HTC aims for 5% of Japan mobile handset market

This week HTC held a press conference in Japan to share its vision and strategy of tackling Japan mobile handset market and also to mark the launch of HTC Touch Pro and HTC Touch Diamond devices along with Touch FLO 3D user interface. 

HTC's outlook for Japanese operations is positive with optimistic goal to grab 5% of domestic unit shipments in near future. HTC will need to ship about 2.6 million devices annually in order to achieve its 5% goal (annual handset shipments in Japan reached 52.3m in 2007, according to Gartner).

HTC's confidence is based on global success of HTC Touch smartphone, which sold in almost 3 million devices from its launch in 2007. The new and enhanced Touch-based models Touch Pro and Touch Diamond should drive more sales, according to HTC. Having launched HTC Diamond in May 2008, HTC reports global sales of 1 million devices with the forecast of 3 million shipments by the end of October 2008.

Along with new devices, HTC also refined its strategy in Japan, including the following moves:

• Target multiple carriers by shipping HTC Touch Diamond to DoCoMo, Softbank, and eMobile and HTC Pro to DoCoMo, KDDI au, and Softbank
• Provide a thorough localization for Japanese carriers enabling carrier-specific email, menus, text input, navigation apps in Japanese
• Bring HTC's latest handsets to Japan in timely fashion (in sync with global launch)...

Source: IT Media +D Mobile

iPhone sales go flat in Japan?

Market research company GfK has just released handset sales rankings for the first week of October in Japan. Surprisingly, Apple iPhone didn't make it to the country's top ten and even ended up third in Softbank's line up. Talking about the novelty effect evaporating...Overall, October is a slow month in Japan as the industry holds its breath for carriers' winter handset lineup announcements. But will Apple have something new to offer? I doubt that. To make it worse for Softbank, an iPhone's operator in Japan, none of its models was listed in top ten list. At the same time DoCoMo's models occupied the top list taking seven out of ten positions including the first top three. Unfortunately, GfK doesn't make public the handset sales numbers but at least you can see the top ten list below:

1. Panasonic P906i (NTT DoCoMo)
2. NEC N906iμ (NTT DoCoMo)
3. Sharp SH906i (NTT DoCoMo)
4. Sharp W62SH (KDDI au)
5. Toshiba W61T (KDDI au)
6. NEC N706iμ (NTT DoCoMo)
7. Panasonic 706iμ (NTT DoCoMo)
8. Fujitsu Raku-Raku Phone V (NTT DoCoMo)
9. Sony Ericsson W62S (KDDI au)
10. NEC N706iII (NTT DoCoMo)

Source: GfK via ITMedia

Japan handset distribution channels: over 10,000 kiosks

Japanese wireless carriers control the significant part of the handset retail distribution channels – approximately 80% belong to carrier-owned stores. According to M-Report’s estimates, top three carriers, including NTT DoCoMo, KDDI au, and Softbank own over 8,000 retail kiosks. Consumer electronics stores and general retail account for additional 2,000 POSs, making the total number of specialized mobile phone stores over 10,000.

Source: M-Report

Social network GREE grows to 4 million users

GREE claims to be the first social network to be launched in Japan. The company has grown to 4 million user base since its launch four years ago. GREE sees its success in delivering appealing content such as user interests-based interactivity (Music Corner service), games (online-based 3D golf), news made accessible from both the PC and mobile phone. The company has a partnership with KDDI au, which recently announced that two million of its mobile phone users are GREE members. GREE has a goal to increase its user base to 10 million in near future. While GREE maybe the oldest social network on the block it is not for sure the most popular in Japan. The most successful rivals include Mobage Town and mixi social networks.

