly, on employment. just want to mention, there's lots of employment numbers being floated around there, in policy circles that i noticed in the last year about the impacts of broadband. some of the other workshops here have even talked about that. i'm a little unconvinced for the following reasons. unconvinced about the exact numbers, not that it can have an effect on employment. for example, it's really hard to

say what caused what. you receive broadband growing in an area, you see employment growing in hand area, assign causality to one of those two, to the other, is always tricky. it's a hard thing to do. i have haven't seen that really nailed down in a convincing way yet, not to say it can't be done. there's always a question of mobility of workers. if town x institutes -- deploys a lot of broadband or ict and attracts workers away from neighboring town, why from the state's points of view is that necessarily a good thing. you need to think about that. the other issue, with you have more productive workers, because they have more ict and broadband to work with, in general, that's, you know, after that transition is done, if you still have a job, that theory suggests that's a good thing, because your marginal product has risen, so your wage probably is higher now. but the firm might be able to do less with -- to do more with fewer workers, so it's not clear. there are a lot of things going on there.

and just very briefly, there's the whole globalization question. senators from require states often like to wax eloquent about how broadband can help draw their rural workers into urban work forces through telecommuting and so forth and that's fine, but why rural indiana and not rural indiana. once you break down that are distance barrier, that barrier is down. so again, not to say that there aren't good impacts on employment, but that it may be a little more complicated than sometimes we think. ok. let me just close with one suggestion here per second for the national broadband plan. more data is always better and i realize -- firm level surveys are probably not what the f.c.c. should be doing, but this is a fat broadband plan, not the f.c.c.'s broadband plan, so we can get congress involve to fund consensus. we have a great plan to evaluate firms horgetting funding under

the vtop. it has some elements of an experiment, since these are firms that otherwise presumably wouldn't have gotten the funding to do what they were going to do, so we can evaluate that and my suggestion for the analyses is, you know, here at the f.c.c., you know, hopefully you can be freed up to do good empirical analysis, where the conclusion is going to come from the data, not from other quarters, and external analysis is always good, partner with academia, there are professors across the nation with graduate students who would love to get the data to work on this sort of stuff and can help you out a lot. thank you very much. >> thanks, jim. i also forgot to mention that if you have questions, you should write them down on a card, and give them to carrie lee earl, who will collect them. yes. >> our next speaker is mr.

goldfarb who is at the robert h. smith school of business. he studies issues such as the exchange of technology, a traditional economic goods, national innovation systems and the relationship to firms and policies. >> thank you, scott. i am going to use my time to talk about broadbent as a general purpose technology. this is going to echo some of the pops and unravel some of the things that james was talking about. so, the war regional thought about the technology is that you have some underlying infrastructure technology that is both pervasive and in labeling. the one thing about broadbent is that it is very close to saturation. it is certainly pervasive. ,t is also

enabling. and the one thing about enabling technologies is it is quite unclear how they will be used throughout the economy, so i'm going to quote nathan rosenberg in his article about experimentation and this will get at the core of my little talk. the freedom to conduct experiments is essential to any society that has a serious commitment to technological innovation or to improve production efficiency, but the interesting part is the starting point is that there are many things thatúcannot be known in advance or deduced from some first set of principles, only the opportunity to explore alternatives with respect to both technology and to form and size of our organizations can produce socially useful answers to the bewildering array of questions that are continuing occurring in the industrial and industrializing societies.

so just as by way of an example, this is an early advertisement from compuserve, circa, the late 1980's and what you see is a couple and the couple are excited about how they sent a bunch of e-mails to their friends and they called it a party and they only had one glass of wine to clean up. and so this is early experimentation, not in broadband, but certainly in internet connectivity. and here's some examples of broadband experimentation from today. most of these are kind of big successful ones that you may all recognize. google and facebook i believe are number one and number three in terms of time spent on websites, orange is banking, netflix is there as well as major league baseball, video -- as video internet providers. major league baseball is the largest if terms of revenue today and of course, i put in web van, which was an internet

grosser that blew through about a billion dollars to point out that many of these experiments, in fact, most of them fail. the experimentation is in a broad range of things and technology, being, how do we exploit this broadband capability, but importantly in products and services, what are the offerings of the companies. importantly, business models, how do we monetize the offerings. organizational forums, given that we know what we want to sell, how should these firms be organized and of course, implementation strategies. so how would we know if we are succeeding in managing the ecosystem in the sense of encoring experimentation? -- encouraging experimentation? another way to phrase that, how do we know if barriers to entry are low enough so new firms and new experiments can be conduct to try to exploit this broadband

capability? one way, is this i pulled off a tech crunch, which for its own motives, keeps track of the ecosystem of internet firms, and in the upper left, you see new firms that have been founded, in the last few weeks. in the upper right, what you're looking at is fund, venture capital funding those new firms to the tune of about a billion dollars a quarter. excuse me. about a balance and a half a month. -- billion and a half a month. under that, acquisitions, which will represent successful exits, which generally reflect successful experiments in the broadband space. so these are new services which have reached a point where they have attained enough value where somebody would like to buy them as a business. measures of the number and outcome of experiments, one thing that we might do is we

might keep track of than broadband ecosystem, so that we could know, is there -- is broadband policy successfully allowing entry and experimentation in this spacey? -- in this space? this is an example, so far, we're doing pretty well, so what you're seeing here are each one of those numbers is the number of broadband-based companies in that one area. this is being the san francisco bay area, which is the center of this, but this is a national phenomenon. this is experimentation happening all over the country, and indeed, all over the world. one interesting thing is that most broadband traffic is not related to this experimentation, in the sense that our infrastructure currently is sufficient for the vast majority of these experiments. and just to point out, this is -- this graph shows us the share of internet traffic based

on different protocols, the green line, which is increasing, from about 2000 to 2006 in this graph, is peer to peer. so the green line is essentially movies, and music, peer to peer, and probably generally most of it is illegal. so these traffic measures, are perfectly related to the experimental ecosystems and we should not be confused by them, just by -- that is the first point. the second point i wanted to point out is that experimentation generates big winners and big losers, and with you have big losers, especially whether they're incumbents, they have strong incentives to try to maintain the rules, that's to their advantage. so just an example, peer to peer appears to be killing the pay for music model and of course,

you need only be alive to see the activities. ri aasa and try to prevent the end of their business model. google and craigslist, plus searo cost publishing are killing the newspaper's advertise willing models and ending newspapers as we know them today. wikipedia killed brittanica, held out a lot by microsoft and incaen -- encarta and voice ovep has helped in the demise of land lines. you might note that broadband providers generally bundle video content, cable and voice. and if that is true, the providers have incentives to leverage control of broadband to restrict competition particular in the video space and in

telephony space. this should be something we should be aware of and keep track of pairfully. so i'm not -- carefully. so i'm not going to use all of my time. but to conclude, to enable economic growth, broadband needs to enable experimentation. another way of saying that, we must make sure there are no barriers to entry in the provision of broadband and its use, most importantly. pretty good job at this, as best as we can tell. most internet traffic is file sharing and associated with only a small share of these experiments, so the vast majority of the use on the internet and the traffic is not related to -- is associated with file sharing. yearly measures of broadband ecosystem would be informative, so if we had a sense of how well our broadband policy is sustaining entry into this space over time, that would be -- that

would be very useful. and broadband providers face incentives to restrict certain types of traffic, and in turn, certain types of entry. that's it. thank you. >> thanks, brent. next speaker is ryan mcdevitt, who is a lecturer in the department of managements and strategy at northwestern university, and he is also a ph.d. candidate. and in addition to his work on broadband and gdp, he's also worked on the relationship between market structure and firms' ability to signal -- send quality signal measures and pricing strategies and he's also worked on market structure and how market structure affects venture capital decisions to specialize. >> thank you very much. i'm delighted to be here to presents some of my research from northwestern university and the motivation for our paper is fairly straightforward. we're interested in measuring the economic value that's been

created by a new good and the few good in this case is obvious hi broadband internet. straight away we can see he why we might be interested in studying such a topic, as practically speaking, it's become the primary means by with households have access to internet and intuitively, a lot of people latch on to the fact this is a popular technology, it's become a part of our lives and there must be some great economic value associated with this, so our primary objective is going to be place bounds on the value that's been create, that's coming directly from broadband internet, and in this sense, it's going to be complicated by the factor that, well, broadband isúreplacing an existing technology in this case, dialup internet, which many people have switched to broadband had experience with before they crossed over. and so, to properly account for the gains that should be accrued, just to broadband, we also have to be very careful in measuring what would have happened in lieu of broadband, in this case, many of the gains

were already brought forth because of dialup, so it's going to complicate our analysis. and there have been many previous estimates of the value of broadband internet, but we just weren't fully satisfied with the methodologies put forth this knows papers, because we felt they weren't being extremely careful with applying economic principles to actually measuring the gains, so in our paper, we're going to be very precise about how we measure economic value as created by broadband, we're going to focus on two primary measures the first is revenue growth, in excess of what would have occurred in the absence of broadband technology and in this sense, we're going to focus on essentially opportunity costs and say, well, its gains that should be attributed to broadband are in excess of the next best alternative, in this case, we're going to focus on dialup. in addition, we're also going to attempt to measure consumer surplus, which is simply the access of what a consumer is

willing to pay for broadband so what he does have to pay and this difference is going to be accrued to him in the form of a surplus. and to jump to the main results, we find that in 2006, we studied the period 1999-2006 in hour paper, about $22 billion in revenue is generated from broadband, but this is very much different than what we contributed to create value and here we have a number of $15 billion, $8.5 billion to $10 billion of this is new revenue generated by broadband suppliers and the remainder, $4.5 billion goes to consumers also indication of this is the price indices for broadband have declined 2% to 2.5%, which is different than the actual official numbers very wisconsin have been very flat duringúthis period, which is a mystery, because when you see this massive adoption, that's concurrent with a dramatic reduction in price to spur this adoption. we didn't see the official numbers hands part of the reason

is we just weren't measuring the consumer surplus properly and what's going to jump out from the page is these numbers are drastically lower than the numbers you commonly see in projections of the economic value you see. usually they're in the range of hundreds of billions of dollars, we're about 1/10 of that at best, and there are two to three main reasons for this. first, we're very careful about measuring what broadband is actually generating. we're going to be very careful to assign to the different buckets, which ones should go to broadband and which one should have occurred with dialup. you can think of two sides to the same scale, well, as broadband becomes comparatively more popular, dialup is becoming less popular, we can't attribute that whole left side just to broad brand because we're losing dialup in addition to that so the aggregate is not changing nearly as much as we expect just from the numbers from

broadbandped secondly, we're not going to -- broadband. secondly, we're not going to worry about externality, such as people have a better user experience on amazon, so they'll buy more books from amazon. we're going to focus just on what we can measure, but in hour defense, one of the nice features of the methodology, is we're not missing the externality, because as was shown in the slide, disruptive technologies will come at the expense of off line brick and mortar retailers. so amazon probably came at the expense of a barnes & noble, so we can't attribute all of this gains just to broadband and amazon. this would serve to magnify gains from broadband. we are taking the highest year and extracting a growth rate.

