Europe South Asia Asia Pacific Americas Middle East Africa BBC Homepage World Service Education



Front Page

World

UK

UK Politics

Business

Sci/Tech

Health

Education

Sport

Entertainment

Talking Point

In Depth

On Air

Archive
Feedback
Low Graphics
Help

Sunday, April 25, 1999 Published at 10:48 GMT 11:48 UK


Business: The Company File

Global deal for Japan Telecom



British Telecom and its global partner AT&T have announced the first big foreign investment in Japan's telecommunications industry.

They have agreed to each buy 15% of Japan Telecom for a total of $1.85bn.

A statement says the three firms are planning a broad alliance in which AT&T and BT will integrate most of their Japanese operations with Japan Telecom's units.

The largest telephone companies in the United Kingdom and United States respectively say they expect this to be the first of several moves they make in building the $10bn global telecommunications joint venture unveiled nine months ago.

The joint venture, which has yet to be named, will provide global voice and data communications services, targeting in particular multi-national business customers and Internet service providers.

Considerable benefits

Analysts say the deal is the first large investment by major foreign companies in Japan's deregulating telecoms sector.

Japan Telecom Co is one of Japan's largest telephone operators, and provides leased-line and long distance services through fibre optic networks running along railway lines.

BT and AT&T were reported to have been initially seeking nearly 40% of Japan Telecom which would have given them a veto over major management decisions.
[ image: AT&T has been busy making deals]
AT&T has been busy making deals
The agreement could bring considerable benefits to BT and AT&T, allowing them access to corporate clients in Japan and kick-starting their data business via Japan Telecom's established network.

BT already has more than a dozen Asia-Pacific alliances, partnerships and joint ventures.

BT chief executive Peter Bonfield said: "This partnership between Japanese, European and US companies is ground breaking in telecommunications and builds substantially on BT's growing presence in Asia."

His AT&T counterpart, Michael Armstrong, added: "It's an extraordinary growth opportunity for all three companies and it is essential the global venture has a strong distributor in this key market."

Deregulation has opened the door for newcomers and foreign companies into Japan's growing telecommunication market - the world's second largest after the United States.

It is overwhelmingly dominated by former state monopoly Nippon Telegraph and Telephone Corp (NTT).

Japan Telecom, Japan's third largest long distance and international carrier, has been looking for a partner to survive tough competition, with many of its domestic rivals cutting rates for calls.

Industry analysts say more cross-border link-ups are inevitable with foreign firms forging ties with Japanese businesses to grab a share in Japan's growing telecommunications market.

Japan Telecom chairman Koichi Sakata said: "The agreement will strengthen further the company's position in the Japanese market with the backing of two such strong brands as BT and AT&T."



Advanced options | Search tips




Back to top | BBC News Home | BBC Homepage | ©


The Company File Contents


Relevant Stories

23 Apr 99 | The Company File
Top talks on telecoms merger

23 Apr 99 | The Company File
Cable wars intensify

08 Apr 99 | The Company File
BT expands into China

30 Mar 99 | The Company File
BT and AT&T clear regulator





Internet Links


BT

AT&T


The BBC is not responsible for the content of external internet sites.




In this section

Microsoft trial mediator welcomed

Vodafone takeover battle heats up

Christmas turkey strike vote

NatWest bid timetable frozen

France faces EU action over electricity

Pace enters US cable heartland

Mannesmann fights back

Storehouse splits up Mothercare and Bhs

The rapid rise of Vodafone

The hidden shopping bills

Europe's top net stock

Safeway faces cash demand probe

Mitchell intervenes to help shipyard

New factory creates 500 jobs

Drugs company announces 300 jobs

BT speeds internet access

ICL creates 1,000 UK jobs

National Power splits in two

NTT to slash workforce

Scoot links up with Vivendi

New freedom for Post Office

Insolvent firms to get breathing space

Airtours profits jump 12%

Freeserve shares surge

LVMH buys UK auction house

Rover - a car firm's troubles