Japanese Market Now Dominated by 3G
Recently released information from the Telecommunications Carriers Association (TCA) of Japan indicates that the total number of mobile customers in Japan stood just short of 100 million at the end of September. The total figure of 99.3 million was equivalent to 5.9% annual growth, with 5.52 million new connections in the twelve months to the end of September. Quarterly net additions totalled 1.28 million, the lowest quarterly figure of this calendar year; this was mainly due to NTT DoCoMo's loss of 22.9k customers in August, a result which produced the lowest total for monthly net additions (324.5k) since October 2006.
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Customers, EOP by Technology
Net Additions by Operator
What was most significant about the August figures, however, was that the W-CDMA customer base represented over half of the total for the first time in the history of the Japanese market.
At the end of September, W-CDMA connections made up 51.4% of the total, with CDMA remaining stable at 28.9% and PDC's contribution dipping below one fifth for the first time since the very earliest days of the service with 19.6%. Since the total mobile market in Japan was close to 100 million at the end of September, this also means that the number of PDC customers was less than 20 million for the first time in 10 years. All three of the major operators are transferring their PDC customers to other technologies at a fairly rapid rate: around 700k per month for DoCoMo, 300k per month for Softbank and 40k per month for KDDI's Tu-Ka. The coming months will undoubtedly see a continued decline in the use of this exclusively Japanese technology.
Having gained the highest figure for monthly net additions for the first time in May, Japan's third largest operator Softbank has held on to top spot for the past five months. Indeed, in both August and September it claimed over half of the total monthly net additions (excluding 3G start-up e-mobile, which seems to be reporting figures on a quarterly basis only). Softbank also has the lead in terms of proportionate growth, both in the calendar year so far - it has grown by 10.0% since the beginning of the year compared to 7.3% for KDDI's au and Tu-Ka brands and 1.4% for DoCoMo - and in the 12 months to the end of September, recording 11.4%, 0.7pp ahead of KDDI and 9.8pp ahead of DoCoMo.
Of course, in real terms DoCoMo still holds a commanding position in the market with 52.9 million customers compared to KDDI's 29.2 million and Softbank's 17.1 million, while new entrant e-mobile is yet to make much of an impact with just 0.12 million customers after three months of operations.
Clearly it will be some time before there is any change in the rankings of the operators, through organic growth at least. However, Softbank has succeeded in taking a considerable slice of the Japanese market with a total 17.2% market share at the end of September, trading with DoCoMo which has seen its share decline by 0.2pp each month since May to finish September with 53.3%. KDDI has remained stable, only adding 0.1pp of market share since April to finish September on 29.4%.
Posted to the site on 23rd October 2007
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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