February 3, 1998 (TOKYO) -- DDI Corp., a long-distance new common
carrier, formed a business tieup with Teleglobe Inc. of Canada.
The two will start providing international telephone service by
connecting each other's public-private-public switched telephone
networks from Oct. 1.
DDI will connect its domestic network with Teleglobe's
international network to provide service.
While the details of the new service are not yet stipulated, DDI
said it will seek to offer the cheapest international telephone
service rates. The company appears to be planning to target a
broad range of users from individuals to business enterprises,
with low rates as a key selling point.
DDI President Yusai Okuyama and Teleglobe CEO Charles Sirois
exchanged a memorandum of understanding at Teleglobe's
headquarters in Montreal on Jan. 19.
Canada-based Teleglobe is an international telecommunications
business with a Japanese affiliate, Teleglobe Japan Inc. It plans
to acquire its own international circuits and start business as a
common carrier on a full scale in Japan by this summer.
Teleglobe Japan's current clients are mainly telecom businesses
and resellers of telephone services, but it also provides a range
of menus to large business users as well.
"This tieup with DDI does not mean that other telecom operators
will be outside of the scope of our company's services," said
Teleglobe Japan. Teleglobe Japan said there are no discussions
now for the tieup to involve capital.
For DDI to move into the international telecom business, it had
to form a tieup with an overseas telecom business as a partner.
The major telecommunications operators in Japan are preparing an
organizational framework to be able to provide an integrated
range of services that encompass both domestic and international
International Telecom Japan (ITJ) Inc. plans to merge with Japan
Telecom Co., Ltd., while Teleway Corp. is making business
preparations with KDD Co., Ltd. in October 1998.
NTT Corp. plans to move into international operations through its
wholly owned subsidiaries, NTT Worldwide Telecommunications Corp.
and NTT Worldwide Network Corp.
In addition, NTT said it received a proposal for a business tieup
from International Digital Communications (IDC) Inc. on Jan. 23.
DDI initially explored the possibility of merging with KDD, but
it could not agree on the conditions for such a merger. The
company gave up the idea in the fall of 1997.
At that point, Japan's international telecom companies were
eliminated as possible choices for the tieup DDI sought. The
alternative of a tieup with an overseas operator came into
With the new tieup, the overall framework for the long-distance
domestic and overseas telecommunications services industry in
Japan will have four core clusters of operators: NTT & IDC, Japan
Telecom, Teleway & KDD, and DDI & Teleglobe. The three rival
competitors have domestic partners.
If DDI can provide distinctive features in service and rates, by
reducing costs with its international communications lines it
might become the driving force in industry's reorganization and
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