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Panel to recommend moderate cut in NTT access charges.

TOKYO, Jan. 21 Kyodo

A government advisory panel agreed Friday to recommend a moderate cut in interconnection fees charged by Nippon Telegraph and Telephone Corp. (NTT), rejecting deeper cuts demanded by the United States, officials said.

The moderate cut, based on one of two new methods of calculating interconnection rates carriers must pay to NTT for use of its network, would result in a 16.7% cut in NTT access charges. The other method would reduce the charges by 41.1%.

The panel, a subcommittee under the Telecommunications Council, will submit the recommendation to Posts and Telecommunications Minister Eita Yashiro on Feb. 9.

The panel will recommend the cut be introduced in stages.

At a press conference later in the day, subcommittee chairman Tadao Saito said that the moderate reductions are better for the maintenance of uniform telecom services by NTT across Japan, as the effects on the firm's earnings would be smaller.

The subcommittee recommendation is expected to draw criticism from the U.S., as well as from Europe and new telecom carriers, who complain that NTT's interconnection fees are too high.

In Washington earlier this week, Japanese and U.S. government negotiators failed to iron out their differences over ways to reduce NTT's interconnection fees.

Japan initially wanted the U.S. to accept a 16.7% cut but conceded to a 22.5% reduction. Washington had insisted on an eventual reduction of 50%, starting with a 41.1% cut in 2000.

In a related development, Junjiro Tsuda, chairman of NTT's labor union, said Friday that a steep cut in interconnection fees, as demanded by the U.S., would make it difficult for NTT's two regional telephone operators to compete with new common carriers.

"We don't oppose a cut in interconnection fees itself," Tsuda told a press conference.

But he added he is against any plan to use all costs saved by NTT under its restructuring for a cut in interconnection fees, passing them on to NTT's rival telecom carriers.
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Comment:Panel to recommend moderate cut in NTT access charges.
Publication:NTT Topics
Article Type:Brief Article
Geographic Code:9JAPA
Date:Jan 24, 2000
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