Japan’s mobile phone market: 2006 results

Japan finished 2006 with a 71.8% wireless penetration rate, which translates to 91.8 million people. Obviously, with the increase of the penetration rate, the net additions are slowing down with each year – 5.5m in 2005 versus 4.8m in 2006.

In 2006, the wireless market in Japan was dominated by DoCoMo with 51.1m users, trailed by KDDI with 25.4m of combined au and Tu-ka user bases, leaving Vodafone KK (now Softbank Mobile) on the third place with 15.2m customers.
The area, in which KDDI outperformed DoCoMo is ARPU, reaching JPY7,040 compared with DoCoMo’s JPY6,910. Vodafone traditionally finished in third place with JPY5,890.
Handset shipments have actually increased in 2006 hitting 48.7 million units compared with 44.8 million in the previous year, but less than 51 million handsets shipped in 2004.

Vodafone Live! is dead, long live Y! Keitai

The sad story of Vodafone’s mobile phone failure in Japan will be officially closed in October 1st when the remaining services with Vodafone branding to be changed to Softbank’s name. For example, the mobile portal, previously known as Vodafone Live!, will be re-branded to Y! Keitai, while other services’ brands will be stripped out of Vodafone brand and substituted with S!, standing for Softbank!

This is not the first time the struggling mobile operator changes its name. Previously known as J-Phone, it was bought out by Vodafone, which rushed to change its name to Vodafone K.K. Now it is Softbank’s turn to introduce the new name for the company – Softbank Mobile.

It remains to be seen whether the new leadership can change the course of Japan’s third largest mobile operator toward success, but merely changing the name of the company will not help if not even making it worse by confusing users.

So far, Softbank’s president Mr. Son outlined the four-point strategy for the carrier, including the following:

1. Continuous enhancement of 3G coverage
2. Strong build-up of 3G phone portfolio
3. Beefing-up mobile content offerings
4. Reinforcing company’s management and brand

Japan's wireless market week wrap-up

DoCoMo buys two carriers in Guam
NTT DoCoMo is buying Guam Wireless Telephone Co. and Guam Cellular & Paging for $71.8 million. DoCoMo plans to merge the two carriers and invest in network upgrades.

In other DoCoMo news, the Japanese operator launched two new FOMA handsets on Friday that operate on the Symbian OS. The FOMA D702i and the FOMA NM850iG bring the total number of Symbian OS model handsets being offered in Japan to 26.

Japan's mobile operators see kids as new market
Mobile operators in Japan have created a new category of phones for grade-school children, equipped with a range of anti-crime safety features, educational content and censored mobile Internet access. NTT DoCoMo estimates that only about 10% to 20% of grade school children currently own phones. Mobile phone usage among children in terms of communication costs has been increasing steadily every year to about a 32 billion yen ($275 million) market in 2005, according to data compiled by Yano Research Institute.

NTT DoCoMo invests in convenience store chain
NTT DoCoMo, Japan's largest wireless carrier, said it will buy a 2% stake in the nation's No. 2 convenience store chain, Lawson Inc., for $76.9 million. The move is aimed at expanding a DoCoMo service that allows subscribers to pay for goods with their mobile phones.

Yahoo! to emerge as a mobile content provider in Japan
Yahoo! co-founder Jerry Yang said he believes Softbank's deal to buy Vodafone Group's Japan business could be an opportunity for the U.S. Internet company. Softbank is the largest shareholder in Yahoo Japan Corp., and Yang said the Vodafone K.K. deal represents a chance for Yahoo to expand its mobile phone offerings.

Japan's wireless market week wrap-up

Japan's eMobile picks Ericsson for 3G network build-up
eMobile, a new entrant to the Japanese 3G market, has selected Ericsson as the prime supplier of its new WCDMA/HSDPA network.

DoCoMo rival calls for wireless giant's breakup
Sachio Senmoto, CEO of Japan's eMobile, said NTT DoCoMo should be broken up to make the country's wireless market more competitive.

Carlyle prepares for Willcom IPO
The Carlyle Group, which owns 60% of Willcom, Japan's largest operator of PHS (personal handyphone system) services, reportedly is planning an IPO for Willcom. Willcom added 64,900 subscribers in February for a total of 3.8 million -- an increase of 25 percent since March last year when it introduced the flat-rate voice plan.

Equity companies want to outbid Softbank to get Vodafone
Cerberus Partners and Providence Equity Partners Inc. reportedly are putting together a $15 billion offer to buy Vodafone K.K. Japanese Internet provider Softbank already is in talks with Vodafone Group about buying K.K.

