Japan Market
Japan Market

Japan Market

Hitachi Mobile Merger Announced

Japan-based Hitachi Ltd. and Hitachi Mobile Co. have announced a stock-for-stock exchange that would make Hitachi Mobile a wholly-owned subsidiary of Hitachi. As part of its reorganization, Hitachi has positioned the automotive systems business as one of its targeted fields. In October 2004, Hitachi merged with Tokico Ltd and Hitachi Unisia Automotive Ltd. Hitachi now owns 64.8 percent of Hitachi Mobile. Shareholders of Hitachi Mobile are expected to vote on the merger in February.

Panasonic Mobile to Restructure

Japan’s Matsushita Electric will end production of current generation mobile phones for overseas markets, cut more than 1,000 related jobs and focus on developing 3G phones, company sources said. The world’s top electronics maker, known for its Panasonic brand, will close a factory in the Philippines and a development facility in the United States as part of its plan to refocus its resources on phones for next-generation networks, they said. Matsushita said it planned to hold a news conference today in Tokyo. Yoshiaki Kushiki, president of Panasonic Mobile Communications, will attend.

U.S. Asks Japan to Increase Transparency

The U.S. called on Japan to increase regulatory transparency in the telecommunications and information technology sectors on Wednesday as it delivered its annual set of government reform recommendations. The proposals were presented by Wendy Cutler, U.S. Trade Representative (USTR) for Japan, Korea, and APEC Affairs to Japanese government officials as a bilateral meeting began in Seattle, Wash. They were made under the U.S.-Japan Regulatory Reform and Competition Policy Initiative, which was started in 2001 to promote economic ties between the two countries.

FY2005 Mid-Term Demand Forecast for Telecommunication Equipment

CIAJ’s Research and Statistics Committee has compiled its annual mid-term demand forecast. A slowdown in new subscribers pulled the growth rate of cellular handsets down, a break in capital investments by fixed telecommunication carriers decreased demand for modems and central office switching systems, and the transition to multipurpose equipment had a negative impact on facsimiles for business-use. On the other hand, continued healthy growth was seen for business and personal multipurpose equipment, optic communication equipment and routers. Strong interest in security and contingency planning for disasters pushed demand up for fixed communication equipment and other consumer equipment, migration of public PHS users to new carriers, and PHS subscriber growth due to new services contributed to the CIAJ forecast of flat overall growth at 4,138.5 billion yen (negative growth of 0.4% over the previous year) for FY2005. The midterm outlook for the telecommunication equipment market from mid FY2006 onward expects steady market growth, with further migration from 2G to 3G mobile communications, the transition from ADSL to FTTH, the switch to IP, and the lasting popularity of multipurpose equipment.

WAMO: Mobile Music Downloads Adding Video Content

WAMO: Mobile Music Downloads Adding Video ContentWarner Music Japan and KDDI Corp. have announced an agreement which will allow access to what is billed as the world’s first mobile music bundle: a package of audio, video, graphic and text content in a single, downloadable file. The service is available on au’s CDMA 1X WIN network and launched on 1 December with Sean Paul’s Za Trinity album. The partners’ press announcement [in Japanese] indicates a steady flow of new material in the pipeline for 2006. The music bundles are available on Warner Mobile – also known as ‘WAMO’ – which aims to allow club members to gain earlier-than-anywhere-else access to the label’s releases, artist interviews and live event schedules.

The downloadable ‘WAMO Packs’ include a variety of mobile music products such as videotones, mastertones and Flash screensavers and menus as part of a single download with the intention of letting customers customize their cell phone with their favorite artist. WAMO Packs also contain bonus material, such as video commentary from the artists, detailed information about the artists and their music, photos, cover art and links to web sites for additional information online.

This evolution in mobile music will come as no big surprise to those who attended the Mobile Monday Tokyo event at KDDI’s Designing Studio in June!

KDDI: No Plan to Increase Subsidies

KDDI Corp., the second-biggest cell- phone company in Japan’s $71 billion industry, plans to add new subscribers without having to pay more incentives to retailers like rivals NTT DoCoMo Inc. and Vodafone K.K., “We’ve no plans to pay more subsidies per handset to add users,” President Tadashi Onodera said in a Nov. 25 interview. “We don’t see a need in giving bigger discounts on handsets if our customers are satisfied with our services.” Japanese wireless operators pay commissions to retailers for each handset sold to encourage sales, the phones are sold below manufacturing costs to consumers as carriers make their money from monthly fees.

Shaking Up Japanese Telecom

Sachio Semmoto likes nothing more than seizing an opportunity when he spots it. Six years ago, the former electrical engineer thought he could crack open Japan’s fossilized telecom sector by connecting businesses to unused lines owned by NTT. Now, Semmoto is smelling opportunity again. On November 10, Japan’s communications ministry granted eAccess one of three new cellular licenses, opening the market to the country’s first new entrants in a dozen years.

Vodafone Pursues Potential MVNO's

Bill Morrow, who heads Vodafone’s Japan operations, said on Wednesday the UK mobile operator was “feverishly in negotiations with quite a few” potential MVNOs. The world’s largest mobile operator by revenues wants to sign up to 10 MVNOs within two years, with the first contract expected to be signed in the next financial year. Such a deal would make Vodafone the first mobile phone network wholesaler in Japan. NTT DoCoMo and KDDI, the country’s largest mobile operators, have said they do not have enough capacity to lease their networks to MVNOs.

Japan Approves Three New Groups for 3G

Japan Approves Three New 3G CarriersBack in 1999, when I was editing Computing Japan magazine, we ran an article entitled “Third Generation Mobile: Three Groups for 3G” looking at the three groups — NTT DoCoMo, IDO-DDI (later, with KDD, KDDI) and IMT-2000 Planning Corp. (later J-Phone) — lining up for a new license. The prediction was that “success for the 3G business depends on the digital content.” Now, 7 years later, three new hopefuls are lining up in a far more mature market, and not only content but also terminals, churn, number portability and voice versus data will be significant factors.

On November 10, Japan’s Ministry of Internal Affairs and Communications said it would grant three new carriers licenses to operate in the 1.7 and 2 GHz bands; BB Mobile of Softbank Corp. and e-mobile of eAccess Ltd. will offer services based on W-CDMA technology while IPMobile Inc. will offer Japan’s first TD-CDMA-based services. The three are expected to launch later in 2006.

The three newcomers are entering a highly competitive market dominated by three existing incumbents: NTT DoCoMo Inc., KDDI Corp. and Vodafone K.K., which reported a collective 89.4 million subscribers as of October 31. The new players are expected to expand the variety of wireless services and pricing levels available, providing more choice and lowering costs — not least of all for terminals — according to one ministry quotation.

Govt to Study Re-Organization Plan

Telecom minister Heizo Takenaka pledged Friday to examine NTT’s plan to reorganize its structure and eliminate overlapping businesses. The remarks from the minister of internal affairs and communications came two days after the telecom giant unveiled the reorganization plan, which is designed to offer Internet and telecom services, among others, for corporate clients at competitive fares.