2004 to be the Year of 3G in Japan

A quarter of all mobile-phone users in Japan are expected to switch to a 3G service by March 2005. Analysts say DoCoMo, Japan’s largest wireless carrier, could add a million customers a month in 2004, once improved phones are released. Meanwhile, DoCoMo’s rivals, KDDI and Vodafone KK, are also expanding, leading executives to predict that 2004 will be the year of 3G in Japan. “If 3G is validated here, a lot of carriers and suppliers will point to Japan as a success,” said Mark Berman, an analyst at Credit Suisse First Boston in Tokyo. “This could touch off a 3G rally” worldwide.

Rival carriers in America, Asia and Europe are also waiting to see if the market in Japan continues to grow before they introduce or expand their services. If 3G remains only a niche product, carriers may have to scale back or freeze plans, which would be a setback for phone and equipment suppliers that are counting on a global expansion. The phone makers Toshiba, Sharp and Sanyo, for instance, hope to piggyback on Vodafone’s 3G network as it expands into Europe. And network equipment makers like Nokia, NEC and Siemens could benefit as networks outside Japan are built to support the service. The promise of 3G is still a ways off in the United States. Continue >>