Vodafone finally sells Japanese operations to Softbank for $15.4bn
Vodafone Group plc confirmed that it will sell its struggling Japanese operation to Japanese Internet conglomerate Softbank in a deal valued at about $15.4 billion.

3G subscribers come near 46 million in Japan

Japan 3G user base grew to 45.9 million in February, surpassing the number of wireless users with 2G handsets (44.8m). This milestone was achieved because of energetic efforts by three major carriers to switch their 2G subscribers to 3G services.

DoCoMo outshined KDDI au in a second time in a row, adding 828 thousand subscribers to its 3G FOMA service, while KDDI au signed only 309 thousand 3G customers. KDDI au reports 96% or 21.1 million of its customers now being subscribed to 3G service (this includes both CDMA2000 1x and EV-DO services). In contrast, DoCoMo has switched to 3G only 43% (22m) of its customer base. Vodafone added 195 thousand 3G subscribers, ending February with 2.7 million (18%) 3G users.

Japan wireless subscribers: February data

The number of Japan’s wireless subscribers increased by 334,700 in February, driving the total user-base to 90,767,700 active users. KDDI au posted the largest net additions, signing up 275 thousand users. However, these high results were undermined by losses at KDDI’s struggling 2G unit – Tu-ka, which reported almost 115 thousand subscribers leaving the company. NTT DoCoMo signed up 162 thousand new users, while Vodafone lagged behind with twelve thousand of net adds.

Measuring by total number of subscribers, NTT DoCoMo continued its domination with 56% market share, which translates into 50.6 million wireless subscribers. KDDI was in a distant second place with au unit taking 24% (22m) of the market share and Tu-ka unit being down to 3% (2.9m). Vodafone slightly improved its performance, having 17% of the market share with the total customer base, reaching 15.1 million.

Japan's wireless market week wrap-up

Vodafone inks deal to unload Japanese unit
Vodafone Group reportedly has reached a deal to sell a 98% stake in Vodafone K.K. to Softbank. Softbank may pay as much as 2 trillion yen ($17.2 billion) for 98 percent of Vodafone K.K.

Japanese 3G mobile phone users exceed 50 percent
According to the Telecommunications Carriers Association, more than half of Japan's 90.8 million mobile phone users are on high-speed 3G networks.

DoCoMo unveil basic 3G FOMA SIMPURE series
NTT DoCoMo announced that they have developed the 3G FOMA SIMPURE series of basic and compact handsets for people who do not require highly sophisticated functions.

Openwave reports 20m KDDI users
Openwave Systems announced that more than 20 million of EZweb subscribers are using Openwave products and solutions to power KDDI mobile phone services using the WAP2.0 and TCP/HTTP standard protocols.

Japan's wireless market week wrap-up

Vodafone Japan intros first 3G handset with VGA display
In a spotlight is the launch of Vodafone 904SH by Sharp, the first mobile handset to feature a VGA (Video Graphics Array) liquid crystal display. Besides, the handset supports Bluetooth communication, applications for newly-developedMotion Control Sensor, and Vodafone K.K.’s first Face Recognition application.

Mitsubishi to scale back mobile phone business in China
Mitsubishi joins Panasonic and Toshiba among the big-name companies that have withdrawn from the booming Chinese wireless market.

Vodafone K.K. upbeat on prospects
Vodafone K.K. President Bill Morrow said parent company Vodafone Group's announcement of an impairment charge totaling at least $40 billion would not affect the Japanese unit. Although Vodafone KK has struggled, Morrow said things are improving, both in terms of subscriber churn and 3G subscriber growth.

Vodafone to sell its Japan unit to Vodafone?
Despite Vodafone K.K. president Bill Morrow's early comments that Vodafone's Japanese operations would not affected by the impairment charge, Vodafone confirmed it was in talks to sell a controlling stake in its Japanese subsidiary, Vodafone KK, to Japanese Internet firm Softbank.

Japanese carriers prepare for number portability

Japanese carriers want to make sure they did everything to keep customers from fleeing to rivals when the number portability law kicks in November this year. First, they increased the handset subsidies. And now they are improving the floor space of their shops in order to improve shopping experience for customers and put emphasis on their brands.

DoCoMo stated it would open 60 renovated shops with bigger floor space and improved internal design before June 2006. Every shop will require approximately 20-30 million yen ($172,000-$259,000) for a revamp, half paid by DoCoMo and another half covered by the shop operator.

Vodafone in its turn announced the company would average up the number of its specialized kiosks to 2,000 locations to come up to DoCoMo and KDDI au.

Vodafone probes Japan's market with 2G phone

Believe it or not, but they still release 2G phones in Japan. This time, Vodafone together with Toshiba presented the V502T model, first phone from Vodafone's spring line-up. Retailed at 12,090 yen ($103), the V502T spots a 2.4 inch QVGA display and has only 20mm in width.

