Two regional call firms under Nippon Telegraph and Telephone Corp. said Thursday that they will reduce charges for calls within prefectures by an average 40 percent starting Oct. 1, when the government will introduce a new price cap system.
NTT East Corp. and NTT West Corp. will unify the current four categories for calls over 20 km within a prefecture into two, reducing prices to cope with intensifying competition on the prefectural-level market, the companies said.
For example, a daytime call between 20 km and 30 km within one prefecture, now priced at 40 yen for every 45 seconds, will be reduced to 30 yen for every 60 seconds, the companies said.
A nighttime call over 100 km will be reduced from 60 yen for 30 seconds to 20 yen per 90 seconds, the companies said.
NTT East and NTT West currently need to seek the approval of the Posts and Telecommunications Ministry to change any call charges.
The new price cap system, to be introduced in October, will oblige the NTT local firms to lower charges by a certain percentage every year.
Price-cutting competition is now intensifying as a new phone registration system, which requires users to register a main phone company in advance, is set to be introduced in May.
The new phone system will automatically connect a user's phone to the main phone firm without inputting an additional key code, for example 0077 for DDI Corp., as in the current system.
The new connection system is expected to make it difficult for telecom companies to attract new customers once they are registered with a rival firm. Telecom firms are therefore trying to offer attractive rates in preparation for the policy change in May.