July 2007 - A Senator's Perspective

Electronic Retailer goes one-on-one with Senator John Kerry in a wide-ranging interview covering Net Neutrality, the need for a broadband policy, privacy and data protection…and Stephen Colbert.

By Tom Dellner (Photos by Roger Hagadone)

On May 8, 2007, more than 70 industry leaders gathered in Washington, D.C. for ERA’s Annual Government Affairs Fly-in. Attendees spent a busy day on Capitol Hill, making their voices heard with their respective members of Congress on the most important issues our industry faces today, including Net Neutrality, privacy and the Streamlined Sales Tax Project.

The day got off to an electric start with a keynote address delivered by Senator John Kerry. A member of the Senate’s Commerce Committee, Finance Committee and the Chairman of the Small Business Committee, Senator Kerry is one of the most informed leaders and passionate voices on these crucial issues.

After the fly-in, Electronic Retailer magazine caught up with Senator Kerry for an exclusive interview.

Electronic Retailer: We are very excited to have had so many of our industry’s leaders fly in to meet with their respective
members of Congress on Capitol Hill as a part of ERA’s Annual Government Affairs Fly-in. We are also honored that you deemed the event important enough to deliver the event’s keynote address. Why do you believe this event is important for the industry?

Senator Kerry and ERA president and CEO Barbara Tulipane at the ERA Annual Government Affairs Fly-in.

Senator John Kerry: Enhanced communication between industry leaders and their government can only be a positive thing-for our business owners, employees and for American job growth. The level of access to electronic retail and how we receive Internet services are some of the leading issues of modern American commerce. We know that access can mean the difference between a business that is struggling to keep up and one that is thriving.

ER: What would you say to those who didn’t participate-small- and medium-sized companies, especially-because they don’t believe that their involvement matters or that, as smaller companies, their voices won’t be heard?

Senator Kerry: Small- and medium-sized companies represent the heart of American entrepreneurship and small businesses are the lifeblood of our economy. Their views are taken very seriously on Capitol Hill and as Chairman of the Small Business Committee, I urge them to make their voices heard.

ER: Net Neutrality is a cornerstone of our industry’s current legislative agenda. Where do you see the issue going during this Congress, and how do you think it will affect entrepreneurs that sell goods and services over the Internet?

Senator Kerry: It is more important than ever that we secure Net Neutrality principles in law. Currently, broadband providers have the ability to degrade or even deny an online company’s capacity to communicate with their customers-that is wrong and may impede innovation.

The Internet’s phenomenal growth has been built on a principle of open connectivity-an open architecture that has enabled consumer choice of content, services and applications free of interference by the providers of the underlying connectivity. This is how many online retailers have prospered. Preserving this basic non-discrimination principle will enhance innovation and technological advancements.

Last year, I fought hard to ensure that Net Neutrality was preserved. We were not able to move broad telecommunications reform, in part, because of this issue. I will continue to work hard with my colleagues to push Congress to address this issue again.

ER: Another major industry concern is the nation’s lack of a broadband policy, as we fall behind the rest of the world both in the deployment and speeds of broadband access to the Internet. What are your thoughts?

Senator Kerry: American residents and businesses now pay two to three times as much for slower and poorer quality Internet service than do those in countries like South Korea or Japan. I have seen it written that about 60 percent of U.S. households do not subscribe to broadband, because it is either unavailable where they live or they cannot afford it. President Bush promised ubiquitous broadband by the end of 2007, but we are nowhere near that goal. The lack of a clear policy has taken its toll.

I introduced legislation to make better use of the broadcast spectrum that is sitting dormant. There is no question this valuable spectrum should be used to offer high-speed wireless Internet access. I also support Senator Lautenberg’s effort to permit state and local governments to provide these services to their citizens. There are other approaches that we will explore as well, but without question, we need to increase access to the Internet throughout the country.

ER: Privacy of consumers’ identities and information and data security have become vital issues of importance for the industry as it strives to protect the reliability of online commerce. What are your thoughts about balancing the protection of personal data with the growing demand by consumers for the convenience and enhanced features that the use of some types of personally identifiable information enables?

