Sir Peter Bonfield

Under the theme of "Forming a Secure Network Society" during Global Information Summit 2002, held last week in Tokyo, business leaders and experts from the information industry worldwide discussed technologies, systems, government regulation and ethical codes needed to assure Internet security from the viewpoint of business and consumers as well as content providers.

The two-day summit, sponsored by Nihon Keizai Shimbun Inc., was mostly devoted to the issue of security in a networked society.

In the first keynote speech, Peter Bonfield, former chief executive of the BT Group, expressed optimism about the networked information society, in spite of the recent boom and bust of the telecommunications business. He stressed the positive side of the bust, such as debt reduction by 50% in nine months and lower costs. "As a next step, consolidation in the industry is highly probable," he said.

In the second keynote speech, Takuma Otoshi, president and chief executive officer of IBM Japan Ltd., stressed the focus of the Internet has turned from virtual to real business. He urged all companies to establish policy about the appropriate amount to pay to reduce online security risks. "Immediate policy establishment is important, as the online population will increase tenfold and online terminals thousandfold worldwide within 10 years."

As for corporate management, Otoshi argued that a networking society forces companies to concentrate on their core businesses and cooperate with outside resources. He said, "Japanese businesses cannot survive unless they change their paradigm from that of postwar high-growth era to that of the networked world where global competition intensifies."

At a discussion about infrastructure and platforms for a networked society, Hidekazu Inoue, president and CEO of Nippon Telegraph and Telephone East Corp., explained the giant carrier's recent effort to boost broadband businesses such as asymmetric digital subscriber lines and fiber-optic Net access in a bid to reform itself from a telecommunications carrier to an information distributor in the Internet era. He disclosed that the carrier is preparing to launch a fixed wireless access service called M-FETS, offering wireless broadband Internet access everywhere.

Stressing the importance of the combination of infrastructure and application, Inoue said NTT East is promoting business alliances with various companies, including broadcasters and digital content providers.

As for government regulation, Inoue said that, in order to sustain the vitality of the networked society and Internet business, the government should not interfere. Bonfield also criticized excessive government intervention. He said that governments make mistakes whenever they make decisions about what technology to back as the changes in technology occur extremely rapidly.

Bonfield also criticized the U.K. government's decision 25 years ago to prohibit British Telecom from distributing video, which has prevented the carrier from offering online video streaming. Bonfield said that governments should set long-term goals and leave business to free competition.

On the second day, participants held heated debate over intellectual property rights for digital content under the theme of "Conditions for Success in the Content Business."

Isamu Tomitsuka, chairman of the Recording Industry Association of Japan, said Gnutella and other peer-to-peer file exchange technologies are enabling a free exchange of music content among listeners and damaging the music business. "Measures should be considered to have Internet service providers monitor every transaction by Net users of files containing intellectual property," argued Tomitsuka. "MP3 music distribution cannot be a viable business as long as peer-to-peer free-exchange systems exist."

Easy-to-use online shopping

Jaewoong Lee, president and CEO of Daum Communications Corp., the largest portal site operator in South Korea, countered that it was too early to enforce regulations on free content exchange, stressing that the music industry should establish online shopping systems that are easier to use than peer-to-peer swaps. He cautioned, "We cannot let Big Brother watch over everything."

Simon Parnall, chairman of TV Anytime Forum, also said that businesses should pay close attention to consumers' behavior in order to find practical solutions to the issue of digital copying. "Consumers need chances to listen to music for free before they decide to buy," said Parnall.

In the third keynote speech, Jiren Liu, chairman and CEO of Neusoft Group Ltd., China's largest software maker, talked about the huge potential of the Chinese software market following the country's entry last December into the World Trade Organization. He predicted that demand for ERP software among Chinese companies will expand as they face harsher competition with foreign businesses entering their home market.

In the final keynote speech, Craig Mundie, chief technical officer at Microsoft Corp., said that, at the direction of Bill Gates, the U.S. software giant is putting the highest priority on the issue of network security. "Protection of personal data and security is essential for trustworthy computing," he said. "The goal is computing as trustworthy as telephones or electricity." He urged that governments and businesses work hand in hand to realize high-level network security.

The final round of discussion was devoted to reliable platforms for e-commerce. Harriet Pearson, chief privacy officer at IBM Corp., stressed that CEOs should address the issue of security, privacy and trust in a networked society because they are all part of essential strategy. "Even if one company is very good, if another company messes up, it will affect the integrity and reputation of all of the industry," she said.