As Japan’s digital technology sector continues to trail global leaders, NTT Corp. is taking significant steps to strengthen its international presence. Central to this strategy is the full integration of NTT Data Group Corp., a leading IT services provider and current subsidiary. NTT, which already owns 58% of NTT Data, is set to acquire the remaining 42% through a tender offer, with plans to delist the company.
NTT Data group holds a strong position in Japan, especially in system development for government entities and financial institutions. Beyond its domestic role, the company oversees NTT’s international operations and holds a substantial share in the global data center market, ranked third worldwide. This acquisition marks a critical phase in NTT’s broader restructuring strategy, which began decades ago when Nippon Telegraph and Telephone Public Corporation was privatized in 1985. The move echoes a similar step in 2020, when NTT made its mobile arm, NTT Docomo, a wholly owned subsidiary.
This consolidation is intended to streamline the company’s operations and leverage its group strengths to develop cutting-edge IT services. With global expansion as a core objective, NTT Data Group is expected to take the lead in driving growth beyond Japan’s borders.
Investing in Next-Gen Tech to Lead the Digital Future
As artificial intelligence drives up global electricity demand, the competition among data infrastructure providers is intensifying. NTT is positioning itself at the forefront by accelerating the development of its Innovative Optical and Wireless Network (IOWN). This next-generation communication technology utilizes advanced optical systems to drastically cut energy consumption—a crucial advantage in the era of AI and data-heavy applications.
NTT plans to apply IOWN across its data center operations, aiming to gain a competitive edge in efficiency and sustainability. This strategic application could not only solidify its place in the global market but also potentially establish NTT as a leader in eco-conscious IT infrastructure.
The company’s restructuring and technology investments are closely aligned with evolving global trends, where energy-efficient, high-performance digital infrastructure is becoming increasingly essential. By focusing on these areas, NTT aims to reassert its relevance and competitiveness in a rapidly changing industry dominated by American tech giants like Google and Amazon.
Policy Shifts Enable Greater Flexibility for NTT
NTT’s recent restructuring efforts have also been facilitated by changes in government policy. Historically, the Japanese government imposed strict regulations on NTT to prevent monopolistic dominance, particularly because of its control over the fixed-line telephone network. This led to the separation and public listing of several of NTT’s business units to encourage industry competition.
However, as foreign tech giants outpaced Japanese firms, the government revised the NTT Law in the previous year. These changes included loosening requirements for ministerial approval in executive decisions, giving NTT greater operational flexibility. The timing of NTT’s move to acquire full control of NTT Data Group aligns with this more supportive regulatory environment.
Moving forward, experts believe Japan must continue reassessing its telecom policies to balance fair competition with global competitiveness. Increasing NTT’s freedom to manage and grow could be key to nurturing tech champions capable of rivaling global heavyweights.
