News Release uhby060512d

5. Average monthly revenue per unit (ARPU)

Average monthly revenue per unit, or ARPU, is used to measure average monthly operating revenues attributable to designated services on a per user basis. In the case of our fixed line business, ARPU is calculated by dividing revenue items in the operating revenues of our Regional Communications Services, that is, subscriber lines services and ISDN, by the No. of active subscribers to the relevant services. In the case of our cellular business, ARPU is calculated by dividing revenue items included in the operating revenues from our Wireless Services, such as revenues from Cellular (mova) services and revenues from Cellular (FOMA) services, which are incurred consistently each month (i.e., monthly charges and voice/packet transmission charges), by the No. of active subscribers to the relevant services (the calculation of these figures excludes revenues that are not representative of monthly average usage such as equipment sales and activation fees). We believe that our ARPU figures calculated in this way provide useful information regarding the monthly average usage of our subscribers. The revenue items included in the numerators of our ARPU figures are based on our financial results comprising our U.S. GAAP results of operations.

Notes :

We separately compute ARPU for the fixed line business conducted by each of NTT East and NTT West using two measures.

-	ARPU from telephone subscriber lines services, which is based on operating revenues from monthly charges, call charges and FLET'S ADSL charges attributable to our telephone subscriber lines services.
-	ARPU from ISDN, which is based on operating revenues from monthly charges, transmission/call charges and FLET'S ISDN charges attributable to our ISDN.

Interconnection revenues are excluded in ARPU of Telephone Subscriber Lines and ISDN Subscriber Lines.

In terms of No. of channels, transmission rate, and line use rate (base rate), INS-Net 1500 is in all cases roughly ten times greater than INS-Net 64. For this reason, one INS-Net 1500 subscription is calculated as ten INS-Net 64 subscriptions.

From the three months ended Jun. 30, 2005, calls from fixed telephones of NTT East or West to mobile phones with a dialing Carrier Identification Code are billed on end-to-end basis and amounts are recorded as call rate revenues of NTT East or West.

We compute ARPU for our cellular business using two aggregate measures.

Cellular Aggregate ARPU (FOMA+mova) = Voice ARPU (FOMA+mova) + Packet ARPU (FOMA+mova).

Our Voice ARPU (FOMA+mova) is based on operating revenues related to voice services, such as monthly charges and voice transmission charges, attributable to our third generation FOMA and conventional mova services, and our Packet ARPU (FOMA+mova) is based on operating revenues related to packet communication services, such as monthly charges and packet transmission charges, attributable to our third generation FOMA services and based on operating revenues related to i-mode services, such as monthly charges and packet transmission charges, to our conventional mova services. We also separately compute i-mode ARPU (FOMA+mova), as a subcomponent of Packet ARPU (FOMA+mova). In particular, i-mode ARPU (FOMA+mova) is based on operating revenues from monthly charges and packet transmission charges attributable to our i-mode-related FOMA and mova services.

Cellular Aggregate ARPU (FOMA) = Voice ARPU (FOMA) + Packet ARPU (FOMA).

Our Voice ARPU (FOMA) is based on operating revenues related to voice services, such as monthly charges and voice transmission charges, and our Packet ARPU (FOMA) is based on operating revenues related to packet communication services, such as monthly charges and packet transmission charges, in each case attributable to our third generation FOMA services. We also separately compute i-mode ARPU (FOMA), as a subcomponent of Packet ARPU (FOMA). In particular, i-mode ARPU (FOMA) is based on operating revenues from monthly charges and packet transmission charges attributable to our i-mode-related FOMA services.

Cellular Aggregate ARPU (mova) = Cellular Voice ARPU (mova) + i-mode ARPU (mova).

Our Voice ARPU (mova) is based on operating revenues related to voice services, such as monthly charges and voice transmission charges, and our i-mode ARPU (mova) is based on operating revenues related to i-mode services, such as monthly charges and packet transmission charges, in each case attributable to our conventional mova services.

We show ARPU for our i-mode using two aggregate measures.

-	i-mode ARPU is based on the No. of all subscribers who have active cellular phones, regardless of whether the i-mode service is activated.
-	ARPU generated purely from i-mode is based on the No. of active subscribers to the i-mode service only.

International service-related revenues in cellular business, which had not been included in previous reports, have been included in the Cellular ARPU data calculation for the fiscal year ending Mar. 31, 2006, due to its growing contribution to total revenues. International service-related Cellular ARPU included in the Cellular ARPU results for the 1st quarter ended Jun. 30, 2005 are 30 yen for Cellular Aggregate ARPU (FOMA+mova), 60 yen for Cellular Aggregate ARPU (FOMA), and 20 yen for Cellular Aggregate ARPU (mova); those for 2nd quarter ended Sept. 30, 2005 are 40 yen for Cellular Aggregate ARPU (FOMA+mova), 70 yen for Cellular Aggregate ARPU (FOMA), and 30 yen for Cellular Aggregate ARPU (mova); those for 3rd Quarter ended Dec. 31, 2005 are 40 yen for Cellular Aggregate ARPU (FOMA+mova), 70 yen for Cellular Aggregate ARPU (FOMA), and 30 yen for Cellular Aggregate ARPU (mova); those for 4th Quarter ended Mar. 31, 2006 are 40 yen for Cellular Aggregate ARPU (FOMA+mova), 70 yen for Cellular Aggregate ARPU (FOMA), and 20 yen for Cellular Aggregate ARPU (mova); those for the fiscal year ended Mar. 31, 2006 are 40 yen for Cellular Aggregate ARPU (FOMA+mova), 70 yen for Cellular Aggregate ARPU (FOMA), and 30 yen for Cellular Aggregate ARPU (mova); and forecasts for the fiscal year ending Mar. 31, 2007 are 60 yen for Cellular Aggregate ARPU (FOMA+mova), 80 yen for Cellular Aggregate ARPU (FOMA), and 40 yen for Cellular Aggregate ARPU (mova). Cellular ARPU data in previous reports does not include International service-related revenues, but Cellular Aggregate ARPU (FOMA+mova) generated from International services for the relevant periods is 20 yen for the fiscal year ended Mar. 31, 2005.

Communication module service subscribers and the revenues thereof are not included in the ARPU calculations.

No. of active subscribers used in ARPU calculation are as below.

-	FY Results & Forecast: Sum of No. of active subscribers**(as defined below) for each month from Apr. to Mar.
-	1Q Results: Sum of No. of active subscribers**(as defined below) for each month from Apr. to Jun.
-	2Q Results: Sum of No. of active subscribers**(as defined below) for each month from Jul. to Sept.
-	3Q Results: Sum of No. of active subscribers**(as defined below) for each month from Oct. to Dec.
-	4Q Results: Sum of No. of active subscribers**(as defined below) for each month from Jan. to Mar.
	**active subscribers = (No. of subscribers at end of previous month + No. of subscriber at end of current month)/2

* Partial listing only.