[Congressional Record Volume 146, Number 41 (Wednesday, April 5, 2000)]
[Extensions of Remarks]
[Page E494]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        SMALL INTERNET BUSINESS

                                 ______
                                 

                             HON. TOM UDALL

                             of new mexico

                    in the house of representatives

                        Wednesday, April 5, 2000

  Mr. UDALL of New Mexico. Mr. Speaker, there is no doubt that the last 
few years have shown us the promise of the 21st century. Our economic 
growth has been spurred by the stunning development of the high-tech 
sector and Internet commerce, which have created tremendous new 
opportunities and new jobs. These opportunities promise only to grow in 
this century. I am aware that declining computer prices have kept 
inflation down . . . and that e-commerce will soon be a $400 billion 
business. The Internet is in its 11th year of annual doubling since 
1988. There are over 44 million hosts on the Internet and an estimated 
150 million users, worldwide. By 2006, the Internet is likely to exceed 
the global telephone network. Moreover, tens of millions of Internet-
enabled appliances will have joined the Internet. We don't want 
government doing anything that would mess up all of that success. I 
believe the private sector should lead. But frankly, it is also 
government's duty to make sure companies follow the will of the people.
  As Teddy Roosevelt told businesses almost 100 years ago, ``whenever 
great social or industrial changes take place, no matter how much good 
there may be to them, there is sure to be some evil.'' The fact is we 
have a protect the consumer. To me, privacy is the make-or-brake issue 
for all electronic commerce. If consumers feel when they buy a book or 
browse a magazine on line, that someone is keeping a personal profile 
on them, they'll stop buying books.
  If they feel that when they apply for loans at different banks, a 
third party can learn about their personal finances, it will be the 
last time they bank on the Internet. More than 80 percent of Americans 
are concerned about threats to their privacy when they are on-line. 
More than 90 percent want businesses telling them how they will use 
personal information. When 80 or 90 percent of Americans agree on 
anything, you know this is serious.
  The legislation that Congressman Campbell and I propose is simple. We 
are recommending the establishment of a seal--much like FDIC or Good 
Housekeeping that instantly assures the consumer that the Internet site 
they are about to use holds itself to an internationally recognized set 
of basic privacy principles. This seal would be completely voluntary. 
Users would learn to recognize the seal as a guarantee that their 
personal information will not be collected or used without their 
consent.
  I foresee small businesses particularly favoring this proposal 
because many of these companies have not yet established good 
reputations as have the larger, well known companies have. Here's a 
proposal that could touch every business owner in the country. Here's 
an idea that could give consumer's the confidence that their 
information is indeed private and is in safekeeping. This is an era of 
truly sweeping changes.
  I want to tell the Chamber about a small business in my district: De 
La Pena Books. The proprietor, Bart Durham began the store as a ``By 
Appointment Only'' business dealing with old, rare, and antiquarian 
books which he operated from the De La Pena House, one of Santa Fe's 
historic homes which he owned at the time. Bart advertised in AB 
Bookman's Weekly and ran a direct mail business. By 1983 he had amassed 
quite a collection of books about New Mexico and published ``Catalog 
No. 1, New Mexico'' containing over 900 separately priced books about 
New Mexico history dating from the early 1800's. Mr. Durham mailed 
about 200 of these catalogs to his customers who responded quite 
favorably. Cataloging then became the method that I used to sell the 
majority of my books.
  In 1990 his business began the open retail shop operation in the 
Santa Fe's Design Center. This move spurred the business into book 
sales of a more general nature and in 1996, the shop space next to 
Nicholas Potter Books on Palace Avenue became available. Sales 
increased substantially and all was fine until the rents on the 
property were significantly increased. To begin to pay that kind of 
rent meant that he would have to sell more books than his modest 
operation could locate and buy. The only alternative Bart Durham could 
see was to go on-line. He gave his notice and rented a three bedroom 
apartment where two of the rooms became dedicated to De La Pena Books. 
He designed his own web page, subscribed to some book locating 
services, and the business was off and flying. The first thing that he 
noticed was that all his ``dead stock'', books about the world beyond 
the limits of New Mexico, started flying out the door. His gross sales 
dropped off a little, but the net sales increased. Bart no longer 
needed to tend the shop for 8 hours a day and was free to do as he 
wished with his new found time.
  Now, whenever Mr. Durham comes home, he goes on-line, check his e-
mail, makes the electronic deposits through customers' credit card 
numbers, wraps up the sold books for shipping, and takes them to the 
post office in the morning. As he purchases new titles, he writes their 
quotes and posts them on-line. In his own words, Bart said to me: ``I 
love the book world, my computer, my web page, the on-line and e-mail 
phenomena, and the freedom that I enjoy to do as I wish with most of my 
time.''
  Mr. Speaker, this legislation is intended especially for small 
Internet businesses like DelaPena books. These small business owners 
often do not have a reputation that allows the average Internet surfer 
to feel comfortable purchasing from their goods. However, a small e-
commerce business can willingly place the seal on their site and 
inspire confidence and trust in consumers. This is an equal chance bill 
that will help large entities and the independent merchant alike.
  Please give this voluntary on-line privacy and disclosure act your 
serious attention-for all Americans.

                          ____________________