this would diminish the economic gains according to broadbent. to drill deeper into show you how we calculate these numbers, you have suppliers and from the revenue, we are losing about 50% that 60% in cannibalized sales. as users switched over from their dial service to broadband, they probably paid $20 for dialogue and many people had a second phone line. a lot of times, he would be completely offsetting. because of this, it would pull down the actual number that we should put for broadbent. this number is going to vary with the assumed price for broadband. obviously, this will shift the line around a little bit. we should be out front and that we have not looked up

profitability for firms. broadbandhave the cost to the household and balls of this, this is all we can say is revenue, but put differently, we're also -- our estimates don't imply that the firms that are supplying broadband would be losing quite a bit of money. they're kind of within the reasonable ballpark. so we're in some ways very confident with the numbers that we shouldn't see these numbers in contrast to our numbers. :

>> this is going to serve increase that contribution of broadband because we are accounted for the consumer surplus. in doing so we are not able to look at different elasticity. you can think of a teenager who is always on facebook and twitter. we are not factoring that in anywhere so again we're probably at more conservative estimate. also the survey is on 2002, as our experience has shifted and we now value broadband comparatively more. would probably expect a little bit higher to pay if we did a

survey today which isn't quite so bad your we stop at 2006 but i think we want to extrapolate the figures through009. we want to be countable with the result. but not to jump to the imprecations of what the numbers in our paper would mean for a policy discussion, as the whole bag across the country is $15 billion, this doesn't bode well for a cost-benefit analysis in the last mile broadband out to rural areas. think of canada cash for clunkers team is. we have a broadband for boondocks a coven. were not very optimistic that if we are only getting $15 billion in the nation, 1 billion oort two to roll out to rural areas will be very effective in terms of contributing to gross domestic product or especially in the sense that we have these alternatives such as dial-up, which many users are already had experience with. and so we feel that the firms

that provide broadband have already revealed that these are probably not the most cost-effective areas. every details cost analysis. so any subsidies that are going directly to rural household are going to come at the expense of not being offset by drastically increased benefits for household. and again, this is an analysis of household, and not businesses. and this is just the u.s. especially as we think of new technology innovations coming on line, five or so years, we think that probably a better situation would be to wait and let them more cost effective technologies come and place your. finally i just want to point to future research. if you're that interested in u.s., shane and i are currently working on doing a similar analysis for other world nations, and you can look for that later this year, if you're particularly interested. thank you. >> will the paper be done by the end of this panel?

[laughter] thanks to our next speaker is chris forman who is associate professor in the robert and stevie schmidt term professor of it management of the college of management at georgia institute of technology. he is research interests include adoption and return to it investment among business, with particular interest in the role of geography and standards on the guy of it infrastructure investment. he also sees innovation at the it software industry. >> thanks. what i'm going to talk about today is this different study about the use of broadband, and specifically what i will talk about is the diffusion of the internet among businesses contribute to divergence in wages across locations in the united states. what we mean by convergence is that locations with high income have lower rates of growth and by divergence we mean those with highway level already have higher rates of growth.

there is a lot of antidote evidence to support all of you but not a lot of statistics. so basically what we are going to do is work going to combine a data set on it investment and enhance internet like the commerce among businesses, combined that with data on wage roads and basically compare how changes in internet between 1995 and 2000, how that is associated with changes in wage growth across counties in the u.s. so this is a location that we will study. basically we proceed into steps. we measure the average relationship between internet and wage growth across all counties. we're going to establish some kind of link. will show that there is an effect, although it is economically quite small, we worried a lot about a lot of the causality things that james talked about earlier, and it would also examine whether internet investment lead to faster wage growth and higher low income areas.

so i'm not going to spend a lot of time talking about the specific progression model, only say this is basically what would you. we look at how changes in advanced internet among businesses, how that is associate with changes in wage growth controlling for local democratic characteristics into the same thing again looking to see whether that wage growth is faster than high income, high education, high population and highly intensive energy. basically internet use among businesses as grades among regions are already doing well on a number of different areas. the i.t. investment data we use is from a private survey, one of the best available. it has data on 87000 established on advanced internet use along with a number of other dimensions of i.t. is. would aggregate us to a little over 2700 counties, and drop about 300 where internet investment, we don't have any data and because these are

locations that are very, very low density and there is a lot of investment data. we combine that with local wage data from bls from the quarterly census of employment and wages, and then also control changes in demographic hairdressing also collect some data from sensors and a variety of other places within the government. so the basic story, can really be seen into pictures. so this is a graph of changes in internet use at the county level on wage growth. and this is the average relationship between internet use and wage growth. and you can see it is upward sloping but the slope is really quite small so there is a statistically significant effect, but economically it is really quite small in our data when you look across all counties. however, if you separate out those counties between those basically if you take the subset

that have high income, education, high population and have a high faction of i.t. intensive firms, you can see the relationship is quite different. among them subset of firms exactly a strong statistically and economically significant relationship between internet use and wage growth. again, these are among the locations that already doing well along in number of different, a number of different dimensions. so i can, and the outline is we're going to establish -- so the next thing we will do, that is kind of descriptive evidence. than we do so more careful statistics first to establish that average link between investment advanced internet and wages, and then to see how that relationship differs among counties that already doing well. so basically, if you look at the average relationship, again, the effect is statistically strong but economically relatively small. so average levels of internet use are associated with pointed

to 4% in wage growth among regions with no internet use. a one standard deviation increase in the use of internet associated with about a .33 increase in wage growth here to these attacks are statistically significant, but economically not large. over this time period, which is in 1995 to 2000, average wage growth is about 20%. so the internet use is explaining relatively little of that. we do a number of -- we go to a number of statistical exercises to worry about some of the causality issues that jim and bitching about. i do want to spend a lot of time on that now, perhaps we can take those in questions. one thing we do release is to show, is to examine whether internet use is associated with wage gains prior to 1995, prior to the diffusion of the internet as sort of a falsification or sanity test and there's no evidence evidence that that is the case.

the next thing that we do is we examine what location internet use is associated with wage growth. and basically we find that advanced internet is associated with wage growth and high income counties, and higher education counties, and also those with both high income and higher education. of course, there is a pretty strong correlation between those two groups. probably one of the main takeaways from the paper, however, is the association between internet advanced internet use among businesses and local wage growth is strongest and primarily concentrated in what we call these high off after counties. these are counties again with high income, higher education, high population and large concentration of i.t. producing and i.t. using firms. how much can we explain along those metrics?

so you take those 180 counties that are high all factor counties, their rage wage growth over a sample that is 29.2% versus 20.5% for the rest of the county in our sample. so this hide all factors group advanced internet associated with 2.4 percentage points total wage growth. to put it another way, advanced internet use among business explains one quarter of the 8.7 percentage point difference between the 180 high all factor counties and the rest of the counties in our sample. so just to conclude, i probably also won't use all of my time. so the use of advanced internet technology is associated with local wage growth. again, looking at the county, at the county level, however, it looks like the relationship is

isolated to particular locations, those that have high population in which high i.t. production and use are concentrated, and those were income and skills were also high. specifically, advanced internet use explains about a quarter of the difference in wage growth between those counties and the average county in the u.s. and we see little evidence of growth of internet use outside of urban areas. we also, one thing i didn't spend too much time talking about, is relative little evidence that advanced internet is associated with growth in either employment or establishment. so our results are isolated, or concentrated in the wage. so with that, thanks very much. >> thanks, chris. as a fellow economist i make this next cment with all due respect, but we know on the economist to people who have real of walker.

>> thank you very much, scott. a pleasure to be here and i would first like to thank the panel for competing in his important work to. i am robidoux. i'm president and ceo for the joint center for political and economic studies which is a joint study. our historic mission has been to develop research and policy initiatives aimed at helping our communities and acknowledge the strength and might they need

to improve their life and to give their true june -- give their children an opportunity that they did not have themselves. in fact, broadband deployment and access is so important that we recently created a media and technology institute to focus on this and other related issues. as you know, broadband has become a vital part of american life. it impacts how we live, how we learn and how we earn. it determines whether or not someone will be successful in life at all, and yet, only one- third of american households have no broadbent. they either have a dialogue for no internet connection at all on my first slide, it gives one example of why that matters. well-known 2007 fact that

brookings institution report projected that for every 1% increase in broadband penetration industry, employment will rise by point you to .3 percent a year, it and increase of 300,000 jobs. another study says that a mere 7% increase in broadband access has tremendous economic impact. 2.4 million jobs per year. and as you can see on the sly, billions of dollars in iraq economic benefits. super, rock band means jobs. in communities new jobs. on the next line here, here are some results from a study performed in california two years ago by sacramento state university. it makes a direct link between broadband growth and the growth of economic indicators. new business ventures, new jobs and payroll growth. most notable is the funny thing increased broadband use contributed about 52000 of the 281 net new jobs created in

california in 2005. that is about one fifth of those jobs. i look at these results like this and i can't help but think what broadband deployment could do for now what broadband deprived communities. and these communities tend to be communities of color, whose residents face tremendous barriers to employment. in some cases they do not have the basic skills to be competitive. in some cases their children go to substandard schools. in these communities also tend to be socially isolated from the mainstream. you see the numbers before you. they are higher, the joblessness among african americans, bassett joblessness among black teens. let me focus on the fourth part on the slighter traffic and americans remain an all time low in broadband adoption. i really see a connection here. when you have a tenured in which access and a culture of broadband use is not supported, then you can see why there are

some economic problems that persist. but i also see a way out of this. and it can begin with this national broadband plan on onomic growth, on job creation, on private investment. all solely lacking in many of our communities of color. in broadband i believe can provide a breakthrough in our communities. and educrat, the sec's plan, i want you to think what can you do to give these communities a fighting chance to survive and recover. and we at the joint center stand ready to help you and we actually are working now to gather and analyze needed data and other information that can be of help in determining exactly how broadband deployment can bring economic and social progress to areas in a country where the progress of any kind is just a dream. if we want to be able to help you develop evidentiary record which are policy makers can

craft that can help these communities move forward to a brighter day. so let me conclude with some specific recommendations that you see on the slide in front of you. first, we feel that the plans should call for innovative broadband infrastructure and revitalization plans of urban and rural communities. repurchasing empowerment and enterprise of initiatives require broadband infrastruure to be integrated into municipal and community plans. and providing incentives for broadband deploymen through other community development programs such as tax increment financing and industrial revolution bond for nonprofit. secondly, you should call for tax incentives to spur broadband deployment by private sector and to migrate new business venture to some of those low income communities. when you have broadband in distress community, they can can become homes and other businesses that require a broad

connection. phonelines, and workers. and on the final slide, you ought to focus as well on raising awareness and access to broadband for de- skilled and underemployed. in other words, let's bring broadband to these communities and and help local residents get on line and begin to benefit from their access to the rest of the world. it begins with teaching how to use e-mail, how to get information from the web, and how to use important applications that can change their lives, on line job application for us is. and finally an important, as we seek to broadband to underserved committees, it is very important that we support minority owned businesses. minority businesses represent a tremendous opportunity for us to bring economic progress to communities, particularly to their participation in broadband deployment and operations. these businesses tend to hire minority workers thus creating a

positive effect for the local economy. and today more than ever we need to understand how to leverage broadband as an economic development also. broadband can be a key to whether communities live or die, and they can deliver hope to communities where opportunity is really fleeting. and to make this happen, we need a. we need ideas. we need a spirit of collaboration and a positive framework to achieve these goals. and we have the joint similar look forward to working with the sec and other to bring all of this together. thank you very much. >> our final speaker is tom wheeler who is currently managing director of core capital partners. he has been working in telecommunications issues, policy for nearly 30 years. most recently he led the obama transmission technology science in the arctic. is that an entrepreneur, and pray much every aspect and communications industry that i know of.

