FTTH Japan Europe: more FTTH broadband subscriptions in Japan than in all of EU + Norway + Switzerland + Iceland

by Gerhard Fasol

Japan has more broadband fixed internet subscriptions than all of the European Union + Switzerland + Norway + Iceland

FTTH Japan Europe:While Japan initially was late in waking up to the commercial introduction of the Internet – Japan was fast to catch up and overtake

Japan alone currently has about 30% more FTTH optical fiber broadband subscriptions than all EU countries + Switzerland + Norway + Iceland added together.

How much broadband (ADSL, xDSL and FTTH) is installed in Japan? Find the answer and detailed statistics and market shares in our report on Japan’s telecom industry.

Japan was first to roll-out mobile internet with i-Mode in February 1999

Similarly, Japan was far in advance of other countries in laying the foundations for the mobile internet, with the introduction of the DoPa (DoCoMo Packet) packet switched network on March 28, 1997, several years before packet switched networks were introduced in EU and elsewhere. However, Japan’s electronics and telecoms industries largely failed to capture global value from this pioneering work. Essentially only Softbank with the SPRINT acquisition now has hope to capture such global value.

A very interesting point is that in EU there are many discussions and uncertainties how broadband fiber investments can be profitable. Japan has solved this problem: FTTH business in Japan is profitable. We see arbitraging opportunities in capturing value from Japan’s know-how, similar to Softbank’s “time shift” investments, arbitraging the time shift of internet roll-out in US vs Japan vs China, as explained in our Softbank-report.

FTTH Japan Europe Broadband: about 30% more FTTH subscriptions in Japan than in all of EU + Switzerland + Norway + Iceland
FTTH Japan Europe: about 30% more FTTH subscriptions in Japan than in all of EU + Switzerland + Norway + Iceland. Source:

Japan has 30% more FTTH fiber broadband subscriptions than EU + Switzerland + Norway + Iceland…

Several years ago the EU engaged our company Eurotechnology Japan KK to benchmark EU vs Japan in fixed and wireless broadband. Our summary was that broadband connections are the lifeblood of our information society, and that Japan was far ahead of EU in providing and using both fixed and wireless broadband, and broad band fiber connections were much faster and cheaper in Japan than in EU. Although both have progressed since our benchmarking work for the EU, Japan is still very far ahead of EU in terms of fast fiber broadband penetration.

Capturing global value – Japan’s Galapagos effect

However, provision of broadband fiber connections is only one side of the coin. The other side of the coin is capturing value and creating wealth for the society. The really important point is, whether Japan’s electronics, telecoms, content and service industries can capture global value from the advanced deployment of broadband infrastructure. As we discussed in detail in the “Post-Galapagos working group”, Japan is being held back by the “Galapagos effect” – and the trick will be to make the necessary changes to break out from this trap.

Detailed analysis in our report on Japan’s telecommunications sector:

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M&A telecommunications

KDDI may partner with Poweredcom/TEPCO

Poweredcom has doubled investments in FTTH to YEN 44 Billion (US$ 0.4 Billion) for FY 2005/2006 from YEN 22 Billion in FY 2204/2005. (For details and analysis of Japan’s FTTH market read our report on Japan’s telecom sector).

Partnership with KDDI‘s triple-play leverages Poweredcom’s present and future FTTH investments.

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NTT to invest US$ 45 Billion over 6 years

Softbank is rapidly becoming the third universal telco in Japan, targeting NTT’s most important income streams. KDDI of course is also targeting NTT’s fixed line income.

On November 2, 2004, NTT announced plans to compete: NTT will invest 5 Chou YEN (YEN 5000 Billion = US$ 45 Billion) over 6 years (2005-2010), i.e. about US$ 7.5 Billion/year. 60% of this investment will be for optical IP networks. NTT plans to build about 30 million FTTH lines.

NTT fibre to the home (FTTH) contracts
NTT fibre to the home (FTTH) contracts

read more here in our report on Japan’s telecom sector…

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