Nippon Telegraph and Telephone group's two regional carriers announced Friday they will cut local-call charges from 10 yen to 8.8 yen per three minutes, starting in May.

The move will mark NTT's first cut in city-call charges since the 1952 inception of its state-owned predecessor, Nippon Telegraph and Telephone Public Corp.

NTT last made a change in its local-call rates in November 1976, when the charge was raised from 7 yen to 10 yen per three minutes.

The regional arms of the group will go about the rate cut in different ways.

NTT East Corp. will lower the rate from 10 yen to 9 yen from January through April to cope with fierce competition in the Tokyo metropolitan area.

NTT West Corp. meanwhile plans to maintain the 10 yen rate until April because it is weaker than NTT East.

It will be the first time NTT has had independent regional rates, NTT officials said.

Although the price gap is a temporary affair, it marks a significant departure from the previous policy. Until the group was reorganized in July 1999, it was a government directive to maintain the same price throughout the country.

The planned rate cut will reduce both companies' annual revenues by 45 billion yen each.

Although NTT East's cut is expected to cost the company another 12 billion yen, the company doesn't see any need to change its earnings projection for fiscal 2000, because of other ongoing cost-cutting efforts. "We could possibly cut the rate further after seeing the reactions (of rival companies,)" said Satoshi Shinoda, executive director at NTT East, during Friday's press conference.

With the launching of a new phone connection system scheduled for May, rival firms such as KDDI and Japan Telecom Co. have hurried recently to announce plans to enter the local call market with lower rates.

The planned preselection connection system has already intensified price-cutting competition as it will require users to register their main phone company before May.

The NTT group controlled 98 percent of the local call market in fiscal 1998, but its market share slipped to 96.5 percent in fiscal 1999, according to NTT officials.