tom, please go ahead. >> thank you. it is a privilege to be here and to be with this augusta panel. in case scott had skipped in his introduction that i may venture capitalist, i am the guy without the tie. but i've been asked today to address the question of whether or not broadband has an impact on the decision-making, on the investment decision-making of venture capital. and the answer is most assuredly yes. it is particularly true for a firm like ours, core capital partners, because what we invest in our i.t.-based companies. internet protocol-based companies. and it is just simple that the better the distribution, the greater the opportunity in ip for the development of new

companies with new ideas. i think it is intuitive that this affects other areas of venture capital such as biotech and other such things as well. but because the ability to move data is integral to innovation, broadband ip means growth and opportunity because it is forever creating new ideas, new opportunities because of its nature as an iterative and compounding technology. what do i mean by that? ip is iterative and that it spawns additional ideas,

additional vision, additional companies that improve on refine what the status quo is. ip is compounding because every time something is built, it creates the opportunity for something else to be built on top of it. and so we invest in ip because we believe that ip is the growth engine for technology, for the technology economy. and we also believe that nothing that ip has ever touched has avoided being transformed by that event. i.t. is more than delivering zeros and ones. it is about delivering data in a format that can be used for

other purposes. and companies leveraging the interactive and compounding nature of ip need to have the ability to move those apps around. period. sure, a lot of innovations take place and can be contained in a data center, but they will have a broader economic impact from the broader application of the ideas as distributed by a broadband network. but i think there is a bigger answer to the question that has been posed here today. and that is that connections have consequences. and that throughout history, network links have defined economics, and because they

defined economics they define the way people live. in a broader scope, we are as we connect. and broadband ip is reshaping the patterns and traditions of the last network revolution. and therefore changing the economics that we exist in today, and therefore changing the way we live. the first high speed network was the railroad. it was the original death of distance. since the beginning of time, up until the railroad, animal strength and stamina determined the ability to communicate. the history shock parser has a quote i love wriggles the radio road, the complete is changing human existence since the nematic tribes became too

grosgrain and raise cattle. it created the scope and scale economies. this network created the scope and scale economies that defined the 19th and 20th century. and that are the basis of the things that broadband ip is taking us out of now. it destroyed the distributed self-sufficiency, self-sufficiency economy. and created a centralized economy, with masses amateurs being delivered for mass production and then shipped out to a mass market. and define our urban geography as a result. it also shaped telecom, because the telegraph all the railroads, the telephone call that ended even stole their terms or switches, trunks. told our railroad terms. but why am i talking about history at a forum that is supposed to be talking about what the future is?

let me tell you a story. chicago is called the second city, as you all know. why is it the secondity? in the beginning of the 19th century, the second city in america, in the west, access to the west was saint louis. saint louis was located on the western side of the mississippi river. the rail lines to the east coast market were located on the eastern side of the mississippi river. the city fathers of saint louis refused to build a real road bridge across the mississippi, so that the network of the day could connect with the source with the market. the city fathers of chicago, at exactly the same time, illegally

built a railroad to connect with a new line coming out from the east. and beit 1861, there were a hundred 60 trains and out a day in chicago and saint louis was arguing about whether they should build a bridge. distributed broadband ip is the greatest change to how we connect since steam on steel. you think is a economic growth? i say look at history. look at the history of in the last network revolution that we're talking about the network revolution that will build tomorrow. but i think one of the other lessons of history is that build it and they will come. exists only in iowa cornfield on the silver screen. that in the chicago story, for instance, the reason why they

could build that connection was there was demand to wed the western range production with the east coast consumption. there was demand for the network. let me give you a more recent let me give you a more recent and personalí@

i was running a company that was trying to create a technology to drive the demand, and that i've got the bloody scars to prove that demand is more important than supply. last suggestion. the poster child of the economic stimulus was the cash for clunkers program. it created demand. why not a box for broadband program that creates demand. and a pulse on something that talking about here here i don't think it is necessary to appropriate funds, but we can use public policy to create demand for broadband electronic

medical records. there is billions in his famous for that. let's stipulate that they have to be tied in to broadband. education and applications of federal funds need to stay plate they need to be tied into broadband. ralph had the idea that enterprise zones need to stipulate that they are tied in to broadband. intelligent transportation systems need to be tied into broadband and a mandatory way. public safety needs to be told that they must utilize private broadband networks. green and smart grid initiatives need to have broadband tie-ins before they get funding. the point of the matter is, we can create through public policy and additional take an existing funding mechanism that demand that will produce greater returns on a broadband future than just simply subsidizing the building up of the new capacity. so let me close with one last

one. broadband ip is taking america back to the dispersed economic activity that was destroyed by the centralizing force of the last network revolution, the railroad. broadband ip is remorselessly slinging activity to the edge of the network, and at that edge are individuals and entrepreneurs. the kind of people that we invest in. in the centralized economy, innovation happened in places like bell labs. massive places where you did and innovative activities. indeed decentralized broadband ip interconnected economy, innovation takes place with two

guys and a dog in a garage. those are the kind of people that venture capitalists like us invest in. those are the kind of people who take that money, who turned around and hire others who spend that money at the grocery store to pay their mortgage, and to send their kids to college. so if we go back to the topic i was asked to address, does broadband availability influence investment decisions, the answer is you bet. but the story is even bigger than that. that history's greatest changes have been driven by network changes. and that we are now at another hinge moment in new network development, and that opportunity, venture capitalist will invest in. >> if you have questions, write

them down. and if you are watching on line, there is a way to submit questions or. please do. let me sort of work backwards a little bit. start with tom. and i really like you bringing history into this issue. i've also written on history but not as much as you have. and you can find sort of lots of similar debates that we have today historically with the telegraph, and even the optical telegraph before that and with telephones, their interconnection and enter carrier debates back in 1900. with your studies of networks over history, do you see particular policy lessons, things that government did back then that either helped or hindered development of new networks and what we can learn from it? >> it is a very interesting question to this dreaded know about chicago and saint louis is the reason that saint louis didn't build bridges at the local politics was controlled by

the water men who were ferrying things back across the river, and they didn't want the competition of the bridge. i don't think anything has changed in the politics of networks since that time. what is interesting though is that this agency, the sec, which has had a very important history but a history that has been basically one of refereeing among various economic interest where the public benefit, as with this initiative the opportunity to become an economic growth agency. and to say that there are policies that we can initiate that will stimulate innovation and investment. and the only point i am making

is that, as we saw on one of the charts, there is billions of dollars for venture capitalists out there that is ready to follow that kind of encouragement of innovation and investment from policy decisions. >> if anybody else on the panel wants to just jump in, and especially jonathan, if you have questions, please jump in. ralph, also building on what both you and tom said about demand, one thing that you didn't mention in your discussion was sort of direct subsidies to users of broadband, which often, when we look at these, you see that one of the main reasons of people who don't have broadband, who won it, they say they can either afford or don't have a computer, which those are relevant to divide

issues, is do you think sort of, does that direct subsidies is less effective than sort of enterprise zones that you talk about or do they address different issues rex. >> i think that is a good point that you raise. i do think that the direct subsidies would be helpful in the process that a lot of times you hear people say they don't have this because of financial conditions associated with such. i think we have used an approach where we do all of the above, if we can, including direct. i'm glad you raise that issue and i should've raised it earlier. >> this sort of to the economist, it seems that kind of putting it all together to find that broadband has an important but kind of indirect maybe economic effect because it is related to so many other things,

innovative, and its innovative ecosystem. and given that, how do you then connect your comments to particular policies that the sec or any other part of the matter might consider as a way to not just affect broadband but what they can do that can help ensure that broadband has some positive economic effect, or maybe it is the case that policies at this point in the broadband aren't necessarily focusing on the economic outcome but just for some other goal. >> thanks, scott. the bottom line is because of the nature, the indirect nature of the benefit to broadband employment, which were described, which i and tom described earlier, keeping -- if

broadband is easy to get, if it is cheap and widely deployed, that is of course good. however, we also know that the lions share of the benefits are going to be concentrated in particular areas. so that's the first thing and in the second point i would like to make is that if we can make sure that broadband, the types of traffic are not regulated in some sort of systematic way so that we can have unfettered experimentation on how broadband is used, that would be good, with the exception, perhaps, of peer-to-peer filesharing. which takes such a large chunk of broadband traffic, it might actually inhibit other sorts of experiences you. >> so you think most broadband use then is not particularly related to productivity or economic effects?

