NTT to offer broadband service to Tokyo homes

From...

By Kuriko Miyake

(IDG) -- Two of Nippon Telegraph and Telephone's (NTT) regional units, NTT East and NTT West, announced on Thursday that they will start offering commercial FTTH (fiber to the home) Internet service in limited areas of Tokyo and Osaka from August 1. NTT has been running FTTH trail services in certain areas of both cities since December last year.

The FTTH services in Tokyo and Osaka will offer three types of services, a basic type, which connects to the Internet at speeds up to 100M bps (bits per second); a family type, which splits a 10M bps Internet connection between multiple users; and an apartment type, which shares a100Mbps Internet connection with multiple households in an apartment building using a local-area network.

The price rates for the commercial FTTH service are lower than those for the trial services, which ranged as high as 32,000 yen (US$257) a month. However, the new fees -- 9,000 yen, 5,000 yen and 3,800 yen for each service type, respectively -- remain relatively high. In addition, users must pay a one-time subscription fee of 800 yen and an installation fee of up to 27,100 yen. Internet access charges are not included in those rates.

At this point, prices for the service are fixed and the companies are not considering lowering these rates in the future, according to Yuichi Nagao, a spokesman for NTT East.

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It will take about a month to install access to the fiber network from a house once a user registers, Nagao said.

By the end of March, a total of 470 users, 400 in Tokyo and 70 in Osaka, subscribed to the trial FTTH service. For the commercial service, the companies hope to expand the service areas in entire Tokyo and Osaka within this year and nationwide in the first quarter next year, reaching more potential users.

According to a Gartner Japan report released last Thursday, the number of ADSL users and cable Internet users in Japan are expected to rapidly increase, but FTTH users will grow slowly, approaching 3.9 percent of users by 2005. However, competition between FTTH service carriers has been underway since the fourth quarter of last year.

Usen Corp., which started its FTTH trials in October 2000, launched Japan's first commercial FTTH service in Tokyo in March, offering a 100M bps connection for 6,100 yen per month.

Usen has already registered 30,000 customers via the Web and has finished 507 installations by the end of May. It expects to double that number by the end of this month, according to a Usen spokeswoman who declined to be named.

Usen's service includes both the connection fee and Internet-access charges. The company plans to expand the service to other cities in Japan later this year.

Tokyo Telecommunication Network (TTNet), another NTT's competitor and a local telecommunication carrier, announced this month that it plans to start a trial FTTH service on July 1 including 300 households in Tokyo.

NTT also announced last Friday the creation of a wholly owned venture, NTT Broadband Initiative (NTT-BB), to administer all of its broadband services, including the FTTH services, ADSL services and NTT DoCoMo's third-generation (3G) mobile telecommunication service, according to Ryouji Kusunoki, a spokesman for NTT.

The new company will provide portals for broadband content as well as handle customer management. "It hopes to market broadband portals not exclusive to NTT customers but other broadband Internet users," Kusunoki said. NTT-BB plans to start operating in the third quarter of this year.