U.S., Japan Look to NTT Rate Cuts

The United States and Japan meet for talks this week on a dispute about rates charged by telecom giant Nippon Telegraph & Telephone Corp., with Japan looking set to offer a plan for faster cuts. Added urgency surrounds the negotiations with the world’s two largest economies eager to settle the row before President Clinton arrives in 10 days for a summit of leaders of the world’s richest nations. Japanese media reported during the weekend that Tokyo would offer a 22.5% cut in the rates competitors pay to use NTT’s local lines, the so-called “last mile,” over three years--a one-year reduction from its original proposal. The offer might not be good enough, though. The U.S wants deeper and faster cuts, saying current rates charged by NTT, a former state monopoly with control of 90% of local connections, are too high. Such domination, U.S. negotiators say, stifles competition and prevents U.S. companies from entering the world’s second-largest telecom market.