>> well, no. i would not say that. in the sense that if there are huge number of startups and other organizations, income and building out services for broadband is creating something. >> so that is the demand-side? >> gets. >> if i can mention one thing. i think one of the direct policy implications that i have learned looking to the literature in seeing what we know and what don't get, is that the policy has to be very careful as to what it takes as its measure of success. for example, we don't want to pick on education anyway today, but if you look at wiring schools, progress has been made in that area. but the measure of success cannot be number of schools wired. it has to be what are they doing with it, how is it impacting, what gets done in the classroom, is it being used?

so it takes an extra step, i think, beyond what many policies like to go in terms of measuring their success because it is easy to measure something like numbers of schools wired. is much harder, takes much more post-grant monitoring or whatever to figure out actually what the real effects are. i mean, that is one practical application that i learned when you have something collocated like broadband where you can't just give it to someone and then it does its thing. you know, with the subsidies it might be more than subsidies. it might be giving the computer to the household, giving the broadband connection, giving the training, something that goes as far beyond an agency like the sec has done in the past. >> i will confine my remarks to business investment, kind of the area i spoke about earlier. i think a lot of our findings are consistent with some of the things that james talked about

earlier in terms of one potential explanation for the result that the impact of advanced internet use is greater in the use of higher education, high income, high population regions are some of the reasons that we heard about earlier. so the importance of local skills, third party market, or outsourcing and technical and programming services, you know, education, organizational change. all of these things which are easier to do in some sense in some areas, in urban areas, than others. so in some sense at least on the business side, it makes it that much more difficult to, you know, dryly faced a connection between rabin and investment potential in wages or economic growth. >> i have a general question to pose to the panel.

and that is that as professor krieger pointed out there have been a number of different ways that's, the sort of effects of broadband been attempted to be measured and he identified some of the potential limitations. could i ask sort of an open-ended question about what you do as some of the benefit that may not have been captured by the studies today, what might be done, and how important these overlooked benefits are? because part of the purpose of these workshops is to try to get as much information as possible about the sort of potential benefits of deploying broadband, and if we concluded as ryan studies, the benefits are

relatively limited, might affect our conclusions as to what policies we should adopt. so any suggestions on how to go ict producing sector itself.

but that is where it is hard to measure the output of a knowledge producing term that might be less tangible. where the output of the firm is intellectual property, something like that, is much harder to measure them when they produce a widget that you can see, feel, touch. and put a price on it. so yes, i think we probably are still missing a lot how we measure it. i don't have any great suggestions there, but i mean, the good point of what you can take from that whatever the impact are that we can measure, we can certainly scale that up by some unknown factor because impact has to be greater than just what we can measure. >> i guess as i said in my remarks that broadband impact is a way that we learn, live and earn. and i believe it also determines

whether or not some is going to be successful in life. so i could not sit here and imagine, you know, a neighborhood or a state without broadband. i would not want to be in that state when i compare myself to others who have the benefit of broadband. so if you just sit back and imagine what your life would be like if you were in an area that did not have broadband. i think that he had to to your question would become fairly obvious, that broadband is extremely important to whether or not one is going to be successful in life. >> as the other qualitative as opposed to quantitative guy, first of all i think we've got some issues with data lags. okay? we talk about latency of data and zeros and ones. there is latency of data that we can measure as well. secondly is -- i hope that this

process doesn't lose sight of being a pro active encouragement of growth, not just a retrospective measurement of growth. and when you stop and think that what is at? it's 60% of all new american jobs, or some number like this, come from small business. the kind of folks that, again, we invest in. none of the companies we invest in could make it on dial-up. period. full stop. and we need to be providing the platform, but we also need to be encouraging the demand that calls for that platform.

>> in preparing for the stock, i looked around and try to find what people are actually doing on the web. and just some sort of standardized data of how people are using this technology, if it is delivered via broadband or dial-up, and it was very difficult to find anything. the best you can find it you can see which website there was traffic. but we do not know -- you can take up a lot of samaras. i now beg i now beg on my so therefore i don't have to go to the bank. and that frees up times for other activities such as watching youtube videos which is of course highly productive. but there is certainly a trade off between maybe the internet provides us more leisure time. but we have no idea as far as i can tell what those things are. and i think that really follows up on james' comment.

we want to know if we're going to provide -- if broadband is to the house or if broadband gets to school, how is it being used, because without that we are really not going to be able to answer these questions. >> just two points. and this is going to follow-up with some of the other speakers have said as well. so certainly one challenge has certainly been that of data. so if you look at where we will often see the impact of broadband, the the impact is going to come from business. and the data that we have on i.t. investment and business right now is pretty scarce actually. we end up using a private survey which we believe in some of the best data on i.t. investment available, simply because firm level or regional investment in i.t. and in particular internet

investment simply is not out there. so it makes it very difficult to quantify the impact of broadband because there just aren't the data out there. and i think that is hindering a lot of, you, a lot of issues in trying to understand the policy here. the second thing is, i mean, most of, and this will follow-up on some of what james said as well, a lot of the, this is a big question about what other ares could we look at to understand. i'm just going to pick on one. the majority of what's been looked at in terms of business investment of i.t. or any kind of i.t. capital, predominately these kind of labor productivity studies that look at, you know, outlook depleted by labor inputs, or some similar measure. and we know very, very little about the impact on innovation or other measures of economic activity rather than just the one that, you, the one that everyone looks at which tends to be productivity which is what we

have data on. so that would be the other thing that i would mention. >> okay. jonathan, do you want to do a question? >> one question, if i may. the range of studies reported on here or referred to here spanned some that look, residential broadband penetration and some that looked at business broadband penetration. and i guess my question is, a plea for some help about how we should go about combining those indicators as we conduct our policy analysis and try and figure out the overall impact, and sort of the one specifics of question of that is there any intuition to suggest or what is the intuition that might suggest that an increase in residential

broadband penetration might have some affect on labor productivity or on gdp, beyond just sort of the end user experience. >> i will make a couple of remarks on a. so actually, in our work we actually combined one of the controls that we had was for our aggressions of the impact of advance internet use we took the data on current population survey data on residential internet use, and use at him in particular some of the data on use at work. and you know, although that seemed to have some effect, it wasn't, you know, the effects weren't as strong as that on kind of direct broadband or direct advance internet investment.

there was one other -- and if you sort of look at correlations between the cbs sort of individual measures of investment and the measures that we use at the firm level, you know, there is a correlation, but it is in perfect in some sense. unfortunately, you know, i think that survey is not being refreshed every year so our data, even at the residential level, the individual level, on internet use is somewhat imperfect so again we have kind of an issue associated with finding, you, another issue associated with not having data. >> could i ask a follow-up question based on your comment, and jim's earlier? which is that several of you pointed to the lack of data that would be necessary to do a more

precise quantification of the impact and benefits of broadband. and so the question i pose to you is, can you identify and sort of give specific suggestions about the kind of data that would be useful? because it could be something that we could include as part of our broadband plan. so i will give you an opportunity here to make some suggestions. i also give you an opportunity to think about it, and then provide those suggestions to us at a later time. if anyone has an answer now. >> i think as an economist i think what we are interested in is the identification strategy to help uncover where the gates are coming for. and we usually don't get that because we had to rely on natural experiments to help tease out correlation and causation. and so i think what i would do just is that part of these policies really try to minimize

the trials and sort of systematically and randomly pick winners and losers. we talked about earlier today. and say let's roll out gradually, and that weight we can invite who is gaining and what are the causes of these games. >> the two things that i would mention, one is just to reiterate one of the points i try to make during my talk is that certainly more could be done at the federal agency senses and data collection effort. so for example, again, the comparison to europe, they are doing much more productivity. is a bit of a shame that anyone needs to go and probably a thousands of dollars for some proprietary data where the quality is unknown. and why can't we provide funding to the senses so they can do for mobile surveys to find out what firms are doing with their ict and the broadband, how they're using it and so forth. so it is needed eight an easy place to start or a hard place to start with you and get interest in funding it.

the other thing i would mention is just going back to, you know, as the studies are done, you know, we don't -- we can already lost the battle with getting a top to randomize to getting money to places in way that approximate a lab experiment there are still stated they are metrics that we can use. for example, one quick example, you can look at firms that just barely missed the cut off, whatever the cutoff is going to be to getting a grant. those firms that just missed getting the money should be very similar a priori to firms that were just over the line. so in a sense they are similar in other ways, but that one got the funny and one didn't. so there's your control group and treasure expended for. you can do analyses of these and we have techniques for dealing with the sort of data problems. what is going to take realistically is probably a lot partnering with people outside of federal agencies to tap on

that. that expertise for academia. >> so to part, we could even build on some of the surveys are out there. census did a 2000 survey on business i.t. use at the micro level data, at the michael. so at the firm level that hasn't in general been refreshed over time. so information on that kind of data would be very useful. the current population surveys, computer and internet survey hasn't been refreshed every year. and that has been a very useful source of data for folks that were studying early on, kind of the uses of the internet and impact of the internet at the individual level. and that survey has not been unfortunately hasn't been refreshed over time. so those things are two things that have already been done out there that they would be very useful to continue. actually, it's interesting that researchers that are looking out for level or regional investment

in i.t. almost always have to turn to private surveys at this point because the only official government statistics that are publicly, or even privately available are at the industry level, for the most part. so these are things that have already been done in the past that if they could be done again in the future would shed a lot more light on some of these issues. >> okay. so we will start with questions from the audience. this first one actually built into some of these data issues because it's about enterprise customers. so the question is, the increased availability of broadband is a huge impact on the so-called enterprise customers and non-ict industries which is banking, airline reservations, ticketing, business process outsourcing etc. the competition has failed to develop for broadband services resulting in supercompetitive prices which ran customers from capturing the potential of these services. how should i shall broadband

center and the fcc adjusted price issue and. lower prices@@@@@@@ @ @ @ @ @ @

data. >> and i'm not even sure if there is, to what extent there are systematic data on enterprise prices for broadband are we all know that the fcc haven't collected such data in the past so it's not there at the federal data collection level. again, there probably are private sources out there. to be honest i don't think i've ever seen and used in a study. most private studies based on basic rate. and quite often prices are collected by researchers by having their graduate students hit websites in different locations and pull a prices. so it hasn't been rocket science in the past. so i would say we probably -- there is more than that we don't know that we do know about prices there. >> you think that is an issue

that business enterprise prices are something that should be looked at along with all the other data issues? >> it's hard for me to imagine that that is the margin were federal intervention is most needed. i mean, if i can think of a competitive market for market where the private provision is probably working pretty well you would expect it would be the high-value enterprise customers. >> and the other thing here is so many of those situations, you are actually talking about that are then turning around and being sold as a broadband service to track your credit card or when you swipe a credit card in the store or something like that, and how in the world do you get to that data, that pricing data. >> i mean, just to make one other point to follow up on some of the other comments on. to the extent that in our study a lot of the action has been in

urban areas, and in urban areas competition has been quite robust. i don't know what the pricing data exactly are. but in general if you look at sort of metropolitan areas, competition amongst broadband providers, at least in -- we don't know the pricing data, but we at least know the number of providers across regions. and that seems to be quite robust. and i would agree with some of the things that james has mentioned, that is probably not the margin that matters within urban areas. i think some of these other things in terms of skills, third party resources available, outsourcing providers and these things are probably going to matter more in the margin than pricing. at least in urban areas. >> that they put two questions together here to i think are related. and the first is whether anybody has said the affects of telework, job will not initially be created in underserved areas. they will be brought in from other areas. recalled his telework. jobs to people instead of people

to jobs. and in the second question is then what mechanisms exist or could be developed to track a relationship between economic growth in employment, technical skills and education, and training to the central and economic stability of historically neglected communities. so what do we know about the effects of telework, and how would we go about measuring those effects, what would people need as a prerequisite to make that work? especially in historically affected communities. >> well, i did run across a few studies when i was doing some earlier research on the business and how it is used. there actually is -- there are very few formal studies done on telework if self. mainly because well, can come if you don't have data you can't study it. the data are hard to come by but even with survey data, it is hard to tease out the impact on a particular worker of allowing

that worker to work at home because of course, in, companies don't randomly assigned the option to do telework and so forth. so there are compounding factors. i think i only ran across you know, tuesdays i was a miniseries attempt at this. in 1000 had no effect and one candidate has a positive effect. so i would say we know very little about that. but you can surely imagine that it could have impact in many ways, probably many of them nonquantifiable and probably many of them not a benefit to the firm but to the worker. let's also ask a break that second question out a little bit more. . .

