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Tuesday, October 30, 1990 - Page updated at 12:00 AM

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Fiber Optics Called Key To New Era

If it were to be expressed seasonally, government regulation of high technology promotes more evils than there are ghouls on Halloween, according to speakers at a Seattle Hudson Institute conference yesterday.

Describing a nationwide ``fiber optic highway'' that would enable the linking of personal computers over telephone-like lines with multiple-media applications in U.S. businesses and homes, speakers at the Stouffer Madison Hotel downtown decried a federal bureaucracy they say is thwarting technological progress and handing over U.S. innovation to the Japanese.

``Japan has already committed to spending $250 billion to install a fiber network throughout their country by the end of the decade,'' said George Keyworth, director of research with the Indianapolis-based ``think tank'' and a former presidential science adviser. ``They intend to contest for leadership in virtually every aspect of digital activity.''

Because of restrictions on using revenues to pay for new technologies, telephone companies have little to gain from promoting fiber-optic technology, Keyworth said.

Optical fiber, which replaces copper wiring, enables purer and faster transmission of all kinds of digitally converted data, from voice and graphics to newspapers and TV signals, between source and receptor. In its most common form today, it is responsible for ending ``echo'' and lag time in overseas telephone calls.

From an engineering standpoint, optical fiber is not difficult or expensive to install (Keyworth estimated the cost for converting the U.S. at $300 billion, not much more than the much smaller Japan). But the 20-year process to convert the U.S. is being stalled, speakers said, by a regulatory thicket requiring approval from some 50 jurisdictions, ranging from state utility commissions to the federal judge responsible for the 1984 AT&T divestiture that created seven ``Baby Bell'' telephone companies.

George Gilder, an author and institute senior fellow whose book ``Life After Television'' envisions a ``telecomputer'' - a personal computer linked to a variety of sources through optic networks - as the central entertainment and information device, said ``government has to get out of the way'' for such a multimedia technology to succeed.

With deregulation, the personal computer would have the ability to ``kill the VCR and kill the television, which the Japanese dominate and which now clutter our lives,'' Gilder said.

Not all of the 18 speakers felt deregulation was the true panacea: Richard Elkus, chairman of Prometrix Corp. and responsible for introducing the VCR to the U.S. market, warned that a fiber-optic network did not ensure sovereignty from Japanese interests.

Pointing out that Sony Corp. offers leading technology in nearly every fiber-optic medium and has purchased CBS Records and Columbia Pictures, Elkus declared, ``I hate to build highways for somebody else's cars.'' Domination of movies, records and other media would translate into domination of fiber-optic networks, Elkus said, pointing out that ``for the Japanese, planning for the long term means forever.''

Aside from the issue of government regulation, industry itself disagrees about who should control fiber networks. The cable television and newspaper industries, in particular, are concerned over Baby Bells using networks to gain a competitive edge.

A call for federal watchdogging came from Frank Blethen, publisher of The Seattle Times, who argued that ``the government's role is to protect the consumer'' by ``severely restricting utilities (Baby Bells) to their monopoly function and nothing else.''

Although newspapers would like the ability to transmit their product over fiber-optic networks to computers, ``lack of responsiveness'' from Baby Bells has hindered the process, known as electronic publishing, Blethen noted.

``As long as they think they might also become owners of information as well as conduits, it's only natural they will attempt to inhibit the success of others,'' Blethen said of the Baby Bells. Newspapers ``do not ask the government for help,'' but ``do need government protection from monopolies,'' he added.

The all-day session was the inaugural event for the institute's newly founded Seattle office, headed by Bruce Chapman, a former city council member and Washington secretary of state.

Published Clarification Date: 10/31/90 - Small Businesses Need Government Protection From Monopolies, Frank Blethen, Publisher Of The Seattle Times, Told A High-Technology Symposium Sponsored By The Seattle Office Of The Hudson Institute Monday. Blethen Was Quoted In This Article As Saying Newspapers Need Protection From Monopolies Such As Baby Bell Telephone Companies In Determining The Future Of Electronic Publishing. The Remarks Were Intended To Apply To Newspapers That Qualify As Small Businesses And Not Newspaper Chains Or Conglomerates.

Copyright (c) 1990 Seattle Times Company, All Rights Reserved.

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