Ltd. After months of speculation, KDD announced November 11 that it was nearing a merger agreement with Teleway Japan. Revisions to the legislation governing KDD's operations, which were approved by the Diet earlier this year along with the new NTT Law, made possible the expected October 1998 merger with Teleway Japan. The main thrust of those changes was to allow the international carrier to enter the long-distance market. However, KDD remains a special corporation subject to MPT's control. Consequently, consummating a merger between KDD and another company would be bureaucratically complex.
Analysts believe that the merger mania in Japan's telecommunications industry has just begun.
Now that is has taken over International Telecom Japan, the carrier is able to offer both international and domestic long-distance services. Once it has absorbed Teleway Japan, KDD likely will form some kind of tie with DDI and then TTNet, again creating a grouping with a presence in every market segment. This consolidation will hardly be the last word, however. In late August MPT announced that it had bowed to the inevitable and would allow telephone calls to be made over the Internet. In the Internet telephony process, words spoken into a receiver first are converted from analog waves into packets of digital data.