Telecommunications

April 2003

Nippon Telegraph and Telephone Corp. (NTT) will cut 12,000 jobs within three years and increase revenue to 11.7 trillion yen under a new management plan. NTT would trim its staff to 197,000 from 209,000, while its revenue target for the year to March 2006 was up 6.8% from the forecast for fiscal 2002. The firm aims to post an operating profit of 1.6 trillion yen by March 2006, up about 20% from the target for the year that has just ended. NTT is aiming to reduce capital spending to 2 trillion yen in the year to March 2006, down from an estimated 2.2 trillion yen last year. The three year blueprint outlines increased efforts to establish broadband services, including a promise to start in 2005 an interactive video communications service for corporate clients over NTT's fiber optic cable network. NTT also confirmed its subsidiary NTT DoCoMo Inc. would lend 200 million pounds to British affiliate Hutchison 3G U.K. Holdings Ltd. , in which NTT DoCoMo holds a 24.1% stake. (April 24, AFP Jiji, the Japan Times)

Nippon Telegraph and Telephone Corp. (NTT) will develop a series of new broadband services to strengthen its fiber-optic communications business. NTT sees fiber-optic communications as its core business, replacing telephone services, but its offerings have not proven very popular. At the end of last year, NTT announced a plan to build, possibly by the end of 2005, a next-generation communications network called Rena, which would be a highly reliable Internet protocol web based on fiber-optic networks. The advanced network would be very useful for teleconferencing and other interactive communications since fiber optics, unlike ADSL communications, enables ultra-high-speed data transmission for both uploading and downloading data. As part of the Rena project, NTT has already started developing communications services for use in remote online medical treatment, telecommuting and online education. In fiscal 2002, however, NTT East Corp. and NTT West Corp. attracted less than one-third of their aggregate individual subscriber target of 600,000 to their optical communications services. The parent company aims to increase the number of subscribers to 1 million in the current fiscal year by introducing the new broadband services. (April 21, the Nikkei Business Daily)

In a bid to increase wireless LAN (local area network) services, the government will eliminate a licensing requirement for a base station. The Posts and Telecommunications Ministry hopes to deregulate for setting up wireless LANs and thereby spread the use of the technology. In addition, it aims to expand the areas serviced by wireless LAN base stations. Wireless LAN technology offers transmission speeds comparable to those of ADSL (asymmetric digital subscriber line) services. In addition, as wireless LANs do not require physical connecting cables, Internet connections using the technology should be competitive with ADSL on a cost basis. The ministry plans to submit to next year's Diet session a revision to the Radio Frequency Law for implementation next fall. If wireless LAN base stations are set up nationwide, users will be able to easily access the Internet wirelessly outside their homes or offices. It would also spread the use of advanced home appliances, such as climate control systems that can be remotely controlled from outside the home. Also, wireless LANs would let a moving ambulance send a patient's vital signs to a hospital in real time, enabling the provision of remote medical care. Under current law, broadcasters and telecommunications firms wanting to use a portion of the radio spectrum must apply to the ministry to have a certain frequency allotted to them. Currently, those wanting to transmit within a certain frequency range at low power need not obtain licenses. But at such weak power levels, services can only cover areas smaller than 100 sq. meters. To provide a wireless LAN service covering a residential area, businesses can either set up many low-powered base stations, requiring no licenses, or obtain licenses. Currently major service providers like NTT Communications Corp. are choosing to set up many low-powered base stations. (April 16, the Nihon Keizai Shimbun)