Telecommunications

October 2002

The telecom ministry said that Japan intends to hold talks with the United States in Washington over a U.S. demand to have Nippon Telegraph and Telephone Corp. cut hookup fees charged on non-NTT carriers. The ministry is certain that the Japanese side can solve this issue through working-level talks, without having to put it on politicians' negotiation agenda. Japanese negotiators plan to brief U.S. negotiators on Japan's basic stances, including a possible revision to the hookup fee calculation formula. Washington has urged Tokyo to adopt a new calculation method that can realize a sharp cut in interconnection fees by NTT's two regional phone units, NTT East Corp. and NTT West Corp. Under the current system based on the cost of NTT infrastructure construction and the volume of phone traffic, interconnection fees may be partially raised due to the growing use of sophisticated Internet connection technologies such as flat-charge asymmetric digital subscriber lines and optical fiber-based services. If Japan proposes hiking hookup fees to the U.S. side, it would end up making upcoming bargaining more difficult. (October 23, Dow Jones)