Word: broadband
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...firm on the planet, was about to be swallowed up by upstart regional player SBC?providing a sobering reminder that in the information age, no institution is too big to fail if it squanders its competitive edge. "Technology is advancing fast," says Shuichi Deguchi, senior manager of NTT's broadband-Internet promotion department. "A complete transformation is required to make sure we stay ahead...
...line fees as a multibillion-dollar annuity stream to fund growth enterprises such as DoCoMo, its successful mobile-phone service spun off in 1992 (NTT still owns 64%). But two new entrants in the fixed-line industry have rocked the company's complacency. Last August, Softbank, a leading Japanese broadband provider, announced it would begin offering traditional home-telephone services at a discount. Two weeks later, KDDI, Japan's second largest mobile-phone carrier, said it too was invading NTT's turf. NTT quickly reduced prices to match its competitors', but the cuts will hurt: Deutsche Bank forecasts that...
...reason to be worried. BitTorrent downloads account for one-third of Internet traffic, according to CacheLogic. So-called tracker sites post links to movies, video games and episodes of TV shows, the content of which is then traded at turbocharged speeds. With more folks logging onto the Internet via broadband connections, online trading of movies, TV shows and porn is surging. Downloads of feature films alone are up 175% in the past year, says BigChampagne, another Web-tracking firm. In response, the Motion Picture Association of America (MPAA) recently filed dozens of civil suits against tracker sites...
...other carriers duplicate NOW Broadband's pay-TV success? Not necessarily, because PCCW (which is in talks with the parent of China's second largest fixed-line operator) has advantages other carriers lack. For one thing, Hong Kong is one of the world's most densely populated cities, so it's relatively inexpensive to reach everyone with high-speed connections. Besides, PCCW?which won't say if its TV service is profitable?did not have to spend heavily to upgrade its network for two-way TV. That's because NOW Broadband runs over an Internet and interactive TV infrastructure mostly...
...Whether NOW Broadband is a role model or an aberration, it's hard to argue with the numbers. PCCW has been signing up about 70% of all new pay-TV subscribers in Hong Kong; it will be the city's top provider of pay TV by 2009, according to a recent Goldman Sachs report. "Other phone companies are watching this closely," says Media Partners' executive director Vivek Couto. If Li can revive his new-media business model, maybe others can as well...