vice separately in August. This eliminated the requirements for telecommunications carriers to provide services such as DSL and FTTH to their competitors on an undifferentiated basis.

Along with the review of the broadband regulations, public concerns are growing regarding the telecommunications carriers' Internet dominance. In response to those concerns, the FCC adopted the “Internet Policy Statement” in August 2005 to show their continued commitment to promote the open and interconnected nature of the public Internet. This statement shows only the principles without enforcement.

Being pushed by companies providing services on the Internet, the movement has become more active since late 2005 to legislate a provision that prohibits telecommunications carriers from discriminating against other companies intending to provide services on the Internet to be incorporated into the Telecommunications act. This argument, so called “Net Neutrality”, has become the focusing point in the US telecommunications policy and the Committees of the US Congress have held public hearings about this issue.

Telecommunications carriers are against this movement. They are also seeking measures to recoup their increasing investments on network facility, such as establishing a framework to ensure high-speed transmission only for the contents provided by companies who paid additional fees.

## (2) Trends in ICT policies in EU

EU Member States were obliged to legislate the “2002 EU regulatory framework for electronic communications”, and the legislation in all 25 Member States was completed by the Greek promulgation on its electronic communications low in February 2006. Each Member State also has a duty to conduct a market analysis on the 18 of the relevant markets contained in the EU Recommendation on relevant markets. As of the end of 2005, 12 Member States including Finland, France, Germany and the United Kingdom have almost completed their market review while the remaining 13 Member States have conducted the review only partially.

The European Commission is going to complete its first periodical review on the above framework toward the submission of a draft of its revision at the end of 2006. In November 2005, a public consultation was launched for five Directives (Framework Directive, Authorisation Directive, Access Directive, Universal Service Directive, and Privacy and Electronic Communications Directive) and Recommendations on relevant markets. As basic principles for the review, the European Commission indicates three points: 1. Reinforcing investments by infrastructure-based competitions; 2. Promoting innovation by clarification of the regulation policy for new technologies; and 3. Establishing a single market with unified rules within the region.

As for the “Television Without Frontiers Directive” enacted in 1989 to seek the harmonization of television program rules within the EU Member States, the European Commission had reviewed it in order to address the current various transmission forms, and in December 2005, it released a draft of its revision which included changing the name to “Audiovisual Media Services Directive.” The revision expanded the applicable scope of the Directive to the provisions of motion pictures to the public via electronic communications.

Non-linear services which receivers can decide the timing of transmission are imposed minimum regulations such as juvenile protection and the prohibition of encouraging discrimination, whereas linear services (television broadcasting) which the transmitters can decide the timing of transmission are imposed regulations such as the proportion of European works and a right of reply, in addition to those above.

## (3) Trends in ICT policies in China

The telecommunications market in China has been growing at 10% annually for more than 10 years.

According to the official statistics at the end of December 2005, fixed line telephone subscribers reached 350.43 million and mobile phone subscribers reached 393.42 million (exceeded 400 million subscribers as of end-February 2006), which placed China at the top of the world in terms of the number of subscribers (743.85 million for total). China still keeps an increase of almost 100 million subscribers a year. Because the penetration rate is still 30%, further growth will be expected.

Meanwhile, the number of Internet subscribers reached 111.00 million as of the end of December 2005, which placed China at the second position of the world. Of this, broadband subscribers accounted for more than half, 64.30 million.

The current hottest topic in the telecommunications market in China is the licensing for the third generation mobile phone (3G). Based on comments of a senior government official that 3G services will be offered by the 2008 Beijing Olympics, licenses are currently expected to be issued within 2006. However, since no official announcement has been released yet, there are various views on the direction of the licensing of China’s standard TD-SCDMA system and the reorganization of telecommunications carriers.

Regarding policy aspects, legal frameworks have been developed, whereas the “Telecommunication act” which is the basic act in the telecommunications field has not yet been established. While a debate on the legislation of the Telecommunication act is growing, there are movements to handle new problems such as the regulation on IP telephone, and the establishment of universal service fund to promote the “Village Connected (extending telephone services to each village)” project which close the gap between villages and cities.

The software industry in China has been rapidly growing for the last several years and is expanding 5 times in 4 years, from 79.6 billion yuan in 2001 to 390 billion yuan in 2005. This is achieved not only by the