The rapid expansion of the 3G market has recently pushed subscriber numbers past 73 million. As well, while Japan has a mature mobiles market with almost eight in every 10 people with a mobile service, 76 percent of the country’s mobile subscriber base is hooked up to 3G.
The result is due partly to the growing sophistication of handsets, as well as the popularity of inbuilt cameras. But the competitive nature of the local market has played a hand too.
The world’s biggest telecommunications operator NTT Corp chased down rival KDDI’s big lead in 3G mobile, overhauled it in 2006 and this year NTT DoCoMo leads the market comfortably. Telco Softbank also applied pressure, buying mobile provider Vodafone K.K. for US$15.6 billion last year, and has since announced plans to unite its broadband and mobile services, which will include a video service to mobile subscribers.
With 26 million broadband lines, Japan ranks third behind China and the US. But the uptake of high-speed fibre-to-the-
There are several factors to explain this: a market competitiveness and readiness, solid government backing as well as a population that is both tech-savvy and consumer-mad.
At the same time, the popularity of DSL broadband is on the wane with almost 240,000 less subscribers forecast during 2007.
“A major advantage of FttH over DSL is the Voice over Internet Protocol (VoIP) costs,” the BuddeComm report states. “Unlike DSL, it is not necessary to pay a basic telephone subscriber charge when using FttH for IP telephony. As the use of video and image data grows, DSL subscribers are increasingly unhappy with the slower than expected and unstable throughput of DSL, which depends on how far their residence is from the local exchange.”
IP telephony is also going gangbusters with the market expected to leap about 4 million subscribers this year. IP provides a better range of voice and data services, more-efficiently, than a fixed-line system.
Importantly, Japan’s Ministry of Internal Affairs and Communications announced it planned to replace the country’s domestic fixed-line telephone network with a fully integrated IP system by 2010 at a cost of around ¥50 billion. Japan’s biggest operators KDDI and NTT have unveiled plans to overhaul its fixed-lines services with IP by 2008 and 2010 respectively.
With IP mobile services expected by next year, BuddeComm predicts they will eat into the revenues of mobile operators, similar to the impact mobiles had on fixed-line telephony. “Under the proposed service, users would be able to connect their phones to the internet at ‘hot spots’ using WiFi wireless access,” the report states. “The VoIP mobile phones were expected to relay information at up to 15Mb/s; this compares to 3G phones available in the country transmitting data at 384kb/s.”
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