fibre-optic businesses into a separate company, the Yomiuri newspaper reported on Monday.
The move is part of efforts by the government, which owns 33.7 percent of NTT, to spread the use of high-speed broadband to all Japan's households by 2015, up from the current 30 percent, the daily said.
The new company will lay, operate and lease the broadband networks currently owned by NTT's two regional units to its competitors, the paper said.
Kazuhiro Haraguchi, Japan's minister of internal affairs and communications, said this month the government would unveil a strategy to accelerate broadband use, including a possible review of NTT's management structure, by the middle of May.
But a government official said there had been no discussion on NTT's management structure at a task force working on the plan. An NTT spokeswoman declined to comment.
NTT has been struggling to hit the target for its cable laying operations amid an economic slump and increasing competition from mobile broadband operators.
NTT this month cut the target for a net subscriber increase for its Flet's fibre-optic service by 16 percent to 2.1 million for the year to March 2011.
The company now expects the number of its cumulative subscribers by the end of March 2011 to be around 15 million, half of the 30 million target the group envisioned in 2004.
NTT shares were down 0.1 percent to 3,885 yen, in line with a 0.2 percent drop in the Nikkei.
(Reporting by Yuko Inoue; Editing by Joseph Radford)
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