Good morning everyone. Secretary thank you very much for walking us through that peer congratulations. My name is Evelyn [ Indiscernible Last Name ] and I would like to call the first digital economies of advisors meeting to order. I just want to introduce myself. I am the designated federal officer for the board. There are just three things to remember about that here you will be hearing quite a bit from the over the next two years. Hopefully that is a good thing we will try not to make that too painful. The second thing is that I am the person responsible for making sure that the work that we do is open and transparent, so I will be keeping track of that as well. We need to be working very openly and with public participation. The other thing to remember and I think the secretary has characterized this very well, is that me and my team, we are actually going to be the bridge for the group into the next administration. I want to let you know that we will be working with you for the full two years and helping to be the glue between those two. In my day job, I am actually the deputy associated ministries are for policy analysis and development at NTI a. They are responsible for really watching and stewarding the Internet, making sure it remains open and free and secure. We really help to keep the flame for the Internet. Larry [ Indiscernible Last Name ] will be talking about that a little bit more. I wanted to just say that I'm very honored to be serving with you all in this capacity. I appreciate the secretary and assistant secretary placing this responsibility with me. Thank you again and now let me pass the meeting over to the secretary. Think you. 

First of all, I just want to say thank you to all of you. You have given your most prescient -- presses -- precious thing which is your time to help us address a number of really exciting but challenging issues that we face not just at the department, but as Larry will tell you, we are responsible to be the chief advisor to the president as it relates to digital issues. I really excited that all of you have agreed to be a part of our digital economy board of advisors. Thank you for that. I particularly want to take -- think Zoe and Michelle -- thank is Zoe and Mitchell for your desire to want to lead this session. I think the group is in great hands so I'm very excited about that. As you know, you met last night our assistant secretary Larry strictly and also our digital director of digital economy Alan Davidson and Evelyn who is not only our chief federal officer, but plays many roles for a seven department. Really, the focus of the digital economy board of advisors is to help us understand what is the most effective way that we can be engaging as it relates from a policy standpoint with the changes that have come about because of the digitization of everything? Fundamentally, there is this notion that there is his digital economy and it nondigital economy. I don't buy that distinction. I think everything runs on a digital platform. I don't care and certainly GE would be the primary example acknowledging that. The challenge that we face is that the pace of change going on in industry is so fast and government is really tending to be more reactionary then practice in this instance and we find ourselves dealing with some very complex policy questions without the kind of guidance that I

think all of you can bring to us. I think as you think about your work, I would think about it in somewhat of a couple of different dimensions. First, let's take the longitudinal dimension. We of course, as political appointees, time dated. But the work is not time dated. Part of what we are hoping for you to do is to develop an agenda that bridges not just our work, but the work into a future secretary. We feel part of what we are doing is laying out with our professional staff who will survive us as politicals and for the next secretary and political leadership, and agenda -- an agenda that is really robust and well informed by all of your experiences and your personal leadership in the economy. That is a very important role. The second is to help us think about what are the dimensions were different topics that we should be focused on as a department?-- and help us think even about organizational questions, do we have the right structures in place to be able to do our job effectively which is among other things to be a policy creator and policy advisor as it relates to things that are issues that are raised by virtue of the fact that our economy rides on the digital infrastructure. You can help us to identify, what are the emerging challenges, what are the trends, but you can also help us identify what are our opportunities to help shape the policy construct that will help address issues that are being raised daily at this point. Many of those issues whether his privacy, cyber security, etc. are well-known topics, but the implications for technology for innovation, for intellectual property protection, for our entire -- I could go on and on -- our economy of the fact that we live on a digital backbone that was never designed to become the digital backbone of the economy. It was designed for a different person -- purpose and now we are retrofitting it to constantly pick it -- fit fix Trent its ubiquitous role. I think -- its ubiquitous role. I think you guys have a big task so the most important thing is not to boil the ocean but to pick 325 or three -- three to five or three to six things and see where you can fit the needle. It doesn't mean that other issues aren't and pork in -- important. While you are mighty there is a finite number of you and your staff has finite amount of time. We have found that our most effective advisory groups have some focus and 10 to try to have things that they get done so then there is a sense of accomplishment and confidence in the process and purpose of the group and then you can move to different issues as opposed to trying to tackle everything at once. So, I just want to close by saying thank you, thank you to the leadership on our team who I have enormous confidence in and thank you to all of you for your commitment to this group. 

Thank you. To be able to work in this capacity -- I think the secretary very much for creating this board , for seeing -- thank the secretary very much for creating this board and for seeing the controversy of this issue. I look forward to working with you on trying to make this digital economy work for all Americans which I think is what we should have as our touchtone. Is the largest transformation of the economy in about 100 years since we moved from agriculture to industrial. There is a tremendous

anxiety, fear and even anger in the country because people don't feel that they are participating, that this digital economy is something -- somewhere where they can see themselves succeeding . We have had stagnant wages. Wages have been flat for many people for a long time and the digital economy is more disruptive. I think we should start this work with a very strong sense of purpose and sense of urgency because so many people in our country feel that the digital economy is undermining their success when I think we all feel that there is tremendous potential for people to succeed through the digital economy. There is the opportunity for small businesses to use data to find markets all around the world and to grow and hire more people. There's the opportunity for people to get retrained in order to participate in and succeed in the jobs of the future, to find new career paths, maybe to get stackable credentials that over a course of a lifetime in able for people to get a college diploma. I think we all feel that there is tremendous potential in the digital economy, but it is up to us to help the Commerce Department really drive this so that everyone in our country and around the world can participate and succeed in this can be a benefit to everyone. I hope that we will use the talents and knowledge of everyone here who understand that you can use 3-D painting -- printing to make any place in advance [ Indiscernible ] facility.. We need to find ways to really provide energy behind that to enable the Commerce Department to fulfill its capacity to focus on the right things and enable people throughout the business sector to and education and training sectors to play the role that they can play. I want to start off just having us appreciate -- this is no ordinary board . The secretary has created this for no ordinary task. This is a tremendous transformation and I think she has very high expectations of us so I really look forward to working with everyone to see if we could step up to that.

I would like to start by saying thank you to the secretary for creating this board and including me on it. I agree with everything that Zoe said and I think the Department of Commerce is a really exceptional place to tackle these issues and to take advantage of the opportunity side of the equation. Here in the United States, the power of commerce and private commerce and particular guided by an appropriate social framework is part of the magic sauce of the United States. That question of the appropriate social framework, what priority and policies are important for commerce, how to engage inductively with private activities and how to build a new society based on the digital back bone that carries the magic that we have known of private economic opportunity unleashed, citizens educated enable to participate with growing opportunity, that is the key to our future. Commerce has a particular role to play. It has always been exceptionally important in the United States. To my surprise, as a lawyer in training, fundamental constitutional questions about the nature of the United States have come out of commerce and the nature of commerce. It is an enormous opportunity and I think we have the background in the scope and I think that this board of advisors in this location and time can do something that is rare

internationally. We can focus on opportunities and challenges, plus private initiative and innovation and hopefully, and importantly if we do well bring an opportunity to more citizens so that the opportunities are visible and the changes less scary because there is hope. I echo the excitement of working with you. I echo the belief that good policies and priorities are important and I think we are in an unusual and unique position both in the United States but also globally to be able to tackle these issues. Thank you all for joining and I am really thrilled.. 

Larry I think it is you.

I was going to say I think when we had contemplated this section of the agenda I think we also didn't want to step on the prerogative of the chairs but I think we had wanted to open it up for a conversation or questions about what you have said and the goals for the board. I think you have laid out in ambitious set of ideas -- an ambitious set of ideas and I think we wanted others to chime in before we jumped into our presentations. But, there may be no comments on this.

Good morning and thank you and thank you to all of you for your willingness to participate in this committee. We are at an important point as a secretary mentioned here at the Department of Commerce as we expand our horizons to pull in a variety of issues that we are now putting under the rubric of digital economy. But it is based on the foundation that I wanted to spend a little time just introducing you to in terms of what we have been working on the last several years here at the department which has been perhaps a little more focused on pure Internet policy. We welcome the broadening of this inquiry to include these larger issues of the digital economy at large. I think that is an important evolution first here at the department and a point at which you all can make a very key contribution to us as we start laying out an agenda for dealing with these broader issues. For the last several years as we have focus on Internet policy, and I'm speaking primarily for in TIA -- ntia but this has been an effort that has engaged many members of the Bureau. To have all participated in the work we have done but it has all, of some very basic principles that we have followed. One is we want to maintain the Internet as a free and open space continues to allow economic growth to strive, spurs job creation and encourages and supports free expression. Underneath that, there are two key principles that we have really organize our workaround the last several years. The first is the building of trust and the maintenance of trust by the users of the Internet. This brings within it a wide variety of issues. Obviously, privacy has been an important one that we have spent some time on as well as the protection of intellectual property, dealing with the issues of cyber security, but all of this is based on the idea that this tool will work best as long as people trusted. Unfortunately, we're starting to see a decline in public confidence in the Internet through some work we have sponsored with another of our sister bureaus, the Census Bureau, we released information last week that indicates people who are

heavy users of the Internet are starting to stop using it for particular tasks because of the fear they have that their private information might be compromise through a data breach or through the use of the information in a way that they are not used to. We see trust as an area where we have to continue to put a lot of emphasis. Here at NTIA we have convene stakeholders to develop codes of conduct to improve consumer privacy. We worked with the patent and trademark office in a stakeholder process to deal with the issue of notice and takedown for illegal content that may be out on the web. [ Indiscernible- Name ] has utilized a lot of these tools in terms of developing its cyber security framework. All of these come under the notion of building trust. The other key element has been inclusion, how do we get people connected to this and how we make sure they're not just domestically but internationally where doing what it takes to get as many citizens of the US and citizens of the world connected to this technology. In the United States, we have done a lot of work on infrastructure in terms of things as direct as finding more spectrum to be made available for broadband services. We also had the opportunity to invest $4 billion in projects under the recovery act to expand the amount of Internet access or broadband access so would be available for underserved parts of the country. As part of that, we have also focused on how to get people the tools they need to have to utilize this infrastructure. We have spent a lot of effort on things like digital literacy seining -- training to get people to actually subscribe to the services and use them and benefit -- use these services , and use them and benefit. Internationally, we have been involved with primarily [ Indiscernible- Name ] as it continues to evolve as an organization trying to engage the world in terms of having more countries, more companies, more individuals connected to the Internet. Throughout all of this we have been experiencing -- experimenting with the tools of governance. We have certainly found that the traditional forms of regulation and legislation really aren't serving this economy and we have to find alternatives. We can't wait for regulators to catch up on last years issues await for the legislators to deal with these very complex problems. We have spent a lot of time focusing on how to make progress in this phase without utilizing the traditional tools. We have focused on what is now -- we have been calling it the multi-stakeholder process. When we started with this the smart people said, that will never work. You will never get a newspaper to publish the world multi-stakeholders because it is too complicated no one will understand it but it has become a part of our lexicon today. What it does is it involves any stakeholder wants to participate. There are no credentials required. If you want to participate you show up and participate. We also provide -- it is not a consultation, we provide the opportunity to actually reach a consensus decision on a talk it. That is how we have done our privacy codes of conduct. That was the way the notice and takedown work was done with the patent and trademark office. It is a tool we continue to explore and continue to look for opportunities to utilize as a way to have people make progress on these issues without having to wait for the local commission or their local legislation to catch up with the

problem. It is something that we -- that is out continuing interest as we focused on how to make policies in the space and how to make progress in the space in addition to dealing with the actual substantive issues we have to deal with. Now for more discussion I will turn it over to Alan to take you through the digital economy agenda as it has been developed here at the department. 

