Thank you very much. Thank very much and I'm delighted be here in Cambridge. And to say what a really visit I've had this morning. mean I can, it's really stunning, the impact of all change and what it's going do for us and to in the next few years. 've also ordered a bunch of for Cherie over the Internet, is going to come as real shock to her. She'll , when I go back, I'll to explain what I've been , otherwise she'll be deeply suspicious I've done something terribly wrong. I also say a big you too to the people have shown me around today helped educate me and us I know that sometimes there big things that come into news on a day to basis but if I can to our friends and colleagues the media, as we call , it is, this is really important long term. When the stories have gone in and of the news, this is , the whole future of Internet , of information technology, of how build a knowledge economy in country, this is what may whether Britain is successful in twenty first century or whether fails. So there can't be long term much more important that.

And we have got proud history as a great nation. We were the first power. We are a creative, , adventurous people. But it's not to trade on our history. need that spirit of adventure than ever today. We need face up to this new , the challenge of new information . And to succeed we have be quick on our feet. have to embrace the Internet - not in a few time. Most of all, if are to succeed, knowledge and we use it has to at the heart of all we do. So, to individuals say get skilled because you're to need it in your life. Your future depends on . And to British business, I a pretty blunt message: if don't see the Internet as opportunity, it will end up a threat. In two years the Internet could be as in the office as the . If you're not exploiting the of e-commerce, put quite simply, its worst, you could go of business. To budding entrepreneurs Britain and abroad I say: is the place to come do business to make money. make Britain a rival to in the world. Come and Silicon Fen truly a rival Silicon Valley.

Now, I know for many people, the impact all this change and technology, 's kind of a scary, frightening . People feel left out by technology, threatened by a younger who've grown up on-line. I those fears. But we can't our backs on change. If do, the world will not for us, it will simply us. Of course one response be simply to say, let fend for themselves. But that 't a sensible policy option for or for us as a . Because it isn't right to the creation of an information . It would both be unfair also inefficient. So there is clear role for public policy. the old role of state , intervention or planning. But a role: promoting competition, minimising regulation, people with the skills that need. A policy that combines the sense of fairness, extending use of this technology as as possible and a desire create the prosperity of the , to help everyone make the of the change. And that's I want to talk about .

Already, some 13m people have to the Internet in Britain; 's higher than any other major economy. E-commerce revenues in this are expected to reach £10bn year, up threefold on last . You can buy flights, books, into a hotel, trade cars, says here plan your wedding the Internet and, as I've this morning, send flowers. All these services are available in UK thanks to Internet entrepreneurs 've created companies in the last years.

And I met two the people who run these this morning. One is Zeus. years ago, the founders, Adam and Damien Reeves, were students . They decided to set up company to provide software for . Zeus has been profitable since was founded, sales, I think 'm right in saying, are currently at 75% per quarter or . Only Netscape and Microsoft are in their market. This morning, 've announced a new alliance with Packard, and they've every intention becoming the market leader. Or 's Cambridge Advanced Electronics. Two years , they were a conventional company. they don't have any premises full-time employees. But they've generated million extra business. How? They a virtual company thanks to in a network that lets work from home. There is same pay rate for all . They bid over the Internet do each piece of work comes up. And salaries are by between a third and half. Not all companies are to work like that, but companies will be able to will do it.

So these are just two examples of economic opportunity of e-commerce. That's we attach so much importance getting our own policy right. 's why last autumn, we set target that Britain should be best place in the world trade electronically by the year . Since then, the Performance and Unit - led brilliantly by Norton - has been working a strategy to meet that . And the PIU incidentally is new think tank at the of Whitehall, that reports directly me, the Prime Minister, on long term issues. And its mark of the importance of -commerce that it was one of very first ever projects they to become involved with. I'm to be launching their report . This is it. I recommend to read it. It's the of serious analysis that governments too seldom done in the . It doesn't attempt to be grand plan, nor an interventionist . Any such plan would be of date before it was the printer. But it is sober assessment of where we and what we should do meet our targets.

