DoCoMo picked for mobile broadcasting project

9 Sep 2010

Japan’s largest mobile operator by subscribers and revenues NTT DoCoMo has won the nod to head up a mobile broadcasting project in the country, local press including Kyodo news reports. A government-appointed advisory panel has reportedly selected a consortium headed by DoCoMo to build the necessary infrastructure for multimedia digital broadcasting for mobile handsets, the reports said. The communications minister is expected to formally announce its decision within a week, the Mainichi Shimbun added.

According to TeleGeography’s GlobalComms Database, in July this year DoCoMo and KDDI Corp (au Corp) presented their competing plans for delivering a next generation mobile-device broadcasting service to the Ministry of Internal Affairs and Communications (MIC). Although existing mobile broadcast service licences allow the airing of digital TV, the next generation concession will enable the winner to broadcast a variety of content, such as movies, sports coverage and electronic books, directly to handsets and PDA-type devices. The launch date for next generation broadcasting could take place as soon as spring 2012 and DoCoMo and KDDI were vying for the rights to the single licence on offer. Both KDDI and DoCoMo created new companies to develop next generation mobile, but the latter’s bid appears to emerged as the winner. If ratified, DoCoMo is estimated to have to invest JPY80-JPY100 billion (USD864-USD1,081 million) to build out base stations across the country to deliver the new service.

In the July meeting both firms played up the merits of their business plans. DoCoMo said that if successful, it intended to hold capital expenditure at around JPY43.8 billion as a way to keep customer fees down and encourage a wider take-up of the service. The NTT unit estimates that monthly subscription rates for the new service will be around JPY300. Answering concerns that its curb on CAPEX might jeopardise indoor coverage, DoCoMo said it was confident that strong signal coverage would provide ample customer access. For its part, KDDI had scheduled investment of JPY96.1 billion – double that of its rival – if its bid proved successful, and said it was looking to deploy 865 base stations, about seven times the number set down by DoCoMo. However, at the time KDDI’s ambition was tempered by concerns that it might need to charge higher broadcast fees to content providers, which could prevent it from attracting enough customers. The firm looked to reassure officials by saying ‘If there aren’t enough content providers, KDDI will take on the responsibility of supporting them.’ However, this gambit appears not to have come off.

Japan, KDDI (au), NTT DOCOMO