DoCoMo's 3G service not repeating i-mode's rapid success

 

If i-mode does have a weakness, it is its lack of a built-in digital camera, a feature of rival J-Phone

Japan might have lagged behind the West in information technology during the 1990s, but their miniaturisation skills have propelled them into world leadership in wireless communications.

Japanese telecommunications firm NTT DoCoMo has signed up more than 30 million subscribers to its i-mode mobile service, which enables users to access the internet from mobile handsets.

And last October the firm introduced the world's first third-generation (3G) mobile service in Tokyo under the brand name FOMA.

But 3G technology, which offers users faster download speeds that can carry streaming video services, hasn't yet been able to repeat the rapid success enjoyed by i-mode. Just 11,000 subscribers signed up to FOMA during the first month, despite reportedly strong interest in services such as video imaging, pedestrian navigation and distance remote control.

And in its first eight months, 3G has attracted just 112,000 subscribers, making it more of a cult than an ubiquitous service such as i-mode.

Limited wireless spectrum is keeping service costs high and DoCoMo has only built 3G networks in major urban centres, restricting the number of people who can access the technology.

The firm also faces an unexpected new competitor in the shape of asymmetric digital subscriber line (ADSL) - domestic broadband - which is satisfying the market's appetite for high-speed internet access at a flat-rate cost.

ADSL subscriptions, which are available in some areas for a monthly fee of less than 3,000 yen (€27), jumped from 650,796 at the end of September to 921,867 in October, the first month of 3G.

Analysts believe that until a flat-rate plan or cheaper data packet charging system is created that keeps 3G charges under 5,000 yen per month for the frequent user, ADSL looks likely to remain a hotter commodity.

This has been underlined by the decision of DoCoMo's competitors, J-Phone and KDDI, to delay their roll-out of 3G, allowing them to recoup cash from heavy network investments through their ADSL divisions.

DoCoMo still projects six million users for its FOMA network by 2004, and the past success of the i-mode service and Japan's love affair with the mobile suggest that, if 3G is going to work anywhere, it will be in Japan.

A past survey of i-mode users in Japan revealed that making and receiving calls accounted for 34 per cent of usage, compared with 41 per cent for e-mail and 24 per cent for surfing the Web.

Cultural factors such as hushed trains, where talking on mobiles is forbidden, and the necessity for discretion in affairs of the heart, are largely behind this disparity between "tongue and thumb".

But the real beauty of the service here is that users can access more than 40,000 websites from anywhere in Japan at unusually low rates, as charges are based on the volume of data transmitted, not connection time.

It is not only HTML-friendly but Java-enabled, boosting wireless e-commerce in areas like online shopping, banking and ticket reservations.

Top-selling products in the past two years have been customised ring-tone melodies, followed by images and animations, then premium content such as news/sports feeds.

And content providers are popping up to cater for every consumer niche going - the latest being a site devoted to bird-watching. Enthusiasts can identify up to 400 different species through digital images.

If i-mode does have a weakness, it is its lack of a built-in digital camera, a feature of rival J-Phone.

And so tight is DoCoMo's grasp of the market that internet cafes have been slow to spread in Japan.

As often as not, they are mere appendages of manga kissas, cafes where Japanese teenagers and twenty-somethings curl up on leather armchairs to read comics in between napping.

Given the tardiness of their hardware, its easy to understand why the Japanese would rather opt for their handsets when it comes the business of e-mailing.