Internet in Japan
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|This article may be expanded with text translated from the corresponding article in the Japanese Wikipedia. (April 2013)|
In Japan, Nippon Telegraph and Telephone planned a step-up process from dialup 56 kbit/s ISDN 64 kbit/s, to FTTH. Under this plan, NTT had been selling ISDN products primarily toward home users while corporate customers sometimes skipped ISDN entirely and immediately upgraded to the still-expensive FTTH service. In the late 1990s, Cable Television operators began offering their own Cable broadband products, but relatively high initial installation costs and cheaper alternatives limited its spread.
ADSL services were started by a venture company, Tokyo Metallic in 1999. After this NTT started and some other companies followed. In 2001, SoftBank started a 12 Mbit/s ADSL service. It was a shocking event, because the price was around only 3000 yen (30US$), which was half the cost of other companies. This, coupled with aggressive marketing campaigns led to their capturing of large shares of the market. Competitors and Softbank each dropped prices in a price war and repeatedly readied higher speed services to entice customers (12 Mbit/s/s 24 Mbit/s/s, 50 Mbit/s). In 2004, Japan had the best cost to performance ADSL service in the world (50 Mbit/s, 35US$) which it held on to in the successive years.
At the same time, NTT and electric power companies expanded FTTH areas. In most urban areas, people can use FTTH (100 Mbit/s, 50US$), but ADSL is still mainstream. However, large discounts and free installation have boosted FTTH adoption. Many new apartments are built to accommodate this service with little or no wiring. In 2005, Kansai Electric Power launched a 1 Gbps FTTH service at 8700yen (90US$).
In September 2000, the Ministry of Internal Affairs and Communications (Japan) (communications ministry) forced Nippon Telegraph and Telephone, the incumbent operator, to unbundle its copper local loop. The price was fixed considering the line costs were covered by Voice Telephony. Alternative operators could only support incremental costs linked with newly offered functions. In the fiscal year of 2004, partial unbundling rates were 120¥ per month and 1,300¥ per month for total unbundling.
In 2000, rules for operators co-location inside NTT facilities and line delivery terms were established. In 2001, NTT were required to unbundle their interconnection optical fiber links between exchange points. Finally, It was forbidden for NTT East & NTT West to offer internet access services.
Softbank, a major Nippon ISP, launched its DSL service in 2001 "Yahoo! Broadband" and massively invested in DSL technology to become the largest DSL operator by 2003 before the incumbent.
In 2004, 52.1% of households had internet access, with more than half of these using broadband.
In March 2005, DSL had more than 13.6 million customers. The concurrence of FTTH was stronger and stronger, with the arrival of operators like TEPCO (Tokyo Electric Power Company), allied to KDDI and NTT. Three million customers were wired with FTTH in March 2005 and it could supplant DSL in 2007 according to Yano Research
The Japanese model of optical fiber deployment is difficult to compare to other markets. The last kilometre is often done on Lattice Towers, shared between operators, even cable operators. This distribution technique reduces the vulnerability to earthquakes and lowers costs dramatically.
The unique problem facing Japan's broadband situation is due to the popularity of high-speed FTTH. Operators struggle to maintain enough bandwidth to allow maximum usage of the service by customers. Even the largest operators have capacities in the region of tens of gigabits while customers with 1 gigabit FTTH services (or higher) may number in the thousands. This problem is further compounded by limits caused by internal router bandwidth. Estimates of traffic based on data collected in May 2007 by the Ministry of Internal Affairs and Communications set total network usage at approximately 720 Gbps combined. The report further states that by May 2008, total traffic will exceed 1 Tbps.
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See also