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| NTT to Introduce Smart Card-Based Public Phones in March
January 27, 1999 (TOKYO) -- Nippon Telegraph and Telephone Corp. said
that it has applied for approval to introduce a noncontact smart card
(or IC card) and a public telephone to use such a new smart card.
|Its application was submitted to the Ministry of Posts and Telecommunications.
The telecom giant plans to install 1,000 smart card-based public telephones
at major train stations, airports and hotels in Tokyo, Osaka and other
large cities and surrounding areas starting as early as March 1. The
company will later install the telephone systems in ordinance-designated
cities, prefectural capitals and other major cities nationwide.
It aims to install at least 400,000 units in five years, a company spokesman
"With the development of this smart card-based public phone system, we
can create new business opportunities," said Masao Matsuo, senior manager
of the public telephone service department of NTT's Service Marketing
and Support Headquarters.
NTT is examining the smart card-based public telephone with simultaneous
use of two smart cards. In this application, a user will insert a smart
card that functions as a prepaid telephone card and another card for
member users together into a public telephone.
Telephone charges will be collected from the first smart card while information
on the user's billing history will be obtained from the second smart
card. In this way, online ticket sales and other similar online services
making use of instant settlement will be realized, Matsuo said.
The application of a smart card for public telephones will offer many
advantages, the NTT spokesman said.
For example, NTT has stopped issuing large denomination telephone cards
to cope with forged cards, however, a smart card will allow longer calls.
NTT's telephone card with the largest denomination is 1,000 yen (US$8.80).
For the smart card for public telephone systems, a dedicated center will
manage remaining available amounts for each user. When a user inserts
a smart card into a public telephone, an individual identification number
recorded in the smart card will be confirmed at the center. The center
will then display the remaining available amount for the user on a display
This system will prevent unauthorized utilization of public telephones
because the center will identify any use of a forged smart card.
Also, NTT plans to equip the new smart card with the capability to record
telephone numbers, using free space in the card's memory. If telephone
numbers are registered on a dedicated public telephone in advance, a
caller can dial the registered numbers by touching just a few keys.
One smart card can register up to 10 telephone numbers, and data on
the registered numbers can be transferred.
However, the smart card has some drawbacks. For example, the production
costs of smart cards will be higher than those of traditional magnetic
NTT is preparing to launch smart cards in three amounts: 1,000 yen, 2,000
yen (US$17.60) and 3,000 yen (US$26.40), and will sell the smart cards
in smaller denominations, such as 300 yen (US$2.60) and 500 yen (US$4.40)
upon receipt of orders.
The smart card will have an effective period of up to five and a half
years. Users will need to pay about 100 yen (US$0.90) to replace an
expired smart card.
NTT will phase out magnetic prepaid phone cards and phase in the new
smart cards in part based on a survey on frequency of use and other
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