My name is Alan Davison, director of digital economy at the department. Great to see so many of you here. I do have a set of slides that I will be using. They are in your packets. We are projecting. For folks watching at home hopefully the production is on the web and we will be posting these also because our interest in transparency and openness. My slides are not as awesome as Jane slides, but I am excited to talk to you today about our agenda. I have been at this job for almost a year. I think I was brought on part with the theory that this is a far-flung department. One of the things that struck me was 47,000 employees, 12 different bureaus, you have heard a little bit about it. All of which are finding themselves doing pieces of work that we would think of as being digital or related to the digital economy or Internet policy. I came in and part to help create an integrated approach, a broad cross department -- departmental approach to thinking about the digital economy. This revised report as part of that effort. I think our goal for the next couple of minutes was just to make sure we were giving you a flavor for the agenda we have created over the last year and that we have been honing. We would of course love your feedback. A lot of the topics we are going to touch on the things we could talk about for hours but hopefully will in some ways in our work in the coming months do that. This is just in terms of a quick level set. Of course, some of these things are things we have been talking about for a while. So, just a quick sense of our theory of the starting point, as you have heard there is a strong belief that the digital economy is a key part of the future success of the broader American economy. It is a source of gross, enabler or trade, we see data that shows us things like the fact that ICT is already over five percent of GDP. That is only a little bit of the story. The importance of the digital economy in digital trade is something that we know is going to be an ever bigger part feature of our economy. At the same time we know the success we feel we have had so far is something we can't take for granted. That technology is changing rapidly. It is incredibly -- incredibly competitive business department. Also, if there is a pendulum swing about regulation of the digital economy particularly globally and that the openness that we have taken for granted and the idea of permission a list innovation that has been so critical we think to the success of the Internet is not something we can take for granted especially in the international environment. That is something that has motivated our thinking about our agenda.

We set out a set of grand -- I call them sometimes grand challenges. The secretary is keen on calling them opportunities as well. We see these opportunities and they really

reflect a lot of the dynamics that Larry just outlined. We have created an agenda that focuses on forming pillars, promoting a free and open Internet around the world were data can cross barriers and borders without a lot of barriers to that flow data. The second is the pillar of trust promoting security and privacy online because we know the digital economy will only thrive and only succeed if people can trust that their privacy and security is protected. A third is this area of access and skill building pretty much the digital inclusion and forth is how we can play a role in supporting innovation and emerging technologies. This fourth slide is really the business end of this which is how we math a lot of the activities that are happening within the department against these parties. I will just take through some of them will he quickly -- go through some of them really quickly. In the area of promoting a free and open Internet not in the net neutrality sense but in the cross-border flow of data view of openness. We're doing a huge amount of work. This comes up for example in areas like we just recently lost a project -- launched a project on digital attaches to put people in industries who can help us tackle some of these challenges. Larry talked about [ Indiscernible- Name ] and [ Indiscernible- Name ]. The workaround the digital single market in Europe making sure it continues even as we find many positive things about it, we are also working with our European colleagues to make sure it doesn't unfairly impact US firms. We're doing a big project on the G 20 meetings this year which will be held in China where there is a digital economy work stream. They can show that is still something that promotes openness and freedom on the Internet. We are doing a tremendous amount of work in the trust agenda. The privacy shield and negotiations we have had with Europeans around cross-border data flows between Europe and the US has gotten a lot of attention. We're doing a huge amount of work on cyber security. We're supporting the president cyber security commission. We have D Trent 11 -- the NTIA cyber security framework. We have privacy multi-stakeholder processes underway. We have recently published a paper on copyright in the digital age, for example. Access and skill building. You have heard Larry talk about our broadband access on spectrum. We also care a lot about thinking about how we build skills. The secretary was just out in the Silicon Valley last week talking to tech companies and career accelerators in thinking about how we can play a role in helping the make sure people have the skills they need to succeed. It is more about getting online, it is making sure people can succeed when they are online. Lastly, one of the things that is exciting is this area about emerging technologies. Part of it is the work of PTO and supporting a good smart patent reform, but also thinking about how we can engage in emerging areas. We have a new project we have been working on. There is a lot of work within the department in particular on new technologies like autonomous and connected vehicles. We released an RFC around the Internet of things. We find people doing work on things like drones. We are trying to collect those different groups of people who work on these things into working groups so that we can offer support for emerging technologies that we think are really important.

Also, we can do some issue spotting early in the development cycle, think about how we can deal with the potential -- both opportunities and disruptions that come from the technology. That is a world wind tour of the things we're working on. We have some structural initiatives were we also doing [ No Audio ] the board of advisors is one of those. I will leave you with this slide four which is really a view of things going on. These are the big picture issues. There are tons of smaller projects happening within the department on these areas and we welcome the chance to engage with you on it. Thank you. We welcome your questions.

Does anybody want to make a comment or ask any questions of the leadership of the department before we move to focusing on the substance of our work and trends? Any comments on what has been said so far? Any questions?

And I want to ask, are we missing anything? Does it make sense? You heard Larry talk about the big challenges we see, this is one way to read it up. There are lots of different ways to slice this, but we would be really interested in your thoughts on whether we are missing anything

I just want to ask one question, one thing that is extraordinary is all of the different agencies and entities. I would be curious one of the things with regards to measurement with the bureaus like the bureaus of [ Indiscernible ] to with respect -- do with respect to supporting what you are doing. It's a very impressive agenda. 

I think that's a terrific question. Is actually a sub bullet. I should pull it up because it is becoming a bigger part of our work. We just started a project in coordination with ESA to do more work on measuring the digital economy, something I know we will be talking about more. Just last week we actually had a roundtable of economist -- one of your colleagues was there actually talking about how we measure cross-border data flows. We actually have a work stream and probably less -- process where we think about measuring the digital economy at large. The most actionable thing were doing is specifically trying to think about slicing off this piece of -- let's just focus on cross-border data flows as a starting point, how do we measure that? I think that is the tip of the iceberg. I think there are other areas around data that are even mention. You're looking at our economy policy agenda but we are also doing a huge amount of work with data. Who have a chief data officer. We have launched something called the commerce data service. Arguably you would say data could be a part of this larger umbrella, structurally we have a little bit of a structural separation in the sense that we have a group that is working on these data projects and you're looking at the policy agenda, but we work very well closely together. 

I think it is a really useful framework and I like the four categories you have. Why look at access and skills I think one aspect that is perhaps missing is a focus on the

needs of people with disabilities. One and eight Americans have a disability. Just as the American disability act open access to public buildings and infrastructure a generation ago. It is just readily apparent that that group of people is only going to be able to achieve their potential of all of these digital resources are open to them as well. There is perhaps an opportunity to explore that a bit more.

Just one other thought and I'm not sure how to capture the sound, but these are all very positive forward leaning things, but I think one of the things we are seeing this year is a lot of concerns about the digital economy growing in our political system to tweak -- too and the level of destruction -- discussion. I know one of the things were going to be doing over the next four years is we virtualize our net work. We are going to by roughly half the level of the equipment on an annual basis that we buy today. We're probably going to need half the number of people attending to those. I imagine this is true across a range of things. I do think a lot of the things we're talking about here depend heavily on political consensus. I do fear that is starting to break down just because there is a growing segment of people in this country that feel left behind as this economy charges forager -- forward. Again, I don't know how to capture it but I do believe it is a factor that affects all of these things.

I would say the one other thing and we're certainly talking about training, but how does it go all the way back to education and early education and are we building the skills at the beginning that we are going to need for many years to come? We can train we can take people out of school, but how are we changing the education process?

Thank you, I wholeheartedly appreciated the framework you provided because it is daunting and so many of us come from slightly different places. As a consumer voice, I look at these and it raises a lot of questions. I wanted to build on something James put on the table having to do with other agencies and having spent enough of my career here, you raised an interesting thought one of your blogs that you asked us to read around the Internet things and how lines are being blurred. Give us some insight because lines are also being blurred in the digital economy, how that translates within a governmental context where you have have -- health, telecommunications , commerce are all in this pot rulemaking but it is not consolidated. It is not holistic. How we get so caught activity to other agencies which are in the space -- connectivity to other agencies which are in the space for Congress doesn't have the power to oversee or two -- just wanted a little bit from you guys there .

Others can time and, on the Internet things particularly, we have a request for comment that we have put out. I think you have raised the question -- part of the motivation behind this one of the things we asked for is how do we need to be better integrated as a whole of government approach? One of the things we're worried about is with the Internet things are so broad you are starting to see rules -- we are very good

at doing [ Indiscernible ] sector rule so we're seeing rules from connected vehicles, rules around -- potential rules anyway -- ideas around drones for example , instances of the broader Internet of things. Want to make sure there's consistency so even taking something like Spectra more cyber security. We want to make sure that yes we can tailor make these sections but you find that there is no interoperability we have very conflicting standards among others. That is a very active area of investigation. It is a terrific point. On some level we are the commerce part and we can only control with the commerce does but our hope is that we offer intellectual leadership and try to create frameworks I know that we do work very closely with a lot of these other agencies and particularly on issues like cyber security or privacy where we have a lot of expertise in those departments and us are working hand-in-hand. 

My observation having come through the private sector and the government and not coming out of government -- there are a lot of pockets of both void and overlap if you thought about charts or van diagrams. Our approach has been one of trying to build -- I like the words that Mary and Ellen used about intellectual -- Larry and Alan used about intellectual leadership. I'd like to applaud Larry who really began tackling this and defining the footprint without necessarily other guidance -- guidance from other , if you will. I think that an administration and this administration is my observation is there are lots of pockets but what we have try to do is create a more wholesome -- or holistic approach taking into account that -- kind of empowering ourselves because the private section -- sector is such an extraordinary large footprint when it comes to the digital world. One of the things that you can do as a group is to step back, look at our framework, maybe give us how we should adjust and advise but then also put that in the bigger context.An administration ought to think about a policy expertise that exist in the department of that -- we're trying to institutionalize what we have created because it shouldn't just go poof and some new secretary has to reconceived of what is the construct that you ought to have. We are in the process of creating another deputy assistant secretary under Larry that might take on the roles that Alan is doing. Right now we have kind of just created all of this. But, to survive -- and frankly it needs ultimately to have more professional and career support under it than we have today. One thing you might look at is what is our organizational structure and how ought it to be staffed appropriately so we can play the role. We woke up and defined this ourselves. Nobody says here is what you are to do. It is a little bit of being entrepreneurial and a government sense, but it is also recognizing an enormous void. When Larry and I got dragged into the privacy process that was run by John [ Indiscernible Last Name ] at the White House you really realized that there was no center of expertise. That really led us to evolve from that to these two gentlemen with Evelyn really saying, we have to grab this and begin to defined what are the capabilities, what is it that ought to be going on. So, you have a big role in helping shape this as I said of bridging into future administrations.

We want to thank James for leading us off here. With that, I will turn it over to you James.

