FOR IMMEDIATE RELEASE
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NTT Details Commitment to Global Business | ||||
NTT, in pursuit of full-scale participation in global business following its planned reorganization in 1999, has been working to develop its role in the global market. In its international telecommunications operations, a year has passed since the launch of new global services in September 1997 under the brand name Arcstar in cooperation with both domestic and international subsidiaries, following amendments in the NTT Law. NTT, still a challenger in the global telecommunications market, will concentrate its resources in fields with strong potential for growth to fully meet the needs of its customers and the market. It will also strengthen its capability to provide services, particularly in the Asia-Pacific region, through tie-ups and other cooperative arrangements with reputable partners. Accordingly, NTT herewith announces its latest business plan for the global market, based on its achievements in the past year and changes in the domestic and international business environment, with the aim of becoming a global infocommunications enterprise.
(a) Global Progress on Deregulation An agreement on the liberalization of basic telecommunications services by the WTO took effect this February and is now promoting further deregulation on a global basis. The governments of participating countries are developing new frameworks, such as introducing competition and privatizing existing carriers according to the state of maturity of each market, as well as easing or fully abolishing foreign-capital regulations. (b) Structural Changes in the Telecommunications Market Needs for low-cost conventional services, such as telephony, are strengthening, and needs for computer-based telecommunications, mainly Internet Protocol (IP) services, are rapidly increasing, as can be seen with the Internet boom. Information technology is becoming an increasingly important part of corporate restructuring for survival. Moreover, IP communications are becoming a new platform for infocommunications, particularly as a tool for restructuring for corporations and governmental entities. Meanwhile, many telecommunications companies are developing new IP-related businesses, as the world's major carriers strengthen their efforts towards mergers and acquisitions and other forms of integration, for example MCI WorldCom and the joint venture by AT&T and BT. (c) Expansion of NTT's Global Services NTT expects to expand its service area and provide a wider range of Arcstar brand services, including high-quality IP services. In addition to its own operations, NTT will also seek cooperation with domestic and overseas carriers and further expansion of coverage and connectivity. Also, in addition to providing services to users, mainly multinational corporations, NTT, as a new business, will pursue the development of international telephony services and the establishment and provision of platforms for the international business of corporations and governmental entities.
(a) Economic Environment The Asian region has been struck since last year by an economic crisis that has made the current business environment very difficult. On the other hand, Asian countries regard the telecommunications industry as a key to industrial restructuring aimed at overcoming the crisis and are, accordingly, making efforts to develop and deregulate their telecom markets. (b) Continuing Strategy Focused on Asia As part of continuing to treat the Asian regional market as an important component of its global business, NTT will strengthen its financial and risk management activities for ongoing projects in the region. To expand global services provided by the NTT group under the Arcstar brand name, NTT will actively invest in and participate in the management of international carriers in other Asian countries, as well as expand connectivity through, for example, interconnection arrangements with individual carriers depending on regulations in each country. NTT will also develop its market for multimedia based on the results of ATM (asynchronous transfer mode) international interconnection trials being conducted between Japan and Hong Kong, Thailand, Indonesia and Malaysia through the Asian Multimedia Forum (AMF). In the regions of America and Europe, NTT will strengthen its own capability to provide services, as well as strengthen its presence in these markets through joint operations and joint capital arrangements, giving due consideration for expanding its range of services further in the future.
The NTT holding company will formulate the NTT Group's overall strategies for global business. The holding company's functions will also include decisions on large-scale tie-ups and M&As, financing and funds procurement.
After the reorganization, the long-distance and global company will play a central role in the seamless operation of both domestic and global operations. To improve global service system, however, NTT will reorganize its domestic and overseas subsidiaries as needed.
*Reorganization of domestic and overseas NTT subsidiaries As for the two global telecommunications subsidiaries established in Japan last year, NTT Worldwide Telecommunications Corporation, an international special Type-II carrier, will continue its operations and mainly conduct sales of global services to multinational corporations. NTT Worldwide Network Corporation, an international Type-I carrier, however, will be integrated into the long-distance and global company.
Domestic regional companies, NTT-East and NTT-West, will participate, under the control of the holding company, in selected global operations, such as providing technical support, by spearheading local projects in overseas countries.
To create the kind of corporate environment needed to compete globally, NTT will begin reforming its internal corporate culture prior to the reorganization. | ||||
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Attachment
- NTT's Developments in NTT's International Business (July 1997 to September 1998)
- Arcstar Global Service Provision Bases | ||||
 NTT NEWS RELEASE |