isen.blog

Well, my VON Magazine article on the Japanese Miracle in Broadband won't be out for a couple of months (durn paper pubs!), but I've had some noteworthy correspondence about the topic!

Nobuo Ikeda writes:

Yahoo! BB built its long-haul network with Gigabit Ethernet [over NTT dark fiber]. When they told the plan in 2001, it was ridiculed by NTT and its competitors who used NTT's leased line (ATM Megalink) that was most expensive in the world. However, to their surprise, Gigabit Ethernet worked. NTT didn't pay much attention to the wholesale price of dark fiber, because they hadn't expected other parties would use it. After Yahoo! BB entered, NTT asked MPHPT to revise the price, but it was too late.

Ikeda continues:

The "liquidation" of [NTT's] PSTN will be a very painful process. I recommend Japanese government to buy the PSTN from NTT and exit. In the US, it's a good idea that [distressed asset buy-out firm] KKR buy AT&T and liquidate its PSTN.

Hmmmm!!! KKR, are you listening?

UPDATE: Nobuo Ikeda writes to say that The Washington Post has actually reported that KKR is indeed considering buying out AT&T. Ikeda adds, "You shoud recommend your old bosses that this is a very good idea. PSTN is a typical target of LBO because it exploits the wasted cash flow of such a 'cash cow'." [Sorry, Ikeda-san. If any of my old bosses are still there, certainly they will not listen to me.]

My brother Daniel, who has spent much of the last two decades doing business with Japanese technology companies as Triangle Technologies, writes:

. . . in Japan, service deployment is MUCH smoother than in the US, fewer glitches, much better customer service and support, and there is truth in advertising. So when a service provider is ready to launch a service that has real value, diffusion is usually very rapid. If you look at diffusion curves for a variety of such services (e.g. i-Mode, sha-Mail (picture mail), ADSL, VOIP etc.) you see a very sharp hockey stick curve. Remember that Japan is a very dense society, relatively homogeneous and when things catch on they really catch on. Service providers understand this, so in general spend a lot more time building an infrastructure to support large scale deployment. I sometimes call this the "Kevin Costner" theory of market development - if you build it, they will come.