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NTT Launches Internet Service, Builds Data Center

Nippon Telegraph and Telephone Corp (NTT) has upped its ante with plans to launch an Internet service and build a data center in Malaysia.

The new investments come despite the Japanese telecommunications firm being spurned recently by the Malaysian government to take a stake in state-controlled Telekom Malaysia Bhd, the country's largest telecom company.

NTT's trade-off was an Internet license secured by its Malaysian subsidiary, NTT MSC Sdn Bhd, in August with a planned launch this month.

The company is the first foreign telecom company to be offered the new "class license" for Internet access, signalling a shift by the Malaysian government to open the market. Regulators describe class licenses, which came into force on August 4, as a means to encourage more competition and provide consumers with more choices. Internet service provider (ISP) licenses were previously only limited to local companies.

Defined Targets

NTT MSC president and chief executive, Akio Hotta, said the company will be providing integrated Internet services under the Arcnet brand, which will be initially targeted at densely-populated and industrial-concentrated areas.

"Our first target markets are corporate customers in industrial-concentrated areas but if the public wants high quality Internet services they can also apply," he said.

Hotta said that besides Internet access, Arcnet will also offer data warehousing, Web-hosting, electronic payment infrastructure systems, and a portal, with among other services, a multi-lingual machine translation engine and live baseball updates from Japan.

NTT MSC product development manager Victor San said Arcnet will have nodes in the Multimedia Super Corridor (MSC) host city Cyberjaya, Kuala Lumpur, Penang, Johor and Shah Alam and is targeting 5,000-10,000 users by the year-end.

"We're being modest because we don't want to take on too many users and compromise our quality of services. Right now our resources are ready to support 10,000 users but if the response is great we will scale up proportionately," he said.

Investment Drive

NTT MSC is also spending US$7.9 million for the construction of a data center to complement its Arcnet services, part of US$26 million earmarked for research activities in the 750 sq km MSC high-tech hub until 2002.

The three-storey data center with a built-up area of 1,858 sq m is scheduled for completion in June 2001. Hotta said the center would be an ideal platform to co-locate mission critical servers and offer guaranteed bandwidth, managed security, traffic analysis, load balancing and traffic prioritization.

Hotta said the company is targeting multinationals and major e-commerce providers as well as new start-ups in the Southeast Asian region.

NTT MSC was first incorporated in July 1997 to spearhead the telecom company's research activities in Malaysia and boasts of being NTT's second-largest overseas R&D facility following NTT America Inc.

NTT MSC already supports several multinationals locally with local area network (LAN) and Intranet site construction, system maintenance, systems integration and data warehousing services.

Cash-rich NTT is believed to be snapping up new business to bolster its broadband reach and push its Arcstar global connectivity services for corporate users in the Asia-Pacific region. Telekom Malaysia already has a partnership with NTT MSC to jointly provide Arcstar's managed bandwidth and managed frame relay services dating back to May last year.

by Julian Matthews, Kuala Lumpur

(November 2000 Issue, Nikkei Electronics Asia)

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