TOKYO (Standard&Poor's CreditWire) July 25, 2000--A long-sought agreement to lower Nippon Telegraph&Telephone Corp.'s (NTT, rated AA+/CW Neg/A-1+) interconnection fees, which was finalized by the U.S. and Japanese governments last week, will not have an immediate impact on the group's ratings. Over the longer term, however, the emerging competition in Japan's domestic telecommunications industry, combined with NTT's moves to diversify and globalize its business through acquisitions, may ultimately pressure the group's credit quality. The pact to slash the fees that the NTT group charges other companies to connect to its local telephone network will clearly be a drag on the group's profitability. Under the deal, NTT will lower the ¥5.57 fee companies are currently charged for a
