DoCoMo and Telefonica in handset pact that could pressurize Vodafone
Published: 27 May, 2009
READ MORE: NTT DoCoMo | Telefonica | Vodafone | Handset
The Japanese mobile industry has traditionally been unique, with its own handset requirements, spectrum and even 3G platforms, so there has been little crossover with the rest of the world. Now, as its market saturates, its carriers and phonemakers are looking for new opportunities in less crowded territories. The operators, particularly leader NTT DoCoMo, are forming alliances with fellow carriers in countries like India, while Softbank is working with the powerful Vodafone-Verizon-China Mobile triumvirate on 3G and LTE software. Now DoCoMo has also formed a new cellphone partnership with Spain's Telefonica, which could increase the buying power of both firms and open new channels for the Japanese manufacturers.
The Japanese cellcos, especially DoCoMo, work more closely with their suppliers than any other operators, and expect a high degree of control over handset hardware and software design (which they also co-fund). This has led to a situation where Japan's phonemakers dominate their home market, which the likes of Nokia and Apple have found hard to penetrate (Nokia recently pulled out, apart from its luxury Vertu range); but because they are working to such specific requirements, the Japanese firms also find it hard to sell abroad. There has been a wave of consolidation, and now the leaders, such as Sharp and Toshiba, are seeking new routes to market.
DoCoMo itself may come to their aid, in the interests of its own new alliance with Telefonica, which could provide a counterweight to the Vodafone consortium. Telefonica is dominant in Spain, Latin America and, through O2, the UK and Ireland, and has various other European activities. As well as Japan, DoCoMo has deepening ties with several south east Asian economies and with India. The first concrete move in their new pact is a joint launch of a Windows Mobile handset from Japan's Toshiba, which will be introduced simultaneously in Japan and Spain next month, and then in other markets.
The product is a full touch-panel design which will be branded TG01 by Telefonica and Pro Series T-01A by DoCoMo. Broader cooperation should follow, particularly in the area of collaboration on services and applications for web-enabled, open OS devices.
DoCoMo's senior VP and product managing director Kiyohito Nagata said in a statement: "DoCoMo looks forward to working with global operators such as Telefonica to jointly develop mobile services and applications for mutually enhanced global competitiveness. At the same time, we would be pleased if such efforts have the added effect of supporting Japanese mobile phone manufacturers in their attempts to expand handset sales overseas."
Other Japanese phonemakers are also looking for new openings. Sharp is particularly interested in Latin America, and so may hope to leverage the new closeness of Telefonica and Sharp's biggest phone customer, DoCoMo. It says it will soon launch a product in Brazil, which would be the first Japanese phone available in Latin America and would probably feature mobile TV.
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