Thank you Mitchell. Madam Secretary thank you very much for the privilege and opportunity to be able to serve in this capacity. I am delighted to be able to do this with an extraordinary group of colleagues. This is a real privilege. I'm going to try to give a short overview of some of the transit opportunities in the digital economy. This is by no means intended to be exhaustive. This is a vast topic is I think we can all agree, but I thought we would highlight some key aspects of this -- of what is going on . The one thing you notice and I think the secretary said this which is we do seem to be digitizing just about everything whether we think about where we live and the way we live in our homes, how we as individuals move about the world and conduct commerce, track information, find things, track our own -- the health of our bodies and also when we go to work, how we actually get to work in terms of our transportation system, the mobility has evolved as well as what we actually do a work -- at work whether it's in the office or factory. Digitization does seem to touch most aspects of just about everything. It obviously raises the question, exactly how big is the digital economy? I think Alan alluded to this. If we think about just the sectors that actually make up what I call information communication technology is about five percent of the share of GDP. However, that underestimates lots of things. If you think about -- for example how this plays into other sectors in terms of these parts and services being consumed by the sector you can get your number two about 10 percent. But if you really think about what does this actually touch in terms of products and services of what actually happens to the economy you are starting to talk about every aspect of the economy almost in every way. This is just small examples to think about in terms of what different parts of this it touches particularly for individuals. This has become a very pervasive aspect of how our economy works. We have seen all of the examples of everything from big data and analytics, how we use the Internet, how we use commerce, how we buy and sell products, how we find products and services. This has become quite pervasive, but we are not done yet. One of the things that are quite extraordinary is there is even more technology that is still playing out that will continue to transform the economy over the next decade or so. But these are some of the ones that we see that are likely to have the biggest impact in terms of scope. By that I mean touching every aspect of the economy as well as what it does to the skill of the impact over the next decade pick the first set is what I call technologies that are related to how we use -- we traditionally think about it as [ Indiscernible ] technology. Of course then we have some of the new trends that we are starting to see around machine learning, artificial intelligence and also the beginning of automation knowledge work. We also are starting to see machines affecting other parts of the economy whether it's in terms of advanced robotics or autonomous or near Thomas

vehicles or drones or other things that move about -- autonomous vehicles or drones or other things that move about. There are also other things that are starting to happen that may not be purely digital in their initial instance but I think we will find that digital technology will talk -- touch these . We are also starting to think -- see things happen with how we think about and use energy. Of these are some of the technology that is going to have a profound impact in digital is going to touch these. These are not done. We're starting to see other things too. You could go on and on. There are a whole set of things that are going to continue to happen to transform the economy. There is a lot more that is going to happen. When I thought I might do is to focus on three areas of opportunity and challenge that are worth thinking about. 

One is this question of how can the economy of the whole take advantage of digitizing should because the promise, digitize a ship -- digitization because the promise is it will touch more the economy. And then second what we call the digit hesitation of mobilization. That of course, one of the big questions is how digitization is affecting work. We will then conclude with some initial observations or some foundations that we could focus on that are important to get right. One way to think about the UN -- US economy is to -- we attempted to try to measure this with metrics and indicators in three categories. One is asset. This is thinking through the sectors and companies in terms of a digital infrastructure that they have now deployed whether it's information technology equipment, software, hardware and even data itself. Second is usage. Think about this as usage of technology in terms of making payments, making marketplaces work, transferring business processes. Then of course [ Indiscernible ] which has to do with how much are we empowering workers of digital -- in the digital capacity? To what extent are we creating new digital jobs? The picture you get no need to pay attention to find details, but hopefully you get an impressive across the sectors. Which ones are the most digitize sectors and which one -- which ones are not. There is a group at the top that are numbered one here. These are sectors that are very knowledge intensive and these are very highly digitize across the metrics I described. There is no surprise that the media sector, professional services and the information technology sector itself. You also have us -- a couple of sectors that still have an opportunity to further digitize their assets. You are starting to see that in pockets as some of these companies start to employ more instrumental or digital aspects from what they are ready to. You also have a set of sectors that even though we may see some of them is looking digital, they have a very long tail of smaller entities that are not very digital. Examples would include retail trade. Retail trade actually includes a lot of small businesses that may not be as digitize as we imagine. Of course there's another sect of Beta be sectors. The group that is probably worth focusing on his group number five and six. Number five, these are very large labor-intensive sect this that have the potential to give more skills to their work because they are very labor-intensive. A group number six is particularly interesting because this group consist of

some of the largest sectors in the economy in terms of employment, share GDP -- these are also sectors that generally are not considered as high productivity sectors. That is where some of the big opportunities are. No surprise it includes the government, healthcare, hospitality infrastructure. You may want to notice the black dots are interesting. The black dots are intended to indicate some spectacular examples of highly digitize and cities that have emerged in those spaces doing some barely spectacular -- very spectacular things. These are things that what we're seeing in transportation with car ridesharing services. Some of these not so digitized sectors, you are starting to see fairly spectacular examples of digitize a shot -- digitization. The second point is as you look at these measures of digitize Asian -- digitization, we're starting to see a gap widening between the most digitize entities whether they are companies are sectors. The blue part on this is looking at sectors and companies you might think of being at the front tier of using the digital technologies and the brown at the bottom is the rest. You start to see this gap. These measures started to widen overtime. You also see the same thing when you look specifically at businesses. This chart -- chart shows examples of very large corporations who you might think would all be digitize but you start to see big differences even amongst them. By the way these [ Indiscernible ] leaders are not just the Internet companies. They are also very traditional companies like this group to the far white -- right. You start to see the difference between the leaders and the rest. So much and perhaps we may have talked about it in the past the digital haves and have-nots. I think what we are starting to see as the digital haves and the have more, has because -- haves because most companies now have digital technology to some extent but the ones that are making use of it and have more seem to do better. They are the ones making big use of this. They are companies that will foster revenue growth, foster profit growth, they see high productivity and levels of innovation. They also seem to foster wage growth which is also interesting.Also in the companies -- these tend to be some of the companies that we 10 to associate with the driving disruption were doing extraordinary things in the economy. This is something work -- were thinking about when we think about digitization the economy, how expand this? Lists which to the second area which is the digitization of globalization . When you look at the global economy it has had a phenomenal run over the last two or three decades certainly a term -- terms of the flow of goods, services and finance. Arguably some would say it seems to have stalled since the recession but one area that has expand pretty significantly is the flow data. This is just going back to a decade ago to about 2005. This is what it might've looked like in terms of a map of the digital flows. You can look at the flows between countries, between cities, between companies, but this is measuring data flows. Look how it has changed in just a decade. These digital data flows have grown 45 fold. The size of the Basel -- bubble which is not even done to scale, you will see there is a big pool of intercountry data flows happening in Europe. There is a big set of flows happening in North America and there is also a big set of

flows within Asia. The numbers are pretty interesting when you look at it country by country. You have many more companies -- countries participating globally. You also have many more countries -- companies participating both large and small. You also see individuals participating. This is important when you think about small businesses. Many small businesses are now participating globally directly. We know for example that small businesses when they have [ Indiscernible ] global platforms they tend to export more, engage the world more and quite directly. They represent a remarkable opportunity for small businesses. On the question of individuals going back to something I think Alan mentioned, is quite extraordinary to see how much directly individuals are engaging globally in able-bodied technologies. The first big circle is simply a measure of individuals on social platforms who have at least one form connection and that is close to 1 billion people. We also start to have something like 260 million individuals participating in cross-border e-commerce where they are buying something from another country basically through e-commerce. You are also starting to see -- these in fact in our view are underrepresented. Simply this is tracking what people are actually paying for those services. There is a lot more where these things are done freely. Think of the kid in Bangladesh who might be using the [ Indiscernible ] Academy to learn for example. That would be measured here because it is free. We are starting to see individuals engaged to be quite bored. I was quite pleased to see Alan point to this and some of his blogs. Let me touch on the third and final error -- era which is the digitization of work. I think this is one of the most profound impacts that we need to contemplate about.

One, we're going to see how labor markets work. We're starting to see examples of platforms that are off matching individuals with jobs. These will become places where employers and employees publish and make available. The matching ability of these platforms is quite impressive. We're starting to see quite a variety only up to the most skillful trying to match people with opportunities. The other part we're starting to see on these platforms for what we call on demand work or the King economy, these are much more time specific, task specific matching of supply and demand to fulfill particular task. These have been very complicated and there is a lot of work to do to make these things work effectively but this is a phenomenon that's probably not going to go away. The question for us is how do we help the various participants in this get the right benefits and have it work the way it has worked well for everyone but these have been quite remarkable platforms that have grown over time. Then you have other trainings and recruiting tools. This whole question of how labor markets wrote -- work , I think is a very important area to think about. 

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The other area is when these -- what is happening to work in automation. These dots represent numerous jobs in the economy. We had the good benefit of being able to

draw on some of the work the BLS and others have been doing. What you should take away from this is several things, it is based on currently demonstrated technologies. We're likely to see automation start to happen for both high wage, high school occupation as well as low-wage low skill occupation. You will see it at the high end on the vertical access, categories that are likely to be easily automated and always for the bottom when you have test like the landscaping [ Indiscernible ] the less likely to be automated but you also see high wage off to the right with the option to be automated. Some things to take away: one is when we look across the next 10 years at the level of activities, not hold jobs but activities, we're likely to see as much as 44 percent of activities, not jobs, activities the automated. However, when you translate that to hold jobs because anyone job consist of lots of different activities, when you translate that to hold jobs at least for the next decade we don't see that affecting more than about five percent of hold jobs. Having said that, there is a very important other thing that is going on. We actually see something like close to 30 percent of activities and about 60 percent of tasks start to get automated. What that means is that most jobs will change. While they may not go away most jobs will change. How we enable workers and others to work with technology becomes critical. You might of this as technology augmenting jobs. When you look beyond 10 years, there is a lot of more work to be done. I think this is at least what we see over the next 10 years. One point that is worth emphasizing with this question of jobs in automation, this one area that this is going to matter a lot and that is in the middle skill occupations. There have been some extraordinary work that David [ Indiscernible Last Name ] many others have done related to this. One aspect is if you look historically, we have always had a pretty somewhat steady low level of automation from low stream jobs over different decades overtime. But if you look at what we are starting to see, is quite possible that a middle skill category, the rate of automation could double. That could be mitigated. If you think about, the demand for the job go up then we won't have these big adverse effect [ Indiscernible ] let me conclude with some thoughts and observations of some of the foundations that may be important to get right. If we are going to fully capitalize and get the benefits of digitization in terms of white -- what it might do for the economy , what might do for business and opt doors and even individuals when we think of them as workers and society as a whole. There are several areas to highlight. One is cyber security which has been on everyone's mind I think. The other is data and privacy. There are also questions about [ Indiscernible ] and governance. The governance part becomes importance when you think about this in a global context particularly with think about data flows. An important area in the past that hasn't had much attention is implications around work and wage affect. People like David have talked to this idea of skill advise technical change in how that is going to affects everything like the weights question. It may be related to some of the discomfort I think we're all feel a sink -- feeling and noticing in our political season. A related concept and idea to think about is this question of skill capability and also the

infrastructure gaps that we have. Is quite remarkable and I think many of us -- it is quite remarkable and I think many of us see this in the private sector, the scope gaps are remarkable. There many corporations and companies find it difficult to find the right skills and capability. Also this question of other capabilities in the economy. How do we help some of the companies and small businesses? How do we help entrepreneurs who don't always get the attention that they should?

Then I think there is an inch in question which I think is quite important given where we are witches how does policymaking adapt to a digital era when in fact things are moving much faster and quite often the technology capability far outstrip the ability to keep up. Should we be a thinking -- thinking about he had stepped in a policy in another way? Should we think about evolving policy in another way quick --? . Then of course there are all the measurement and classification challenges. I think many economists have already pointed to the fact that where we measured the economy today doesn't fully capture the benefits, the impact of our digital technologies. There also all kinds of classification questions as we start to blur the boundaries as I think was pointed out and we start to think about sectors blurring, jobs blurring, worker classification changing. How do we think about some of these measures in a classification challenge. Limit leave it at that.

