The
iPhone
and
Japan
Apple's iPhone has impressed consumers in the US, but will it have the same
impact on the Japanese consumer, and will it even get here?
It seems as if Apple's fiscal momentum
can't be stopped as of late. Every new
year brings a new generation of iPod,
iTunes, MacBook, Mac Pro, Mac Mini and
MacBook Pro. The catchy call signs are
churned out so fast, it's hard for most of
us to keep up. Nano. Shuffle. Time Capsule.
What's the difference between the iPod
Classic and the iPod Touch? Do I need
the AirPort Express Base Station with
AirTunes or the AirPort Extreme Base
with Gigabit Ethernet? This saturation of
products is clear evidence of Apple's
success, something that Steve Jobs surely
doesn't need reminding of. The company
announced on January 22nd of 2008 that
they had attained $9.6 billion in first
quarter revenue; the best quarterly earn-
ings in Apple's history. Of that 9.6 billion,
45 percent was from international sales
- hefty chunk from any economic stand-
point. So now as Apple's latest US and
European craze, the iPhone, is being
auctioned off to our Japanese keitai pro-
viders, we (the consumers) are presented
with two questions. First, can the iPhone
be successful among Japan's highly compact
and technologically advanced mobile
competition and finicky target audience?
And secondly, should we really care?
There are reportedly two companies
currently in talks with Jobs over providing
the iPhone to the Japanese. Those two
companies have been identified, unsurprisingly,
as Docomo and Softbank.
Docomo would obviously be the first
choice for Apple as they are the number
one mobile service provider in Japan, with
over half of the country's 100 million
cellular users. Steps have been taken to
court the wireless giant with Jobs breaking
bread with the Docomo president,
Masao Nakamura, at Apple's Cupertino,
California offices in December of 2007.
Softbank, Japan's third biggest mobile
provider and recent proprietor of Vodafone,
is also in talks with Apple but
speculation is favoring this as a negotiation
tool to bring in the reticent Docomo
whale. Apparently the talks have not gone
well with either company, mainly due to
Apple's high demands concerning revenue
share, which has some estimating as high
as 10 percent from the phone's users. But
Apple's invasion of Japan may run into
plenty of other snags that have nothing to
do with profit sharing: mainly the end
user. Would the iPhone be embraced by
the very demanding Japanese consumers?
While nothing can be written in stone
when forecasting financial trends or
technological fads, it is the opinion of this
humble writer that the answer is in fact ...
no. One very important factor is the
network capabilities of the iPhone. The
phone doesn't currently support 3G net-
work technology, something the majority
of us exploit every day while we kill time
during that long commute here in Kansai.
The 3G network, which was developed
by NTT Docomo, is what allows us to
receive information on our phone at
384kbps. Japan has the highest concentration
of internet users via cell phone in
the world, which makes this an important
issue. What's worse is that NTT is currently
jointly developing the next generation
of wireless networking with China
and Korea, 4G, and are aiming at a 2010
(or sooner) commercial release date. The
new network would allow downloading of
songs, games and internet information at
a lightning speed of 20 megabits per second.
Something the iPhone won't support.
This, along with Japanese consumers'
favoring of more compact handsets with
maximum functionality could spell trouble
for the US based juggernaut.
Apple has succeeded in Japan before,
with over 50 percent of the country's
digital portable music market. And trends
have no greater shelf life then in the
land of the rising sun, of where Apple is
considered quite fresh. But if I were you,
I'd just pick up an iPod Touch (which
sports almost all the functions of the
iPhone) and continue impressing friends
with my next generation cell phone on
trips home.
Text: James Fleming • Photos: KS
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