Vodafone exec to head Japan Telecom


Japan Telecom has 7 million subscribers to its J-Phone cell-phone service, but is suffering in its traditional business

By staff and wire reports

TOKYO, Japan -- Japan Telecom Co. on Wednesday named Vodafone executive William Murrow as its president.

Murrow, 42, is the country manager for Vodafone in Japan, as well as a managing director at Japan Telecom. He will replace Haruo Murakami, 62.

Vodafone bought two-thirds of Japan Telecom, Japan's third-largest phone company, in October.

Japanese telecoms have been relying on growth at their mobile-phone businesses to see them through.

But analysts expect Japan Telecom and its larger rivals, No. 1 Nippon Telegraph and Telephone and No. 2 KDDI, to have to revamp as they face pressure on profits.

A large loss on fixed-line customers

Vodafone, the world's biggest cell-phone carrier, was expected to overhaul management and lead a push to improve profits at Japan Telecom.

JT has over 26 million fixed-line customers, including 9 million subscribers to its J-Phone cell phone service. But it faces a 16 billion yen loss ($129 million) from its fixed-line business this year.

It lost 5.2 billion yen ($42.4 million) for the half year through September, due to what Murakami called "a dramatic change in conditions." That compared to a 6.9 billion yen profit in the first six months of 2000.

It forecasts a 2 billion yen net loss for the whole year through March.

Vodafone's decision to bring in overseas management harks to a similar trend already well under way with Japan's auto makers, where Carlos Ghosn has revitalized Nissan and Mark Fields is attempting the same at Mazda.

Japan Telecom stock closed down 1.2 percent at 414,000 yen on Wednesday, on a day the benchmark Nikkei index crumbled 3.0 percent on technology weakness.

Reuters contributed to this report.