Cities surveyed
MIC has compared prices for i) Internet access services, ii) domestic telephone services, iii) cellular telephone services, iv) international telephone services, and v) leased circuit services in Tokyo, New York, London, Paris, Dusseldorf and Geneva on a basis of the Telegraphic Transfer Selling (TTS) Rate as of March 31, 2005.
Survey period
The survey was basically conducted in January 2005.
If prices were revised subsequently, this was reflected to the greatest extent possible.
Main points
- Flat-rate for always-on broadband access, such as ADSL in Tokyo, have continued to remain at the lowest levels in the world, for the fourth consecutive year since the survey was first conducted in FY2001.
- Even though domestic telephone charges for daytime and evening calls are the lowest, subscription fees (facilities and equipment charges) remain at a higher level despite being reduced by half in March 2005. Long-distance charges are at a lower level due to daytime discount rates.
- Starting this year, cellular telephone charges have been split into three categories, voice only usage, voice and email usage, and voice, email and data (Internet access) usage, and are compared according to usage frequency. Even though Tokyo charges can be higher than in other cities, they are generally at the same levels or slightly lower. NB: Conditions for telecommunications services differ from country to country, with a variety of pricing systems starting with the differentiation between standard rates and discount rates. Payment methods (such as prepaid or post-paid) and conditions of use (such as SMS/email) also differ, with variations between regions within the same country. The influence of changes in exchange rates can also have a major effect, so that one cannot necessarily make sweeping statements about whether variations in prices between Japan and foreign countries are small or large. Readers are aware that results of this survey are one of the indices.
Points that should be noted with regarding to individual charges are shown below.
Access to the Internet
- Comparing ADSL services at a speed of 1 Mbps or higher with those in other cities, the charges in Tokyo are at the lowest level in the world in conjunction with the growth in competition between service providers. As for speed, whereas other cities offer between 1.5 Mbps and 8 Mbps, Tokyo offers a maximum of 50 Mbps so that when a comparison is made based on telecommunications speed, charges in Tokyo is even lower.
- Cable Internet prices are the second lowest, after Paris. but looking at telecommunications speed, Tokyo offers 30 Mbps as opposed to 2 to 10 Mbps in other cities, so in a speed-based comparison, Tokyo can be said to be the lowest. Fig.1 ADSL
Domestic telephone services
Comparison based on individual rates
- Monthly basic charges for residential users and corporate users are at nearly equal levels to other cities, but the subscription fees (facilities and equipment charges) in Tokyo remain the highest despite being reduced by half in March 2005. Relocation charges, however, are the lowest.
- Local calls in Tokyo are the lowest when compared to other cities, both for daytime and evenings.
- Standard charges for long-distance calls, especially in comparing inter-prefectural telephone services, are lower than those for interstate and intrastate telephone services in New York, but remain at a higher level than in European cities. Discount charges are at a lower level for daytime and are at average levels for evenings. An OECD model that compares domestic telephone tariffs indicates that:
• For residential use, with the exception of London, Tokyo is at about the same pricing level as other cities for ordinary charges. For discount rates, it stands with London at a lower level.
• For corporate use, with the exception of Geneva, Tokyo is at about the same pricing level as other European cities for ordinary charges. For discount charges, it stands with Dusseldorf and Geneva at a lower level. Fig.2-1 Domestic telephone (Weekday at noon, 3 minutes) 
Fig.2-2 Basic charges (Residential : Per month)
Fig.2-3 Initial subscription charges/ Relocation charges (residential)
Note: The price comparison was implemented based on both individual rates and the models that reflect the actual status (OECD Model and Tokyo Model).
OECD Model: The Organization for Economic Cooperation and Development (OECD) carries out a price comparison using a model it has formulated which sets a traffic pattern by communications distance range, time zone, etc. in order to compare prices of telecommunications services in its 30 member countries.
Tokyo Model: This model was established for cases where there is no OECD Model or OECD Model does not suit the actual situation in Japan. It calculates average usage conditions for communications distance range, time zone, etc. based on traffic in Japan, and compares prices based on this.
Cellular telephone services
- In terms of charges for cellular telephones, package-type tariff plans that include the basic charges and fixed hours of air-time charges are the mainstream in many cities, and there are many variations to this type of plan. This makes it very difficult to make a simple comparison of charges between cities. There is also widespread use of cellular telephone terminals for email and data communications (Internet access).
- Consequently, the FY2004 survey investigated three possible categories, 1) voice only usage, 2) joint usage by voice and email, and 3) joint usage by voice, email and data (Internet access).
- For users who were closest to actual traffic usage in FY2003 and who had low usage frequency, pricing levels in Tokyo were at about the same level as for other cities in all three categories. For high-frequent users, however, in all three categories, Tokyo was second lowest after New York.
Fig.3-1 Low-frequency users (37 minutes of voice calls, 30 emails, and 7,500 data packets per month)
Fig.3-2 Mid-frequency users (106 minutes of voice calls, 100 emails, and 39,000 data packets per month)
Fig.3-3 High-frequency users (315 minutes of voice calls, 300 emails, and 390,000 data packets per month) 
International telephone services
- It is generally lower to make international calls from other overseas cities than to make them from Tokyo.
Domestic leased circuit services
- There are differences in domestic leased circuit charges according to distance and speed.
i) Comparison based on individual charges
In Tokyo, charges for leased digital circuit services of 64 kbps are the lowest for distances of 15km and 50km. Charges for leased digital circuit services of 1.5 Mbps for a distance of 15km is the second lowest following New York, and those for 50km are the highest. Charges for leased digital circuit services of 45 Mbps, Tokyo is the second lowest following Dusseldorf for distances of 15km and 50km.
ii) Comparison based on the OECD model
In Tokyo, charges for leased digital circuit services of 64 kbps are the lowest, and those for 1.5 Mbps are the highest. Charges for 45 Mbps are the third lowest, following Dusseldorf and New York.
Conclusion
- According to this survey, although communications charges in Japan vary depending on the type of services, but charges for broadband services are lower in comparison with America and European countries, and charges for cellular telephone services are lower for people who frequently use email and data (Internet access) in comparison with European countries.
- In striving to make Japan the most advanced ICT nation in the world, MIC will continue to promote fair competition and work towards creating an environment to encourage reducing charges.
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