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The French vision

The Brenton report on teleservices: The impact of IS on employment

This report was commissioned by the French government in order to assess the impact of new telecommunications services (such as teleservices and telework) on employment. The report prepared by Thierry Breton , the strategic director for the French computers group Bull, and released in June 1994, first underlines the growing importance of services in modern economies. Even on the last decade, this trend has been impressive (see table 1). However, productivity gains have mainly concerned the manufacturing sector. The use of new information and communication technology should be encouraged in services in order to enhance productivity and create new jobs.

[Insert Table 1 here.]

According to the report, the market for teleservices- i.e. all added-value services supplied via communication networks, including cable television - represented around 30 billion FF in 1993. It would be worth 90 to 190 billion FF in 2005, with 30 to 50 billion FF for services to domestic users. On-line information services could grow up to 16% a year in France over the next decade. Within the same period, related employment would grow from 65,000 persons today to at least 170,000. But the overall impact on employment will not necessarily be positive since teleservices may destroy traditional jobs and facilitate off-shore delocalizations. The bulk of the growth will come from business services, including teleworking, tele-banking, distance management of computer systems, etc. However, tele-medicine and distance education could grow rapidly providing government supports their development. The report suggests that the development of teleworking in the public sector and a reduction of the tariffs of France Télécom would help teleservices take-off. It adds that a major obstacle that must be addressed is the fair distribution of revenue amongst services providers.

While sharing the overall rationale of the White Paper, the Breton report expresses some dissent on the timing of innovations. For Breton, the information revolution will take place over 40 to 50 years since people need time to adapt to and take advantage of new technologies. There is therefore no urgency for public authorities, which should assess social effects of new communication and information technologies before taking action. A difference with the Bangemann report can be also noted: Breton considers that state support is necessary in the domain of educational and health services.

The Théry report on IS: Forward to the past?

The report, made public in September 1994, bares some similarities with the White paper and the Bangemann report: it considers that the development of IS is inevitable and will be global. Since world's leading economic powers are committed to quickly deploying IS, it is therefore urgent that France takes similar action. As the White Paper and the Bangemann report, Théry also emphasizes "the multiplying effect, which the superhighways will have on the competitiveness of enterprises, and the development of service activities which constitutes a formidable opportunity to create jobs". Finally, Théry underlines that public authorities should ensure a real competition not only in the services field but also in the software field. However, the liberalization of telecommunications should not lead to a "crumbling" of European forces.

The plan for IS envisioned by Gérard Théry rests on three main proposals:

· all French households and firms should be connected to IS by 2015. Access to IS must be universal in order to allow equal access among citizens and avoid discriminations between the poor and the rich, urban and rural areas, professional users and domestic users.

· IS necessitate a massive development of fiber optics links - with the connection of 4 to 5 million households and firms as soon as possible -, and a generalization of ATM. Design of new software should be undertaken, for instance with the support of risk-capital companies.

· experiments should immediately take place in order to create a dynamics for IS. They are intended to stimulate partnerships, test new services and assess technical problems.

In terms of costs, the setting up of an optic fibre network would amount to 150 billion FF over 20 years. According to Théry, this would cost less than twice the cost of the maintenance and upgrading of the existing telephone network estimated to 5 billion FF a year10.Théry thinks that the major hurdle on the way to IS is the cost of related software, which would be boosting the total investment to 450 billion FF.

The plan proposed by Gérard Théry is in many ways similar to the videotex plan with which it shares at least four common features:

· a voluntarist approach. The Minitel plan as the IS report rest on the ideas of a technology-push and of the stimulating role played by public authorities in the dialectics content/conduits. Infrastructures have to be developed for a demand to emerge. The public operator is to play a key role in the setting of the network, because it is only one to have the financial capacity to carry out the needed investment, and because of its commitment to universal service. However, by contrast with the Minitel plan, this role will not be not exclusive.

· the importance of experiments. This notion seems to be directly taken from the Minitel plan. Between 1978 and 1981, experiments of videotex services were undertaken. This approach turned out to be very positive: it allowed technical improvements, the formation of partnerships and the progressive design of an appropriate regulatory framework through negotiations among involved actors. Experiments also familiarized French people with the concept of videotex; and contributed to the social legitimization and political acceptance of Minitel (one of the aims of experiments was the assessment of Minitel's social impact and utility). However, such a societal concern no longer appears in the Théry report on IS. Instead, attention is focused on the economic viability and technical feasibility of applications.

· the model for information provision. The Minitel is based on the notion of a transparent network - the network as a market-place - which permits users and information providers to "meet" simply and freely. Any user can access any information provider, any information provider can offer services. The network operator facilitates contacts but do not play any other role (such as the selection of users or information providers). In this model, there is no hierarchy of services, no permanent commitment from the users. This conception of information provision is still present in the Théry report on IS. It opposes another conception of information provision which relies on integrated and segmented systems of services, each one associating specific networks operators and information providers (as in the US where coexist Compuserve, Prodigy, AOL, etc.).

· partnership between public and private interests. The Minitel system relies on a cooperation between the public operator - which runs the network - and private information providers which are in charge of host computers and applications. In the same way, the development of France's superhighways should be based on a joint action of public authorities and the private sector, including both SMEs and big corporations. Government must act as driving force, in particular as regard to public service missions.

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