Senator Kerry: The appropriate word is balance. Consumers must have a reasonable expectation of privacy and security; otherwise the online business model is threatened. At the same time, government policies must be fair and recognize the difficulty for online companies to comply with a nationwide patchwork of differing rules and regulations.

ER: On April 26, the chairman of the U.S. House Financial Services Committee introduced a bill that would rescind an online gambling ban imposed by Congress in 2006. Furthermore, the bill would make it legal again for banks and credit card companies to make payments to online gambling sites. What do you think about this proposed bill?

Senator Kerry: I support gaming. For example, Nevada’s state-regulated gaming industry is an important driver of its economy and employs hundreds of thousands of people across the state. I also believe there should be some protections, such as those that ensure that kids don’t gamble. One of the major questions with Internet gaming is whether adequate protections can be put into place to ensure it is not used by children.

ER: Okay, a fun question. We were pleased to see your use of streaming video on your website that included your interview with Stephen Colbert. Inquiring minds have to ask-what was it like being on “The Colbert Report,” compared to a more traditional interview format? What are your thoughts on non-traditional news sources gaining traction in the American media landscape?

Senator Kerry: A conversation with Stephen Colbert is like the weather in Boston-totally unpredictable. You have to just enjoy the ride. And as for someone other than the usual pundits and conventional sources talking about the news-that’s very welcome. It brings more people into the debate. It’s not a substitute for other news outlets and the blogosphere; it complements it.

ER: As you researched the environmental book (This Moment on Earth) that you’ve recently written with your wife, what unique uses of technology did you come across and what role do you envision technology playing in the environmental movement of the future?

Senator Kerry: The web was a key resource for us as we wrote. Since we both travel often, there was a lot of sharing information through e-mails, copying and pasting hyperlinks to share ideas and do research, and finding activists through their websites and blogs.

The blogosphere, and the web in general, have generated much of the brainpower and motivation for the green movement. There is no doubt that much of the problem with climate change is about political will-and Internet communities and communication will be a big part of the solution.

Highlights from Senator Kerry’s
Keynote Address
2007 ERA Government Affairs Fly-in - May 8, 2007

I was part of the writing of the Telecommunications Act of 1996 which, interestingly enough, shows how fast things move…. In 1996, the entire conversation in our committee was about telephony. Nobody, at least among the people at the table…had the vision or the understanding of what was coming down the road. The result was that within six months of the writing of the bill, it was obsolete. Data took over and this stunning transformation [ensued], which has taken place over about a 10-year period. And it has obviously transformed the world of business. So it’s important for us now to try to have the vision to be able to look ahead and understand what happened [over the past 10 years] and the various forces that came into play…and not screw it up. Washington has this unique ability to find unintended consequences [which can eventually have] unbelievable implications on a lot of people’s capital investments.
You’d be amazed at how many conservative, Republican “keep your cotton-pickin’ hands, government, out of my business” leaders come to Washington to ask us to legislate their monopolies. It’s really an interesting phenomenon. Or at least to legislate their economic advantage in the marketplace. And I am very wary of that and have no intention of falling prey to it. And that is essentially what I see in this Internet neutrality issue…. To have a group of legislated, already-powerful economic players suddenly become gatekeepers that can begin to determine-through the prices that they charge-what happens to certain types of businesses is completely antithetical to the nature of the Internet itself. To fall prey to this would be to stomp on the very energy and creativity that has brought us this phenomenon in the first place. I am passionate about this.
I am on the Commerce Committee and I spend time at it and this issue is still complex. There is always some nuance that you need to be reminded of or updated or refreshed about, because you’re not in it every single day. For my colleagues who aren’t there [on the Committee], it’s baffling and complex and there isn’t really an exact understanding of…that marketplace. So it’s important to help them understand and I think your time is well-spent in doing so.
We’re trying to figure out how to do this [collect sales tax on purchases from out-of-state retailers, including online retailers] fairly without becoming obtrusive. It [remote selling] is not supposed to be a tax haven, akin to a kind of offshore enterprise. We need to find a sensible way of doing this…it’s a matter of how obtrusive it is and what is imposed…but the concept itself is not fundamentally unfair. What we’re looking for is an even playing field. We should not be in the business of legislating advantages or disadvantages.

We would appreciate your feedback. To submit comments, please e-mail the magazine at [email protected].


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