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We have had a few conversations with bad -- Brad and will ask him to make some remark -- remarks. For myself, I was going to take the opportunity to do as the secretary suggested just set this in context a little bit. I know James you said that wasn't comprehensive but it certainly was close if not. I imagine we may discuss and find a few things to add to it but thank you for such a broad and brief but close to comprehensive set of topics. To set it in context, I thought I would add a few different things in it. One of which to come back to Larry's comments about expirations and government which I think is something that is often under looked as part of the work, but very interesting. We see this of course an Internet governance in general, but also the work being done here. Larry talked about multi-stakeholder is a -- which I think is a long word with technical meaning but good in the way of how might we explore this area? Policymaking is a form of governance. We have the issues raised not only at the department of government -- commerce. As we work those things out, those are long processes. In the meantime, either as immediate activities or potentially experiments for the futures are some experimentations and governments turn governance and policy taking. Multi-stakeholder could be a good example of something to look at. How would one gather people who are affected? Try to look at issues may be in the sense of design thinking, prototype a potential solution, try it out. Certainly other stakeholders in the process have the freedom to try it out and government. More freedom to try, more freedom to fail. More freedom to iterate and try version 2 or

three or 4.oh. I think this question of exploration and governance and how we interact and how we might test cell policies could be a fruitful area. Certainly from the Internet area which I have some experience with, it tends to be fruitful and two particular circumstances. One is where the problem is generally shared and it is something that everyone wants assault. The other is trickier, is when you had this is interest that may be competitive but for some reason or the another a potential solution needs to happen now. We have advanced experience in that. For the World Wide Web, sometimes it's obvious it's a problem we need to solve. Other times we could tell stories and Microsoft would have different interest but a number of important solutions emerged out of those kind of complex and trying different implementations.-- conflicts and trying different implementations. A second area is the individual experience. Jame just described -- James just described is an immense period of change in human beings are typically nervous about change whether or not it is positive or negative so, huge amounts of concern plus changing jobs and that means loss of jobs for some and changed for as many as can be managed. In the context of individual experience, there is such a need for opportunity and hopefulness and whether our educational and institutions can adapt fast enough is a big question. Once again I think there is a real question about what sort of expirations and change could be managed -- explorations and change could be managed. Perhaps the work of this board might include other explorations in the way of skill or capacity or ways that might be possible to run. I think the final piece of context I would like to add is the global aspect in which the United States has clearly been the leader in the digitization and technology. It is also clear that there is at least one other market that is large enough to develop and sustain massive economic develop meant trying to element and change. That is China -- development and change. That is China . I think it will take longer for Chinese innovations to fundamentally affect the rest of the world because that economy has such characteristics both in language and the use of Internet that the language actually drives different forms of input, different visuals, but it is an economy with a power of its own. Open question, whether we integrate with it or whether we fragment with it? I think that has a very large business affect and our policy and our policy will need to consider that as well. Certainly, the Arab speaking world is large enough to maintain its own active and dynamic digital Internet and economy. It clearly is not as integrated as China, but it is also something to consider. The final piece of context I would like to leave us with that the open borders of the Internet will bring a different degree of global interaction into the priorities and policies. Our ability to isolate itself in still remain a part of the world economy is really complex. That is a big challenge. I think it is also an area where the United States has in the past and can show exciting leadership. We had the opportunity to do that provided we can solve the security and trust issues which our leadership in that area suffered in the last few years. So, one other topic is the degree to which we had the interest and will and the ability to continue to lead in that area. With that, I think

because we have had conversations with Brad I'm going to ask him to comment and then we will have the general discussion phase of digital trends and topics. 

Thank you. James I thought that was a terrific summary and the report was invaluable as a foundation for everything we need to think about. I would say certainly for me it highlights two of what I think are the fundamental questions we all have to grapple with, namely, where are the jobs of the future going to come from and who is going to fill them. When we think about what is going to happen to jobs, it is readily apparent that some jobs are going to go away and some new jobs are going to be created. I think it offers some solace to recognize that this has been going on for about 150 years. It is not new and we can learn some things from the past. 

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Personality I'm struck by two photographs I have seen recently of the same corner on Broadway in New York. There were tens and thousands of people in New York who had jobs simply to feed and clean up after versus. All of those jobs were gone 20 years later but there were lots of people were building, maintaining and even driving cars all of which were quite new skills. I think we face a lot of daunting challenges, but it is helpful to just have the perspective that we had been through this before. Certainly where you ask where the jobs going to come from, it is on one level impossible to know in advance but on the other hand easy to predict certain things. If it's all about digitization than the jobs of the future are likely to involve work with data and digital technology regardless of what part of the economy one is in. As your report, the written version pointed out, we even have small businesses basically functioning as a micro-multinationals using platforms like eBay to sell the products around the world. I think the big question in a way is how will we help the American people fill these jobs of the future? I was very struck by one experience I had last year, last year I was in a town in Kenya that is about 100 kilometers north of Nairobi. It is right on the equator. Only 12 percent of the people in this area even have electricity. But I was visiting an Internet café that was connected through a super Wi-Fi or white spaces technology and had a solar panel for electricity and I met a very sharp fellow in his early 20s who had a laptop computer and he was sitting here at this hotspot and I asked him what he was doing. He showed me that he was basically using this place as his office. He was providing technical support for a US startup and he was providing support to Americans. If we want these people to fulfill these jobs were going to have to equip them with the skills they need. We may really need to focus on a future where people go to school until they are 20 and then stay connected to learning throughout their lives. As much as anything else, I think what we need to grapple with is how to ensure the jobs are created here and filled here otherwise the future is going to be far more daunting.

What anyone else like to comment on the digital trends and the scope of things we are looking at, might look at to go into our work?

I think that was incredibly insightful. One of the things that strike me as we look at the many issues we think about sort of focusing on a few is that how do we actually go about thinking about how we enable these things, how we enable the job creation, address some of the trends, but at the same time minimize the unattended consequences. One of the things that always stands out to me is that -- I think that how difficult it is to participate in the barriers that you have. When I look across our current government right now I see lots of people attempting to address lots of different aspects. When you actually have focus and energy and attention and lots of people trying to solve it sometimes you end up with complexity. One of the things I think we should just be mindful of as we go through this is how do we, as much as possible, come up with solutions in the broader content to simplify. I do think complexity is the interview -- enemy of participation and enemy of assess ability. 

That is a fascinating phrase since participating -- participation is such a big aspect of the user economy. That is a really interesting piece. Complexity is the enemy of participating. Fascinating.

That made me think about something similar but from a different angle which is just about the design of law. When you are doing your wonderful presentation I Inking about how law impacts digitization I kept thinking about how law impacts digitization. I often try to look at how to find data about how the law of things affect [ Indiscernible ]. If you have high trade secret protection that impacts the mobility of labor markets. If you have significant [ Indiscernible ] and the copyright world that FX lending and how people want to disrupt in the vast technology. One thing I wish we had a little bit more data on was the question of how the design of legal entitlements impact innovation but also this question between interactivity between different agencies that are doing rulemaking and common-law, the whole privacy shield issues came up out of the litigation case and so how those things interact I think is such an important thing for us to 30 -- study and to think about. 

You mentioned briefly the question of intellectual property protection and labor which I also think is an area that is underserved. It is my personal theory that Silicon Valley is hard to replicate because of California's labor law which allows -- allows an employee to leave a company and maintain in their head the knowledge they learned and go work for a competitor the next day. It is very hard on management. I have experienced this as well. But the history from Silicon Valley is exactly that. Certainly I know when we hire people we need to wait six months or a year because it is a real train on innovation. So as to are we interested in innovation or is the ability of an individual person be able to move important or does the ability of management have

consists of the -- consistency important? I might ask, on James's presentation does anyone have any thoughts on what might not have been included?

I guess I have one question about the distinction between what can be digitized and what will be digitized? Is the presumption that the cost of automation is becoming so cheap that you would just automatically replace people with machines? I give the example, there was a guy who was an economist whose wife worked at the World Bank and was a case officer. Her assignment was in Sri Lanka. This guy as an economist set up his teaching schedule so he could go to be wherever she was when she would do it. He spent the month in Sri Lanka and he said there are many things in Sri Lanka that are automated but they are not electric. He said if you go to the grocery store they have an automatic door opening, but it is just two people who pull the door open as you walk up and then they shut it. It was just the price of labor was so low that store owners are like you would be an idiot to install an electric Matt to open the door I could just pay two guys to pull the door open. That, while being a trivial example, if you looked at your list where it said 30 percent of these job functions could be automated, are you conceding that it is going to get tremendously cheap to automate them and they would rather have machines do it then people? 

Thanks Austin. That is a very important question. The first question is will everything that can be automated be automated? The answer is no. One of the things that is quite interesting is I think we always imagined that it would always be the low skilled, menial tasks that would be the first to be automated. When he throws the economics of that, it is actually likely not to be the case. What happens at the low end where the work is mostly physical and manual, even though automated -- automation technology has made huge progress we have made relatively less progress on physical restraints -- machines working in unstructured environments. If we could, those are still physical machines that actually cost something. The surprising impact is the work that is actually easy to automate is actually most of what we all do which is all the thinking work. Most of that is actually software. Involves -- it involves very little physical machinery. Those are all algorithmic things. Most of the automation we have seen is in the middle skill category not necessarily the low skill because you have both the complexity of technology and the example of doing it per your door for example. 50 foot -- the deeper issue is the middle skill category. The labor supply at the bottom and is going to be much larger, more malleable. Even though we may not automate those jobs in the low skill category, there may be different wage effects that may not be as attractive. Even though those jobs may be available the wages may not be that great cousin of a dependence of labor so it's a much more complicated question but hopefully that gets your point. 

Could you say just a little bit about -- you also said middle skill and high school. Could use a little bit more about that as well? 

So, most of where the progress and machine -- in machine learning is actually in things that are repetitive, but task that you would typically pay well for so accountants and clerks in some parts of the legal profession, discovery and so forth. That is where most of these technological factors have made the most progress. That is also where the scarcity of the labor of work to do is low. The trade-off to automate as much easier to make at that level. Also, in some cases is not just a cost issue. It's when you apply these algorithms the results are better. It's not just you are doing equivalent human level performance in some cases you are actually getting better results. While we have worried historically about automation at the low wage level, I think middle skill and high school will be an interesting place to watch. 

I remember my time doing discovery and reading documents so I can imagine that. Thinking to the experiments and governance, I'm wondering, Karen, since IEEE is also a different form of governance, I will put you on the spot to see if you have anything to add to that topic? 

Two years ago IEEE started what we call the Internet initiative because we recognize the exact same things that Larry talks about, the same focus of commerce. The need for trust in the Internet that was being eroded, the need for security and privacy and Internet governance as well was changing. The program is designed to bring technologist to the policymakers so the policymakers can make better decisions. For those of you who don't know IEEE we are the world largest professional organization of engineers. We started as an electronic and electrical engineers but we now spend pretty much every discipline of engineering. One of our most powerful -- I say that from parochial interests, but one of our most powerful technologies is standard. We have worked closely with WCCC to develop what we call the open stand principles for market-driven standards. Some of this helps us to say that it is the market that drives the standards not the government which is a very interesting parallel model. Anyways, for the last two years we have been holding forums in various parts around the world to discuss the issues like we're talking about today and see how technologist Kim being -- bring reality to policymakers. So, in Europe the reality to be forgotten. Technically speaking that is not so easy to do. You can go to the Internet way back machine to see what your website looks like in the 80s. We're trying to help bring the reality to the policymakers to help us to have the right decisions all around the world. I hope that is what you are asking.

