IP: Telecom Triangle in Japan

[Dave Farber <farber () cis upenn edu>]

From: sja () glocom ac jp (Stephen J. Anderson)




The past week saw opening moves on the regulatory front in Japan.  With
the LDP forming a new government and caution over the policy agenda, 
these moves affect businesses, telecom firms, and regulators.


The first area concerns the business user views on telecom prices.
Kyodo reported that Keidanren asked the MPT Telecommunications Council
to set upper limits on NTT prices.    A key passage states:


  'The Keidanren report said the government should create conditions that
''would motivate NTT to volunteer to streamline its operations.''


  To this end, the government should place upper limits on NTT charges and
abolish the current system under which NTT has been allowed to decide what
is an appropriate profit margin, it said.'




I find it interesting that no mention of "break-up" appears in this story, 
and thus appears to place Keidanren against dismantling NTT.


At the same time, NTT has issued a barrage of press releases.  A new
service in ten years (2005) would give 10 Megabit per Second bandwidth 
for around 10,000 yen per month.  This is part of the long term research & 
development efforts of NTT, but not as impressive as might meet 
the eye.  Many experts wonder if this bandwidth will be enough.


Among other carriers there is also much rumbling about the BT/MCI merger
which makes them wonder about their fate.  Mergers are increasingly 
possible in Japan.


The triangle from business and carriers is completed by the bureaucrats.
MPT must approve prices and mergers--and the latter is increasingly possible.
The landscape of Japan's telecommunications is about to change, with the
specifics with NTT as a multimedia company and NCCs reorganized to compete,
This ground is just beginning to shake.  But like earthquake prediction, the 
process of reorganization is likely to come through a series of events that
are quite difficult to forecast.  Any comments on such events would be most
appreciated.


****************************************
Stephen J. Anderson
URL http://www.glocom.ac.jp/staff/anderson.e.html
Center for Global Communications (GLOCOM)
International University of Japan
****************************************