Japan’s love affair with 2.5G affects next-generation uptake

10 Jan 2003

Japan has released mobile telephony subscriber statistics, which show that the country added 705,400 new users last month to take the year-end total to 73.51 million, a year-on-year increase of 9.6%. Japan’s declining PHS system ended 2002 with 5.57 million subscribers, 32,300 fewer than it had at the end of November, with only KDDI’s DDI Pocket service adding new customers. KDDI’s cdma2000 1X RTT network, which offers high speed 2.5G data services, signed up 775,900 new subscribers in December alone, although much of this growth could be attributed to the company migrating users from its PDC and cdmaOne services; the pair saw their combined customer base decline by 619,000. NTT DoCoMo, which earlier this week reported that it had capped spending at its 3G unit on the back of weaker than expected demand, added a total of 393,000 customers in December, just 3,000 of whom signed up to its FOMA 3G offering. Rival 3G provider J-Phone, which commercially launched its W-CDMA network in December, had attracted 1,200 users by the end of the year. One reason why 3G services have not been as successful as Japanese cellcos had initially hoped is the popularity of existing mobile internet offerings. The market leader, NTT DoCoMo’s i-mode, accrued 641,000 users in December alone, taking its total to 36.21 million, while Ezweb, operated by KDDI and its TU-KA Group subsidiary, saw its customer base increase by 239,600 to 11.77 million. J-Phone’s J-sky offering is close behind with 11.55 million subscribers following the addition of 214,800 new users last month. As a result, Japan was home to 59.53 million mobile internet users by the end of the year, most of whom currently seem reluctant to upgrade to 3G as, for the most part, their existing packages boast better coverage and fewer technical problems.