DOCOMO targets USD176m in savings in H2

30 Nov 2016

NTT DOCOMO says it has identified JPY20 billion (USD176 million) worth of additional cost-cutting measures in its fiscal second half, increasing its planned cutbacks for the full year from an initial JPY80 billion to JPY100 billion – including a projected reduction of JPY57 billion in the October 2016-March 2017 period alone. The Nikkei notes that DOCOMO’s proposed cuts fall mainly in the area of customer services as it looks to steel itself to deal with a government-led call for lower mobile phone fees.

It is not the first time that Japan’s leading mobile operator by subscribers has looked to trim operating costs, having previously reviewed other areas of its business, such as network upgrades and maintenance, and commissions it pays to its distribution chain. The paper estimates that DOCOMO found cost-savings of JPY120 billion in fiscal 2014 and JPY240 billion in fiscal 2015, as part of its ongoing review of the business.

As previously reported by TeleGeography’s CommsUpdate, in September 2015 Japanese Prime Minister Shinzo Abe called on the Ministry of Internal Affairs and Communications (MIC) to consider ways of lowering mobile phone bills, which he sees as becoming an increasing burden for householders, at the time sparking a sell-off in shares of Japanese mobile carriers and a dramatic slide in share prices. The PM’s intervention came during a Cabinet Office panel on economic policy when he declared: ‘Lightening the burden of cellphone bills and other expenses on household budgets is a critical task.’ The policy aim was met coolly by investors though, with the three leading cellcos – DOCOMO, KDDI and Softbank Group – plus fixed line operator NTT Corp losing a combined JPY4 trillion over just two days.