Japan Plans Infotech Catch Up

Friday, September 1st 2000, 12:00 am

By: News On 6

TOKYO (AP) â€” A panel of Japanese corporate heavyweights is asking the government for a complete overhaul of Japan's information infrastructure that would allow it to overtake the United States within five years in offering low-cost, high-speed Internet access.

To address the concerns, the government's IT Strategy Council â€” chaired by Sony Corp. president Nobuyuki Idei â€” is drawing up a plan to better compete with Internet rivals through massive investment in infrastructure and scuttling of laws that inhibit e-commerce.

Despite the nation's technological prowess, high costs and legal restrictions have kept Japan from experiencing an Internet revolution â€” and officials are worried the new economy will pass the nation by.

The council said that if steps are taken now, the Internet could lead Japan's bruised economy into a new era of super-fast expansion.

``Our country must aim to accomplish a new period of rapid economic growth by stimulating new businesses and existing industries, and overtaking the United States within five years as a major high-speed Internet nation,'' the council said in a report posted on the Web site of the Prime Minister's office.

In addition to Idei, other notables on the panel include Softbank Corp. President Masayoshi Son and Fujio Cho, president of Toyota Motors, which has recently expanded into the IT industry.

The council said it is essential to cover Japan with fiber-optic lines that will permit the high-speed transmission necessary for growth of the Internet. It was scathing in its assessment of the current state of Japan's IT infrastructure.

``There is hardly any high-speed infrastructure ... the connection speed is so slow that using costs are extremely high,'' the report said.

``In Japan, the IT industry's development is being obstructed ... The promotion of infotech has fallen way behind the United States.''

The council cited more than 700 legal impediments to the growth of e-commerce, including the obligatory exchange of paper documents in Internet transactions.

To jumpstart Japan's laggard IT industry, the council recommending that laws to deregulate e-commerce be debated during this fall's special session of Parliament.

The government panel said it would complete its proposal of specific measures to promote the Internet in Japan within two months.

``The government's understanding is that it has to move fast,'' Akira Fujimoto, an official in the information technology bureau of the Prime Minister's office, said Friday. ``We are hoping to put together a concrete plan by the end of the year.''

Prime Minister Yoshiro Mori has promised to make information technology the backbone of Japan's economy in the future.

Much of the mammoth amount of public funds going into nursing Japan's economy back to life have been allocated to promoting infotech. Fujimoto said the council has not yet discussed whether expanding IT infrastructure would be part of public works layouts or accomplished by the private sector.

The Internet has been slow to catch on in Japan. Only about 11 percent of Japanese households have access to the Web, compared to 37 percent in the United States.

The main problem is cost. Local call fees in Japan make it expensive to go online with a telephone line, whereas such calls in America typically are covered by a relatively low monthly fee.

Deputy U.S. Trade Representative Richard Fisher said in March that Internet access in Japan costs almost 10 times as much as in his country.

The United States has been aggressively lobbying Tokyo to bring down telecom fees and open up the lucrative sector to competition.

In July, the Japanese government succumbed to U.S. pressure and agreed to lower the connection charges that foreign telecom companies pay to local telephone giant Nippon Telegraph and Telephone Co. by 20 percent over two years.

One bright spot has been the country's embrace â€” in research and development and among consumers â€” of wireless technology.

The Internet-friendly i-mode mobile phone created by NTT subsidiary NTT DoCoMo now has more than 10 million subscribers.

Experts say that Japanese wireless technology is about two years ahead of the United States and Europe.

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On the Net:

Prime Minister's Office: http://www.kantei.go.jp/