NTT DoCoMo's i-mode Draws 4.2 Mln Users in 1st Year
Tokyo, Feb. 22 (Bloomberg) (It's big growth out there :-)
NTT Mobile Communications Network Inc. said its i-mode service, which provides Internet access through mobile phones, has drawn 4.2 million subscribers in its first year, topping expectations and fueling a stock price surge that has made the company Japan's biggest in market value.
Putting i-mode's growth in perspective, Sony Corp., the
world's second-largest consumer electronics maker, sold 2.7
million PlayStation video-game consoles, or 225,000 a month, in
the first year after its introduction in Japan in December 1994.
NTT DoCoMo, as the company is better known, had said it
expected 3 million users by now. It has added 350,000 customers a
month, or more than 11,500 a day. DoCoMo said it expects almost 5
million users by the end of next month.
DoCoMo has 29.4 million subscribers in all, making it the
world's second-largest mobile-phone company.
Since i-mode's debut last February, NTT DoCoMo's shares have
risen almost four-fold, giving the company a market value of 34.6
trillion yen, ($310 billion), greater than that of No. 2 Nippon
Telegraph & Telephone Corp., DoCoMo's parent.
''The expansion of the i-mode service has been much faster
than I had expected,'' said Hironori Tanaka, a Morgan Stanley Dean
Witter Ltd. analyst.
NTT DoCoMo shares fell 100,000 yen to 3.64 million yen today.
They're down 8.1 percent so far this year.
Games and Music
The i-mode service, currently offered only by DoCoMo and only
in Japan, allows mobile phone users constant access to the
Internet, eliminating the need for a service provider. That means
users are able to send and receive e-mail and browse certain Web
sites without logging on to a computer.
The i-mode service also enables subscribers to access a
limited number of online services like ticket reservations and
banking. NTT DoCoMo charges 300 yen ($3) per month for the
service.
Most popular among content offerings include games provided
by game makers Bandai Co. and Sega Enterprises Ltd. Bandai
provides users with the ability to access static images and even
play a quiz game on their cellular phone displays. Sega allows
users to download music, which can be played to signal the arrival
of incoming calls.
The growth of i-mode has coincided with Japan's awakening to
the Internet. The number of Internet users in Japan reached 18.3
million in December from 14.3 million a year earlier, according to
Access Media International, a research firm specializing in the
Internet. In 1997, that figure was 8.8 million.
Challenges to Come
Still, past accomplishments don't assure future success.
Analysts say Vodafone AirTouch Plc. of the U.K. may challenge
DoCoMo with a service similar to i-mode. Vodafone AirTouch earlier
this month agreed to buy Mannesmann AG for $204 billion in stock,
creating the world's largest mobile phone company. The agreement
gives the new Vodafone 42 million customers.
''If Vodafone tries to expand mobile Internet services
similar to i-mode, and uses other standards, like WAP (Wireless
Application Protocol), then it could be a threat to DoCoMo because
Vodafone now has a much larger user base,'' said Hironobu Sawake,
a senior analyst at ING Baring Securities (Japan) Ltd. ''DoCoMo's
i-mode isn't based on the global standard
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