Telecommunications

April 2004

Fixed-line phone fees may rise under a plan of the Public Management Ministry panel. All telephone calls on fixed lines currently go through circuits and switching boards nearly monopolized by NTT East and NTT West, even for customers of other telecommunications carriers. Other carriers pay for the installation of maintenance of the switchboards in the form of the connection fee. The increase in the use of email and phone calls made via ADSL and fiber-optic cable has resulted in a decline in the use of fixed-line telephones by 10-20% each year since fiscal 2000. The drop in telephone use has pushed up the connection fee each year, with the fees for fiscal 2003 and 2004 raised for the first time since the system was introduced in fiscal 1994. Higher connection fees would prevent newcomers such as foreign firms from entering the market by offering discount fees. The issue of lowering the connection fee has been on the political agenda between Japan and the United States for a long time. The new telecom firms argue that the cost of installation has been unfairly added to their costs. This argument has led to the panel's decision to partially transfer the fixed charge to the basic fee on fixed lines to prevent a rise in the connection fee. The new telecom companies have demanded NTT minimize the hike in the connection fee by reducing its operating and maintenance costs. A ministry's study suggested that an 11% reduction in maintenance costs by NTT was possible. The ministry hopes to minimize the basic fee hike through a reduction in NTT's operating costs and ad advertising expenses. (May 1, the Yomiuri Shimbun, the Daily Yomiuri)

The International Telecommunication Union (ITU) and Waseda University of Tokyo, Japan, have established a research center at the ITU-Waseda Information and Communication Technology (ICT) Center to support work in the area of radio communications, particularly in the fields of radio frequency spectrum, digital broadcasting, mobile services and regulatory issues. The center will hold workshops on policy, regulation and emerging technology issues in mobile and radio communication for government officials and telecommunication operators from the developing and developed world. (Nikkei Electronics Asia; April 2004 Issue)

The Public Management Ministry will review interconnection fees that telecommunications firms outside the NTT group are asked to pay NTT East and NTT Wet when they use NTT's fixed line network, and the basic fees subscribers pay each month to NTT firms, to cope with the declining number of fixed telephone service users. The ministry aims to reduce interconnection fees by transferring part of the fees to the basic subscription fees. Though the monthly basic fees might be raided by several hundred yen, the ministry hopes to minimize the fee hike by reviewing the method used to calculate the basic fees. The ministry plans to refer the issue to the Information and Communications Council on April 20. Following the council's proposal expected in autumn, the ministry plans to revise ministry ordinances and other relevant regulations. The number of subscribers to the fixed telephone service is rapidly declining due to several factors, including the increasing use of e-mail and mobile phones. (April 14, the Yomiuri Shimbun, the Daily Yomiuri)

Japan, China and Korea have agreed to jointly develop communications and other technologies for fourth-generation cellular phones, which are expected to come into commercial use around 2010. The agreement is aimed at having the three countries adopt a unified communications protocol. Together, they account for about 30% of all cell phone users around the world, suggesting that the protocol might eventually become the global standard. Working-level meetings will soon begin on a regular basis to exchange views and promote joint research among their scientific institutes and private companies. Fourth-generation cell phones, which will succeed the FOMA third-generation service of NTT DoCoMo Inc and CDMA2000 3G service of KDDI Corp, are expected to enable throughput of 100Mbps -- equivalent to the speed of fiber-optic communications. They are also expected to allow users to watch crystal-clear TV images on their displays even on fast-moving trains. Posts and Telecommunications Minister Taro Aso will meet his Chinese and Korean counterparts in Japan in July to sign an accord on joint development, sources said. The three countries are expected to adopt the same stance from now on at international conferences and other occasions designed to decide on global use of frequency bandwidths -- a crucial point in spreading fourth-generation cell phone services. They are joining forces because if they develop and use the same technologies service providers in one country will be able to enter the markets of the other two, a development that could lead to a further expansion of their combined markets and allow them to have a bigger say in the sector around the world. Joining hands will also increase sales opportunities to cell phone makers in their countries as well as reduce handset development costs. Subscribers will also be able to use their phones overseas. (The Nihon Keizai Shimbun; April 5, 2004)