Japan ministry stirs debate on information highway -- to those who study japan

[David Farber <farber () central cis upenn edu>]

         TOKYO, July 15 (Reuter) -Japan's Construction Ministry
said on Friday it will seek several hundred billion yen
(several billion dollars) in fiscal 1995/96, ending March 31,
to start building a nationwide fibre-optics network for an
"information superhighway."
         The ambitious plan has stirred up controversy, however,
with many wondering whether it will be a boon for the project
or stir up rivalry between government ministries over the
plan.
         A Construction Ministry official told Reuters the ministry
plans to dig tunnels under roads to install fibre-optic cables
and hopes to start construction in fiscal 1995/96 in large
cities.
         The ministry will submit a bill to the next session of
parliament, he said.
         The total cost of building the tunnels to install 400,000
km (250,000 miles) of fibre-optic cables would run up to 40
trillion yen ($408 billion) by early in the next century, he
said.
         Earlier, the Ministry of Posts and Telecommunications
announced its policy of connecting every household in Japan in
a fibre-optic network by 2010, emphasising the private sector
should take the initiative in the programme.
         The posts ministry estimates the cost of laying a
nationwide network at 33 trillion yen ($336 billion),
excluding the spending on underground systems.
         "The idea is that we create space for cables (for private
companies), replacing telephone poles with underground
optic-fibre systems," said a Construction Ministry official.
         For new telecommunications operators which do not own
their own networks, the construction ministry's project is a
boon.
         Laying out new cables using existing telephone poles would
require a complex process of getting permission from local
governments, telephone firms, police and government agencies.
         "It's almost impossible for newcomers to lay their own
optical-fibre networks...if you have no connection with
organisations that operate roads, railways and other
facilities which can install networks," the chairman of
telecommunications firm DDI Corp, Kazuo Inamori, told
reporters on Tuesday.
         "The project could ease 'non-tariff barriers' in the
network business and would definitely promote new entries,"
said Satoshi Hirachi, an analyst at Daiwa Institute of
Research Ltd.
         He said the project could also benefit consumers, as the
government would shoulder nearly half the cost of building the
underground optic-fiber system by 2010, a total of 83 trillion
yen ($846 billion).
         Other analysts doubt, however, whether the bill will be
passed, because a government advisory panel only recently
urged the posts ministry to leave the construction of such
networks to the private sector.
         "The ministry's plan is a move against the set direction,
in which the private sector takes the lead in construction and
the government concentrates on deregulation," said Akiyoshi
Hayakawa, an analyst Nikko Research Ltd.
         A DDI spokeswoman said the company welcomes the
construction ministry's plan "if the ministry creates an open
network system that is available to every sector of users".