APRICOT: Sun's Gage sees a taxing fate for Internet

A top Sun Microsystems official says the White House policy on Internet commerce is on the right track, but he warned the Asia-Pacific Internet community that governments and the groups that influence them still have some distance to go in understanding the Internet. As presented by Ira Magaziner, a senior advisor to US President Clinton, the US would appear to have a unified view that the Internet should remain unfettered by governments, says John Gage, chief scientist at Sun. The reality, he says, is that many politicians, law enforcers and trade unions may not be so supportive of leaving the freewheeling network of networks uncorralled.

A top Sun Microsystems official says the White House policy on Internet commerce is on the right track, but he warned the Asia-Pacific Internet community that governments and the groups that influence them still have some distance to go in understanding the Internet.

As presented by Ira Magaziner, a senior advisor to US President Clinton, the US. would appear to have a unified view that the Internet should remain unfettered by governments, said John Gage, chief scientist at Sun this wek. The reality, he said, is that many politicians, law enforcers and trade unions may not be so supportive of leaving the freewheeling network of networks uncorralled.

Gage was speaking in a keynote speech following Magaziner's opening address this morning at the first day of the Asia-Pacific Regional Internet Conference on Operational Technologies (APRICOT), taking place here this week.

Drawing on a Clinton administration policy announced in July, Magaziner proposed a world in which governments should not regulate the Internet but rather empower people to protect themselves. The plan calls for leaving issues such as privacy protection to the private sector while keeping the Internet free of taxes or tariffs.

Though Gage agreed with Magaziner in principle -- between speeches he gave Magaziner a lei of jasmine flowers as a gift recognising his efforts -- he told the audience that the Internet is still a mystery to many of the world's policymakers.

Underlying Gage's argument is the assumption that the Internet is changing the world in unknown, and thus frightening, ways. "We are undermining things, and we don't know what direction it will go," he said. "You are scaring people," he told the audience, which consisted mostly of regional Internet service providers.

The response by those outside the Internet community -- such as members of the US Congress -- is to pass laws in order to assert some sort of control, Gage said. The Internet, unlike many technologies and industries, he said, is virtually unregulated and therefore is viewed by some as disruptive to existing systems of government and taxation.

Magaziner is traveling the globe proposing a policy of no new taxes for the Internet. In the Asia-Pacific region and elsewhere, however, governments of developing countries may feel that their economies will see healthier growth through the imposition, rather than avoidance, of taxes. Malaysian Prime Minister Mahathir Mohamad last week said that, unlike the US, his country does not have the funds to build its infrastructure and must consider taxing the Internet, said Gage.

Gage pointed out that governments historically have been creative in raising revenues, imposing taxes on income, electricity, televisions, windows, cigarettes and luxury cars. Such costs inevitably will find their way onto the Internet, he said.

The Internet is likely to see governments intervening for other reasons as well, Gage said, alluding to technologies that might allow the tracking of U.S. forces into Iraq if the conflict in the Persian Gulf escalates. "Not only are they worried about taxes," he said, "they are worried about military security."

Calls to regulate the Internet also could come from outside the halls of government, as trade unions become anxious about the possibility of job losses resulting from commerce moving to the Internet, he said.

Gage urged the members of the audience to counter these social and governmental impulses by speaking out to policymakers like Magaziner. The Internet community should strive to reduce everyone's level of fear, he said.

"The foundation rule in all of this, of course, is that technology is easy," he said. "People are hard."

To win people over, he said, the Internet community needs to welcome more schools, teachers and parents online. Gage urged audience members to read the Clinton administration's stance on electronic commerce and then e-mail opinions on the future of the Internet to Magaziner.

"Everyone here has to read the paper and send at least one sentence to Ira," he said. "Who else is going to say what should be done?"

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