>> can one of my ecommerce help me out on that? >> i think -- i agree that i don't think there have been a large number of studies -- my understanding is the information that is out there suggests most of the teleowork that is going on and not people coming from the city and doing their work, it is not a complete substitute for worked in a place of business at least right now. most of the telew currentork suggests that is a compliment to

working in a place of business of people a spending three days of weekend work and two days at home. it is important to be clear how it is being used right now. in terms of the second question, there is a lot of meat. i think -- i think i agree the questions on causality are pretty daunting but even beyond that, i don't think there have been a lot of surveys about where people are doing -- who is doing the telework, how much are they spending time at work verses at home. most of the information we have is out there. there's a lot of coming back to the data issues, a lot we can

know before we progressed farther. >> can i try and off the wall thing? i am saying to myself if somebody came off the wall thing? i am saying to myself if somebody came to me with an idea that married telework with crowdsourcing as a variation of outsourcing of work, and i would think that would be a really interesting business idea. but i would stipulate that it requires broadband connectivity. again, i think what we are playing with here is we are playing with how do we establish demand that drives into the market this kind of connectivity so that there will be residual

activities like telework needs crowdsourcing, then nobody dreams of today. i know of examples in the developing world where there is telework, an outfit called tx text, i believe, where they use crowdsourcing concepts on mobile phones in the bush in africa to do work in a central city. but it requires this kind of connectivity. you can take connectivity to enterprise areas, the challenges we have, those things result. >> related to that, i would be surprised, given the information we have, simply providing broadband to underserved

communities would do much of anything of high-value. if it was not couple with a whole bunch of other programs that have made broadband, high value and other communities like improved education, improved training for social skills, a wide variety of things. if all we did was provide broadband to underserved communities, it would probably not provide many benefits at all. >> but broadband would open additional opportunities on education and other things you get through broadband by not having broadband, you would have access to those types of things. >> we have to do a study. >> we have heard from today, not mine, i will point out, the benefits in terms of wages have

come to communities that are already highly distributed. >> there is a variation on this theme, back to the point i was trying to make, you can't force demand with supply. first, you have to have the man. in a national broadband policy, needs to worry about how am i going to create demand. when i put demand into that impacted area for this purpose, low and behold, people start hanging things -- and other things you never anticipate, that it has to start with that demand. whether it is broadband in rural communities -- >> there is little effect, that is the basis of the statistical comparison in a steady. it is insufficient to start with broadband. we must also provide education and other activities that may be beyond what the fcc does, but without that, we will provide broadband which will not really be used.

>> if i could jump in here, the reason for this is most of this is dial up after the e-mail. the very basic services on the internet that huge gains come from are already available, broadband provides incremental benefits so there will be a huge effect. we have seen it already with dialogue, which i think's especially consumers surveyed, their time on line at least in the middle of this last decade, they didn't increase their use of internet drastically once they got broadband which goes to evidence that it is not transformed technology over and above what by law provided. at the same time, there will be diminishing gains as they continue to roll out broadband services. >> more broadly, there's a lot of -- at least in our study, one of the takeaways, there's a lot of complementary other stuff you need to see wage gains. some of those are associated

with lower costs associated with cities, either lehman markets, education, things of that nature. that collection of things, the things we have been talking about, lowering the costs of not just broadband investments, but the things businesses need to do to use broadband effectively, it is not just building a broad band connection, it is creating e-commerce and doing the logistics and other things that are needed to create a business model out of broadband and all those things are easier to in some of the areas that are already doing well. on the other side, a neglected thought is that oftentimes, we usually think of broadband or networks as being complements to face-to-face communication but there's a lot of evidence that suggests in things like an

entrepreneurship, people need to meet once or a number of times in addition to the telecom or icts enable communication, those are easy to do in locations that are -- from our work, we see the challenges of getting benefits out of in our case advanced internet investment, you need these complementary things that are available in particular locations. >> how do we think about the incremental returns? you pointed out that we want to measure the economic effect, you want to measure the improvement over what it replaced. broadband isn't either/work. there are lots of flavors of broadband and some people care @@@ 2nand and some people care

dial. if they were drastically greater, the numbers would jump off the charts and everyone would dropped dial up straight away and we didn't see that in the data. there is evidence that they are willing to pay more for broadband but so -- not so more that is transforming live, complete the new technology. >> can i push back a little bit on what you just said? since 2004, there have been a number of new applications that have been made available that would not be made available over dial- dial-up, online banking, online government, this might have increased the value of broadband so people who would not take

dial up would find it useful to take broadband, and a 2004 survey considered what applications were available to broadband then that were not available for dial up, probably might underestimate the value in 2009 where there is so much more available. i welcome your response or any of the panelists. >> it is hard to imagine something like youtube being it compelling technology of the dialogue. is not useful for consumers. at the same time the beauty of the mythology which goes on -- i am sorry -- nobel prize-winning work, we are not properly attributing the gains for what they are replacing. if you're on youtube more acute, you're watching tv less. that affects the economy, may be decreasing over others because

something like television studio will not invest as much quality in programming because they can't catch the advertising, so quality of media in general has declined. we take a stab at trying to measure those. it is important to consider what we are giving up as technology progresses. not just simply say we like youtube lot, what is the value above and beyond what occurred without broadband. >> what i was suggesting was that data used based in 2004 on how did consumers value broadband over dial up may be no longer relevant. i am not disputing -- >> you are absolutely right. we continue this methodology. my point is for overall economic gains is not going to matter. they will be offsetting. just because consumers are revealing their not going to buy a movie from blockbuster at this point. the overall impact on the

economy is offsetting. >> the big benefit, at least to consumers, is video. that is what you're getting. banking, you can do over dial up without much trouble. i can research by concern over dialogue, i can do my e-mail over dial up, the inferior technology works for most of the things people are going to do on the web with the exception of video. what is the value of having internet videos? we don't know. >> i think we fall into a trap if we say -- if we assume that economic growth and consumer use are synonymous. i really don't think we are talking about universal youtube.

we need to enable the productivity in the engines that will hire people and allow them to go to the grocery store. we have multiple companies that are virtual companies, a marketing guy is down south, they have got to have broadband connectivity. >> they do, don't they? >> they do, but they are limited. they make their life decisions around that, they have to make corporate decisions around that, there is a limitation. i am not disputing, i circulated at the outset, first, you create demand, that will cause the investment to go out there.

for new broadband. but we need to look at it as a lot more than consumer applications. >> i am in complete agreement with that statement. my question would be, what evidence do we have that businesses are not being served sufficiently well? >> the kind of compounding ip that i invest in has to have broadband, in that we are defect go making decisions as to weather economic investment is going to be made because you can only place them in certain areas. >> you're leaving out certain people in san neighborhoods and certain talents because they don't have broadband connectivity. >> i am not -- we are looking at the wrong thing.

we are looking at the pipe, we have to be looking at the reason for the piper. we need to be saying what are we doing as federal policy to incentivize people like us and others to want to invest in building that pipe to the demand? we don't look at it that way. >>, jonathan, you want to say -- >> i want to partially after question i asked before. if we wanted to measure what you were talking about, this business or residential or neither? >> what i am talking about is business. we have seen the spurt in economic growth from consumer applications of broadband.

they are going to disappear. but i think the great compounding activities are in the enterprise space, and we have to enable those compound in activities. we don't have any data on what is happening other than anecdotal stuff. >> just to follow up, i agree completely that if you are going to see an impact on measurable economic returns from internet investment, that will come predominately from the business sector. to follow up on the original question about measuring different dimensions of broadband, to come at it a different way, we need to know more about measuring different applications of broadband. we are not just talking about plugging in a pipe to a business. there is a lot of college and 80

to make this happen -- this is dependent on whether this is a collaborative technology or enabling supply chain logistics, all of those things, the questions we are asking about the impact on local economy and how that goes across locations, likely to vary significantly across these applications. >> more questions from the audience to further this discussion. people are itching for a fight. could chris and ralph comment on their conflicting broadband deployment? broadband availability has not had a substantial impact on wages for low-income or education populations and broadband availability would benefit all populations, are these in conflict? can they be reconciled? does the answer depends on short

verses long term and a third question, how they take into account innovation. why do you disagree? >> i was setting existing studies from sacramento state university where it shows there was a direct link between economic growth and indicated in terms of new jobs and payrolls. i am sure there are studies allover. one thing clear from this discussion is in order to go forward, there's a lot more data that we need to collect and understand in this area so there will be studies that differ. that is what i was sighting. >> i don't want to start any fights here. [talking over each other] >> that is right.

that is right. that is right. it is an extraordinarily difficult question. james alluded to this in the first talk, disentangling the supply verses demand in some sense. there have been a number of studies that have examined differences in local supply, associated with broadband providers, local employment, we need to be a bit careful because there are a tricky issues and broadband providers. we try to address in a careful

way. something we need to look at very carefully. short verses long run approach, we were looking at the period to be clear, a different sample period between 95, and 2000. more work needs to be done on more recent data, at least in our own study, we tried to see whether internet investment in 2000 was correlated with future wage gains, this is short verses long run issues, i didn't talk about that in my remarks. what we seem to find is there was the short run increase in wages associated with internet

and the difference between what we call the high factors for other areas but there were not additional benefits, at least associated with 2,000 investments as you go from 2000 to 2005. i want to be careful in saying this, that this is looking at the affects, long run affects of this 2000 investment on future data. there is a lot of work to be done here that everyone on the panel has mentioned, about looking at either different margins of investments for future data, what we have and what other folks have done to flourish this out. there's a lot of additional work that needs to be done. >> looking for the financing, we can probably get together, get some new data. talking about data from 1995 to 2000, talking about how fast things have changed over the last nine years, people are using it differently and

everything else. we can get together on this. >> this is the third time i have said the same thing. it appears from the slide that the studies we are referring to, was referring to actually looking at residential internet penetration and the data chris was using is based on business. so it is at least possible that they are reflecting different mechanisms or different phenomena. we don't know. >> a quick clarifying question. when you talk about people do one thing or not spending money on another, is there any data on what sorts of things are being crowded out by broadband activity? >> we have the numbers on dial up. that is immediately in there. we have to do a more systematic consumer survey and see how they're spending their time on line. a chip to amazon is different

from a trip to an offline retailer. we don't have systematic numbers on that. there will be studies like that, we just haven't incorporated them into our analyses. it is something to consider. >> any comment before we finish? if not, i want to thank all the panelists for joining us, those who came out of town on their own expense, very grateful that you did. it was an interesting discussion. i learned a lot from it. thank you very much. [applause]

