Swamped by Euro Feedback – Now Let's Look at America
Go ahead and feel free to mail me with your notes on which US/Canadian companies, technologies, business models, and content services bear watching. Can m-mode delivered via GSM/GPRS by AT&T Wireless sweep the US? Or does the backwards compatibility and high speed of CDMA 1x technology have an overwhelming advantage – making the CDMA carriers the ultimate market winners? Republishing your collected, collective wisdom on the European and North American mobile Net markets in the final two WWJ newsletters strikes me as being the best way I can pay back your loyal readership and spread around some of the local-market knowledge that WWJ subscribers have amassed.
A big “Thanks!” to everyone who submitted comments and observations in response to last week’s WWJ Viewpoint, wherein I solicited feedback on “what an outsider needs to know about Europe’s mobile Internet.”
If you’ve just joined us, my query was elicited by your humble correspondent’s pending move to Germany after nine years of Japan experience – and the sudden realisation that he doesn’t know a whole lot about the Euro mobile Internet. There were, however, lots more responses than expected, so you’ll have to wait until next week (Apr. 21 – WWJ’s second-last issue from me) before I can collate, organize, and republish all the comments.
But that got me to thinking – why not balance things out by asking loyal list members to also furnish their feedback, commentary, and informed insight on the North American mobile market? (… also ill-understood by your soon-to-be-ex-WWJ writer – despite his Canadian origins.)
Go ahead and feel free to mail me (at the address below) with your notes on which US/Canadian companies, technologies, business models, and content services bear watching. Can m-mode delivered via GSM/GPRS by AT&T Wireless sweep the US? Or does the backwards compatibility and high speed of CDMA 1x technology have an overwhelming advantage – making the CDMA carriers the ultimate market winners? And, will US subscribers ever take to Hello Kitty downloads? (There’s evidence to say argue they already have – see WWJ No. 92, link below).
Republishing your collected, collective wisdom on the European and North American mobile Net markets in the final two WWJ newsletters strikes me as being the best way I can pay back your loyal readership and spread around some of the local-market knowledge that WWJ subscribers have amassed (and remember – there are over 4,000 or you now – most working deep in mobile Internet space somewhere on planet Earth).
I will gather your responses and present them in the final WWJ newsletter on April 28 – European responses will come on April 21.
Last week, I wrote that: “My first impression [with the 505i-series] was that DoCoMo has now entered a “post-packet-fee” era. By this I mean that the company is no longer merely fixated on deploying features and services that boost individual packet usage and ARPU; this has been the sine qua non of mobile carriers in this country since the dawn of i-mode. DoCoMo has clearly decided to make the phones uber-sexy so as to grab market share and stem the churn over to KDDI (and – to a lesser extent – J-Phone).”
This observation sprang largely from the fact that Big D has adopted removable memory in a big way with the 505i phones – a substantially new development at DoCoMo.
The natural conclusion is that the carrier is satisfied with the packet usage and traffic fees generated by most individual users and doesn’t mind letting them swap photos and other data off the handset without using the network. So long as DoCoMo wins new converts due to the sheer technical attractiveness of the handsets (i.e. removable memory, high-resolution cameras, etc.), they’ll earn plenty future revenue from an increased subscriber base – and stem the loss of market share that’s been bleeding away to KDDI’s CDMA 1x system for almost half a year now.
Of course, as one of my keen students at the mobile marketing course that I co-teach at Niigata’s International University pointed out yesterday afternoon (I wrote this on the Shinkansen “Bullet” train as I returned to Tokyo), DoCoMo **had to** offer removable memory as a way to get the huge picture files created by the new, 1.3-megapixel camera off the handset without incurring injurious packet fees. True enough.
But lead CSFB telecoms analyst Mark Berman had a different take. He wrote to say, “Actually [you are] incorrect. DoCoMo’s churn rate has been steady, and actually fell in the 3rd quarter (the last we have data for).” Ouch!
He added: “Also, I disagree with the view that DoCoMo is moving away from a strategy of raising ARPU – [i-mode tanto-san Takeshi] Natsuno’s presentation to analysts focused on the increase in data usage they are seeing per user per day with the new camera phones – a point I keep hitting on as an indicator that their data revenue will continue to rise at a strong clip.” Ouch again!
(After that sound thrashing, though, he did add, “Overall, though, good work on your pieces!”) 😉
I’m still not convinced that packet revenue per user won’t take a hit once folks realise they can off-load pics using the memory cards instead of the pay-for-every-packet network – and only 3 of the 6 new 505i models have the megapixel-class cameras that arguably demand physical offloading versus network transmission; the rest still have 300k-pixel class lens and remain clearly in the toy/novelty/convenience category.
If users aren’t prepared to pay for one of the sure-to-be premium-priced Sony 1.3-megapixel 505i models, they’re probably also too cheap to use packets to offload pics.
Further, in our upcoming video report from the 505i-series launch event, Natsuno-san told me that he recognizes the fact that there are now two modes of usage – using the network to swap photos, and using removable memory and photo print kiosks.
The cool new kiosks, by the way, are being pushed by NEC, Fuji Photo, and Omron, which – since last fall – have been in turbo mode to develop and distribute as many kiosks as they can to high-traffic public areas and chain shops (it costs about 50 yen to make a print). The machines accept all forms of removable memory sticks and have evidently been designed with non-packet-using el cheapos in mind.
Ultimately, any reduction in packet revenue due to offloading via removable memory may be more than compensated for by other new usages – such as using removable memory to transfer pics to the phone (and mailing them) from non-wireless-enabled devices like digicams. Maybe Berman and me are both correct. 😉
Please don’t hesitate to drop me a note (mail address below) – even if just a few lines – to provide your feedback on what an outsider needs to know about the North American mobile market – and log on April 21 and 28 to access what will probably be WWJ’s two best issues ever!