US Warns Japan On High Mobile Network Connect Fees -Kyodo

TOKYO -(Dow Jones)- The Office of the U.S. Trade Representative urged Japan in an annual report Thursday to rectify the "excessive" interconnection rates imposed by provider NTT DoCoMo Inc. (9437.TO) on mobile networks, Kyodo News reported from Washington.

The USTR also pressed Japan to lower fixed-line interconnection rates charged by the Japanese telecom giant Nippon Telegraph & Telephone Corp. (9432.TO) group and to prioritize frequency allocations to new wireless providers instead of NTT DoCoMo and other existing entities, Kyodo reported.

The 2005 review report on foreign compliance with telecommunications trade agreements highlights five areas in which the USTR will focus its efforts this year.

They are excessively high mobile interconnection rates in Germany, Japan, Mexico, Peru and Switzerland, restrictions on access to leased lines in Germany and submarine cable capacity in India, excessive regulatory requirements in China, Colombia and India, burdensome testing and certification requirements in Mexico and South Korea, and limitations on suppliers' choice of technology in China and South Korea.

The high mobile interconnection rates are "particularly troubling to us," Acting U.S. Trade Representative Peter Allgeier said, stressing that they "involve tens of millions of dollars in charges U.S. companies and consumers pay for international calls."

"Protecting U.S. consumers and companies from being gouged will remain a USTR priority," he said.

The report said U.S. trade negotiators will continue to urge the Japanese Ministry of Internal Affairs and Communications to "take a more active role in analyzing what a reasonable interconnection rate would be so as to provide NTT DoCoMo with a clearer long-term glidepath toward competitive levels."

The USTR raised two other concerns regarding Japan in the report - "unjustified" wireline interconnection rate increases proposed by NTT East Corp. and NTT West Corp., and a lack of transparency in the allocation of new frequencies to mobile wireless providers.

The report urges Japan to "accelerate steps to bring wireline interconnection rates down to competitive levels and implement plans to assign new spectrum with a priority on substantially increasing competition in this concentrated market segment and improving the transparency and impartiality of the spectrum assignment process."

Allgeier said, "We are deeply concerned by the tepid commitment some of our trade partners have shown to competition in the telecommunications sector. This is especially true in countries such as China, India and Japan where national operators are already competing on a global level, but remain protected at home by relatively closed markets."

"It is very hard to see a legitimate reason why these markets should not be open to full and effective competition," he said, vowing to "work vigorously to strengthen and enforce our trade rights in these countries and elsewhere."

(END) Dow Jones Newswires"

Posted to the site on 1st April 2005