Japan finishes 2008 with 110 million mobile phone subscribers

The “low-baller” competition led by Softbank and eMobile is on in Japan and DoCoMo seems to be back in the game while KDDI and Willcom are out of steam. The December 2008 new adds data from TCA shows just that (see above). Overall, Japan carriers including PHS operator Willcom added 401 thousand new subscribers in December 2008 boosting the country’s total number of mobile phone users to over 110 million equal to 87% of population penetration.

As for the carrier market shares, DoCoMo is in comfortable first-class seat with over 49% of the market while the second and third contenders KDDI and Softbank are chugging behind with 27% and 18% market shares correspondently (see below).

Source: TCA

Forecast for multiple wireless subscriptions in Japan

While the proportion of Japan’s population using mobile phones has slowly reached around 80% and the prospects of further organic growth are bleak, the country’s industry players hope that the next growth will happen in the secondary mobile phone line ownership market. The trend of buying second or even third subscriptions is abundant in Europe where prepaid contracts are commonplace. Can Japan hope for the same rapid growth in multiple wireless contract ownerships? The answer is not likely since the prepaid contracts are banned here. However, some growth can be expected thanks to mainly enterprises buying phones for their employees. According to ROA Group’s forecast, almost 15 million mobile phones in 2008 can be attributed to a second-phone category. And this number should go way beyond 25 million by 2012. Japan’s unique case is that in most cases the users will actually get a new device, not just an additional SIM card to insert into their existing phone.

Source: ROA Group

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.

Japanese kids and cellphones: wireless penetration numbers

Quite obviously the demand for cellphone accelerates with the age confirms the recent survey by Survey Research Center in Japan. While the elementary school first graders' population is scarcely penetrated with wireless service, almost all of the high school graduates (95.3%) own the cellphone. Moreover, 100% of college students are wirelessly connected.

Source: http://www.clue.ne.jp/index.html

Japan wireless subscribers: September 2006 data

TCA's mobile phone market data for September revealed that Japan's wireless user base has increased by 315,000 users since August, totaling in 93,812,400 wireless subscribers. On the wireless carrier front there were winners and losers, with KDDI au getting 312,500 subscribers while KDDI's another brand - 2G carrier TU-KA - lost 151,700. But TU-KA can be hardly called a loser as KDDI's goal is to transform TU-KA's 2G user base to au's 3G services. Meanwhile DoCoMo managed to sign up 126,300 new users and Softbank continued Vodafone's tradition of adding the fewest of customers among three carriers (I exlude TU-KA from this competition) - it recorded only 23,400 net additions in September.

Source: TCA

Japanese cell phones: Healthy shipments in March 2006

JEITA’s March 2006 data shows revival in handset shipments in Japan compared to the previous year:

• The sales of cell phones and PHS handsets accounted for 6.05m terminals, a 127.7% increase from March 2005.
• By terminal type, cell phones grabbed a substantial share of shipments with 5.85m devices running on cellular networks and the rest being PHS handsets.
• As for the cell phone generations, 3G phones accounted for 5.24m terminals or 89.6% share, while 2G phones faced a further decline in shipments, making only 607 thousand.
• The total number of cell phone users in Japan by the end of March reached 91,792,000 people.

3G penetration in Japan to hit 87% by March 2008

Asahi Shimbun reports that according to MM Research Institute's estimates, about 75 percent of cellphone subscribers in Japan will have 3G handsets by the end of March 2007 and the rate will climb to about 87 percent by the end of March 2008.

Japan: PC vs. cellphone shipments

IDC Japan has recently released the number of PCs shipped in Japan in 2005. Surprisingly, the number increased by 9.1% YoY, totaling 14.61 million units. The research company explains the recovered demand (mostly in home PC market) by two factors:

• Interest in Olympic Games 2004
• Increased shipments by major PC vendors, which started selling “spring models” in December instead of January

Nevertheless, the PC shipments still lag behind cellphone shipments, which accounted for 45 million devices in 2005, according to Gartner. Moreover, “although the home PC demand was a driver in 2005, there is a gap between shrinking home PC and expanding business PC markets. Despite the declining growth, business PCs will remain strong with over 60% of Japan PC market," said Kumi Shingyouchi, senior market analyst of IDC Japan's Personal Computing and Digital Imaging. This means, that cellphones continue to be the main devices from which Japanese users access Internet.

3G subscribers come near 46 million in Japan

Japan 3G user base grew to 45.9 million in February, surpassing the number of wireless users with 2G handsets (44.8m). This milestone was achieved because of energetic efforts by three major carriers to switch their 2G subscribers to 3G services.

DoCoMo outshined KDDI au in a second time in a row, adding 828 thousand subscribers to its 3G FOMA service, while KDDI au signed only 309 thousand 3G customers. KDDI au reports 96% or 21.1 million of its customers now being subscribed to 3G service (this includes both CDMA2000 1x and EV-DO services). In contrast, DoCoMo has switched to 3G only 43% (22m) of its customer base. Vodafone added 195 thousand 3G subscribers, ending February with 2.7 million (18%) 3G users.

Japan wireless subscribers: February data

The number of Japan’s wireless subscribers increased by 334,700 in February, driving the total user-base to 90,767,700 active users. KDDI au posted the largest net additions, signing up 275 thousand users. However, these high results were undermined by losses at KDDI’s struggling 2G unit – Tu-ka, which reported almost 115 thousand subscribers leaving the company. NTT DoCoMo signed up 162 thousand new users, while Vodafone lagged behind with twelve thousand of net adds.

Measuring by total number of subscribers, NTT DoCoMo continued its domination with 56% market share, which translates into 50.6 million wireless subscribers. KDDI was in a distant second place with au unit taking 24% (22m) of the market share and Tu-ka unit being down to 3% (2.9m). Vodafone slightly improved its performance, having 17% of the market share with the total customer base, reaching 15.1 million.

Wireless penetration in Japan surpasses 100% in the 15-64 age bracket

According to the Statistics Bureau of Japan, the population of the country stood at 127,740,000 at the beginning of February 2006. If we break down that number by age brackets, we shall learn that there are 84,330,000 people in the age group between 15 and 64 year olds. According to TCA, the total number of Japanese wireless subscribers in February was 90,767,700, which is much more of the number of population in the 15-64 age bracket.

Of course, there are still people in that age group who do not own a cellphone, while others have two or more cellphones, keeping separate accounts for personal and/or business use. What this data shows is that Japan’s market growth will depend on the replacement sales and further penetration into the youngest and oldest age groups. Tough times await the numerous domestic handset makers and wireless operators.