The good is we've started well. More have websites, a higher proportion sales are made on-line in than in any other major country. Our large companies are than holding their own in global market that is the . And we've got big advantages. , the common language of the . A developing venture capital industry. some of the best universities the world. But the report found a lot of signs conservatism. For example, the fact less than 4% of British thought that the Internet could business costs, compared to 15% the US and 30% in . Or the industry representative who that the government's response to bookshops should be to ban . Overall, the report found that was lagging behind America, Canada Scandinavia, and also that Germany France are making a real to catch us up. So 've got a lot to do. too often in the past 've made a good start, only see others exploit the full of new technology. So the falls to British business, to British people but also the to government too. And the that has been published today some 60 detailed recommendations. It's the kind of changes that get headlines, but they will a real difference to the that you do business. And can announce today that the has accepted them all.

I to summarise under seven brief seven areas where we as government, though, have got to and make a difference.
Firstly, use self-regulation. A government bill at least a year to through Parliament. Given the pace the Internet, its likely to out of date even before comes into effect. That's why announced in July, and I repeat this to you today, we will implement most of measures in the Electronic Communications through self-regulation. So the ball's in the industry's court to up with a credible scheme.
same is true of key . Many of you will be of the issue of mandatory escrow - the previous cross-party to coerce people to give password to their Internet mail a third party. Well, one the report's main conclusions is those plans are simply not to work. So let me clearly today no company or will be forced, directly or , to escrow keys.
Secondly, however, need to act faster and -ordinate better. So we are reorganising way that government works. There's single lead minister, Patricia Hewitt, is now the e-minister with responsibility for e-commerce. And we appointing Alex Allan as the -envoy. And he is well placed do this. He ran number as its senior civil servant, he knows how government works indeed was in charge of private office at Downing Street I first came into power. despite that, we're still appointing . He's not only a brilliant servant, he also, he must one of the few senior servants with his own website certainly the only one whose has a comprehensive guide to lyrics of the Grateful Dead. it was Alex that told that the band that I in at, if you don't me mentioning this word here, , the band that I was called Ugly Rumours actually was of a Grateful Dead song. there's a …I've been told bits of interesting information today; 's a bit of useless information you in return. Patricia and are going to report to on progress every quarter and 'm convinced that it will help make policy better and faster. for goodness sake, let us up the dialogue that we today. If there are things you think that we need be doing that we are doing that we should be , things that need to go and better, we have a minister in charge, we have dedicated e-envoy, they are the that will make it happen you. But keep the dialogue the sense of partnership going.
third thing is to get . I mean this is a for everyone. It starts in . Now, when we came to , barely one in ten schools connected to the Internet. Now, thirds are; the most of G7 country. So that's a plus for this country. The of primaries connected has gone four times in the last alone.
But it isn't enough, 'm afraid, again. We have pledged that by the year 2002, schools will be connected. What more, we will subsidise over ,000 of the poorest families to computers, so they can access Internet at home too. And we want is to lead a situation where all our will have access to the . Not just those with relatively off or enthusiastic parents, but our children.
Adults, however, also training. That's why we announced £450m computer skills strategy in Budget. Through Individual Learning Accounts, are accounts that people can that gets access to training, will provide, as a government, next year, there will be % discounts, in other words you for a fifth of the a basic computer training course. we will be putting a subsidy into allowing adults, wherever are, whether they are in or out of work, to access to the basic computer and I think that will encourage and drive people to a greater interest in it , who knows, once they take interest, then they can see types of things that they do.
We are also going be setting up 800 IT centres to give access to to those who would otherwise excluded. So that people can in and actually use the there. Already a lot of schools are doing this. So of the kids, if their haven't got a computer at , they can go in to classroom, sometimes after school hours they can use it there. is very important as well.
also intend, where companies provide to their employees, we will give effectively a tax break the employee. It won't be as a benefit in kind they won't pay any tax it and for the company will be a deductible expense. that is again, for some the companies, some of you be completely familiar with this, 'll do it already, but for companies, it won't be. And is something that allows people gain access better to computers. package of measures should mean everyone will be able to to use the Internet, rich poor, young or old.
Now, 's my confession. In many ways, am the last person to making this call to action. say the least, to be blunt and honest about it, anyone watching me on the this morning would know, I not an expert. In fact, watch my children and Cherie the Internet and feel a , not so say profound, sense humiliation at my lack of . And, in a sense, you , especially when you've got a and a staff around you, can rely on other people do the work, but, in , what you lose from that a sense of what the possibilities and potential is. So 've decided it's no use me lectures to everyone else about they should on how they take up basic computer courses learn basic IT skills, I enrol myself in one of courses that the government has up and I will do basic work and I will the basic skills in IT. , I'll be doing it. Right.
kids tell me it's easy. I'm not sure about that. it's true, there's a lot, of my generation, about ten too late, in a way, 's a big psychological barrier to over as well as everything . But it's important that we .
The fourth thing is to the infrastructure right. Britain is one of the most competitive in telecoms in the world. some measures, the cost of the Internet is lower here anywhere else, 1p a minute the evenings and at the .
But again we need to further to stay ahead. We've announced some far reaching moves : a fifth mobile phone licensee, in BTs local networks. And opened up these markets, we to make sure that they open. That's why the PIU, Performance and Innovation Unit, recommends OFTEL and the OFT work to review all possible barriers competition by March next year.
fifth thing we can do to build trust. The report that the biggest barrier to spread of e-commerce is cultural. are worried that either they 't get paid. Consumers are concerned their personal details will be . Copyright holders fear piracy. The goes a long way to many of these concerns. We to implement their findings, and communicate that Britain is a place to trade electronically, as as any in the world.
, we should lead, as a , by example again. If people buying plane tickets on-line, they expect to get their driving or find job vacancies there . So that's what we'll do. have already set as a that all government dealings that be should be deliverable electronically 2008. We're making real progress that target and that target really too late, if you about it, if you sit and analyse it. So, for , another announcement that we're making is that from next year, will be able to submit self-assessment forms on-line and we'll and bring forward those starting and get them clearer and and tighter. Because again, you , this world's not waiting around us.
The last thing is think European. E-commerce abolishes frontiers for the smallest firms, bringing 380m people in the single within reach. I saw that when I was looking at possibilities of this when I at the Zeus company. People, they're able to look at prices all the way round world for goods, if they're to look all the way Europe for where they can the goods most cheaply, they're to be doing that. And that starts, people are going be doing it in every field of endeavour. And there be enormous opportunities and there be enormous dangers in that companies. And it will make far more competitive as a . But my goodness, it's going be a big challenge. And, think that we again, companies to think European, because the market is their home market. governments need to think European turn Europe into the world's vibrant virtual market. And, I've this with the new president the European Union, who agrees me about the importance of challenge, that Europe's goal must not following but setting trends electronic business over the next years. And I think countries the rest of Europe are up to this. So we're competing with other countries in and we also need to forward the whole European market .

