NTT DoCoMo may buy cheaper handsets made in China by NEC Corp., its No. 2 supplier, to cut costs as revenue falls. The company is also offering handsets from overseas vendors such as Nokia Oyj and LG Electronics Inc. in the coming year, Chief Financial Officer Yoshiaki Ugaki said in an interview conducted on Nov. 15. Foreign-made phones can be as much as 10,000 yen ($84) cheaper than domestic handsets used on the company’s high-speed network, he said. DoCoMo expects costs to sell new handsets to rise in the fiscal second half as more customers typically upgrade or buy new phones at the end of the business and academic year in March, Ugaki said.

In the first half, incentive costs including commissions paid to retailers fell because handset sales dropped 23 percent to 222.5 billion yen. “We have to put an extra emphasis on cost cuts,” said Ugaki. “We can’t see any reasons that earnings will recover dramatically in the next year or two as we expect more competition.”

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