Source: GREE press release (Japanese)

Related articles:

• Mobile social network Gree adds another million users
• Mobile social network EZ Gree grows to one million users
• Study: mobile social networking usage in Japan

KDDI au’s Full Game: 10MB games targeted at mobile users

KDDI au, one of the biggest supporters of Qualcomm’s BREW platform outside of United States, took the advantage of BREW 4.0 capabilities and deployed a mobile game service called Full Game that provides high-quality 3D mobile games for download. The Full Game service is based on the precise rendering capabilities of KCP+ platform (KDDI Common Platform) based on Qualcomm's MSM7500 graphic chipset. To deliver a smooth 3D gaming experience the game’s file size reaches 1.5MB plus up to 8.5MB of supporting data. There are six Full Game-compatible handsets, including the W56T、W54S、W54SA、W61SA、W61T、and W61S models with more to follow. Initially, there four titles, which will become available for download from February 28.

Source: KDDI press release (Japanese)

Sharp handsets do magic and spur mobile web usage in Japan

CNet Japan reported Be Trend’s research results about the mobile internet usage in Japan in January 2007. First, they show the breakdown of mobile internet access shares by carrier. The trend here reflects the recent turn around at Softbank, with carrier’s share surpassing 9% in January and gradually heading to a 10% milestone. Nevertheless, NTT DoCoMo still holds the lion’s share of mobile phone users accessing mobile web.

What is more interesting is that Be Trend was able to track down the mobile web access statistics to a single handset model, publishing top five models for each carrier. First come DoCoMo handsets with the top five ranking being occupied with spring and summer models of 2007. However, the latest models of 905i series also start penetrate the ranks, with Be Trend reporting that the P905i has made the Top 10 list with a 2.7% share.

Sharp entered KDDI au’s Top 5 list the W52SH model for the first time. Considering Sharp’s leading positions with other carriers, this success with KDDI au tells that Sharp has found a winning formula to manufacture both the CDMA and WCDMA handsets with appealing design and user friendly interface.

Softbank’s Top 5 list of devices used to access mobile web is dominated by Sharp model – only Toshiba handset prevents Sharp from taking all five positions.

Source: CNet Japan (Japanese)

Signs of LTE becoming a 4G technology of choice emerge in Japan

It is no wonder that WCDMA carriers like NTT DoCoMo and Softbank in Japan might pick LTE (Long Term Evolution) cellular technology for the upgrade of their current 3G networks. After all, LTE is considered to be a more optimal path for them than alternative 4G technologies, such as WiMAX. As a matter of fact, DoCoMo is already moving into that direction as it just announced the selection of Ericsson for its LTE base station development project. The two companies have a long history. Since 1992, Ericsson has delivered PDC base stations to NTT DoCoMo and, more recently, W-CDMA base stations for the operator's FOMA network. However, there are signs that even carriers from opposite to UMTS camp – CDMA, are hesitant about upgrading from their CDMA EV-DO networks to the Qualcomm’s proposed UMB (Ultra Mobile Broadband). CDMA carriers worldwide, Verizon Wireless, Vivo, KFT and SKT in Korea, made a pledge for the WCDMA upgrade path. What’s more interesting is that Japan’s CDMA carrier KDDI also seems to be evaluating its options about 4G. upgrade. According to Jean-Pierre Bienamé, chairman of the UMTS Forum, he senses a change of direction in the KDDI boardroom. “They have frozen development on EV-DO Rev A and are now assessing Rev B and Rev C alongside all the other options, including WiMAX and LTE. The decision criteria will be on cost reduction per bit and it is here where LTE has an advantage,” he said in an interview to Telecommunications Magazine.

Mobile social network Gree adds another million users

Last August we reported that mobile social network Gree on KDDI au had reached a milestone of one million users. And now it is time to update that data with another million to a total number of two million users, which roughly constitutes 2 percent of Japan’s total wireless population.

Source: KDDI au press release (Japanese)

KDDI au's top ten selling phone models

GfK, a market research company, published ranks of top selling mobile phones with each operator in Japan during the last week of November. This post will cover KDDI au. See table below for the top 10 sellers with au brand.

