Tokyo Analyst: 2003 Wireless Outlook
“Camera phone penetration is increasing. With the newest handsets – particularly in DoCoMo’s case – the packet downloads have just surged. So you’ve got much higher packet usage – two to three times higher now on the camera phones,” says CSFB sr. telecoms analyst Mark Berman. Watch our 2003 kick-off program as we pick the brain of one of Tokyo’s most respected industry watchers on what to expect in ’03. DoCoMo, KDDI, J-Phone, ARPU, data trends, and multimedia: these are a few of our favorite things!
Comments from Wireless Watch Japan Editor-in-Chief Daniel Scuka:
“Packet downloads equals revenue, so that means the newest handsets are generating a lot higher revenue in terms of data ARPU,” says Mark Berman, senior telecoms analyst at the Tokyo office of CSFB. Mark covers NTT, NTT DoCoMo, J-Phone’s public parent Japan Telecom, KDDI Corp, and other players in Japan’s telco scene, and he’s one of the most respected industry watchers on this side of the Pacific. He’s bullish on wireless in Japan – especially 2G i-mode and the other wireless Internet systems – and he’s also keen on 3G.
He explains that the penetration rate of advanced handsets – like those equipped with cameras and Java – is on its way up. J-Phone has already reached the 55-60% penetration level for its Sha-Mail camera handsets. “You’re going to boost the overall packet download rate – even though, obviously, per user, it will come down because of dilution. I think these services are generally going to generate a significant rise in packet traffic.”
I think Berman is making an excellent point, and there are results from other carriers to support his belief that J-Phone is benefiting from an overall packet revenue rise due to cameras (and other packet-intensive features) even if individual usage is falling.
Look on Slide 4 of the NTT DoCoMo IR presentation from September 2002 (see link below). Note that packet usage among **all** i-mode users (red line) in August 2003 was some 30 packets per day higher than that among non-Java-enabled i-moders (orange line). Clearly, the effect of launching Java in January 2001 has been to secure a sustained. Long-term increase in daily packet usage (and hence revenue) of some 17% per user per day. This effect holds true even if not all i-moders have switched to Java (and only about 43% have, as of the first week in January 2003).
This program goes on to cover a wide range of issues and topics related to the business of wireless in Japan in 2003, including 3G, W-CDMA, CDMA2000 1X, FOMA, pricing, handsets, i-mode in Europe, and data services – and comes in at a whopping 23:54 (our longest proggy yet!). It’s well worth your time to log on, grab a notepad to take notes, and watch it all. Then watch it again.
NTT DoCoMo IR Presentation Material September 2002 http://www.nttdocomo.com/reports/20020906_ir_presentations.pdf