News Release ljzn080513b

3. Business Operation Policy

(1)

Basic Business Operation Policy and Medium-Term Management Objectives

For over 100 years, the NTT Group has been the mainstay behind the growth and development of Japanese telecommunications; this track record, the confidence that comes with it, and our R&D capabilities, which are second to none in the world, serve as the foundation from which we will "continue to provide safe and secure service, and continue always to earn the trust of our customers and stakeholders." With these words as our guide, amidst fierce competition in the marketplace, we will fulfill the legal responsibilities and social mission demanded of each of our businesses in a market environmental characterized by intense competition, and at the same time move proactively to develop our businesses to meet the needs of the ubiquitous broadband society of the 21^st century. Our aim is for sustainable development backed always by a high level of trust from both our customers and our shareholders.

In order to respond to the increasingly diversified and complex needs of customers in the wake of the rapid developments taking place in the information and telecommunications market, NTT Group formulated "NTT Group's Medium-Term Management Strategy" in November 2004. Since that time, NTT Group has announced specific steps it has implemented to timely respond to the changing technologies and market conditions. As NTT Group achieves its goals set forth in its Medium-Term Management Strategy, NTT Group will continue to proactively work to provide greater convenience to its customers, contribute to overcoming social problems, and implement a management strategy that emphasizes shareholder value.

(2)

Issues Facing the Corporate Group

Although the Japanese economy has been decelerating, we anticipate a moderate recovery supported by a rally in housing constructions and an increase in exports. However, it is necessary to continue monitoring carefully the uncertainties concerning foreign economies and the international financial markets and the rising prices for energy and raw materials.

In the information and telecommunications market, IP-based networks and ubiquitous broadband communications continue to spread, and the convergence of services, including fixed-mobile convergence and communications-broadcasting convergence, is accelerating. The resulting diversification of customer demands is expected to intensify competition even further.

Under this environment, NTT Group is moving forward with the construction of the next-generation network (NGN) and open connectivity with the networks of other carriers as set forth in its Medium-Term Management Strategy. With "open" and "collaboration" as its key terms, NTT will also continue to collaborate with businesses from a wide range of fields to create and develop new services and new value.

As a specific measure to promote the NGN, commercial service was launched in the Tokyo metropolitan area and Osaka Prefecture in March 2008, and is to be expanded progressively to ordinance-designated cities and prefectural capitals. NTT will expand services that offer convenience through capitalizing on the high quality and highly secure characteristics of the NGN. In promoting the development and commercial launch of new services that utilize the NGN, NTT Group is using forums such as collaborating with a range of partners to create new services, including through the Next-Generation Services Joint-Development Forum.

NTT Group continues to engage in efforts to provide appealing services through the NGN and establish business processes that will allow for accurate and prompt response to customer demands and promote increased use of optical access services.

With respect to FOMA, while increasing customer satisfaction and enhancing customer relationships are its top priorities, NTT Group is taking measures to strengthen its overall competitiveness, including construction of a stable, high-quality network, enhanced after-sales service, introduction of user-friendly rate plans and services, and expansion of its handset lineup. Moreover, the eight regional NTT DoCoMo companies will be consolidated to establish one nationwide company structure, in an effort to integrate and strengthen customer service and increase business efficiency.

In regards to services for corporate customers, NTT Group will make continuous efforts to bolster marketing and development capabilities and offer a variety of solutions. To respond to customer demands relating to, among others, integrated domestic and overseas ICT usage and end-to-end network quality assurance, NTT Group is working with overseas businesses, making a full use of NTT Group's comprehensive resources and capabilities.

In addition, NTT Group will continue to conduct and develop global businesses tailored to market conditions in each country and region, using its know-how and experience of providing services based on its research and development, such as NGN services.

Also, NTT Group is continuing its efforts to expand business in new fields that do not rely on traffic volumes. The entire group is working together to review business processes and increase business efficiency through consolidation of business sites and outsourcing.

At the same time, NTT will continue to allocate the managerial resources of NTT Group in a proactive and flexible manner, promote unified research and development of fundamental technologies, and otherwise take advantage of the benefits of NTT's holding company structure. NTT will also provide individual NTT Group companies with advice, intermediary services, and other assistance including support for their efforts to obtain cost-effective financing.

On the research and development front, NTT will continue to focus its efforts on the creation of basic technologies required for the development of advanced networks and new services that will support the development of a secure, dependable and convenient ubiquitous broadband society and will undertake proactive measures regarding basic technologies with a focus towards the future. NTT will promote development geared towards commercialization based on close collaboration among NTT Group companies, so that the fruits of research and development are reflected in its business. NTT Group will also continue to promote the dissemination of the results of basic research and development and to contribute to the standardization of technologies and will actively move forward with research and development activities carried out in collaboration with other research institutions.

Through the activities described above, NTT Group will continue its efforts to develop a rich communication environment through the use of ubiquitous broadband, increase the efficiency of corporate activities, and create new business opportunities, with the objective of improving NTT Group's corporate value.

Note:
The forward-looking statements and projected figures concerning the future performance of NTT and its subsidiaries and affiliates contained or referred to herein are based on a series of assumptions, projections, estimates, judgments and beliefs of the management of NTT in light of information currently available to it regarding the economy, the telecommunications industry in Japan and other factors. These projections and estimates may be affected by the future business operations of NTT and its subsidiaries and affiliates, the state of the economy in Japan and abroad, possible fluctuations in the securities markets, the pricing of services, the effects of competition, the performance of new products, services and new businesses, changes to laws and regulations affecting the telecommunications industry in Japan and elsewhere and other changes in circumstances that could cause actual results to differ materially from the forecasts contained or referred to herein.