PROSPECTS FOR DEVELOPMENT OF A HEARING BEFORE THE COMMITTEE ON GOVERNMENTAL AFFAIRS ONE HUNDRED FIRST CONGRESS FIRST SESSION AUGUST 1, 1989 Printed for the use of the Committee on Governmental Affairs U.S. GOVERNMENT PRINTING OFFICE For sale by the Superintendent of Documents, Congressional Sales Office COMMITTEE ON GOVERNMENTAL AFFAIRS JOHN GLENN, Ohio, Chairman SAM NUNN, Georgia WILLIAM V. ROTH, Jr., Delaware WILLIAM S. COHEN, Maine WARREN B. RUDMAN, New Hampshire JOHN HEINZ, Pennsylvania PETE WILSON, California Leonard Weiss, Staff Director Dr. Robert D. Reischauer, Director, Congressional Budget Office, accompanied by Dr. W. David Montgomery, Assistant Director, Natural Resources and Commerce Division, and Dr. Philip C. Webre, Principal Analyst, Natural Resources and Commerce Division Juan A. Benitez, Deputy Assistant Secretary of Commerce for Science and Dr. Craig Fields, Director, Defense Advanced Research Projects Agency. Tom Long, vice president and general manager, Technology Group, Textronix, Inc., representing the American Electronics Association, accompanied by Ms. Pat Hill Hubbard, vice president, education and science policy, Ameri- can Electronics Association..... Peter McCloskey, president, Electronic Industries Association. APPENDIX Prepared statements of witnesses in order of appearance.. "Workshop on Creation of Government/Industry Partnerships Through the "Origins of RCA," by Richard J. Solomon, MIT, February 1989. "Television Manufacturing in United States: Economic Contributions-Past, "Economic Potential of Advanced Television Products," report by Larry F. Darby, Darby Associates for National Telecommunications and Information Administration, April 7, 1988.. Letters and statements from: Dr. Kenneth Flamm, senior fellow, The Brookings Institution Dr. Peter S. Friedman, executive vice president, Photonics. Page 47 257 259 268 298 300 340 433 495 509 513 516 ........ 526 Barry Whalen, Ph.D., senior vice president for plans and programs, and Mark Eaton, director, international programs, MCC (Microlectronics and Computer Technology Corp.). Semiconductor Equipment and Materials International [SEMI] PROSPECTS FOR DEVELOPMENT OF A U.S. HDTV INDUSTRY TUESDAY, AUGUST 1, 1989 U.S. SENATE, COMMITTEE ON GOVERNMENTAL AFFAIRS, Washington, DC. The Committee met, pursuant to notice, at 9:35 a.m., in room SD-342, Dirksen Senate Office Building, Hon. John Glenn, Chairman of the Committee, presiding. Present: Senators Glenn and Heinz. OPENING STATEMENT OF CHAIRMAN GLENN Chairman GLENN. The hearing will be in order. Today the Committee turns its attention once again to the issue of U.S. trade and technology policy. That is a topic on which this Committee held 7 days of hearings in the last Congress. Our focus this morning is on high definition TV, HDTV, as it is called. The Congressional Budget Office, CBO, will release at this hearing a report on HDTV requested by this Committee. This is not an all-inclusive study. The report is one part of a longer term CBO study still in progress on R&D consortia requested jointly by this Committee and the Senate Budget Committee, which is chaired by my distinguished colleague, Senator Jim Sasser, who also sits on this Committee. Many of us in Congress are tired of, indeed we are alarmed by, increasingly seeing new products invented here in the United States, being perfected into mass produced consumer goods abroad, and then being sold back to us. I fervently believe that we need to preempt our foreign competitors from gaining the ability to do this. That is, we need to organize and position ourselves to be able to seize the advantage first. It is not that our economic rivals are evil; they are doing what any good competitor would do. Simply put, they are taking advantage of a market opportunity before we do. Thus, the blame is not as much on them as it is on us. I hope HDTV does not turn out to be another case in point. HDTV may be one of the most, if not the most, crucial technological advancements the US. electronics industry will have to wrestle Waring the upcoming decade just before we enter the 21st cenkry. It goes far beyond being just a prettier TV picture. HDTV has far more implications than that. Because of the overwhelming size of the electronics sector in the US economy, how HDTV develops could have an enormous impact |