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I was really glad to hear you talk about China. Our past president of IEEE recently went to the China Internet forum. The discussion there was that China has very strict policies about, Google is not allowed, Facebook is not allowed and the government

controls a lot of the information flow. They see that as a security issue. They see that as protecting their citizens whereas we from the outside see it as walling off their country and preventing commerce and the flow of information. The philosophy is completely different thinking. At this point there is no right or wrong but something we need to understand.

James, one question. I think you did a great presentation. The thing is that when you look at the ability to actually capture the opportunity most of it is actually capture on the consumer side of the industrial side. In fact, industrial productivity has gone from a traditional global four percent down one percent in the last five years. So, there are natural barriers that are causing this to not occur. I think the promise has been there probably even for a decade yet it is not moving as fast. We see two things and I'm curious if there are others. One is the cost of technology still has not reached the point to where the economics work. I think it works on the consumer side because people like some of the coolness and social factors not necessarily the cost-effectiveness. So, one question is where do you see the cost-effectiveness of this for widespread adoption beyond a consumer environment? I think the second thing is talent. These technologies are more complex than traditional manual approaches. They require new kinds of skills. As a result, we have a large number of unfilled positions globally especially here in the US. We see ourselves having to bring in [ Indiscernible ] employees to fulfill those which is a limitation and we see the growing of native talent inside the US is slower than we would like. Do you see either of those getting solved in the near-term and what other barriers would you see that we have to be concerned about?

Bill, thank you. I was hoping you were going to solve the industrial benefits part of the question given what you are doing. I say that and part because one of the things that is quite interesting on a product to be questions and there are enough economist in the room that hopefully you all can try men's, it is quite remarkable how we used to have the solar paradox in the 90s. I remember doing some work with Bob Solow on that question in the early 2000. One of the things we concluded was that we saw the big benefits in the economy broadly in terms of productivity when a few things actually happened. One was when we started to have very large sectors in the economy actually start to make big gains and process changes. That is when we actually saw the numbers were big enough to be noticed in the broader economy. Arguably, if you take the graph that I showed -- we haven't seen digitization affect large sectors. If we put the numbers on the size of the sector most of the numbers we read with a really large ones. Arguably you can say we have yet to see the full benefits of this round of digitization because we have not really started to move the really large sectors in the economy if you take that historical argument. I think the question on the consumer question and I think it is the case. I think the consumer question

represent some interesting conundrums. On the one hand many economists have argued that we don't measure properly, but the other part is that most of the technologies -- the good thing about them is they have conferred huge consumer benefits in the terms of consumer surplus in the sense that the products and services are either free or very cheap which is wonderful if you are consumer and challenging if your company and a business trying to make money and you want to measure things that you can actually see as GDP. There is that part of it to. We love that as consumers and users of these products and services but don't like that in business from a station turned modernization standpoint. I think the signals have been there for a very long time. There are benefits to more education, better education in terms of wages but yet somehow the system doesn't respond very well. Somehow we're not making education interesting or creating more incentives. That is an ongoing problem that has been the case for a while but it may start to get worse which is we may need to rethink what we actually train and educate people to be able to do. If you take the arguments and the evidence from machine learning and most of the things -- and AI most of the things are very easy to automate. Were asked things like creativity, other kinds of thinking, those are slightly harder things to do. There is a question about how is our educational training systems going to evolve both the recognizing what the technology can do but also what is actually needed. It is no longer as simple as teaching everybody map or teaching everybody fax. Yes, those are important but those are -- fax -- the facts . Yes, those are important but those are things that machines can do very well. 

I think your point on consumers benefiting the most, I think the consumer statement is absolutely right. Consumers are leaning toward these projects -- products because it's giving them something they didn't have before . One of the things less talked about is the supply size. We are giving people incredible flexibility to work anyway they didn't work before. You put that together with the fact that you are going to see such a huge change in jobs over the next decade which whether it is 60 percent or 30 percent, it really doesn't matter. It is just such a large number anyway. I think there are probably three things we should press on. First thing has been talked about which is education. The second one I think is this idea that we need an experiment framework that allows us to go much further than we have gone before without feeling this risk of failure. The third one is a topic that is a little more controversial and it is this idea of how we classify work. If all of us are employees of one organization or another, the legislation that that pertains to goes way back to 1938. There's this conversation that we are having around what is it mean to be an employee versus the contractor, and what that actually means? As you look a decade for a large percent of these jobs is going to be automated, should you really have a full-time job and what does it mean if you are working across three or four different platforms?

There was a mention of consumers and I feel compelled, I do think consumers are enjoying the gadgets and the devices, but I think one of the things I don't want us to lose sight of is that there is so much burden falling to consumers about the marketplace and about these devices. We have to ask ourselves about the interoperability of these devices across brands. That ties us and it brings us right back to this notion of how important it is on the trust side of this. I just wanted to put a marker there.

One question -- or issue that we have been grappling with is this notion about products today are developed and used equally by consumers and businesses, and should the rules of the road to the same given these different users because by virtue of having one set of rules we are creating some real challenges. There is not a line at all. For example, what is the right of privacy for my personal phone versus my Commerce phone? One could argue they may be should be different, but right now they just look the same they're just different colors so I keep track of which is which. But these products were often developed as consumer products but they are tools that we all use in our day to day business so that is a very important thing to keep in mind. A question I would just ask if there is some thought the group would want to have about that division is that an important divisional not?

I have one thought there. It is interesting. We talk a lot about how innovative companies, new companies are able to disrupt or get their position. I think a big part of it is they have changed the model in some ways. For lots -- I think history you actually had to have a large cell force that had lots of calls and lots of complexity to actually penetrate. I think this fact that you are actually talking about about being able to find ways to access and see and get an on the consumer side or on the individual side and then expand your footprint has been one of the drivers that have a lot of people to innovate. I think part of the complexity -- not just from a policy perspective from an experience perspective is how do you actually maintain the ability to have low friction for the best technology or the best solution to deliver the right experience but then addressed some of these issues of trust and complexity that comes when you have these blurring lines. I think that is something that technologist and innovator struggle with once they have gone into the position to get inside. I think lots of the reasons you have had some of the flexibility and adoption is that you no longer necessarily have to have a highly expensive salesforce to actually go penetrate institutions and organizations. I think that having a positive effect.

[ Indiscernible - low volume ]

Sorry, thank you James for taking off of -- the discussion for a broad range of topics we can keep in mind as we follow the Senators topic about how we will focus on our work going forward. With that I'm going to turn it over to Zoe. 

That is a great session. One of the things we have talked about pursuing as we do our work is to bring in others who have been thinking about these issues for a long time or more recently with intensity to inform us. We have the privilege this morning to have Senator Mark worn with us who has been collaborating with a number of his colleagues and probably many view around the table -- many of you around the table to think about what these transformations in the economy mean for the people of this country and what the role is for Washington to engage with that. If I may, let me invite Mark to make a few comments.

Thank you going -- Zoey .-- and secretary Pritzker putting together this panel. If time and interest allow I would be try would love to sit through -- I know you have a break coming up a little bit later but I would watch rather -- much rather take part in the flow of the conversation . This is a space that I'm very interested in. Some of you -- in my background I spent 20 years in the telecom and IT business. It brings a little bit of experience at least relative to my colleagues in the space. I think it's extraordinarily exciting but it raises a whole host of new policy questions. Let me go through them in no particular order. One, I am amazed -- as I travel Virginia and the country -- as we think about the digital economy and what it means , how many Americans still don't have access to broadband. I think that those of us who live in urban and more suburban areas think this is a problem of the past, it is not. I think about it in my state, big areas in Southwest Virginia both typography and the inability to have incumbents have a problem with distribution networks. There is a huge problem with understanding that most communities that broadband is not a guarantee to success, but the failure to have broadband -- I know we have lots of other governmental efforts, private sector efforts, we lack a how-to handbook for local-based communities on how you can aggregate enough demand to bring particularly last mile providers most of which I think will be wireless to communities in terms of access here accesses number one. Number two --. Access is number one. Number two is the level of security. Most of our devices have enormous security challenges and opportunities as we think about databases being broken into. There is not a week that goes by rat -- where I am out around Virginia that I don't hear from OPM, concerns about their personal data being hacked into. I still think we lack a single standard, underwriters laboratory, good housekeeping seal of approval around security. I think about this from a policy standpoint and particularly as we move into the Internet of things. I don't think most Americans have any sense of what is about to happen as we think about all of our devices from appliances to autos to refrigerators, you name it, all having sensors connected to them. It raises a whole host of issues around security, around privacy, around questions about what happens in the aftermarket if you found out your devices have got a bug in it and somebody has hacked into it. Whose -- whose responsibility is that to bear -- ? One of the things because of the encryption

debate but not necessarily entirely driven by encryption more encryption and overall security, Mike [ Indiscernible Last Name ] the chairman of Homeland security came into the house. He and I put together a legislation that would say let's put together a commission to try to look at these issues around digital security. Now, I know and I would tend to agree with the premise that usually encryptions are congressional punts where there is a willingness to kick the can. I for one who spent 20 years in network and six years on the Intel committee know that if we rush to a top-down legislated solution particularly one that would legislate some form of a backdoor that we raise a whole host of issues around security, around maintaining America's innovation lead as it will push also the bad guys both criminals and terrorists, but trying to elevate up the security issues. I don't know whether that exactly falls within the purview of this commission, but we need a common set of facts. We can't get this legislative commission together where it is broad-based and bipartisan and we have lots of support from Intel, law enforcement -- I have been candidly surprised at Tech were in one day and out the next day on this, but security is going to be a huge issue. Finally, the one where many of you around the table I have engaged with and that is the whole changing nature of work that is being driven by this digital economy. Some of you heard the analogy I have used. It was coined by my friend Lindsey Graham who I will never be as good as political -- at political phrases as he is. I spent an hour in the car with Lindsay recently where he had to listen to my whole on-demand economy, sharing economy pitch. I talked about the transformation of work and how we have move to more contingent work and people are being able to monetize their time and their energy and their assets on a real-time basis and great freedom and flexibility and Lindsay said, marked -- Mark, I will explain it like people in South Carolina explain it. You are saying work becomes a little bit like the way we used to have to buy cable TV. Used to have divine -- buy cable TV . You had to by the whole package to get the channels you wanted. Now more and more people are buying all a cart. Work in a certain sense -- al a carte. Worked in a certain sense is doing the same thing. Increasingly we are finding ways where work can be purchased on an as needed skill driven basis. Enormous upside for consumers, a norm is driving down of cost. I found a great number of people who are workers in this on-demand economy who love the freedom and flexibility, but from a policy standpoint this raises as many fundamental questions as anything I think that those of us on the elected side will have to deal with. This really shakes up at its core the social contract that was derived in the 1930s and 1940s as more and more work becomes contingent. Austin and I have talked about this a bit. While the on-demand workforce is still relatively small, the contingent workforce which now numbers somewhere in the 30 to 40 depending -- percent depending on the way you want to cut it is now more corporate starting in the 90s to take everything that is not core to the function and outsource it. If not literally outsource taken outside the country or outsource it from being outside the structure. Out of -- all of that work that has been outsourced whether it's your bat off -- back

