Computer and telecommunication company officials told a congressional subcommittee yesterday that foreign governments have begun erecting barriers to the free flow of information across frontiers.
Among the devices used by European and Third World nations have been data privacy and protection legislation, rate structures and technical restrictions that may raise the cost of international communications and limit the ability of U.S. firms to compete, industry officials said.
Compounding the problem is the absence of a central government authority in the United States setting policies and negotiating with other countries on data-flow issues, said several witnesses before the House Government Operations subcommittee on government information and individual rights.
L. John Rankine, IBM's director of standards, product safety and data security, told the subcommittee that, IBM has not yet encountered any major problems but they are concerned. Restrictions on data flow "are a new set of tools for anyone who might want to play the protection game," he said.
In fact, according to other witnesses, some national governments already are playing. "In 1973, European and Third World countries began to initiate a wide variety of barriers, obstructions and restrictions against open and competetive business operations, especially against U.S. information processing and equipment companies," said Warren E. Burton, vice president for government affairs of Tymshare Inc.
According to Burton, the barriers include "data protection legislation which involves a government data regulatory authority established in each country to review, inspect and approve . . . the information and information flows within the country and those entering or leaving the country." These laws, adopted in the name of privacy, can be used to exert government control of information, several witnesses said.
Several witnesses described the frustrations their countries faced in trying to provide international services and talked about the need for a united front in dealing with telecommunications agencies in other countries. In most cases those agencies are government-owned and operated.
GTE Telenet Communications Corporation has proposed a consortium approach to negotiating for international record carriers, said Phillip M. Walker, vice president and general counsel.
It would "not only enable the implementation of U.S. policy favoring competitive services and cost-based rates, but would also strengthen the bargaining position of all U.S. carriers" by eliminating the ability of the foreign government to play the carriers against each other, he said.