International Conference The Technological Innovation in CODELCO: A World-Scale Experience Session 1: Innovation in global companies

NTTs R&D model

-Innovation for a Human-Centered Network-

Sept. 12, 2005

Yuji Inoue NTT Tokyo, JAPAN yuji@m.ieice.org
(C)2005 NTT

I. What is NTT?

(C)2005 NTT

About NTT
Name Head Office Operating Revenues Operating Income Date of Establishmen t Number of Employees Paid-In Capital Total Number of Shares Issued NIPPON TELEGRAPH AND TELEPHONE CORPORATION 3-1, Otemachi 2-chome, Chiyoda-ku, Tokyo 100-8116, Japan 10,805.9billion yen (FY ending March 2005, on a consolidated basis) 1,211.2 billion yen (FY ending March 2005, on a consolidated basis) April 1, 1985 (in accordance with the Nippon Telegraph and Telephone Corporation Law (Bill No. 85, December 25, 1984)) 2,792 (NTT holding company, March 2005) 201,500 (total, including subsidiaries) 937.95 billion yen (as of March 2005) 15,741,209 (as of March 2005)

(C)2005 NTT

R&D Organization in NTT Group

Fundamental R&D

NTT (Holding Company)

R&D

Common fundamental technologies to create new services Basic and core technologies to generate new principles and components

NTT East
R&D
Intra-pref. comm.

NTT West
R&D
Intra-pref. comm.

NTT
Communications

NTT
DoCoMo

NTT Data
R&D
SI

NTT
Facilities

NTTME

NTT Comware
Software development computer service

NTT
Electronics
Optical devices, LSI

NTTAT
Technology transfer, software & hardware development

R&D
Internat. & Inter-pref. comm.

R&D
Mobile comm.

Bldg. mgt.

Maintenance and Operation of network facilities

Class 1 (regulated)

Class 2 (competitive)

Class 3 (Utilization of management resource)

Class 4 (New business exploration)

Application R&D
System improvement Customization
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II. Trends in Telecommunications in Japan

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Changes in the numbers of ICT users in Japan

120 Internet accounts 108.1 million (June 2005) 100

Fixed phone+ISDN users 59.6 million (Mar. 2005)

Subscribers [million]

Mobile phone users 93.3 million (Aug. 2005) 80

Fixed phone+ISDN
60

Broadband users 20.6 million (Mar. 2005) IP phone( ISDN) 8.3 million (Mar. 2005)

40

20

3/94

3/95

3/96

3/97

3/98

3/99

3/00

3/01

3/02

3/03

3/04

3/05
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Source: Ministry of Internal Affairs and Communications, Mobile Computing Promotion Consortium, and InfoCom Research, Inc.

Monthly growth in subscribers to ADSL and FTTH services

NTTEast
K) (Subscribers: K
100 80 60 40 20 0
03/10 04/01 04/04 04/07 04/10 05/01 05/04 05/07

ADSL

(Subscribers: K) K )

Turning Point @2004.11

NTTWest
100 80 60 40 20 0

Turning Point @2005.6

ADSL FTTH
03/10 04/01 04/04 04/07 04/10 05/01 05/04 05/07

FTTH
FTTH (called B Flets): 2,500 yen/month (condominium type) Optical \4,800

ADSL (called Flets ADSL): 3,060 yen/month (47Mbps) Copper \3,100

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III. NTT R&Ds Approach

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Mission of the R&D division for achieving the NTT Groups Medium-Term Management Strategy

(1) Contribution to achieving e-Japan/u-Japan

Respond to declining birthrate/aging population Reduce environment loads

(2) 30 million optical access customers by 2010

(Telephone IP-based network, Metallic optical fiber) Safe, secure, convenient, easy-to-use

(3) New revenue of 500 billion yen (including non-traffic business)

Reduce CAPEX by 30% and OPEX by 800 billion yen

(4) Universality and standardization

Eliminating the digital divide
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Key strategic R&D areas

Fundamental technologies for providing new services
Portal
Presence FMC Billing Authentication

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Security

SHR Location control

SHR Super High Resolution

Service control platform

RENA
Network infrastructure Leading-edge technologies
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New R&D mechanisms

Multi-faceted approach
1. 2. Comprehensive producer mechanism
R&D management supplemented by the infusion of viewpoints from the business side

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Young Employee Committees & Young Employee Projects

The ideas and enthusiasm of individual young employees are given full play by letting these people act as producers

3.

Chie-no-wa (Intra community site)

Activities to provide a forum for the free exchange of information and opinions across organizational and disciplinary boundaries
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Comprehensive Producer Function

Off-the-shelf technology/product Off-the-shelf technology/product

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Needs of NTT group companies

Holding company

Alliance Alliance Alliance

Applied R&D in group companies

Comprehensive producer function NTT Laboratories Leading-edge research

Leadingedge Leadingresearch edge research

Core technology Core technology development development

Expert assessment Research/analysis of market/technology trends Marketing Planning/proposal for development Market creation

Commercial development

Commercial introduction

Market trends
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Gracias

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