office work, janitorial or food services , really operate in a totally different set of rules and regulations. I think our binary view of employment to 99 versus W-2 -- 1099s versus W-2 , one common with the whole contract, other with basically no social insurance we are seeing this kind of happen underneath the top line of the economy, a massive shift to this contingent workforce which again is at 35 percent. That is the most accurate number and growing exponentially. If we end up with 60 or 70 percent of the workforce in some form of contingent whether we call them on demand are not, we have a huge challenge with our public entitlement and social safety net programs because, if no one has been contributing to social insurance along the way, workers and employers, when bad things happen those people fall upon a safety net that is already strained. My hope would be and I don't think -- my hope would be that Congress will not top-down legislate and stop this innovation is that we can see more innovative models being tried out in local communities on a regional basis and the state basis. I command what Uber and the machinist did a week ago. I think that is just one model. My hope, whether we can get more models to try out. Secretary Prisco, one of the things we have talked -- Pritzker, one of the things we have talked about is there is great fear to try anything in this space because of the fear of the things that will be used against them. Secretary Pritzker if we could get some more regulatory sandboxes or inability to try innovative pilots I think we would go a long way. I will close with this: as one of the things -- if we are going to move to this new model and beyond the two classifications of work and as we think about a third or fourth classification of work, there are two Park where at least some of the work that we are doing we're focusing on one, making those benefits attached the human being rather than being connected to the workforce. Two, this is again where a lot of the companies maybe not at this forum but elsewhere that could help us think through these items, if we were able to wave a magic wand and say everyone in the contingent workforce will have a portable set of benefits that travel with them that is going to have some kind of joint contribution coming from the employer and the worker. Before we simply poured over from the 20 century, unemployment, Workmen's Comp., disability, health and retirement, those are still big buckets. Was -- before we port those over , what I would hope we would also think about is can we reinvent what that social contract would look like. Last point I will make is, one of the things we have discovered as we started with on-demand and spread to a more contingent workforce and then really dug in with some of the firms with some of the more traditional financial institutions. More challenges that Americans face that really is exponentially different than it was 30 or 40 years ago. If you think about work whether you made a little bit of money, a medium amount of money or a lot of money you had productive Billy. If your income volatility is exponentially higher -- J.P. Morgan has done a lot of good work here , our current benefits package is not meant for a universe of Americans were going to work -- even if they make enough money in an extraordinarily volatile income situations. So are there tools that are coming out

that can be income smooth, that can help create that emergency $400 that can only be used once a year without diverting people into payday or car title loans or entities debt spirals that people get into? All of this is possible but it is going to require making sure that everyone has access. It is going to require thinking through this transformation in our economy and thinking through the security issues. Then finally, it is going to require as people think about the changing nature of work, I hope we end up at a place where there is social insurance, where there is a 21st-century social contract and part of the social contract will entail some ability to have some form of income smoothing because I don't think we're going to go back to a predictable income stream the way we have in the 20th century. I know I bounced around, but would love to sit and listen or have people respond. I guess one thing I would love to hear from the panel, if we have a couple moments is, what should Congress to over the next few months recognizing Congress is not going to do very month -- much over the next few months but what should Congress do and what should Congress not to in the short term in [ Captioners Transitioning ]the space? 

Senator, thank you for joining us. If you look on the Board or the screen, this is the sort of framework within which commerce has been acting, and this is sort of a framework against which the group has been reacting to say is this an inclusive policy or not? We don't pretend in commerce to think we have a full some enough agenda and is why we created this working group, which is very helpful. I think access has very much been on our mind. I think Brad suggested our access agenda should also include folks with disability. Not just coverage but also we need to include folks with disability. As it relates to security, this is absolutely true in the area of our trust bucket. It's a huge issue that your point about there is not a good housekeeping seal or how to book is exactly right. We have the Cybersecurity commission has made one, not this group, but one that we support has made that one of its two dues to come back with a set of suggestions about how to measure appropriate Cybersecurity and security? Does not mean it's not a purview of this group of saying it's not in their bucket. The point of changing nature of work we spent a lot of time talking about. You brought an additional dimension. We spent time talking about the need to change education, the realization that work is changing but your point about the social compact and the social safety net is one that we had not focused on. I think it really is an important dimension to be added to the work with this group. One of the things Larry Strickling, [Indiscernible] at NTIA has championed is the stakeholder process of coming up with ideas and solutions in the digital world. That might be a way to reinvent the social contract is to engage in some form of multi- stakeholder approach. Those are a few reactions. 

And I? 

Sure. 

Two questions. On the Cybersecurity task have spent quite a bit of time with Tom Donlon and [Indiscernible] President for moving forward on this initiative. My understanding could be wrong of what the President's task force is focused on. It's more cyber hygiene for USG. Terribly important and, obviously, in a state like Virginia, expotentially important but, questions around getting ahead of the debate on as we move the Internet of Things, at least, thinking about market and aftermarket if you've got software in your refrigerator and somebody hacks into it two years after the fact, whose responsibility is that going to be? Not saying this commission needs to come up with that but I don't think most decision-makers our policymakers even know what the Internet of Things is. Number three, the current debate about encryption is, as someone who feels I am hanging on by my fingernails trying to understand all of the ramifications of this, God forbid, another incidents -- incident, which I don't believe back guys using crypto technology which I believe they will gets to the fact there is a couple of thousand new apps a day added to the App Store and most are encrypted. For us to presume that something won't happen and will be easily encryption do, if we don't layout proactively some of the set of options, there will be political solutions offered that I think they sound good, may not make Americans safer and could do enormous damage to America's long-term economic lead in the area that we are still the world leaders. I know it's not, perhaps, the purview but Billy Albright, it's coming. -- but boy, oh, boy, it's coming. And [Indiscernible] bury their heads in the sand again. It's been disheartening to see people retreat from the debate. Then on the question around how we get it right with the social contract about social insurance, I think the warm editorial comment here, the view around the giga non- demand economies public's mood is shifting. It was all very positive a year, six months ago. I'm not sure it is as positive anymore. Notional ideas of let's say, let's put everybody back into a traditional 20th sentry box in terms of classification, I think, is a much higher chance today than it was three months ago. My fear will be if we do not try some models, again, Secretary caught you and I have talked about this before. Even internal discussions within the administration about where we fit. If we cannot try out new models than policymakers are going to be left with two choices. Weeds our put everybody back into 20th century context or say were not going to have any insurance at all. The laughter of everyone for themselves, I don't think is going to fly. 

The issues you are raising, which as you know, I think a very important. I would mention to that Senator Warner is working on this on bipartisan basin -- bases and working with Mitch Daniels, [Indiscernible] Bush administration got Governor Indiana and now, President Purdue. These issues are a piece, broad set of policy issues for which we don't have a very good means of deciding what we value as a country, let alone reaching conclusion on the policy issues. The issues you raise about portable

benefits, the social compact and social classifications of work, they are issues Mitchell raised earlier about Americans may take in global discussions about data flows and the carpeting -- compartmentalization of the country of the Internet. I think what are the challenges for us will be to see if we have a way of thinking about how commerce can lead a development of the current values in a very divided country in order to develop consensus around positions, let alone, or bodily of consensus around positions we even know what directions the experiments might go or what direction we might want to seek for policy. Brad caught did you want to make a comment before moving to the next part of the agenda? We need to move through pretty quickly. 

Two brief comments. Personally as well as in capacity here today think the legislation you've introduced with Representative Mackall is extremely important. The notion we should take a issue and develop common understanding of the facts before developing opinion on the outcome is, perhaps, unconventional this year. Nonetheless, laudable but imported an increasingly people our looking at it as something we need to do. Secondly, I want to build on your comment and the prior comment. It's interesting to see how much the future of commerce depends on the nature of labor. One is reminded, at least I am, when this apartment was first created it was the Department of Commerce and labor and then they were split. I think we really only have three choices. We either creating a model for the 21st century or we fall back on the model of the 20th century, or we fall back on the model of the 19th century. If there is no labor law at all and no Social Security at all, we are back in the 19th century. The truth is, neither of those outcomes it makes sense. I think one of the disconcerting things for those of us who work in the tech sector is the degree to which, right now, the debate seems to be about the application of 20 of Sentry Law to 21st entry practices. It's like watching -- 21st century law. I don't think anybody knows what the new model should look like. I think we can start by asking ourselves what values and principles exist that we regard as timeless -- we want people to work in a safe environment, be healthy. People to get a decent day's pay for a decent day's work and be able to retire at the end of their careers. We need to ask how to apply those in this day that we work. A gig -- great question to think about. 

Question on encryption data and comments about tech industry. I'm from Mozilla. It occurs to me that on a practical level in this trust bucket this year, we might consider whether it's possible on how one might build a more trusting, workable relationship between the tech industry and of the government. No question, the Snowdon episode fractured that in a deep cot dysfunctional way. It might be a topic. I'm not sure if it's in the purview are most effective but within the trust bucket issue you raised, it's probably important to progress on many of them. 

We are going to to move on because we planned to use the rest of our time before public comment period to dig into three possible areas that we may want to have on our agenda, shape our agenda around. We will revisit all of this, obviously, after today as we think about how to form the work we take forward. But we have asked some of our members to lead off of the discussion. The three that we've highlighted because of the conversations that we've had with people before the meeting our first, this question of measurement. What do we need to measure to understand what is happening in the economy to inform policymaking? 

What kind of data and information does the government have that can be useful to businesses as they grow, to small businesses, to individuals to understand the economy, to policymakers? And what other information ought the government be looking at whether it be in the context of the senses, standard-setting processes or otherwise? The whole issue of measurement and metrics for the economy, we will tick-up in the first session. -- tick-up in the first session. We will tick-up the question of Lake -- take up. The work of the future and how people think about their place of work in the future. We will tick-up and enable and [Indiscernible] small and large businesses and enable small, medium large businesses which are often individuals to grow and participate in the benefits of data for business growth and benefit in engagement, global trade and the global economy. To kick us off on the measurement point, let me ask Austin to start. We only have, unfortunately, because of where we are in the schedule about 10 minutes for these topics. Austin, you may begin the discussion. Thank you. 

It works out well. I was only going to talk t hree to five minutes so we could have discussion. It's either a curse or opportunity to have gone after James has presented some fairly detailed information. I was going to make a few points. The first is, if you didn't know already, the commerce department is in the pantheon of the greatest data agencies of the world. And BEA, national account is run out of commerce. You've got the senses run out of commerce, both individual senses and economic senses. ESA, there are a whole bunch of functions. Totally appropriate we would think about that topic of how could we give some contribution, some advice, if it were, to these data agencies. I think the existing structure we have now in a weird way, in the data world have the same as in labor world or others, our systems are designed with the 20th century economy in mind and what we track and measure. That's becoming increasingly wrong. And an a way that makes it hard for both industry and for policy to do what they need to do. At a fundamental level, we try to measure the standard of living through the GDP and output. We kind of measure outputs and we measure inputs. Both of those are getting complicated. I would think we might be able to give some help on identifying what are the correct outputs, correct inputs and how to measure them. On the output side, we have largely interpreted for all of the time when

keeping the data will estimate the value, the contribution of standard of living by how much we spend on it. Now, we've got a bunch of things that are free that we spent a lot of time on but that we do not pay any money for. There is an active and contentious debate over -- from Hal Varian and others, if we spend time on these and raise standard of living, is the best to think of those as productivity enhancing and we are just miss measuring it? Is the best to think, no, that's a productivity slowdown. You are doing or selling anything. That's an area we to think about. On the input side, we talked a little bit last night about the changing nature. I loved the comments as regards to AT&T, the changing nature of what our investments are. Are we going to be buying equipment anymore? We've seen a big shift as to software-as-a-service and other capital goods that our conception of, let's go out and buy anything for a lot of money today, which we depreciate and we get these payments over a ten-year period. That's not really the model anymore. I think some measuring what the new assets are, if you just look at market value to book value of assets, it's gone way, way up. It -- inbuilt brazing from last night, valuable companies used to be those with the most assets. Now it's increasingly not. The most companies have very few assets in measure. How do we measure the existence of, size up, intellectual property? Human capital? Things like that is another great area. It's going to spill over into our discussion of the labor force. You got capital input and labor input. Increasingly, the labor input is not just bodies but a bunch of skills. How we work with -- how we get the Commerce Department to work with Bureau of Labor Statistics and I work with the private data providers on and inventory, census, if you will, on skills and the economy? What are being used? What would be important? I think would be good. We have increasingly seeing the more measured it is, the better able we are able to deal policies and industries toward it. I wondered if we could talk about the measurement of drones, automated cars, the Internet of Things. We really have no conception of how big these truly are except for private surveys that we try to be representative, but I wonder if the Department could go through that. Monitoring the international treatment of international goods coming to the United States and the flows. Tracking the flows is the beginning of that by tracking the equivalent of tariffs, regulatory restrictions, tracking security violations, tracking things that have to do with Cybersecurity, I think, the senator is right. All of those are going to be major issues. I have just highlighted those issues as being of critical importance to several of the other things that we are going to be doing to several of the things Commerce Department does. I would just end with one plea. For six years I was on the census Advisory Committee's and. With the origin of electronic commerce, there were lot of pressures on the census Bureau of Quality Improvement to keep track and say you have to keep track of retail trade, electronic commerce. Census felt, and not wrongly, so much pressure was on them to track electronic-commerce from commerce and others but nobody gave them and the money so to inherently tell them, we need you to track ABC was forcing them to say, we are going to stop. We're going to have two

either stop or cancel program DEF. I hope we don't do that. We can have a lot of suggestions but don't tell them to abandon all of the stuff they have been tracking because this is so important we only want you up -- to pay attention to it. 