The phone is being targeted at first-time users that require a user-friendly interface and a simple operation. To meet these requirements Vodafone incorporated into the phone a ‘Simple Mode 3’ feature. According to Vodafone,

"Simple Mode 3 displays frequently used functions such as voice call, mail and camera in large fonts, making the V502T easy-to-use for both beginners and mature customers. It is also equipped with ‘Limit Mode’, which lets customers control when calls are made, usage volumes and outgoing or incoming numbers to prevent overuse, making the V502T suitable for children."

Here are some additional specs of this phone:

• Size: 51mm x 103mm x 20mm
• Weigth: 119g
• Talk time: 120 minutes
• Stand by time: 380 hours
• 1.3MP camera
• Extension slot: miniSD
• Applications: V Appli ver.2 (256Kb)/ QR-code scanner/ Chaku Uta

Vodafone's V502T product page

Vodafone to start Chaku-uta Full service in Japan

Starting today, Vodafone will follow KDDI au in its offering of full-track music download service, known as Chaku-uta Full.

Initially, the service will be available to the owners of two 3G handsets: 703SH and 903SH from Sharp. Vodafone partnered with 18 music portals to offer its users songs for download, which are going to cost in the range of ¥105-¥315 ($0.95-$2.87) per song.

The Chaku-uta Full service gained some market traction in Japan since its debut in November last year, recording 10m downloads in June 2005.
Source: IT-Media

Vodafone and Toshiba teamed up to market 3G handsets

The world's largest cellular operator Vadafone announced that it had agreed a strategic partnerships with Toshiba to market a range of handsets in Europe, Australia and Japan, according to The Financial Times.

Initially, they will start with the shipping of TS 921 3G handset in Europe, also known as V903T in Japan.

For Toshiba it will be an opportunity to break out of its domestic market, which accounts for 40m handset sales a year, and enter the European market, which is more than three times larger than Japan, with 148m phones sold every year.

The TS 921 is Toshiba's first 3G handset based on UMTS standard. The group currently has a 10% market share in Japan, where it is hamstrung by not having a relationship with NTT DoCoMo, the dominant mobile phone operator.

Japanese mobile handset makers are desperate to enter the global mobile phone market, because their domestic market witnesses a decline in sales. Now, with a global spread of 3G standards, they have this chance. They will learn from Toshiba's attempt how to export their products to the West as they need to address many factors, including localization of their handsets.

Vodafone will ship the V903T 3G handset in Japan in April this year. The handset features USB connectivity, Bluetooth, PC Link, IrDA, Video output, QR Code reading, etc.

Vodafone highlights the following main features of the Vodafone 903T:

• Active Turn Style design for enjoying a variety of viewing styles in different situations
• Auto focus 1.92 megapixel mobile camera
• Twin stereo speakers for greater enjoyment when listening to long version Chaku-Uta musicdownloads and ringtones
• Fully supports Vodafone 3G services
• International roaming support for seamless voice, mail, web and video call services

Vodafone's poor performance reflected on Nikkei

According to The Financial Times, Vodafone's Japanese unit worried the stock market and was one of the reasons Nikkei's eight-day winning streak ground to a halt.

Vodafone KK, the domestic listing of the world's largest mobile phone network operator, lost 2.2% to JPY273,000 after February industry data showed a second successive large monthly decline in customer subscription levels, according to the newspaper.

By contrast, NTT DoCoMo and KDDI both showed gains. NTT shares added 0.5% to JPY185,000 and KDDI was 0.7% stronger at JPY542,000.

Vodafone keeps loosing subscribers in Japan

TCA released Japan wireless net subscriber numbers for February 2005. DoCoMo maintained 56.1% of market share followed by KDDI au with 22.2%. Vodafone (17.5%) continued loosing customers along with Tu-Ka (4.2%).

Net Additions in February:

1. DoCoMo - 246,100
2. KDDI au - 183,700
3. Tu-Ka - (9,000)
4. Vodafone - (53,200)

The companies also continued to switch their 2G subscriber bases to 3G. While KDDI au's 91% of subscriber base is already 3G, DoCoMo with 21.2% of 3G subscribers just started the shift. DoCoMo re-signed more than 600 thousand of its 2G subscribers to 3G base in February.

3G subscriber bases in February:

1. KDDI - 17.3m
2. DoCoMo - 10.2m
3. Vodafone - 0.6m

At the end of February 2005, Japan cellular operators' total subscriber bases were as follows:

1. DoCoMo - 48,098,600
2. KDDI au - 18,922,700
3. Vodafone - 15,152,300
4. Tu-Ka - 3,601,100