International Logistics Pilot by the EPCglobal Logistics Group IIJ, NTT Comware, Oracle Japan, and VeriSign Japan to Participate.

Japan Application Consortium to Be Established and Standard RFID System for International Logistics to Be Constructed

TOKYO -- Internet Initiative Japan, Inc. ("IIJ", NASDAQ: IIJI, TSE1: 3774), one of Japan's leading Internet access and comprehensive network solutions providers, today announced that IIJ, NTT Comware corporation ("NTT Comware"), Oracle Corporation Japan ("Oracle Japan"), and VeriSign Japan K.K. ("VeriSign Japan") will construct an RFID system based on a jointly developed standard for use in the international logistics pilot program that is being conducted by EPCglobal, the international RFID standards group, in January 2007.

Pilot Outline and Objectives

International logistics is the backbone of global supply chains and logistics service providers handle huge information with a multitude of customers located throughout the world. The result has been a complex system whose costs grow annually.

The demand for advanced systems and supply-chain visibility in the logistics industry is growing, as is the demand for an international standard to facilitate the use, expansion, and spread of RFID. To this end, several leading logistic service providers and EPCglobal(1), the international standards organization for RFID, established the Transportation & Logistics Services Industry Action Group(2) in November 2005. This year the Ministry of Economy, Trade, and Industry offered its support, and the international logistics RFID pilot program was initiated, with the first phase involving a test from Hong Kong to Japan possibly coming in February 2007, and the second phase involving a test from Shanghai to Los Angeles possibly happening in October 2007.

Potential participants in the first phase include international logistics service providers, DHL, Maersk, NYK, Schenker, and Schneider. The first phase test is scheduled to include interoperability over the RFID system. This pilot is intended to test the suitability of the RFID specification to the demands of businesses in the field, and to bring any operational problems to light so that they can be resolved.

Participating Companies

It is vital for this pilot that the integration of an RFID system makes global supply chains visible. Through this pilot, NTT Comware, IIJ, Oracle Japan, and VeriSign Japan form the Japan Application Consortium (JAC).This consortium integrates an RFID system that can access and exchange information from RFID tags attached to products and containers, and each company contribute their EPCglobal-compliant products and solutions to the project.

These RFID systems in each country and company will work together to create an open platform for the exchange of supply chain information, and help make the supply chain visible, efficient, and effective for logistics service providers, shippers, and others in the industry. This, it is hoped, will contribute to business as a whole.

Through this pilot, the companies intend to show the effectiveness and results that are achievable by using an open platform for the exchange of RFID information.

Contribution of each company

   RFID Middleware:           NTT Comware, Oracle Japan
   EPCIS:                     IIJ, NTT Comware, Oracle Japan
   ONS, Local ONS:            VeriSign Japan

The Future

The results of this pilot program will be used to actively promote an international standard, and provide practical experience in applying RFID technology to the logistics industry. Connecting different systems, effortlessly handling large volumes of data, ensuring greater security--these and other features will characterize the RFID system as it matures, and leveraging the achievements, experience, and technological strengths of the participating companies, the objective is a worldwide open platform.

Note:

1. EPCglobal

EPCglobal develops, promotes and sets standards for the EPCglobal Network System, a system that replaces the bar code with RFID tags and the Internet for data transmission. EPCglobal is a non-profit organization established in November 2003 in Princeton New Jersey, USA. The organization was formed from several standards work groups, with the two most important being the former International EAN Association (an international logistics code standardization organization, now known as GS1 UK1) and the former UCC (a U.S. logistics code management organization, now known as GS1 US). As of December 2006, there are 1073 member companies.

2. EPCglobal Transportation & Logistics Services Industry Action Group

Established in November 2005, the Transportation & Logistics Services Industry Action Group promotes the standardization of electronic tags to improve the efficiency of international logistics. The group considers the various applications of electronic tags in import/export procedures, logistics center operations in the yard and in the warehouse, and in transit on land, sea, or air.

About IIJ

Founded in 1992, Internet Initiative Japan Inc. (IIJ, NASDAQ: IIJI, Tokyo Stock Exchange First Section: 3774) is one of Japan's leading Internet-access and comprehensive network solutions providers. IIJ and its group of companies provide total network solutions that mainly cater to high-end corporate customers. The company's services include high-quality systems integration and security services, Internet access, hosting/housing, and content design. Moreover, the company has built one of the largest Internet backbone networks in Japan, and between Japan and the United States. IIJ was listed on NASDAQ in 1999 and on Tokyo Stock Exchange First Section in 2006. For more information, visit the IIJ Web site at http://www.iij.ad.jp/en/.

The statements within this release contain forward-looking statements about our future plans that involve risk and uncertainty. These statements may differ materially from actual future events or results. Readers are referred to the documents furnished by Internet Initiative Japan Inc. with the SEC, specifically the most recent reports on Forms 20-F and 6-K, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements.