DOCOMO CEO says it could be 2017 before new flat-rate subscriber plan pays dividends

18 Feb 2015

The chief executive of Japan’s NTT DOCOMO, Kaoru Kato, says it could be the end of fiscal FY2016 (i.e. 31 March 2017) before the mobile operator starts to see a profit from customers subscribing to its new flat-rate tariff plan. In an interview with Reuters, the CEO also said that the carrier also expects that its fledgling fibre-optic broadband service – docomo Hikari – will turn its first profit during that financial year. The mobile operator-turned broadband provider says it has already started taking orders of the service, which bundles a discounted mobile phone plan with a broadband connection, which will go live from 1 March this year. DOCOMO secured regulatory approval to lease fibre-optic bandwidth from its parent, Nippon Telegraph and Telephone Corp (NTT), despite concerns from its rivals that the setup could lead to the pair gaining too much control of the domestic wireless market.

‘We want to make a profit by the next financial year but [losses] may drag on until FY2016,’ Kato said, referring to the firm’s flat-rate subscribers. At the end of January this year, such subscribers amounted to about 21% of DOCOMO’s total user base.