KDDI au Top Ten
1 (1)	Toshiba W53T
2 (2)	Casio Exilim W53CA
3 (3)	Sharp W52SH
4 (4)	Sanyo W52SA
5 (5)	Kyocera A5528K
6 (8)	Sony Ericsson W53S
7 (6)	Casio W52CA
8 (7)	Panasonic W52P
9 (9)	Toshiba W54T
10 (20)	Kyocera W53K

Source: GfK via ITMedia

Google Japan intros new single portal for domestic mobile operators

Now mobile phone users of NTT DoCoMo’s iMode, KDDI au’s EZ Web, and Softbank’s Yahoo! Keitai data services have one uniform URL they should use to get to Google Mobile - google.jp. Google Japan redesigned the mobile search method by getting rid of radio buttons with Web, Mobile and Images search options, leaving it to just a simple universal search. Google also report they optimized the local search and display of maps on mobile handsets. While this announcement is a step ahead for Google Mobile in Japan, it looks like the Japan’s team has a lot of localization work to do when comparing the array of mobile services available in the U.S. with those few offered in Japan (see image above).

Source: Google Japan Blog

10 million of mobile wallet users at KDDI au

Contactless payment solutions continue to penetrate mobile phones in Japan at the accelerating rates. KDDI au registered 5 million mobile wallet users in March 2007, now they report 10 million users or 35% of their total subscriber base is actively using mobile phones to make all kind of purchases you do in your daily life. Thanks to the adoption of FeliCa, a flavor of Near Field Communications standard, by all major carriers the POS locations don’t have a headache of prepping different readers in order to process the mobile phone transactions. FeliCa rules in Japan. Expect the similar solutions to be deployed by AT&T, maybe even in 2008.

Source: KDDI au (Japanese)

KDDI au ships Hitachi Woo mobile TV phone

Mobile phones with built-in one-seg TV tuner are driving replacement sales in Japan, making any self-respecting handset manufacturer release its version of mobile TV phone. Now that everybody does mobile TV phone, how are you supposed to differentiate your product from the bunch of others. Well, there are some ways to do so. First of all, you are in luck if your company is also in flat-screen TV business, because you can borrow its established brand and re-use it for mobile phones. As a result, we have Sony Ericsson Bravia, Sharp Aquos, and Panasonic Viera mobile TV phones attacking the market. Hitachi is not exception here as it also uses its TV brand Wooo to woo mobile phone customers. In order to make the appeal of Wooo handset stronger, Hitachi says they adopted the same graphic quality control technology Picture Master they are using in Wooo TV sets. Besides, the external design of the Wooo handset also borrows from the Cutting Edge Design concept used in Wooo TVs. To further differentiate itself Hitachi brings into play Wide QVGA organic light emitting display that complements handset’s slim body (14.2 mm) in a very cool way. Not to mention handset’s 2MP camera, contactless payment capability, GPS navigation and full HTML browser. KDDI au is shipping it this week at unknown price under the Wooo W53H model name. I can only say, “Wow Wooo!”

Phone Specs
Model:	Wooo W53H
Carrier:	KDDI au
Maker:	Hitachi
Price:	N/A
Form factor:	Clam/Swivel
Color variations:	Black, White, Purple
Weight:	131 g
Dimensions:	51 X 107 X 14.2 mm
Main display:	2.8 inch WQVGA (240 X 400 pixels) OLED
Talk time:	250 min
Standby time:	360 hours
Platform / OS:	N/A
Memory:	100MB shared with BREW folder
Memory card slot:	microSD card
GPS / Location:	Yes (EZ Navi Walk - Voice input 3D navi)
Bluetooth:	No
Infrared:	Yes
USB:	N/A
Wi-Fi:	No
Camera:	2MP
Video calling:	No
One-seg TV:	Yes
Music player:	Yes (Lismo, SD Audio)
Browser:	Full HTML
FM radio:	No
Mobile Wallet:	Yes (EZ FeliCa, QUICKPay)
QR-code:	Yes
Biometrics:	No

Source: KDDI au

The launch of Toshiba W55T is limited to 3,000 models

KDDI au is launching today a limited edition of Toshiba’s super slim W55T, with only 3,000 models to be sold. KDDI is targeting the handset, which size-wise emulates the business card, at style-conscious business customers who value exclusivity and personalization. The personalization comes with the ability to engrave the owner’s name, initials or some citation on the stainless back panel of the handset. As for the accessories, the Weinheimer design house has created a leather case that looks like a business card holder and features an imprinted serial number of the handset.

