Urban railways in Tokyo and Osaka are characterized by a multiplicity of operators, including companies in the JR group, multiple other private railways, local governments, and the third sector. Taking a broad view across an entire metropolitan region where commuter flows cross multiple prefectures and municipalities, it could indeed be the case that more than
10 distinct railway operators are combined to form a single rail network. In the early years of urban railways, transport services were provided in a format where urban peripheral rail services run by the government were combined with tram services that linked the inner urban areas. As populations increasingly clustered in urban areas, cities expanded and the process of urbanization spread to suburban regions. Scenting the chance to make a profit by linking urban peripheral railways to these growing suburbs, Japanese entrepreneurs sought to emulate Cornelius Vanderbilt, ‘King of the Railroad’ in the USA, and invested in urban railways. The result was the formation of a wider rail network in large cities. With the spread of automobiles, trams were replaced first by buses, and then, as traffic congestion and environmental issues came to the fore, there was a switch to underground railways. In this way multiple operators appeared on the scene and heavy rail became the mainstay of urban railways. When underground railways appeared, there was a move to link the suburban railways, which had expanded out to areas beyond peripheral railways, to the centrally located underground railways, ensuring better convenience by provision of through-service trains. Through services eliminated the need for transfers, reducing the physical burden on passengers as well as travel times. However, transferring between the lines of different operators meant that the fares of each operator were added, resulting in an outstanding issue where the fare was considerably more than if the same journey had been made on the lines of a single operator. Economic theory suggests that companies move from competition in markets to create oligopolies and then monopolies. However, in the case of railways in major cities, companies’ diversification of business operations has strengthened their business base and they continue to operate as before in an era of competition, without cutbacks or curtailment of services.