Adam Peake: What is the Japanese broadband miracle? 28 million is about 55% of households. That's a good number of people. We have it. In the United States, you don't. In Japan, this can be traced back to the language of the 1996 act. A good number of you came over to tell us what a good broadband policy would be. We've really been involved in watching the Internet grow.
In the early 2000s you had an incumbent who decided that IP networks were good and something they should embrace. That’s important. We talk about speeds. Here I have a brochure for a housing development in Japan. It's overlooking the fish market. And they advertise that the mansion building has 1 Gbps to the basement. You don't have 1 Gbps to your home, but you have access to that technology.
Randy Bush is one of the people who's driven the Internet around the world for the last 20 years. He's got fiber to his home, it's 100 Mbps, and he can tweak it so he gets maybe 80 Mbps out of it. Don't be misled by that. You won't get it. But you will get extremely fast service, and extremely affordable service.
Fiber, fast DSL will be about $35 a month. You can get 100 Mbps with telephone and the Internet for under $70. That's quite good.
The open access model can work if the conditions are right. We've adopted many of the ideas from the 1996 act. What are the conditions that allowed Japan to get where it is today?
The first difference is that we don't have a major cable television industry. It's all about telephony and opening up the incumbents' networks. The legal system is also not litigious. That means the NTT didn't spend its time going to court and fighting this. They accepted it, and that's how Japanese business works. They also had a regulator who stood by it. The goals were set at the national level.
We're moving to an information society. It's more than broadband. How do you use this in society? We have 100 million mobile subscribers. 85 million of those are 3G. 87 million of those have an Internet contract. 40 million have contactless payment cards in them already. 20 million of them are digital televisions. Very sophisticated set of uses. The end result is a ubiquitous networked society.
Japan doesn't really have a particularly good broadcasting industry. It's somewhat moribund. The programs aren't particularly good. They don't even have a popular sport. Think about the United Kingdom, where BT says there are no commercial opportunities for the them to bring fiber to the home. That's because they have BskyB, subscription satellite television to the home.
I hope that gives some idea of the background of where Japan is. It's important to think about what the problems are and what the future might bring. There are two issues, really. One is the Japanese view of network neutrality. It's important all around the world. In November 2007, the ministry responsible for communications accepted an amendment that was similar to the four principles of network neutrality, but they made them rules that should be followed.
IP networks should be easy to access and easy to use. They should be accessible to any terminal and support end-to-end communication. Users should be provided with equality of access at a reasonable price. Those are the principles. And they're meaningful principles people will adopt and follow.
Next, we have a more problematic situation. That's one of packet shaping and network congestion. One of the impacts of accessible broadband is that it pumps out a lot of bandwidth. This is a worry. Some companies have begun packet shaping on peer-to-peer traffic particularly.
There's a particular problem on an application called Winny, the national peer-to-peer application. It's extremely easy to share your whole hard disk. And prone to viruses. Winny is basically a pig, and there's no way anybody's going to defend it.