Yup, matches my experience (designing/deploying AOL's swan song JP
network infrastructure) during the same period.
The "ILECs" were artifacts of the Japanese regulators' 1997 effort to
relieve the last mile facilities death grip on services, ala the
(1984) US MFJ / AT&T breakup. The new c. 2001 "pressure" was possible
because the Japanese gov was still NTT's largest shareholder.
The same "pressure" that prompted FTTH rollout also delivered the
metro and access facilities unbundling that begat YahooBB and
ubiquitous 20-100Mbps to the home over conventional facilities -- the
latter mandate being similar in form the US Telecom Act of 1996, with
the minor exception that it actually worked there...
TV
On Oct 23, 2007, at 9:42 AM, Rod Beck wrote:
I did consulting work for NTT in 2001 and 2002 and visited their
Tokyo headquarters twice. NTT has two ILEC divisions, NTT East and
NTT West. The ILEC management told me in conversations that there
was no money in fiber-to-the-home; the entire rollout was due to
government pressure and was well below a competitive rate of
return. Similarly, NTT kept staff they did not need becuase the
government wanted to maintain high employment in Japan and avoid
the social stress that results from massive layoffs. You should
not assume that 'Japanese capitalism' works like American
capitalism. It doesn't. NTT only reveals financial statistics at
the aggregate level; the cross subsidies between divisions is
completely hidden and this enables them to pursue the government's
social objectives.
Moreover, it is not clear that you should desire broadband rollout
at any cost. Presumably broadband access should be justified as
satisfying some net benefit criterion (benefits minus costs).
A better model is the French model which generates very high
broadband penetration rates and is economically rational. France
has successfully forced the ILEC to open up the central offices and
you now have two highly successful and publicly traded DSL
providers, Neuf Cegetel and Free.
The US effort failed because of silly arguments based on the
equally silly notion that private property is an absolute right and
that forcing the ILECs to share facilities even when they are
receiving a fair return of return in a form of 'confiscation'.
As always, these comments are mine and not the position of Hibernia
Atlantic.
Roderick S. Beck
Director of EMEA Sales
Hibernia Atlantic
1, Passage du Chantier, 75012 Paris
http://www.hiberniaatlantic.com
Wireless: 1-212-444-8829.
Landline: 33-1-4346-3209.
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