Ready for a wireless world?

Foreign wireless savvy may soon leap-frog US technological dominance if the Internet goes mobile.

The Europeans are coming! The Europeans are coming!

Actually, so are the Australians, the Canadians, the Brazilians, and even the Japanese. The US dominance of the Internet and its best-known expression, the World Wide Web, is under attack by a variety of foreign companies and governments that aim to shift the Internet's momentum to a more international stage, in part, by buying US telecommunications companies and media interests.

Whether this new threat is a flash in the pan or an 800-pound virtual gorilla will depend on how American business responds; how the US government reacts to these foreign takeovers; and how fast the next version of the Internet, which many believe is one built on wireless devices, develops.

Recent examples of this trend of foreign companies buying US telecommunications and media interests include Vivendi, a French water utility and acquired Seagrams (which owns Universal Pictures) in a move to challenge America Online; Spain's Terra Networks, a telecommunications giant that acquired Lycos, the well-known Internet search engine; and Vodafone, which purchased AirTouch, giving the European company a presence in the American wireless market.

(There's even been a moment of unintended humor, when British Telecom announced that it owned the patent to hyperlinking - the ability to link from one Web site to another - and that it would henceforth charge people to create Web links. Perhaps the best response to this claim came from an American businessman, who said he was glad to finally know who owned links so that he could sue them for all the broken links he had to deal with each day.)

Meanwhile, the European Union played a key role in preventing the merger of WorldCom and Sprint. And US trade representatives are still negotiating with EU representatives about which privacy guidelines will be used on the Internet. (The EU has much stricter online privacy protections than does the US.)

But how fast the next version of the Internet develops is perhaps the most important factor.

For most Americans, the Internet is accessed via desktop or laptop computers. That's because the hardware and the telecommunications infrastructure exist to support this method. Americans have lots of computers, copper or digital telephone lines, modems, and most important, flat telephone rates. In other words, when they make that local call to connect to an Internet service provider, they're not paying a per-minute charge to use the phone on top of the charge to access the Internet.

This has translated into a huge head start for American business, particularly in terms of e-commerce. And while the Internet economy is currently going through a shake-out, more and more Americans are using the Internet to purchase goods and services.

Meanwhile, most of the rest of the world, particularly Europe, had few of these advantages. Relatively few people owned computers, and if they did, they had to pay outrageous phone rates when they accessed the Net. But an interesting thing has been happening as a result - most of the rest of the world has decided to skip this desktop-laptop stage of the Internet and move straight to wireless.

"In wireless, which is the next step, the Europeans and the Japanese are maybe five years ahead," says Lee McKnight, associate professor of telecommunications at the Fletcher School of Law and Diplomacy at Tufts University in Medford, Mass. "The United States is quite behind."

Many of the infrastructure advantages in the US have been turned around in the case of wireless access to the Internet, Professor McKnight says. Europeans don't pay high rates to use their cellphones - for instance, they don't pay for incoming calls as most Americans do - and coverage is extensive and robust, unlike wireless coverage in the US, which is strong only in medium-to-large urban areas.

"Americans tend to scorn wireless as not the 'real Internet,' " McKnight says. "But everywhere you go in Europe and Japan, people have these WAP [Wireless Area Protocol] phones. And they are doing everything that people do on the Internet - chatting, sending e-mail, buying things, looking up stock quotes.

"In Japan, there are 7 million users of imode phones [phones that access regular HTML, the basic building code of the Internet], and it's growing at a rate of a million a month."

But as McKnight says, not everyone is convinced the recent European buying spree, or move to wireless, really means much for US control of the Internet.

"US dominance of the Internet is not going away quickly," says Milton Mueller, director of the Telecommunications and Network Management Program at Syracuse University's School of Information Studies. "What I think we will see, and this will affect US businesses, is a globalization of legal and regulatory arrangements."

Professor Mueller also challenges the notion that wireless will drive the future of the Internet. "Think about it. Do you really want to use the Internet on a dinky cellphone? I just don't buy this concept that the Internet will become wireless. Yes, it does have its uses, but how often do you want to be mobile when you're using the Internet? Most people want to be in a home or office where they can access the software that helps them use the Internet effectively."

One thing that both McKnight and Mueller agree on is that the move toward a global Internet, whether in terms of the Internet's next iteration or hammering out common regulations and legislation, may produce some bumps in the road.

"Americans have been, by and large, immune from the effects of globalization," McKnight says. "But when you combine the movement toward a global Internet with other concerns, like national security, for instance, there is sure to be a strain of 'We can't turn our critical telecommunications infrastructure over to foreign interests.' "

Those strains were heard just last week, when the Federal Bureau of Investigation raised national security concerns about Japanese Nippon Telegraph and Telephone's planned acquisition of Verio Inc., a California-based Internet service provider.

Apparently, the FBI is concerned about not being able to maintain surveillance of telecommunications entities - like the Internet - if those entities are owned by foreign companies.

McKnight says that if this trend continues, it could turn the Internet into very contested virtual real estate.

"If you get into a situation where the US retreats into a 'Fortress America' mentality, and yet you have the basic infrastructure of the Internet controlled, even funded, by American companies and the US government, when the rest of the world needs access to that infrastructure, that could be problematic."

Yet Mueller remains optimistic about how the US will react to these recent acquisitions. "I don't think Americans really care who brings them their cable TV, for instance, as long as they receive good service."

McKnight agrees: "You have the example of Lycos, bought by [the Spanish company] Terra Networks, which was hailed as a good thing for Lycos. And the tenor of the American business press seems to be that these purchases are good things because there doesn't seem to be any American companies making these big moves."

So will foreign companies control the Internet? Probably not. US business has shown a remarkable ability to respond to new challenges (like the wireless Web), and national security concerns will continue to be a thorn in the side of foreign businesses who want to acquire US telecommunications and media firms.

But we may be moving toward a day when no one country can control it as the US has to this point. That will mean a truly global Internet, which is, of course, the idea its creators had in the first place.

*Tom Regan is associate editor of The Christian Science Monitor's Electronic Edition. You can e-mail him at Tom@csmonitor.com

(c) Copyright 2000. The Christian Science Publishing Society

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