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Advances in information technology over the past decade have stirred the creative spirit of a generation and dramatically changed our everyday lives. As we enter the 21st century, the Internet and information technology (IT) continue to capture our imagination, holding out a future filled with possibilities that go far beyond the transformations we have already witnessed in business, education and consumer choice. This paper includes an introduction letter by Zoe Baird and reports on Health and National Security, the Markle Foundation's two main initiatives for the year 2004.