W-CDMA Goes Top in Japan Five Years After Launch
W-CDMA was first launched in Japan by NTT DoCoMo in October 2001, with Softbank Mobile (formerly Vodafone K.K.) joining it 14 months later. Exactly five years to the month after the standard was introduced into the market, W-CDMA has become Japan's leading technology, with customers numbering 34.75m at the end of October 2006.
PDC became the leading technology in Japan after overtaking NAMTS, the other proprietary Japanese standard, at the beginning of September 1995, and remained top dog for 11 years until September 2006. At the end of October, however, the technology was consigned to second place, with 34.49m customers. The CDMA standard, which is operated exclusively by KDDI's "au" business in Japan, came in third with 24.89m.
As we remarked in The Mobile World Briefing Issue 40, mobile number portability (MNP) was introduced into Japan for the first time at the beginning of October, and the monthly net additions figures from the market's three players take on added significance as a result. They show resounding success for KDDI, as the company itself had confidently predicted, with DoCoMo being the biggest proportionate loser, giving away 110 basis points of market share over the last month. This may not sound very much, but it is more than the company lost in the last three months put together. Also October was only the first month of MNP: if the effect of portability accelerates during the coming months, as it would be expected to, DoCoMo might find itself in for a rocky ride.
Total customer numbers topped 94m for an overall mobile penetration rate of 73.8%; adding in PHS subscriber numbers, which rose again in October, these figures become 99m and 77.6% respectively. Total mobile net additions were 265k in October, which is on the lower end of the range the Japanese market has experienced over the last twelve months. Portability does not necessarily make any difference to overall net additions of course, but rather to the distribution of those additions amongst the players in the market, as churn rates are impacted. It is this proportionate picture which gives the most dramatic view of the effect of MNP in its first month.
Perhaps the most surprising observation is the apparent immunity of Softbank Mobile from the fight so far. However, these are very very early days, and to draw any conclusions at this stage would be premature. There is very little doubt that Softbank will get pulled into trading blows with its larger rivals sooner or later, although to what effect remains to be seen - that largely depends on the new management and strategy, which so far has made little noticeable impact on the operator's operational statistics.
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Posted to the site on 14th November 2006