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Tokyo's amazing week: UK/Jpn JV, 'SoftBank Mobile' and MNP

Watching the business of wireless in Japan just keeps getting better!

Last week brought a slew of new announcements, including news of the JPY11 bn SoftBank/Vodafone joint venture, confirmation that the company formerly known as Vodafone KK will henceforth be known as ‘SoftBank Mobile’ and details on the long-awaited MNP (mobile number portability) implementation. Subscribers can access WWJ’s insight on the first two in today’s Viewpoint (here), but read on below for our take on MNP — possibly the biggest revolution in Japan mobile since i-mode itself.

First, a little history.

Until now, the Big Three cellular carriers (DoCoMo, KDDI/au and Vodafone), as well as the smaller PHS carriers (Willcom, Astel, etc.), have run their networks as independent — and highly competitive — fiefdoms. There has been nothing like number portability or, for that matter, portability of any other service/feature. If you switched carriers, you lost your number…

DoCoMo Quadruple Play Includes Windows DRM, HSDPA, 7 New Credit-Card Phones

F902iSIn a rare quadruple play, DoCoMo today issued three new handset announcements plus one new technology tie-up press release. The first handset news includes the long-expected new credit-card-enabled phones that will come bundled with the carrier’s ‘DCMX’ Java-and-IC-chip-based credit card. The new 902iS series FOMA 3G handsets mark the latest step in DoCoMo’s transformation from Just Another Mobile Phone Company to full-featured financial services provider.

The carrier also said it had agreed with Microsoft to incorporate Windows Media technologies in DoCoMo’s F902iS 3G handset, to be released this summer. The first-time collaboration means that the F902iS will support both Windows Media Audio and Windows Media Digital Rights Management 10 for Portable Devices (WMDRM-PD). The carrier will also evaluate the incorporation of Windows Media Video, Microsoft’s version of SMPTE VC-1 technologies, in future handsets. The press release states that incorporating Windows Media technologies will enable NTT DoCoMo handsets to play music downloaded to a PC from more than 100 online music services around the world, and also support music content ripped from CDs in the highly efficient Windows Media Audio format (login for details).

Handset Shipments Rise 16%

Total domestic shipments of mobile phone handsets in February surged 16.0 pct from a year earlier to 5.02 mln units, data from the Japan Electronics and Information Technology Industries Association (JEITA) showed. Shipments of PHS handsets surged 172.2 pct to 157,000 units, rising for the 13th straight month, according to the report.

Our 5th Birthday!

Our 5th Birthday!This week marked a major milestone for WWJ! In one form or another, I’ve been writing this email newsletter for five years — and what a five year term it’s been!

I spent a couple hours last night looking over past WWJ newsletters, and was struck by how much Japan’s mobile scene has changed. In 2001, when I started writing a weekly mobile-focused newsletter for J@pan Inc, i-mode had just celebrated its second birthday, KDDI had yet to roll out CDMA 1X services and the No. 3 competitor in the market was known as “J-Phone.”

Today, DoCoMo is far in the lead with their 3G FOMA service and music and TV are the new hot trends; i-mode itself has become almost dasai (uncool). KDDI have created one of the mightiest and most unified mobile platforms on Earth, with GPS-based blogging, shopping and PC Internet integration drawing huge usage. The company formerly known as J-Phone is about to become the company formerly known as Vodafone as Masayoshi Son attacks 3G mobile with the same successful discount focus with which he attacked NTT and home broadband.

Bonus ‘those were the days’ tidbits via the WWJ Newsletter after the jump!

Kids' Mobile Device for Willcom?

Reports in the Japanese business press have suggested that publisher Bandai Namco is about to announce the launch of a new mobile gaming device, which would be aimed at the children’s market and launched with mobile network operator Willcom. The new service, Kids Mobile, would be co-launched by Bandai Namco and Willcom, a Japanese mobile operator which was spun out of major operator KDDI in mid-2004, and is now co-owned by Kyocera and the Carlyle Group.

DoCoMo 3G Overtakes KDDI

As WWJ predicted last month, the latest Telecommunication Carriers Association numbers confirm that DoCoMo has indeed gone on to ‘Grab [the] 3G Lead from KDDI.’ OK — so the news isn’t startling given that the trend for the past several months has been growing in DoCoMo’s favor. The news that has been below almost everyone’s radar screens, however, is the exceptional performance of upstart PHS carrier Willcom and its success in attracting new customers compared to third-place 3G carrier Vodafone. The folks over at Willcom posted a net subscriber gain of 80,200 in January compared to Vodafone’s paltry 17,600 result.

Willcom taps Sonus Solutions for VoIP

Sonus Networks, Inc., a leading supplier of service provider Voice over IP (VoIP) infrastructure solutions, announced today that WILLCOM, Inc., a major Japanese provider of wireless data and voice services and the largest operator employing Personal Handyphone System (PHS) technology in Japan, has selected Sonus Networks as the foundation for its new nationwide long-distance network to support WILLCOM’s PHS system. This agreement marks the development of Japan’s largest VoIP network for PHS subscribers. WILLCOM will utilize key components of the Sonus solution including the GSX9000 Open Services Switch, the PSX(TM) Call Routing Server, and the Sonus Insight(TM) Management System, which includes the Element Management System (EMS).

Nokia and Kyocera Resolve Dispute

Kyocera Corporation, along with its subsidiary, Kyocera Wireless Corp., and Nokia Corporation, along with its subsidiary Nokia Inc., today announced that they have entered into a patent license agreement. Under the terms of the agreement, Kyocera is licensed under Nokia’s essential patents, and some additional patents, relating to CDMA, PHS and PDC standards. Kyocera will pay royalties to Nokia for all Kyocera CDMA mobile phone and module products. Reciprocally, Nokia is licensed under all of Kyocera’s essential patents, and some additional patents, relating to all standards and covering all Nokia mobile phone, module and infrastructure products.

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.

Willcom Sees Strong Initial Sales

Willcom Sees Strong Initial Sales“Despite the high prices, there were huge line-ups waiting to buy the new Willcom PHSes,” said my Kiwi pal in an email last night. It looks like some of Willcom’s PHS phones appear to be selling well on the strength of flat-rate voice and data and handsets that are at least comparable to the high-end 3G cellular models from the Big Three carriers. Is this a hint of price destruction to come when the new licensees jump into the market in 2006?

“It normally takes about 20 minutes to get a new phone, but the wait for the new Willcom models on the first day of sales was over an hour and a half. A day or two later and the long lines have vanished,” added Keith Wilkinson, a long-time Japan hand and a keen watcher of all things electronic.

He was referring to the WX300K, WX310K and WX310SA, from Kyocera and Sanyo, as initially reported by WWJ in October, the first in a new series of PHS models. PHS is the shorter-range, non-cellular standard that has enjoyed a resurgence in popularity due to lower costs of usage and flat-rate pricing. According to Willcom, phones could be reserved starting on 11 November, and became or will become available in shops on the 18th (WX300K, silver and ochre), the 25th (WX310K, silver & pink; WX310SA, silver & red) and the 30th (WX310K, other color).