The exclusive and limited offerings of cell phones are still rare occurrences in the mobile world but it can change with the saturation in the mature markets. Currently, to drive the replacement sales in such market carriers are introducing technological advancements in new handset models. While these tactics seem to be working in approaching the mass market, the carriers can’t afford to overlook the market segments that don’t want bells and whistles of advanced mobile phones. The strong interest to design and fashion from users, along with the desire to personalize your phone, is growing trends that will make carriers and handset manufacturers sell more limited and exclusive handset models in future.

Phone Specs
Model:	W55T
Carrier:	KDDI au
Maker:	Toshiba
Price:	$485~$290
Form factor:	Clamshel
Color variations:	Golden, Platina, Black
Weight:	104 g
Dimensions:	54 X 94 X 9.9mm
Main display:	2.4inch QVGA (240X400)
Talk time:	22o min
Standby time:	240 hours
Platform / OS:	N/A
Memory:	N/A
Memory card slot:	microSD
GPS / Location:	GPS (EZ Navi Walk)
Bluetooth:	No
Infrared:	N/A
USB:	No
Wi-Fi:	No
Camera:	2.0 megapixels
Video calling:	No
One-seg TV:	No
Music player:	Yes (LISMO)
Browser:	PC site viewer
FM radio:	Yes (EZ-FM)
Mobile Wallet:	No
QR-code:	Supported
Biometrics:	No

Mobile phones as fashion statement

The idea of mobile phone serving as not only a personal voice or data communications tool, but also as a fashion differentiator helping consumers complement their designer clothes is not new. However, in Japan, KDDI au moved a notch ahead in co-branding with famous designer houses (see the image above).

Celebrity hairstyle: use your mobile to see if it fits you

Japanese mobile phone users got a fun application I would also like to have on my cell phone. The application, dubbed as Hair Chen, allows you to select trendy hairstyles from a sample database and apply them to your own picture to see how you’d look with that new hairdo. You’ll find a lot of Japanese celebrities in that database as usually they are the trendsetter for hairstyles. For starters, the sample database will contain around 80 virtual wigs to try on, but eventually it will grow with the time.

The Hair Chen application is not offered as a standalone, but rather serves as a bait to lure users to the same-named portal that aggregates nationwide data about hair salons and related information. The portal relies on a subscription-based model to make a profit, charging JPY315 (USD2.67) a month. While KDD au users had this application at their disposal from 2003 DoCoMo users got access to it only recently. The application developer Rstream partnered with hair salon operator Taya to feed the portal with the relevant data.

Source: Source: Rstream (Japanese)

Mobile social network myMTV selects Japan for debut

Viacom decided to test mobile social networking waters in Japan with a bang - claiming to be the "first in the world to offer simultaneous video and page-browsing on mobile." I'm not sure how it works in reality but can suggest it splits the screen in two parts.

Among other perks users will be allowed to use artwork by Japanese designers to decorate their personal pages and provided with access to the feature programming from "MTV's library, such as Pimp My Ride, and Japanese productions such as Usavich."

"The service is ad-supported and free to consumers, and is available on all three of Japan's mobile operators, NTT DoCoMo, KDDI and Softbank Mobile," according to C21Media.

Mobile social network EZ Gree grows to one million users

Launched in November last year mobile social network EZ Gree is growing in user numbers with an accelerating speed. Having hit 500K milestone in March 2007, EZ Gree’s user base passed one million in July.

