The lessons of DoCoMo

3GSM: 3G has been a conundrum for operators since its inception - what can we learn from what has happened so far?
Written by Tony Hallett, Contributor
The president and CEO of NTT DoCoMo, Masao Nakamura, has been sharing some of his company's plans for advanced mobile technology -- and talking about how users in his home market can nowadays be a tough crowd to please.

DoCoMo is Japan's leading provider of mobile communications and, especially after the success of its i-mode mobile data service in the late 1990s, saw eyes from around the world looking at its progress.

However, its early introduction of 3G -- in the form of a version of the W-CDMA standard currently being rolled out around much of the world -- encountered problems, so there is a cautious approach to DoCoMo's next stage, so-called 3.5G technology HSDPA.

"It was difficult after our initial launch of W-CDMA systems," said Nakamura, speaking through a translator at a 'fireside chat' session at this week's 3GSM conference in Cannes. "But now we see explosive growth."

It currently counts nine million 3G users and has a target of 10 million by the end of March. Overall, Nakamura disclosed some 25 percent of its revenues are derived from data services -- a figure many operators in the West would like to emulate. The 3.5G future, he reckons, will mean two positives: reduced network cost and richer content.

But there are problems.

Nakamura, who became the operator's chief executive towards the end of last year but has been at NTT most of his career, admitted to mistakes in recent years.

He said using W-CDMA to improve roaming for his customers is working -- DoCoMo's previous system worked only in Japan -- but increasing the number of handsets for his network is an ongoing challenge and return on capital invested hasn't been good.

"We made a lot of capital investments [in operators overseas] and that ended in failure," he said.

DoCoMo, whose name means anywhere in Japanese, famously branched out at the turn of the millennium and bought into the operator that went on to become 3 in the UK, only to ultimately sell its stake at a hefty loss.

Nakamura, in common with some other high-profile speakers, also talked about social responsibility at this year's show.

He said that while the company has an i-mode-based disaster alert system and researches ways to help society through mobility, consumers are demanding more.

He said that at the time of the Kobe earthquake in 1994, mobiles were seen as a godsend and providers literally as lifesavers. But while services and coverage has improved immeasurably since then, a recent quake in Niigata led to criticism of providers when systems didn't work perfectly.

Editorial standards