AEA and TIA Commend New NTT Procurement Agreement.

SAN FRANCISCO--(BUSINESS WIRE)--July 1, 1999--

The American Electronics Association (AEA) and the Telecommunications Industry Association (TIA) today commended the governments of the United States and Japan for reaching agreement on a new telecommunications procurement agreement covering purchases by the successor companies of Nippon Telegraph and Telephone (NTT), Japan's dominant telecommunications carrier.

The new agreement will remain in effect for two years, continues pro-competitive government oversight of the NTT successor companies, monitors progress with data collection and government-to-government review, and includes adherence by the successor companies to open, transparent, non-discriminatory, procurement procedures.

While both associations acknowledge that U.S. suppliers selling to NTT have seen increased sales in certain areas over the past several years, the results do not equal the level of increased sales U.S. companies have seen for their equipment in the Japanese private market or other regions of the world. Given the global competitiveness of U.S. telecom suppliers, AEA and TIA expect to see continued progress in foreign sales and market share in Japan under this new framework, and will monitor its progress closely.

NTT, which accounts for one third of Japan's $35 billion telecom equipment market, is the largest telecom equipment purchasing entity in the telecom sector. Through its R&D and deployment decisions, NTT sets standards that impact the entire Japanese telecom market. Thus, non-discriminatory access to NTT is critical to market access in Japan.

AEA President and CEO, William T. Archey, said, "We appreciate the efforts of both sides to reach this agreement. Maintaining pro-competitive oversight is not only in the interest of foreign suppliers, it is also clearly in the interest of the Japanese consumer, who will ultimately benefit from an open, non-discriminatory process that yields competition."

"After much hard work by negotiators on both sides, the outcome of a new agreement is positive for foreign suppliers. We believe that foreign competitors in the telecommunications equipment market in Japan should be able to compete on a level playing field with Japanese equipment suppliers, with transparent rules available to all," said Matthew J. Flanigan, President of TIA. "The role of pro-competitive government oversight of this agreement is key. We support the outcome, and will continue to monitor its implementation to ensure increasing sales for U.S. suppliers in Japan."

The NTT Agreement has been in place since 1981 and was designed to permit foreign suppliers of telecommunications equipment more access to the Japanese telecom market. Since then, NTT has sold 33 percent of its shares to the public, but still remains majority government-owned. NTT is scheduled to undergo a corporate restructuring on July 1. The new corporation will consist of a holding company, regional carriers (NTT East and NTT West), and a long distance carrier (NTT Communications).

The American Electronics Association is the largest technology trade group in the country, representing more than 3,000 high-tech companies. With 17 councils located in technology communities throughout the United States and offices in Brussels, Beijing and Tokyo, AEA provides a unique grassroots capability. For more than 56 years, AEA has been the accepted voice of the U.S. high-tech industry.

TIA is a full-service national trade organization with membership of 1,000 large and small companies that provide communications and information technology products, materials, systems, distribution services and professional services in the United States and around the world. The association's member companies manufacture or supply virtually all of the products used in global communication networks. TIA represents the telecommunications industry with its subsidiary, the MultiMedia Telecommunications Association, in association with the Electronic Industries Alliance.

Note to Editors: Please note that information regarding the Telecommunications Industry Association is available via TIA's World Wide Web site at http://www.tiaonline.org.