The mobile version of Gree is offered in a partnership with the second largest carrier in Japan KDDI au who plans to integrate its other mobile data services, including LBS, into the Gree platform. At the moment, besides the ordinary social networking stuff, EZ Gree’s users can send each other html-rich emails (Deco-mail) and play Flash-based mobile games.

Source: KDDI au press release

Google befriends with KDDI, plans global expansion from within Japan?

First Google powered KDDI au’s mobile search platform in July 2006, fetching mobile screen-optimized search results from KDDI’s own EZWeb service and conventional Internet. Now, it will offer the rebranded version of Gmail under the "au one mail" name. So, instead of @gmail.com the email address will look like @auone.jp. KDDI au users will get the service for free and be able to access it from both PCs and cell phones around from late September. Like Gmail, the service features familiar simple user interface and the mail box size is set to be 2GB.

Both KDDI au and Google are to benefit from this co-branding partnership as the former shows its users a new and friendlier Web 2.0 face and the latter penetrating into the walled gardens of mobile world and gaining mobile expertise. KDDI au’s strategy is in a striking contrast with DoCoMo’s protective build-it-yourself approach.

Mobile lessons learned by Google in Japan can help the company better compete on global arena. This was partially confirmed by Google’s Strategic partner development manager in Japan John Lagerling who said at Wireless Japan 2007 conference that Google wanted to develop mobile services in Japan and introduce them globally. With his previous business development experience at DoCoMo, working on i-mode international expansion strategy and mobile wallet projects, he seems to be determined to make it happen for Google. According to John Lagerling, Google’s global mobile strategy is built around three blocks: 1) Personalized search; 2) Cell phone-optimized mobile services; and 3) Partnerships with various industry players. Of course, each country’s specifics are taken into account when developing mobile strategy for one particular market.

John also provided interesting statistics about Internet usage in Japan, saying that among 85 million users, 16 million access Internet only from PCs and 19 million (1/4 of all Internet users) do it only from mobile phones, while 50 million don’t mind surfing the net from both PCs and cell phones.

Sources: Yahoo News and IT Media

KDDI au quarterly results: voice ARPU declines faster for data ARPU to fill the gap

KDDI au posted its 1Q financials results for the fiscal year ending March 2008. Here are some highlights:

• The number portability rule continues to play out well for au as the total mobile number portability net additions (since Oct. 24, 2006) hit the one million mark in June 2007.
• In 1Q, net additions reached 520,000 customers.
• In an accord with healthy additions, the churn rate also improved, going down to 0.97% from 1.04% a year ago.
• While data ARPU went up 5.6% or JPY110 (1 dollar = 120.08 yen as of today) from last year it was not sufficient to cover the losses in voice ARPU, which declined by 10.1% or JPY490 for the same period. This resulted in the total ARPU declining by 5.6% or JPY380 year over year. For comparison, a year ago the total ARPU stood at JPY6,810, while now it is already JPY6,430. For the same period, data ARPU grew from JPY1,970 to JPY2,080.
• KDDI is pessimistic about its ability to reverse the situation with the declining ARPU, estimating its overall ARPU would fall further, including data ARPU. The main factor behind that is the amplified mobile data price war among national carriers in Japan.

Source: KDDI

Casio mimics Sony branding strategy, shows Exilim cameraphone

Consumer electronics brands are being adopted by mobile handset arms of Japanese CE manufacturers. The trend started with Sony allowing its joint venture with Ericsson to sell featured mobile phones under Sony’s well-known Walkman, Cybershot and Bravia brands. Now Casio follows suit by assigning its Exilim digital camera brand to the cameraphone destined to be offered by KDDI au in Japan in near future. The rumors of Casio Exilim cameraphone surfaced first back in May and now it looks like its debut is imminent, according to ITMedia report from Wireless Japan 2007 trade show happening in Japan this week. The phone spots 5.1MP camera supported with specially developed Exilim Engine for Mobile. Interesting part is that the phone has a clamshell form factor with swiveling screen protecting it from scratches when not used and allowing using it as a huge viewfinder (VGA 2.8inch) in a shooting mode. More specs and pricing details are coming after KDDI au’s official announcement.

