In a watershed rhetorical moment this week, U.S. Trade Representative Michael Froman not only acknowledged the importance of several digital trade issues but he highlighted them as key elements of the U.S. trade negotiating position going forward.
His remarks – delivered in a speech at the Center for American Progress – focused on two key policy issues of utmost importance to Internet-enabled commerce: the commercial importance of copyright limitations and exceptions (such as fair use) and an acknowledgement that 21st century trade agreements should clear the way for data and information flows.
In a 21st century global economy where the Internet will be more important to international commerce than shipping lanes were last century or than the Silk Road was two millennia ago, it would be unthinkable not to incorporate the needs of the information economy into the international trade agenda.
Without copyright limitations and exceptions in the U.S., such as fair use, technologies such as search engines and video/audio recording devices would be illegal and websites like YouTube and Facebook would not exist. And without trade provisions that encourage the free flow of data and information, particularly at the time when the future of the Internet is in jeopardy, the Internet could become a patchwork quilt of different networks, protocols and regulations that prevent the seamless global exchange of data and information. Not only would this spell disaster for Internet users who rely on the Internet to communicate with each other and educate themselves, but it would also have dire consequences for companies that rely on the Internet to facilitate global supply chain management and to access international customers.
These issues are becoming even more important in the trade context for the USTR as international markets become more important for U.S. Internet companies. For example, China has nearly two times the number of Internet users as the U.S. has people, and major Internet companies such as Facebook and Google have an international revenue intake that either meets or exceeds their domestic revenue intake (and Twitter saw its international revenue skyrocket in 2013). And, not only will these commitments benefit the U.S., they will also spur innovation and investment in the domestic Internet sectors of our trading partners who commit to these principles themselves.
Although these two key issues are not an exhaustive list of trade policies needed to facilitate Internet commerce (for a more comprehensive list, refer to CCIA’s comments to the U.S. International Trade Commission on digital commerce), having them feature in an agenda-setting speech by the head U.S. trade negotiator at a time when three major trade agreements are in play is a great step in the right direction for U.S. trade policy.