Japan’s domestic shipments of cell phones posted year-on-year growth for the second straight month in December, an industry body said on Thursday, as new-model camera phones breathed life into a saturating market. .
Berman warns, however, that with a typical handset cost of 37,000 yen in the latest quarter, “it will require about 23 months to cover [the] cost for upgrade customers.” He goes on to state that this creates a difficult situation for KDDI, wherein there’s lots of room for concern for the cost of the 2G-to-3G upgrade cycle. Remember, too, that KDDI has committed to launching a 1X EV-DO upgrade in late 2003. Will it have to commit to another two-year cycle to convert subscribers to the new system? If so, the expense half of their balance sheet may get a little out of control no matter how strong the revenue side remains.
The level of roaming in particular is a new feature for the market, and they face a sales challenge in figuring out how to sell this to a high-end business crowd – radically unlike J-Phone’s traditional youth target. But I think that today, almost 4 years after the invention of i-mode, provision of wireless Internet is an absolute requirement for success in the Japan market, and the absence of J-Sky access – both Web and mail – with some ill-defined “later in 2003” target is a major weakness.
“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!
Last month, researchers at the International University of Japan released a report detailing surprising conclusions about consumer behavior and usage of mobile networks. “Business mouths are watering at the opportunity for location-based marketing,” says professor Philip Sidel of the International University of Japan. But it ain’t necessarily so, and Sidel states: “We believe that previous authors have adopted a much too simple framework for ‘contextual marketing’.” His exhaustive research offers surprising results to those who would sell via cell
Experts see 2003 shaping up to be a banner year. For starters, DoCoMo, KDDI and J-Phone will all be coming out with refined 2G equipment. They’ll also be rolling out new 3G systems, expanding rich-media services and launching camera-enabled, programmable handsets that can serve as “e-wallet” and “e-ticket” mobile-commerce terminals.