Finally because there's no reason can't rival America. There's no why Silicon Fen can't beat Valley. I'm delighted to be Cambridge today. Your research rivals of Berkeley and Stanford. You the first computer, the first communications and the basic control which is in 90% of phones. No other place has so many breakthroughs in such short space of time. Now 're matching Silicon Valley's business practices , matching academic innovation to entrepreneurial . You're winning industry's backing. Microsoft chosen Cambridge for their first so far only research centre the US. BT announced today you will be one of first areas to be connected their new high speed networks. Government is doing its bit well. The East of England Agency are developing initiatives to technology clusters, working with the Institute to identify the capacity firms to innovate, and to technology transfer. We are committed the development of the Cambridge which will rival Silicon Valley. is our commitment as a .

So, thank you once again having me here today. We've a good start in e-commerce, I think we know very clearly we have to transform into a permanent industrial success. cannot afford the type of that appears to be left in some parts of British . That's my message today. Silicon can rival Silicon Valley. British can lead the world in e-commerce. Britain can have more connected to the Internet than other country. But to achieve goal, we need big change. need partnership, we need to together, we need to put place the right framework, we to lead by example as government. And the British people to have the confidence and to exploit these opportunities.
I've no doubt at all that today's world what creates a economy are two basic things: stable framework of economic management, we have tried to do Bank of England independence, through rules that put tough curbs spending and make sure that run a tight ship in of our fiscal and monetary . But the second thing is, you get that foundation right, top of that has to built the knowledge economy, has be built an economy where have the skill and the and the opportunity to carry innovating, creating, moving into new , developing new industries, and handling challenge of this extraordinary driving of new information technology. I that we can do it, I really do think we a sense of national purpose order to get this done. I do say, I mean, all seriousness, to the people the media: this is where future is at. Now I be going to a completely audience tomorrow, down in Brighton, telling them the same. If want this country to be , understand the challenge of this information technology. Gear the country to meet that challenge and the country as successful as can be. For the challenge here and now. And if fail it, then we'll be in the future. But we 't fail.

OK, thanks.