V. Group Operation

Maintaining the present Group operation under a holding company will be necessary in order to proceed with the structural reform that will revise NTT East and NTT West cost structures by reallocating personnel within the Group and making use of outsourcing companies. It is to be noted that communication carriers both in Japan and overseas are coping with the changing business environment by going over to a form of management that enables them to make business decisions dynamically on their own. (See Reference 1 and 2)


From the standpoint of maximizing corporate value (shareholder profits), the NTT Group management apportions each Group company's business areas such that (1) in fields where new markets need to be developed, such as Internet-related business, each company is free to decide its own business strategy while taking advantage of its own strengths, even if this involves competition among Group companies. (2) In the remaining fields, Group operations are carried out on the principle of avoiding duplication of resources.


The simultaneous holding of executive positions between local companies and NTT Communications or NTT DoCoMo is not implemented currently and will remain unimplemented, from the viewpoint of fair competition. Decisions on Holding company's investment ratio of NTT Communications and NTT DoCoMo and the simultaneous holding of executive positions will be continued to be considered from the standpoint of maximizing shareholders profits, while fully respecting the autonomy in actual business operations of each Group company and taking into account the operational necessity and stock market trends, as market and other environment surrounding NTT Group are rapidly changing.


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