[Indiscernible - low audio] 

[Participant too far away from mic] . 

This is going to become a digital economy Agency? 

Two quick comments. 

Austin, terrific. You covered most questions in my mind. Two comments. One on tracking assets and which to track, one suggestion we should consider data as an asset. In fact, one of the things because if you were to include things like software and data as assets, that probably most closely correlates too the valuations you often see of entities and companies. It's much closer to that. The assessment we try to do at the economy, we did try to include data in the assets group of things we measured. That's one suggestion. The other comment is, I think, one thing we will have to think through on all of these measurement questions is, one of the things that has changed is much of the information about the digital economy is actually not in the hands of the government. It's actually in private places, private sources. We found in our work trying to understand global dataflow, most of the sources were actually in the private sector. Whether it's companies, a whole set -- the question is, how do we work through the sources of data from all of these are no longer going to be surveys and that we know [Indiscernible] surveys but trend of behavioral data that exists. How do we work that question, access too the data? 

That's huge. I'm going to have to move us on to the next topic. If I could call on Mindy to jump in on the skills and labor issue. 

We talked a lot about this throughout the morning. If you take James is comment about [Indiscernible] will change and them brads comments about how to build them, think it's imperative, given the shift to digital economy that we really focus on training, educating, developing a workforce that has the skills to serve the needs of business in the future. I think no matter where we think our business is headed, pace of innovation is not going to slow down, nor is our expectations or imagination. If you look at the fax today, there are no lack of jobs. There is a lack of unfilled positions in the workforce. I was talking to Penny last not. The number is about 5.8 million. That was record set before recession. I think new technology cycles were going to bring new requirements and the cycles are actually getting shorter, which relates to skills mismatch. I think the magnitude of training on Skilling is critical. I think the

mismatch is also driving up the price of labor and competition for workers in this world. What contributes that our things like education policy, immigration policy, and also in ability to keep up new economy industry. Bill was talking about that from [Indiscernible] earlier and how are we creating greater inequities we don't address the workforce training currently and future? We are also jeopardizing our own competitiveness if we are not supporting the business needs. I think there is some seismic shift where investments and talent will be focused. For example, working with my role at national retail Federation which covers businesses from small independent retailers to large mass, to digital, we represent one in four jobs in the U.S. If you think of the type of jobs that are going to be required and the skills needed our shifting dramatically. Need for data scientists, analytics, engineers, programmers, videographers, programmers, IT professionals, security experts, social and even digitally competent cells professionals, people they can use that new technologies even in a selling environment. This utilization of tools is permeating the length and breadth of every function. I do think though to James earlier point, the one thing we cannot forget is technology can't replace creativity. How do we merge the skills needed in the digital world but still foster the creativity needed to utilize those skills and move them forward? We recently polled a broad group of CEOs and ask them what keeps them up at night. Certainly typical things such as security and other things came up. I will say the number one thing on the list was talent and making sure we are retracting cot retaining and developing the talent we need for the future of the business, and having a robust pipeline of talent within the industry to make competitive growth. Certainly, working with educators on curricula, academia, business and academia partnerships are important. What are broad-based training programs? Whether it be for our industry and others, as well as certifications to reflect new talent needs. How do we, certainly, work industry ride but how do we bridge the because it's not an industry specific issue. It's relevant to our ability to be competitive. Think the big questions that come up is, how do we enable people to get the skills they need to participate? I think the were participation has come up quite a bit this morning. And then where are the biggest gaps in that? What training and educational institutions and curricula as I said before, even early on in early education but certainly critical now to get these jobs filled. If we don't, what impact is that going to have an American competitiveness ask what can we do, certainly, government and business, to be able to prepare the workforce? 

Comments Lex. 

If I could just underscore -- comments? 

If I could underscore, at AT&T we are dealing with a lot of this now. The biggest challenge it going for is rescaling the workforce. We are doing a lot of it ourselves because they're just are not good ways of doing it out there, with the exception of

some experimentation with Georgia Tech we have done between them and you'd acidly. Much of this we are doing ourselves. One of the things we ought to be looking at is higher educational systems in this country not meeting the challenge currently. It's not as far as we can tell. The class of higher education is dramatically rising, access is being limited by that. He will come out with incredible loads of debt, which burdens them further. We have all of these midcareer people we are talking about that are in mid-level jobs that are not necessarily going to go away but they are going to change. We have to get these people the capability of doing it. We are finding it in our Company we make it available, the up take rate is huge. People in their 30s and early 40s seeing their jobs changing in the course of their career wanted to develop the skills too meet the challenges and adapt so that they have a good career. It's one thing when you have a company that is our size that has the capability of developing that internally but not everybody can do that. A lot of that really should be falling too the higher educational system in this country and it's just not designed for this at all. 

[Indiscernible - low audio] 

The notion of employers running their employees has a very long tradition in this country but it's something we have gotten away from as people have not have had a lifetime employment with the same Fortune 500 companies as they used too. There is an interesting experimentation going on in the Labor Department and commerce, I think, have been engaged in, in looking at the models of other countries and thinking about how to apprenticeship, internship and programs like that to get encouraged. We have done some research but there is a lot of research that employers our looking for skills that cut across-the-board in whom they are trying to hire. Soft -- soft skills, skills capacity to work in teams. One of the teams -- one of the things we may want to look at is how can commerce department contribute to collections of employers, collaborating on skills development and creating new innovations in that regard, as well as encouraging employers like your own. 

One thing I put on the list is alternative certifications. If you get a Computer Science certification from AT&T, that's probably portable. If you think about the workforce we are talking about, we talked about earlier, you might be able to develop that across-the-board. Make no mistake, that is something that we have to consider simply because our traditional source of higher education Art meeting that need themselves. 

We've been at Department of Commerce, as you but the point out, used to be the Department of Commerce and labor but we did make workforce training a priority. From every single employer that I met with since day one that this is an issue. The way that we've tried to influence is two or three ways. One is to work with the Department of Labor so that there is now a federal checklist. We work not just with Department of Labor but administration. There is a federal checklist so that for grants

which is $1.4 billion of funding that requires certain criteria, including a business driven a job driven criteria so that the federal money is pushing out principles, as opposed to pushing out solutions. Second is the President has committed to double number of apprenticeships. That is a focus. Third is the Department of Commerce, we have partnership with Aspen Institute call, communities at work. We are working with several different communities focused on different sectors of there it economy. The concept is to bring together the business leadership, the educational leadership. That's K-12 plus community college plus University and a community, local government. In some instances, and those working best, social service organizations. Often you have to help someone bridge from one place to another. What we are finding is -- and we will have results of that effort toward the end of the year. The goal being not only learning from each other but to come up with Best Practices. What we are finding is the communities where the local leadership takes hold of this and recognizes, here are the six, eight, five or seven sectors of the economy we will focus on. They come together and breakdown. With the federal effort is doing is helping them break down there own silos and address that there is enormous -- enormously positive things happening for the workforce and for the employer getting the workforce too meet the needs of the employer, getting the whole apparatus begin to work toward the jobs and the way jobs and training, trying to get the education system to start much younger to address the challenges that communities are going through. These communities range from Dalton, Georgia to San Francisco. There is a different variety. The point being, there is a bunch of work we are doing that you should get briefed on so you know what we are doing and how to build on that as well. Because I think what we are trying to do is with limited resources come up with best practices. And how can we use are economic development grant dollars to make sure they are being used to support workforce training, even though the mandate is really public works kind of EDA. A few thoughts on what we are doing. You guys need to make sure you are aware of that so we can build on that. 

Thank you, Mindy. That was terrific. I just wanted to applaud in the framework how closely you tied our conversation around skills with access. I don't want to lose that. I think both need to be rated together to the extent in this bucket that you pulled out, though we, we don't forget that. I think the two working in partnership is essential. 

There is a piece of skills important in industry right now, diversity and inclusion. It's a really big thrust. If there is a way that we can to Department of Commerce and to this Board if we can make become a reality rather than lip service, I think it will make a huge difference. The digital economy is giving underrepresented groups huge opportunities they never had before. 

[Indiscernible - low audio] 

I am going to move us on now. 

Unfortunately, I am going to have to leave in a couple of moments. I do not want to interrupt discussions so I will sneak out. I will try to circle back before you all wrapped up during the lunch period after that. I just want to say, thank you. This is unbelievably -- I can tell this is going to be productive and useful and I really appreciate the commitment that all of you are making. 

We are very grateful to you for inviting us here. As You Li, listen carefully. Bill is going to take on a topic I know that you care about a lot. I'm going to pass it over to Bill. 

Thank you, very much. I think we all know the digital economy is here today. It's just not evenly distributed inside the U.S. or even globally. The thing that seems to be at the cornerstone of this distribution or these technology platforms they become the cornerstone of the ability to scale and deliver and enable people, small businesses, individuals, as well as large businesses to participate domestically and globally. Good example, the Internet itself is a basic platform. It is not the digital economy platform. It's connectivity communication platform. We certainly need greater access even to start there. Without that caught you can participate in the digital economy. Above and beyond that, we've got to encourage the platform. Examples of the world today that are successful the consumer cap economy is built on a number platforms from different players. That has allowed a lot of small, innovative companies to build and deliver products on global bases like never before. Certainly we seem things like that going emerging as a new kind of platforms. The point I would make care is there is not going to be a platform. There's going to be lots of platforms and needs to be encouraged across all industries. They can also be barriers. We have seen discussion about single digital markets globally. I think we have to be cognizant that if these become platforms that they could, in fact, be inhibitors to having a true digital, global economy. We have to make sure we think about that in policy. I think if we look there -- we are trying accomplish fairness, competitiveness, globally, and connect simultaneously. These things have to be built into policy. If I look at the agenda and activities, I think this is awesome. It covers quite a bit. I would make, with regard to that point the three-point -- with regard to platforms. One is that a ride and data protection is like water rights to the Valley. If you don't have data or access you cannot compete effectively. Really applaud the cross border data initiative but I think it has to be a first year player, not embedded in Internet. It's important we think about data both in terms of what the government needs to do with it data but how to enable data within the U.S. and outside. He can't be buried as sort of a single activity. I think the second thing we've got to lead on global trade ensuring that platforms are open for scaling outside. We are already starting to see barriers put in place in countries making decisions about not allowing platforms to play. I think that will not enable our

small, medium businesses as well as large businesses to compete effectively. Lastly, ensuring standards so that these are not built in a way that becomes a barrier. Has to be open way to participate in these things going forward so that we can all company. Things like the industrial act consortium and put together to try to lead in this. We got to enable these more and more. I would say that I think platforms are not something you dictate or legislate. The market decide how many platforms. We had too though allow fairness standardization, competitiveness, ability to compete globally and allow them to be innovative and not stop people from innovating. 