>> first of all, it's being used by others, some friends, some

adversaries, around the world. how many of you know about the counter-farce campaign in columbia on facebook? in 2008 last year in january, an engineer in columbia publishod facebook, a terrorist group, within a week he had 20,000 supporters on facebook. a month to the day after his post, more than one million people marched in over 165 city necessary 40 countries against the farc on a campaign largely organized on facebook. as many of you know, the first indications of the attack necessary mumbai came by twitter. twitter was used extensively by all sides in the gaz a fighting last year and there was, as the admiral said, you have to be able to know the difference. there were advanced and scoops

and red herrings. this was out there and an issue of global importance. then of course we saw what happened in the aftermath of the iranian elections. so government, particularly the national security elements, cannot ignoreb& this. nick gowing, with bbc, basically says that the velocity of information in this space has so compressed the timelines for government decisionmakers to respond, they're going to have to invent new ways to address the problems. his estimate i think is on the order of three to five hours. if you don't have something on the street after a major event you run the risk of becoming irrelevant. the folks on the blogosphere and twitter, doesn't have to be accurate, the government has to be accurate. that puts enormous burden on the processes. you have to find a way to change

the organization to address this kind of space. what can they do? let me talk about four years. first of all, is to make informed risk-management decisions, not just risk avoidance. second, to responsibly empower the workforce. third is to recognize there is more strength in responsibly sharing information than in hording it and the fourth is to avoid micro-managing. you have the capability to micro-manage, you have to train yourself not to do it. the elephant in the room and all this is security. it is not just national security, it is privacy, accountability and sorting out the weak from the chaff. the balance between security and sharing has been one that the -- certainly the national security, intelligence and defense community has been wrestling with since the early part of this decade. with the network centered capabilities and the concepts of need-to-know, versus

need-to-share have been part of the discussion of the vocabulary largely within controlled spaces. now we're talking about moving beyond this environment to deal outside the boundaries of government space. mark drapo, who was here, and i co-authored a paper a few months ago on social software and national security and one construct of the paper is four broad functions of sharing. broadly divided into sharing with known entitys and sharing with unknown entities. inbound and outbound sharing to be among unknown entitities. inward would be sharing within your organization among people you know and outward might be sharing between the defense department and the state department, but between people who are known to each other. inbound would be receiving

feedback from the public, sort of the point admiral allen made about regulatory issues and outbound would be the kind of blogging and posting of pictures they talked about in the north slope. the security needs of each of of those is somewhat different. i think one needs to take a look at how social software fits into that. for example, we have asked 10 broad categories of social software from blogging to micro-blogging to photos to video to things like that. and if you then take three instantiations of these, this might be flickr versus picasso, 30 different entities. could you bend these into four broad category okay for use within protected enclafs, suitable for use outside the firewall?

suitable for use on the following restrictions across the boundarys and never acceptable. examples of using within protected enclaves would be intelligent work like with enteli entelipedia. and 24/7 coverage of what is going on in the blog. to gib to approach from that, perhaps the problem becomes more manageable. so it is one thing to say you are never going to have facebook on dot-mil, that is probably true out to unrestricted access to the outside world. you could use facebook effectively or something like facebook within a protected enclave, we are trying to work through the rules. this is more than a fence, it deals with any agency that has to inl teract with the public, basically all the government and network enabled government demands we do it. the second piece then we need

leaders need to empower the workforce to behave responsibly. i suggest that you could do this by sort of showing yourself to your workers, encouraging the responsible use of social software. so if you know about it, you can talk about it, it is a really good way of posing the problem, but we should not discourage our people from ever touch thanksgiving stuff because a, they are going to do it to begin with. and b, we will probably learn from them in how they find ways to make use of it. >> when needs create a culture of social software experimentation, this is after all experimental. two weeks ago, three weeks ago, camp roberts in california, we and i'm part of the project on providing sort of sustainable support to stressed populations, star tides. we were out in neighbor

postgraduate school field experiment in california where we were able to take people from industry, such as google, a number of nongovernmental organizations, a number of government people and imagery provided by the government compareed with imagery produced by unmanned air vehicles, mash this together in geospacely formed products like maps and pictures that could be rapidly updated through things like short message system text feeds or twitter feeds. you could get realtime situational awareness of what is happening in a region based on better access to imagery than you had had before. this was invented on the fly in the span of five or six days out in california. within 15 days of the time the people first got together, it was on the ground in jalalabad and afghanistan being used to

monitor stings about the election. this was within three weeks of the time it started. encourage people to experiment responsibly with this. this was outside the boundaries of a totally open source. we are trying to encourage people to do new ways to do business. in this vein, empower your people to be authentic. authentic in this model is, don't be perceived as being stoogess for the organization. you want people to go out and engage in social software space speaking as themselves. they may be employees of general motors or the department of whatever, but they're seen as representing a reasoned view of what is going on in the organization, not being the mouthpiece for the organization. this is one of the keys to establishing trust in this kind of discussion n. terms of generational gap, there is a very -- lady named misty

bermiefter who has written a book and has interesting insights about how you, you know, bridge the gap across the digital divide between the digital may havens and those in the workplace a few decades longer. recognize there is more strength in reasonably sharing information than in hoarding it. this was a major discussion with the defense intelligence community in 2001, 2002, 2003, twoth four and 2005. one of the points here is that a lot of the innovation that is going on in this space is what mark has termed the new digirody. a lot is occur nothing small companies, not in the big defense contractors and not necessarily happening in large-scale integrators. how do you get people out to talk to open street maps and the small companies that are really doing creative things? i encourage those kinds of

interactions. be prepared to discard comfortable legacy systems. intelipedia has done exceptional work in causing analysts to come together and look at things differently. it is impeded if you have processs that have to proceed in parallel that says, you can go to -- take a lot of extra time to put stuff in intelipedia. you need a leader to try to tie the processes of the organization into the new ways of doing business. the final piece is to avoid micro-managing. the navy has a great story about this. in the late 1980s or so, we got a data link called joint operational tact tile system that went across the whole theater. you could watch worldwide to see where ships and planes were and see what was happening. within weeks, the commander of the fleet setting up there in

the headquarters, was calling the commanders and saying, i think you ought to move the picket ship 25 miles northeast. everybody was saying, how do i turn this thing off? so what happened, the navy went to a system called control by negation, which basically says admiral or commodore, the pace of modern work is moving too fast for you to control everything. you have got to delegate and your model is controlled by negation. if you don't like what is going on, step in, but by and large leave the decisions to subord nants. it took several years to train people to do that. most people have internalized this now and something like that, the intersection between leadership and technology is a really important part of our training programs that we need to focus on. recognize you can't control the message. the admiral said, your organization is flat.

you may not know it it, but the organization is already flat. you can't control what is out there. put your story out there in as many different formats that people are going to use and compete in the space, not try to ignore it. so a good example of that, by the way, is comcast, which was apparently getting really bad press for its customer service and one of the customer service representatives said, hmmm, watching the twitter feeds and seeing what was happening and he set up a system when something tweeted negatively about comcast, you would respond and say, how can we help you and satisfy your problem? in a short period of time, the company went from having one of the lowest customer satisfactions in the space to getting a good one. empowering people in that space. lifelong learning, the admiral mentioned this. commit to it yourself and reward it in your employees. i was listening to ray chriswell, who talked about

interesting work on the velocity of technology. the point he makes, human beings tend to think linearly. take 30 steps, move 30 paces. you want to shoot a deer, calculate and pull the trigger. the problem with technology is it it is moving exponentially. we know about moore's law. point of fact, the amount of computing power is doubling about every 11 to 12 months by some measures. let's say it is 12. so if you have 10 years that is two to the tenth power, 10 doubling, which is 10 24s, thousand times change in 10 years. in 20 years it it is a million times change. in 30 years a billion times change. in the course of our careers, we tend to think 30 years linear

step by step, the technology in which you are working changed a billion times. if you are not committed to life-long learning to incorporate and understand what is happening there, you are failing your organizations and your employees. so, we must take the time to do this, take the time to others are doing it whether we like it or not and first responsibility of leaders to do that. great quote outside from president reagan that says: there are no limits to growth and human progress when men and women are free to follow their dreams. social software is a great leveler of of allowing people to express themselves. we in government, business, we in any space need to take advantage it. thank you very much. let me open for questions. [ applause ] >> come on, there has to be some questions somewhere.

okay. well, i'll give you back some of your calendar time then. holdup. i have a question here. yes, sir, there is a microphone over there. microphone. >> question: i was at a conference last week with military services and on advanced learning and there was a lot of discussion about social media within d.o.d. i'd just like your take on what the process is going to be before there's some adjustment within d.o.d. and utilization of social media? >> the deputy secretary actually signed out a memo on the 30th of july that is due by 30th of

september of addressing how social media is to be used within d.o.d. for example, mat rein corps just banned social network sites. i had an interesting case the other day, a new website, public affairs website. i got an e-mail saying, we have redesigned this to really be more -- address young people and so-and-so. you open it up and here you have a nice big video screen in the middle and stories around the side and over here it says, "beauty blog," and it's got facebook and youtube. this is not in the dot-mill tis in the space link. i went from my dot-ndu, to edu space. the defense organization went to click on the picture, on the movie. there was a note that says, this works best with flash player 10. cool. download flash player 10. a button comes up and says, you are not authorized to download

flash player 10. i wrote a letter to people that said, look, i love the website, really cool f. you are going to do something that will affect the department-wide gout a month ahead of time and go to the approval authorities for the sub-nets and say, we have decided this is something important for the department to have, would you please enable your people to use our official website. hopefully some of that will come out of the debate. i don't want to minimize the serious security problems. i go to the hacker convention in las vegas every year. great time to spend with really serious talented people, but with different life views. and the -- the level of attention being paid to hacking social software site system absolutely nontrivial. i heard something yesterday that said tax on social software is up 90% in the past year. you can't ignore this. the rest of the world is using

it. so if we cut ourselves off, the anti-farc demonstration was nontrivial national security event. what happened in gaza strip and the way it was used was nontrivial defense. i am glad the secretary teed up the debate. as you can imagine, there are passionate issues on both sides and i would hope that -- by the 30th of september, a task to come out with unified approach. so... could somebody -- it is being recorded, you need to use the mic. thank you. >> question: you have been in the job before and helped them write the policy. what would you recommend they be thinking about as they work through this? >> i think we are trying to get people to bend some of these into, this is okay within protective enclaves. these are great models for what

a lot of government could do within protected enclaves. what admiral allen is talking about, establishing presence outside the firewall and at least understand what is going on and be prepared to respond to the space is a really good way to do business. what i'm asking the security services for is a reasoned assessment of the risks involved in dealing across the boundary. are there any way necessary which you could use -- for example, some parts of d.o.d. allow e-mail. some parts don't,llow g-mail. some departments and agencies allow facebook and some do not. in some cases you have organizations like public affairs who are required by their jobs to look at youtube, who are prohibited from using youtube by the organization policies. the first thing i would ask for, can we get a reasoned security assessment by professionals that let's the policymakers make