Source: IT Media (Japanese)

Japanese users think iPhone is fat

When asked what additional features they would like to see in iPhone if it was offered in Japan, majority of Japanese users (44.6%) pointed out to the lack of built-in TV tuner, according to online survey results published by research company iShare (1,341 respondents). The wish list for iPhone continues with the upgrade to 3G speeds (37.1%) followed with the inclusion of GPS (36.2%). Surprisingly, a lot of respondents (34.6%) think iPhone is not slim enough, while a rightful number of them want higher resolution camera (33.1%) and removable memory (33.1%).

DoCoMo is perceived as the least likeable carrier to offer iPhone in Japan (17.1%) among the three national cell phone operators, while SoftBank’s chances are the highest (53%) followed with KDDI au (19.6%).

Source: iShare (Japanese)

Softbank last to hit 50% milestone with 3G subs in Japan

Having added 560,100 subscribers to its 3G service in April, Softbank finally passed a 50% 3G penetration milestone for its subscriber base. The leader in conversion cell phone users from 2G to 3G camps remains KDDI au, which has managed to get 97.9% of its total subscriber base to be equipped with 3G phones. DoCoMo so far persuaded only 69.1% of its customers to switch to 3G.

Japan’s mobile phone market: 2006 results

Japan finished 2006 with a 71.8% wireless penetration rate, which translates to 91.8 million people. Obviously, with the increase of the penetration rate, the net additions are slowing down with each year – 5.5m in 2005 versus 4.8m in 2006.

In 2006, the wireless market in Japan was dominated by DoCoMo with 51.1m users, trailed by KDDI with 25.4m of combined au and Tu-ka user bases, leaving Vodafone KK (now Softbank Mobile) on the third place with 15.2m customers.
The area, in which KDDI outperformed DoCoMo is ARPU, reaching JPY7,040 compared with DoCoMo’s JPY6,910. Vodafone traditionally finished in third place with JPY5,890.
Handset shipments have actually increased in 2006 hitting 48.7 million units compared with 44.8 million in the previous year, but less than 51 million handsets shipped in 2004.

KDDI au grabs 60% of one-seg handset market share

If you stop somebody at the streets of Tokyo who is watching digital broadcasting TV on his mobile handset and ask who is his carrier provider, chances are high the answer will be KDDI au. Having started selling its first one-seg model – the Sanyo W33SA (discontinued) – in December 2005, KDDI au expanded its one-seg portfolio to 12 models, resulting in two million units sold as of February 23, 2007. According to GfK Japan, au group has sold more one-seg compatible handsets than its rivals, grabbing 59.96% of the total market share. The early start and variety of one-seg models predetermined its leading position. In related news, the U.S. based MobiTV announced that it has crossed the two-million subscriber mark. It took some seven years for the company to get off the ground and sign up its first million customers, which it announced last April. Scoring its second million took just 10 months.

Disruptive technologies and competition to undermine the hegemony of NTT DoCoMo

Financial Times reports (January 25, 2007) that “DoCoMo is forecasting a small drop in operating profit this fiscal year.” There are several directions from which the giant feels uneasiness. First comes the number portability that sparkled a price war initiated by Softbank (ex-Vodafone). It also became clear that another DoCoMo’s rival – KDDI au was the biggest winner so far from number portability. Number portability combined with Japan’s traditional fat handset subsidies, of about $300-$350 a piece, alone could affect the profitability. To continue the list of disruptions, FT lists:

• Arrival of fixed/mobile convergence (meaning more bundling);
• Small operators bringing in Skype-type services; and
• Further regulatory changes.

The question remains whether operators such as NTT DoCoMo accept their utility-like (dumb pipe) status or successfully fight off the trend with counter measures. So far, the indications are that they are going for a big fight.