Thank you. 

[Indiscernible - low audio] 

I would like to make a comment about all three groups. I think these are three terrific topics where this group could add a huge amount of value, which is partly why we are really glad they came up organically from your conversations, particularly through the Co-Chairs. As you heard from the Secretary in each of them there is a fair amount of work to do. We are doing a fair amount of work on measurement project but there is hope we could use in thinking about doing fair amount coming out of economics USA or Bureau on this, the issue of skills and education you heard the Secretary talk about. You heard about the work we are doing there but also there are additional thoughts about where we can direct our efforts and what commerce can do. It huge we have a commerce data service we stood up, date itself, but also how we react with SMEs is a big [Indiscernible] how we interact with commerce initiative. We have our commerce attaches in the field. Pulling these together in the way you talked about could be helpful. I would also want to add, I think there's a little conversation still to be had about things that we are missing in the sets of buckets. There is plenty of work to do. If I had to pull out one other thing I would say, I heard a lot about the trust agenda whether it's marks comment about an entry, Cybersecurity conversation we have had, it's come up a lot whether something productive for us to do there. I leave it to the chairs to thing about whether we could have three small groups, four subgroups cot whether to pick and choose caught whether to do all of these things. I would just say this is productive stuff that could add value very easily in our next six months. 

Let me go back, if I may to dwell -- thank you. If I may, let me go back to what Bill opened up top particularly, because I think there are others with views about this. The capacity to enable the participation of small medium sized enterprises. If you look at any of the data, we know only 4% of small businesses export, but of those who use platforms as Bill talked about, the number has skyrocketed, 70% or something. Not sure the number but totally different order of magnitude. We know and James is one of the leaders in try to quantify this that the billions of additional middle-class consumers are going to be coming online in very short quarter-end it countries around

the world. This is a fairly central issue too the possibility of growing more good jobs in this country if our small and medium-sized enterprises can engage in the kinds of platforms bill is talking about with good data analytics for their own understanding of markets and supply-chain management and all of the things that GE does so well. Why can't a local business do it with share data or good analytics, as well as the export issue? Our their others who want to jump in -- jump in on this topic for a moment here. Please Lex. 

To follow up on what Bill said. [Indiscernible] bank represent about all [Indiscernible] banks in the U.S. Going global at an early stage is so critical too their success. I agree with you. I think making sure the cross-border data initiative is one of the key topics is critical to them. If they don't have that pre- access from a global perspective and data availability, it kills a lot of their opportunity. I would concur with that. 

And the other or thoughts? 

We have blown right through our break, as you probably noticed so, I apologize for that. We are going to move too a public comment period. [Indiscernible] do you want to take over? 

The floor is open for public comments. I will ask our organizers here, these are public comments here in this room. Our their other facilities as well? 

Yes, we have an open phone line. The public can join that way. We also have the ability for those in the audience to speak as well. 

Great. 

We will pass the microphones. 

Is is the phone number available? 

It was on the agenda online. We can also meet it out. Is on the NDI DEBA website. I'm happy to give the number. Local (203)607-0666 and the pin number 5605 1A. 

We are not accepting donations. 

-- 5905 1A. 

I will now ask for audience questions. 

-- 590518. 

Any questions? 

Given the nature, it might be worth opening the public comments to something that is not required to happen during our meeting. People would send him a question and that they can farm it out. 

We did call for that in our Federal Register notice. That is open and that we do welcome after today's first meeting, we will be accepting written comments as well. 

Once again, I will ask if there is anyone here? . 

We may gain some time back in that case. Zoe, I will hand it back too you. 

See how seamlessly we work together. We have known each other for a few years so it helps. 

Where thinking and the commerce department has asked us to think hard about how we can make some progress in the next six months. We have a two-year time frame for the appointments to forward -- for appointments to the Board and stand up to the Board. Hope we will have contribution to make in short order. Thought is we will have the public meetings within that time frame. We are looking at the first week of August for a second meeting probably in California. And the third meeting will probably be in November. We will talk more about all of this and, obviously, get your input. As we said earlier, we are looking to form a working group -- working groups. We are looking to create robust public engagement. One way to get more robust public engagement would be to have people participate and provide input too the working groups, beyond of those who will drawn to participate in the plenary public meetings. I want to open the floor now on behalf of Mitchell and myself to get your suggestions for how we move forward and the form in which we meet and deliberate, or any other thoughts that you have about how you would like to see us work. 

We are on the digital economy, I assume we would Havas Digital tools that would allow us too not have to always meet and collaborate in person. I don't know how we go about doing that but, we should start with that as the center point. 

I can speak to that a bit. We do have capabilities at the Department that we can offer, for instance, a collaboration site for the members, things like that which should make it a bit more helpful to collaborate. Obviously, phone bridges and things like that. We will have those administrative options available if the group would like to meet intersessional he. If we do get together as a full group, that we need to do in the public but when it is subgroups working on just getting together to prepare, to talk about

what might go into deliverables that will be presented too the full group, that's okay to do intersessional he with just the small groups. 

Good. Could do or, Zoe, could we maybe talk a little bit about, procedurally, what we think our production is meant to be? Are we going to be issuing a report? I know different committees advising the Federal Government different things they do? Some put out large data reports. Some write a letter to the Secretary saying we think what to three. Some just to give a briefing. Do we have a sense of what might help us figure out? 

I would echo on that because you mentioned you wanted to see specific progress in the next six months. What does that look like too you? 

We have a lot of work to do to sort that out and it's going to turn in part on what the working groups think will be most reductive. We welcome your thoughts on that. Our inclination is too not try to prepare a comprehensive state of the world type report that recounts the kinds of things McKenzie has already done that, as Allen said, be targeted on where we feel we can make a contribution and that the working groups will need to look at to what extent are they setting up the objectives are the suggestions for principles are the possibilities in this time frame? And to what extent do we have answers? 

If there is a group that works on measurement, that group may say this is what we need to examine as opposed to measurement rather than data collected and measurement should be. It will vary. Some things we will be able to make fairly quick progress, presumably, based on work that has been done based on work done by others or ourselves in the past to target some recommendations. On others, I think we will just be targeting what needs to be focused on. May own inclination is to let the working groups try to put things in two -- into buckets and see how far you can get quickly. Then we should consider that together in terms of our objectives with a lot of interim conversation through digital tools. 

I would echo that and say, especially, as we think about how to set this up and others can chime in. I think the charge was, originally, to provide input and advice to the Secretary, ultimately, on the important trends and policy priorities in the digital economy from this illustration. I know you value that. That sick I doesn't have to [Indiscernible]. It could come. I don't think it's an either/or in our minds. All along we fell, yes, a paper we could look at would be valuable. Things like masterful job that James said with the [Indiscernible] compressing three large McKenzie talks into 15 minutes. Impressive and helpful for us having that on the record in some ways can be helpful for us. It gives us a chance too really ground our work in a set of inputs and advice formally from people who are role leaders in the field so we are not making

this up ourselves. There's not it either/or here. Papers are welcome but short, quick interventions are also welcome and no timeline saying all of this has to be delivered in the fall. I think we contemplated all along some of this could be worked out that happens the fall. Some of it could be work that happens faster because there are probably a few of these areas where it is clear you all have well formed thoughts. Some of them may be slower burn and we all recognize that. I don't think we come in with hard coffee test notions about how this is supposed to happen. There is a set of tools in the toolkit which will vary for each of the groups and the topics. 

I think that's totally right. I would say though that as part of this focusing on what are actionable recommendations? Especially in a short time frame. None of them are easy or we would have sold them by now. They are all challenging both short and long-term. Allen's point is right but I think very actionable recommendations is helpful as well. I would use the example, the President's export Council, for example, which each year does a letter to the resident making recommendations. That is one form I think I particularly, in a six-month time frame would be very helpful but I think to Allen's point, this is part of having the working groups sit down and scope out the problems, but also what is the best for them to recommendations on? I would put towards a bias of recommendations as well. 

They don't tend too meet as frequently as what you are describing. Meeting three times in six months face-to-face is a pretty aggressive meeting schedule so, if we were going to maintain that I think it would help us on the Committee to add direction. Let's not organize meetings just for the sake of organizing meetings and then each meeting we try to decide what we are trying to do. 

We will have time to get into this more when we have a working meeting at lunch to organize ourselves work. 

I have a question related to this. When the group meets as a whole and the public requirement is implied, does that mean physically, face-to-face with public access? Or can we use digital tools for public access Lex. 

Yes, we can use digital tools for public access. And but when we do meat in person, I think we will usually try too always have the opportunity for public to join if it's the full group. But certainly, with the phone bridge, we do try too always allow access. 

À la brought the issue of the trust issue which I think one of the under liar's, at least for me is what are the distinct which it -- distinctions or overlaps with the President's commission on Cybersecurity? How should we think about trust as a relates to digital economy and what we can all what has already been done Lex I don't think we have

the need or desire to replicate work that has been done. I would a for work to be ignored because [Indiscernible] doing it. 

I think everything is pretty much true on the list and agenda of activities. Seems there are so many [Indiscernible] and Department of Labor working on skills development, next-generation workforce, education and skills development. Too me, looking at that list, what are the groups and organizations working on and how to leverage that. I fund it easy to respond to what other people are doing as opposed to spending six months, nine months freethinking ideas and find out other groups are working on it and feeling like he wasted a lot of time. Whatever we can do and get from help perspective understanding what everybody else is working on will be helpful which is kind of what you were saying [Indiscernible]. 

Very helpful, Greg. Your comment made me think of, as well as yours, Allen, when you put up a proposal to think about do we need another bucket. I'm not suggesting that but is there something on the list not being pursued? I thought about your comment on Internet of Things which does bring trust too the table but it could be valuable what to do something that is not being replicated elsewhere that would bring in the trust element. 

We are going to break at this point I think we have covered our agenda. I thank everyone for your patience. I apologize we did not take a break in the middle but we wanted to keep everyone together while the Secretary was here. Now you get your break. We will continue the conversation. I thank everyone in commerce for what you had done to support us. Zoe? 

Yes. 

One thing I wanted to mention, as we move into the session this afternoon, that is more administrative and preparatory session. We do have to have a sense here in the public session of what topics we want to take and to that discussion of how we will focus our time and organize. It sounded too me like we had agreed to at least pursue the three areas and maybe a fourth. Maybe we could see if we have consensus on that so that we can feel we are able to go in and have enough planning discussion as well? 

It looks like you do. 

Wonderful. Thank you for obliging me on that, thank you. 

Are we adjourning? 

We are closing the public session. 

Wonderful. 

With that -- 

I wanted to offer a great thank you too all of you -- publicly, I thank you, to all of you for being here and do all of the audience and for those tuning in and tweeting as well. We appreciate it. Your input is incredibly important to us and to this ambitious agenda that we have. Thank you. 

Thank you. 

With that, I will adjourn

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