decisions on the basis of information, rather than just doesn't seem right to me. i think those three things. first of all, get aggressive presence within protective enclaves, establish a presence outside and do serious analysis of what the boundary conditions would be is how i perceive it. >> question: come what would you say the number one thing leaders need to keep in mind? >> what is the number one thing leaders need to keep in mind in the gov-2.0 world. i would say they need to empower their organizations to act responsibly in this space. the normal inclination of most of us who are beyond a certain age is going to be -- this is either scary, it's a waste of time, it is something kid dos and so therefore it can't be important. but in point of fact, it is. just think back when many of of us came into our organizations, the telephone was a little black

thing that sat on the desk for official use only and you had to walk down the hall to get to the pay phone in order to make a call. the computers were standalone. you had to -- we couldn't possibly hook up to the internet or any network. we've come a long way and it will be that way with social software, we just need to figure out how to get there responsibly. >> question: yes, i wonder if if you elaborate. you said the smallest companies being the most innovative. could you, laberate, which companies and who innovations? >> let me be general and not specific. just if you look at the people who are out at this mash-up in camp roberts in california, i don't think any of them with the exception of the google people there, came from an organization that had more than 50 people in it. and lots of them are leveraging

being social software. for example, open street maps has done terrific maps of parts of the world where there are no decent maps, by just giving somebody a g.p.s. receiver and having them walk around the streets at fifth and abdulah. they generate a street map out of that. it is the mix typically of the small batch folks in the back room who are working on the idea now lefrnling a whole batch of volunteers and a whole batch of folks interested in work nothing this space. i see a lot of creativity coming out of that. t the -- you know, i think that is the main point. i don't know when i look at the things like tim o'reilly's camp, the friends of o'reilly.

and crisis camp looks at how to put together tools for disaster relief. most were smaller companies who were there playing in the space. i'm actually not in any way maligning what larger companies are doing except there is a lot of energy and useful stuff coming out of the small companies and my point was just we ought to encourage our people to get beyond the normal to go talk with the new people, as well. >> yes. yeah? sure. >> there we have. you have folks sharing information in oin innovative w. they are posting in the old

system and using intelipedia. when does the intelecommunity say go one way or the other or continue to use both systems at once? >> this is a question about when do you take the sails off the steam ship? the last u.s. navy steam ship his sails into the 1890s and so i think the answer is going to be when you feel comfortable enough with the new process and the cost of the old ones just got to be too expensive. so there's going to be a large amount of inertia to keep the old system running and left old devices, they gallon on and on and on and on. i would recommend a couple so you don't have one data point, a couple of tests. we want to solve that problem using software and using traditional ways of doing business. once you start getting

consistent or better results using social software then ask yourself, especially in the intel community, am i exposing sources and methods if i put in the collaborative space that are protected by other means that the answer comes back a toss-up. i would move to the new space. rather than saying, hmmm, i think it is this way, i doll tests and experiments. again, thank you all very much. appreciate the chance to talk to you. [ applause ] >> mr. fischer: i hope someone quotes the theme about steam ships. small token of appreciation for you. appreciate your time. >> thank you. >> mr. fischer: shift in schedule. where did paul go? paul was here.

can someone get paul wong? he might be in the speaker's lounge. we will move paul wongup to be the next speaker. okay. art just left, too. okay. i'll let people shift some spaces. i just need to turn on the projector for one second.

>> mr. fischer: okay. we'll go ahead with paul and brian burns will be next. paul is a branch chief in the department of homeland security, federal emergency management agency mitigation director.

paul collaborates closely with fema's 10 regional offices, a multitude of staffing contractors and closely with local, state and federal officials. he also collaborates with local and state and coordinates data collection and risk communications ensuring optimization of local and federal resources. there is someone who knows about management and collaboration, i think it is paul wong, that is why i invited him here today. paul. [ applause ] >> paul wong: thanks, ken, and thanks for having me today. last night i was thinking about going over my presentation once and not until ken said a note that says, c-span will be there. i thought, maybe i should is practice. and so my wife sitting there and

hey, do you mind if you listen? she's got her laptop on and she's probably on facebook. she is probably writing: oh, god, not again, i'm the audience. then she goes, no, he's probably telling bad jokes. she was a terrific audience and she was using social media as she listened to me practice last night. so my name is paul huang,i work with the homeland security. admiral allen was a terrific help in hurricane katrina, and his leadership should be commended. i was excited when i knew he was a keynote speaker. i'm a branch chief and mitigation directorate. we reduce loss of license property through mitigated actions. that means stronger building codes, buyout, building stronger disaster, working with communities to make sure they

are doing the right thing so when a disaster happens, they are prepared and risks are mitigated. one thing also if you didn't know, fema sells flood insurance to transfer some risk to the federal government. that is one program i work on. so a little bit of overview on what i'll cover today. i'll talk about leadership and collaboration. the program we just launch third degree year performance-based measure is as example of challenge in collaboration that we all face. the old way of doing things and perhaps new way when we talk about technology and risks in best practices i'll share through our experience at fema. before i do that, yesterday morning my friend and colleague fred, and i have one or two fema representatives out in the audience, so they know fred. he's worked in the government for 35 years and he comes in and

knocks on my door and says, paul, what are you doing tomorrow? i have web 2.0 going. what is web 2.0? and fred had his badge expire and he said -- they wouldn't give him a new one because his background check needed to be renewed. he had to go online and submit for a new badge. he said, i am going to retire because i don't think i can do that. if it tells you about its technical capabilities, fred is a terrific guy and provides good advice. he says, tell the audience, even if you know and most of you probably know, what is web 2.0? i said, in the sponsors are going to hate the fact i say this, but i said, it is like a hallmark holiday. it made up the term, like wear a suit to workday or happy wednesday day. web 2.0 really is not something different. it is an evolution of the web.

web 1.0, never called 1.0 before, it it was a one-way type interaction. you went to the "washington post" website and read the news. someone posts something and you read it, one directional. or you sent e-mails. i'm sending an e-mail to you, you send a response back to me tis narrow in scope. web 2.0, new tools are being introduced. collaborate and work with each other. so things like wiki, and things like twitter and things like that where your audience is bigger. when you go to the "washington post" you may contribute to the news article, not just read it. you may comment on it and build on other comments. those are the types of capabilities for web 2.0. as i said, fred ultmeatally, the technology just new technology. something else, as the last speaker said, the technology will change.

what it helps us do is solve common management problems, common problems we all face. when he started in the government in 1974, the same issues, different angles, but different way to think about solving the problems. the theme for my presentation today is "same problem, how we can apply technology to helping solve those? little about leadership and collaboration. this is leadership segment of the two days. i pull someday quotes to talk about leadership and as i speak about these, i'd encourage you to think about what some of the technologies you'll hear in the next two days and you already know about can do to address some of of the issues and what it can't. because you can't fill the void of leadership through technology sometimes. so some of these things can be

solvable. they are important in terms of the topic i'm speaking to, manning the challenges and collaboration. good collaboration, the first thick you need is good teams. this is annac nim i brought up, together everyone achieves more. i don't know if you have seen this exercise, great team-building exercise called the cascade survival game. so pass out this to a team and go, okay, here is a scenario. the scenario is you are in the mountain necessary colorado having a great time skiing. you get an alert that says a big snow storm is coming and everybody needs to be evacuated. you pile into a helicopter and the helicopter crashes. the helicopter crashes and the pilot dies. you are all alive and there is a list of 10 items you find in the helicopter, anywhere from snow shoes and skis to flares and flashlights. you are supposed to list and rank order of the 10 or 15 items in the order of importance to

your survival. so everybody does this individually and scores one through 10, importance of these items for survival and say do this as a team, do this collaboratively. they work together and go, okay, what does that rank order look like? at the end, park rangers or professionals of some sort, provide the real answers and you compare individual scores against the real answers and the team scores against the real answer necessary terms of what are the items in the helicopter you crashed in, are key to survival? over 75% of the time in this activity, the team score beats the individual score. it is collaboration that is important. team work is really important. maybe the technology creates opportunity to expand the way we do team and collaboration. since it is football season, i just threw a lombardi quote in here about leadership. just really did throw it in because it is ball time and i was watching football.

people who work together will win whether it is against a complex defense like the baltimore ravens or problems in modern society. we face these all the time in the federal space and private sector. there are complex problems. collaboration is a way to find better answers to solving this problem. one of my favorite books is by patrick -- i will butcher the last night. onceoni. "five functions of a team." i have pass third degree out to my team and they have all read it, and so have other fema staff. it's a really good book, almost hierarchy of needs. at the bottom is absence of trust. this is negatively spun book so i will spin it the positive way. you need to have trust in the team to collaborate well. what does that mean? you need to be honest and you

have to be unafraid to share ideas and thoughts and trust your peers so you make comment and it it is not seen as insulting, but constructive comment. you can't fear conflict >>yes have collaboration if everybody agrees? right? so conflict actually if done correctly and you are not afraid of it, will generate typically better answers. commitment. have you to be there when you are doing something, whether online or in a team or group setting there, has to be a commitment we are here to solve the same problem and work together. accountability. you leave that website and you got to go, okay, i said i would do this. someone has to keep each other accountable to what you assign them to do. inattention to results. this is a hard one. i'm sorry. i think i missed one. last one is shared goals. this is always a challenge to

collaboration, whether you are using technology to solve the problem or doing this in person. throw away the ego. whatever you guys collaborate on and agree to, your idea is not always going to make it the final answer. there might be disagreement. but at the end, leave collaborative session and say, hey, i buy in and i support this, the result. so some thoughts on leadership. i will close in terms of leadership piece of this before i really talk about crowd sources and the technologies we use. with a quote from the leader in my family, and i think it is good advice when you think about the challenges to collaboration. and that is "no question is a bad one, listen and no yelling," and that is from my three year old who always gives me good advice. so let me tell you about a program. we recently launched what we call in fema risk mapping and assessment planning with

terrific vision. the word collaboration is in the vision statement. through collaboration with state, local and tribal entities, deliver quality data that increases public awareness and leads to action that reduces loss of life and property. this is an exciting time. we are coming off a program that i will talk about in a minute called map monetization. one of of fema's missions, one thing i work on is identifying the flood hazards. flood is the number one cost to the nation in terms of national disasters. i don't know if you know that. floods happen everywhere all the time. in identifying that hazard fema can write and sell insurance properly. they can mitigate against that flood by affecting local ordinances and building codes that say, you have to build this high or this low or in this area or not in this area. affects our grant programs, where we rebuild and provide

funding for structures and such. so flood hazard identification or mapping of flood hazard is an important thing. we can't just identify the hazard, we have to communicate that harzard to folks to take action. that is an exciting thing about risk map tis taking not just quality data hazard item, but we're going to make a big push in terms of public awareness and you will see national campaign coming up to raise the nation's flood hazard awareness that hopefully will result in local action. okay. this is serious. we have natural hazards we have to mitigate against. so that is the goal of risk map. this year we got 220 million at this fiscal year, appropriations from congress as transition year. we also got on top of that about $80 to $90 million worth of federal insurance fees to help support the program. we're talking about a $300

