DoCoMo faces uphill battle to put US ahead of Europe
Japan's dominant mobile Internet network may be coming to the US, but industry observers say it will face an uphill battle there because of wildly different market conditions between the two countries. In the meantime, Europe is still far ahead of the other side of the Atlantic where it comes to mobile phone technology.
At first glance, NTT DoCoMo's deal to buy 16 percent of AT&T Wireless Group this week might seem like a major win for US mobile communications. The US mobile market is about two years behind that in Europe, with basic features such as text messaging and wireless data access only now emerging.
DoCoMo's i-mode system, on the other hand, is the world's most successful implementation of the mobile Internet. Though it is a "walled garden", offering access only to selected online services, the system has grown to 14 million users and has become a mainstream phenomenon. In Europe, carriers such as British Telecommunications (quote: BT) and Deutsche Telekom have met with little demand for their WAP (Wireless Application Protocol) services.
But American wireless systems are unlikely to catch up to Europe's any time soon, says analyst Carsten Schmidt, with Forrester Research. For one thing, the US is still hampered by the same infrastructure issues, such as vast geographical areas to be covered and competing network protocols, Schmidt says.
DoCoMo may have difficulty in getting Americans to accept its view of the mobile Internet as a closed system. "There are a huge number of applications, but it is a very restricted environment," Schmidt says. "If you look at US users, they are much more Internet-savvy than in Japan, and they don't like the walled-garden environment that much."
It may also be difficult for US companies to get in on i-mode when it is launched in America, for the simple reason that the system will already be full of existing applications provided by DoCoMo's Japanese partners. "They want to open up new markets for companies that had success with i-mode in Japan," Schmidt points out. "That could lead to an environment where you have... limited possibilities for US players to take advantage of it."
There's also the fact that DoCoMo, through a deal with KPN, is also planning to launch i-mode in Europe.
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