million program. in the president's budget for fy 10, we put in for $220 million, so the funding level will likely be the same. we are hoping it is a five-year program, so we are looking at a billion dollar program again. when you have a billion dollar program, people say, what are you going to deliver? that is a key driver to everything we do and report. performance-based measures have been embraced by d.h.s. and fema. they cascade. they are in my performance plans and in the program goals, they are in my boss' plan. they drive this stuff. classic challenge back to common problems that we've all faced from fred's generation to mine. things like collaboration. we have something to deliver. we need to measure a program. the key to that is how do you get buyin and deliver something smart that is deliverable, it is a stretch. we call it smart measures,

specific measurable action oriented results driven time bound measures so that you can drive the program. 50i78 going to use this example over the last couple minutes of my presentation to talk about how we did it in the old way and how technology in web 2.0 has affected a new way. so back to five years ago, the floods map monetization program was funded in 2003 by congress over five years and we just finished that program this past fiscal year and it's been a very successful one. d.h.s. ranked it as son of the top three level one, level one being anything over $100 million programs ran in all the department. we are really proud of this. i'm very proud of this and the goal was to take old paper-based maps, as you see in the presentation here, and move into the gis world rment it is more

powerful when you look at 2-dimensional flood map that shows hazards. on top of the structures and something you put in map longs and zoom in on and see the harzards. the billion dollars was to move from there, the paper, to the digital. the nice thing about the digital tis easier to update. flood hazards change all the time. keeping this up to date was crucial. paper to digital. the key measure, back to performance measures was that 92% of the nation's population was covered by digital gis flood map and dat a. we came up with the measure, 92% of of the population. in fact, we'll deliver on that and that has been a success for the program. how did we get to that measure? go back five years ago, a couple ways to do that before web 2.0 took hold. lots and lots of meetings.

we work with 10 regional offices. my job is to coordinate with many of these. i've been doing calls with those over the last couple weeks and they are the ones on the ground delivering the program. our headquarter is we develop standards and measures and push out the money. these guys deliver the program. they have constituent and stakeholders whether they be association groups big into this stuff or local officials or citizens they have to face on a day-to-day basis. when you come up with a measure like this that drives a billion dollar program, to get it right we had to do lots of meetings, which means flying the guys in, flying stakeholders in, having lots of cost associated with that. it is inefficient, you are always telling a story. i was in this session talking about performance measures and here is what someone said. someone else wasn't in the meeting so you retell the story. the reason we came up with that

was because this person said that and these decisions were made and what do you think? it is endless loop, a lot of effort. there is no transparency, too. at the end of the day, they go, how did you come up with that measure? who made that decision? what resulted out of that collaborative session? my boss, the division director, would come in and say, i like this idea. no folly of his own, he just skewed the discussion in a collaborative environment by his title, perhaps you skewed that decision. sounds like the big boss likes that idea, so let's go with it. collaboration dies at that point. sat the same time, he's conscious of that is and hesitant to share ideas. there is leadership bias in the old way of doing things. or they go, with all these risk its is easier to decide on our own. make it it very inclusive, develop preference measure that hasn't been collaborateod a lot

and go down that. i wasn't at fema five years ago and my boss tells it, seven people got in a room in georgetaun and said, we will map the measure with 100% of the nation with a digital map. that says 92% of the popeulation. what happened? it sounded good. it sounded great. seven people, we didn't have the soft associated, good collaboration. we had a couple of people in a room. for a billion dollars, congress, we'll give you 100% of the nation with this new great product. what happened? the stakeholders didn't like it. there wasn't buyin. they said, why 100%, where is the quality behind the product? why aren't you investing in quality versus quantity. the region said, we are delivering this, why did we make this decision. there was not that inclusion or

buyin. two years into the program, we had a miscourt adjustment. congress said, you don't think we should do 100% of the nation. focus on quality over quantity. 92% of the population was in the land area. in alaska, admiral allen went, or in the midwest, not a lot of population. doing the map still costs the same as a debs area. by reducing our goal to 92%, we could afford more quality. that is what happened. the program has been successful, but a billion dollar program, turning it around after two years of launching it, was not an easy task. and maybe collaboration could have been different when we developed that measure. fast forward to risk map, which i spoke about recently. let's not do this. if we're going to get buyin for the new program and it is going

to be likely looking like a billion dollar program, what can we do differently? we looked at technology and web 2.0 technology. we brought in a group. we didn't lose a human irteraction. we brought in a group of leadership and talked about ideas and we created some potential measures for the new program. then we used something called e- provide third degree tool and let me tell you a little about it. essentially these ideas, you generate seeds or ideas and then you can vote on these ideas. i like this one, i don't like this one and add and build on those ideas and folks can rank your idea. back to the nation covered with a digital map. say that was a seed coming out of this group from georgetown five years ago. someone might comment and say, i don't like that idea. then the author is revealed. you don't see the publisher of

the idea until you vote on it it. that gets rid of the leadership bias. it was nice actually voting on things and saying, i don't like that, only to find out my boss wrote it. next thing, build on that idea. someone might put in an idea that says i -- and invest in quality. great. i like that idea. then someone on top of that might say the way to track this is to use census data. pretend there were five years back, what happens is this bridge dialogue starts generating and you could start buggeling up good ideas. it is collaborative, you can open it it very widely. couple things. very inexpensively flying a bunch of folks in.

create transparency, we sold this to o&b is said, here are the measures f. they ever say why, here is the tool, read through the comments. it is always documented transparency there and buyin, why did we make the decision. it is time bound, my best ideas when when i'm taking a shower or taking the kids for a walk. i'm not in a meeting or collaborative session. you are not bound to that. you throw an idea on grapevine or crowd sourceing and it allows flexibility. we talked about leadership bias and voting and not revealing the author. what resulted, five key measures, lockdown, we have great buyin from the stakeholders and we can explain why. the last thing i'll talk about, what are some of the challenges to web 2.0if you are in this

room you probably know or have a huge interest in web 2.0 or social media. you might know what a twitter is, or a blog, but a lot of folks don't. back to fred, when he walked into my office, what is web 2.0. the change is difficult. getting folks to break the old mold of meetings or exclusive collaborative group that makes all the decisions, that is a difficult thing. change generally, whether generational or not, whether it is fred or someone just starting. change is difficult. use web 2.0 technology and social med wra. terrific ways to solve problems that are common problems in a new way. i think that is something you think about, but you can't lose some of the old stuff. you need meetings, you are losing one-on-one touch, walking

the halls. back to my example of leadership, the base of that is trust. the only way to have trust is building online and talking to. emotional tax, somebody might put an exclamation point, does that mean happy, angry, upset? there needs to the way to mitigate that. you can't read a yawn online. if someone is bored with what you are writing, you can't read that online. the last one we've heard a lot about, these are great -- how to apply the tools. we are constrained in the space. privacy laws are there for a reason. you have to work around them or you have to be flexible and respect those rules, but try to make progress.

i think that's it for me. i hope i didn't go over on time. >> no, does anyone have questions for paul? thank you, paul. [ applause ] >> any questions? i think the reason i invited paul here is because he's thought a lot about managing in a collaborative environment and i think that's dialogue which might be useful to get started. hope we can in the future have more talks about how leadership and management change in a more collaborative world. yes? mary is bringing it to you. >> question: my name is robin and i'm a contractor for the government. i was wondering, i was fascinated by what you were presenting and really encouraged by the way that you are describing the collaborative difference in the web 2.0 or

gov 2.0 world. are there any quick examples you could give us, not covered in your presentation, and i understand if you need to change the names to protect the innocent , but examples of the ways you have solved problems that you couldn't have solved before or achieved something that you really think might not have been achievable before? dhafr thanks. >> guest: yeah. i can't think of a good example, but i can tell you how it got more efficient. last year a staff member said, we publish a lot of standards and the maps require standards and g.s.i. stuff and specs. they said, we always do this kind of inhouse and put out to the public on the federal register notice or publish to stakeholders. he said, why don't we use a wiki. put out the best thinking we have and open it up to get more

volume. we use d.h.s. interactive tool. we got two or three hundred comments and input into the standards development. then it was easy to sell. in the past you twp the standards and fight them. i don't like those standards. you are changing the way my contract is working. we didn't have that problem this go around. we are in the process of finalizing the standard and i think it is done in record time. you can do those things to make it more efficient or to tackle this problem differently. >> question: i'm a question hog. i am wondering if you can talk, you gave one example, i'm wondering if the collaboration tools are standard practice now in fema and i'm wondering if you would advocate or describe specific technologies that you recommend or like? >> guest: sure. fema is starting to take hold of this.

i know in the external affairs office they have web 2.0 lead and fema has really gone out to facebook and i think mitigation has a myspace account and are moving in that direction. me personally in my branch, i like blogs or information. we startd that a year ago, too. my folks, the staff complaints were hey, we never get to think, all we do is operational stuff. same old, same old. we went with the google model and said, set aside time every week and put up a random thought, could be work related, maybe not cork related. something you read or write. so i really like that, the wiki, for standards development, i think we will continue to do that type of thing and as we look to risk map and improving risk awareness, the only way we can afford it because i think

our stakeholders want our investment to be in the quality of the hazard maps and want to see risk awareness, but not for a lot of money. we will penetrate that through social media. that is something new contractor accenture is pushing in terms of risk communication. i look forward to seeing how successful or not that is. i think what you definitely get is more bang for your buck. >> thank you. >> question: tammy moody. before i moved up here and worked for deca, i was with the little rock army corps of engineers. last year -- what was it it, 2008 or 2007 one we had basically all of arkansas was under water. i was wondering if you had used that kind of collaborative method with the corps of engineers and back and forth? unfortunately, right at the moment, corps of engineers, at least in little rock, they won't

dip their toe into twitter or anything like that. they are definitely afraid of it and may be getting more ahead of the times now. >> guest: we have a great relationship with the u.s. corps of engineers and maybe that wasn't the case a couple years ago. i think that has happened because not the technology, i think we created the foundation, which is we have a lot of meetings with them and interact with them regularly. we sit down and have meeting and strategy sessions with corps. i think the evolution, now that we have trust relationship, i think we can expand to technology and make it it efficient. we are not there with the corps right now. we do a lot of e-mails and meetings. i think we can change that. >> thank you, paul, i will have to cut off the questions there. sounds like the foundation -- wait, wait, don't leave yet. the foundation needs to be developed along with having the right tools. >> absolutely.

>> i want to give you a small token of appreciation for coming to speak and giving of your time. >> thank you. [ applause ] >> host: now i have a recommendation for everyone. there is an excellent room in the back to take a 15-minute break and visit our sponsors. greatly appreciate it if you stop by. they would love to chat about what we are talking about and anything else. thank you very much. we will be back with brian burns, deputy cio for the navy for emerging technology.