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What's New  January 2002

Market Snapshot - Japan
Wireless Internet Service

Each month the Japanalyzer takes you inside one of Japan’s IT industries- showing you who’s who and where the market is heading. This month we focus on Mobile Internet Service- a worldwide subject of discussion given the rollout of 3G (wireless broadband). NTT Docomo’s recent launch of next generation 3G services, called FOMA, has received criticism from many circles for not living up to speed and application availability promises. Meanwhile, competitors have turned existing 2.5G services into worthy adversaries.

By the numbers:


Current # of Mobile Phones (11/30): 66,390,200
Current # of Subscribers to the Mobile Internet (11/30): 47,177,700
Growth Rate: approx 2% from previous month
Market Predictions: By 2005, mCommerce will reach a value of $1.7 billion. By 2006, there will be 94 million mobile phones shipped
Current Use of Mobile Phones: 2% for Businesses, 98% for Consumer

Key Players:

NTT Docomo


Location: Tokyo, Japan
Website: http://www.nttdocomo.co.jp/english/index.shtml
Revenue: 4.7 billion Yen
President: Keiji Tachikawa
Market Share: 62% as of 11/30
Comment: As Japan’s national  teleco provider and founder of the original mobile internet service I-mode, NTT has the dominant position in the market. DoCoMo is currently offering its 3G (FOMA) service in Tokyo with plans for metropolitan city coverage by the end of 2002. FOMA currently has 15,000 subscribers and the company estimates it will have 150,000 by March 2002. It’s confidence comes from an aggressive marketing campaign however battery life and coverage problems still persist.

J-Phone


Location: Tokyo, Japan
Website:http://www.j-phone.com/h-e/index.html
Revenue: N/A
President: Daryl E. Green
Market Share: approx. 20% as of 11/30
Comment: Japan Telecom’s, J-phone is a fierce competitor fully capable of leveraging it’s Vodafone parent relationship on the global scene. J-Phone's 3G launch remains June ’02 but they are currently running a trial network. By delaying the launch, J-Phone will be able to integrate the latest changes in W-CDMA (3G) specifications. J-Sky is the name of their Internet Service which employs the same technology as that of Docomo (PDC or Portable Digital Cellular).

KDDI


Location: Tokyo, Japan
Website: http://www.kddi.com/english/index.html
Revenue: 2.3 Billion Yen
CEO: Tadashi Onodera
Market Share: 18% as of 11/30
Comment: KDDI is known for being the only CDMA operator in Japan. It’s Internet service is known as Ez-Web and recently it introduced two interesting new data services: GPS Keitai and Movie Keitai. Its GPS service allows customers to view detailed maps of city streets while its movie services allow customers to download various video clips ranging in length of 15 seconds to 1 minute.

Trends:


All major operators in Japan have 3G service as a major component of their strategy and are firmly committed to the rollout.
New data services will drive usage and this should lead to an increase in replacement handset sales because these new services require new terminals.
The Japanese wireless market is currently and should continue to be dominated by local equipment vendors.
Consumers will continue to be the main target of wireless Internet services although 3G will increasingly be targeted at corporations as a means of access to corporate networks.

Helpful Links:

@pan Inc feature on non-Docomo players: "The Other i-modes "
http://www.japaninc.com/article.php?articleID=84&page=1

Mobile Media Japan
Consulting and research firm that features a great portal to information on Japan’s wireless industry
http://www.mobilemediajapan.com/

The Japan Telecommunications Carriers Association
Great statistics and monthly updates on the state of the market
http://www.tca.or.jp/index-e.html

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This Month's Bridge Builder
Featuring the real voice of IT across the Pacific

January, 2002 

Mr. NatsumeSo what’s it all About in Japan?
Mr. Masanori “Max” Ninomiya
Senior Vice President & CAO, Recruit About.com Japan

People who’ve been surfing the Internet for a long time remember a great little portal site called The Mining Company. The site was great because unlike other search engines and directories, which are mainly user and computer populated, the Mining Company provided a guide to the Internet written by real people with real expertise on popular topics. The Mining Company employed a network of freelancers called “guides” who brought the best of the Internet together to create mini-portals administered by these guides. Three years ago the Mining Company changed its name to About.com and today is the seventh largest web property in the US, according to Media Metrix. This month’s interview is with Max Ninomiya, a founding member of About.com’s Japan joint venture with Recruit, Recruit About.com Japan.

Q. Max, tell us about yourself and your career with Recruit and About in Japan?

A. I graduated in 1989 from Tokyo University’s Law program and immediately joined Recruit, which as you know is Japan’s largest publisher. My first job was in their Real Estate Management division, a wholly owned subsidiary focused on building development and management. I provided consultation for Recruit and property owners on investment, financing, development and feasibility of real estate projects. 7 years later I was selected by Recruit to participate in their paid overseas education program. The program was designed to award good performers with English-speaking ability with the only condition being that recipients return to the company for three years post-education. I decided to get an MBA and chose UCLA over schools like Wharton because of the UCLA’s IT and entrepreneurial focus. After graduating UCLA in 1998, I returned to Recruit’s Legal Department, where I negotiated many Internet-related deals, contracts and alliances, both domestic and international. One year later, I was assigned to Recruit’s Next Generation Business Development Group, where I met Ebata-san, now the President and CEO of Recruit About.com Japan.

Q. So you met Mr. Ebata at the beginning of it all. How did the company form and how were you involved?

A. Ebata-san, my senior at Recruit by 2 years, was already a part of the Next Generation Business Development Group when I joined and first heard about the idea of a Recruit/About.com strategic alliance from him. He had thought that About.com would fit strategically with Recruit’s portal ISIZE (www.isize.com). ISIZE’s predecessor started out in March 1995 as an online version of Recruit publications. It was purely informational while today’s ISIZE is a network of truly profit-oriented e-business centers featuring not just Recruit content but information from non-Recruit publications. He had envisioned that About.com’s guide model would also work in Japan and serve as a loyal customer gateway to drive traffic to ISIZE’s profitable businesses, and I also shared his vision. In October 1999, Ebata-san invited me to visit About.com’s NY headquarter on the first day we met, as I’d experienced several international transactions including establishment of Autobytel Japan, and five days later Ebata-san and I were in NY for our first meeting with About.com. Over our several business trips and innumerable teleconferences we explained to them our strategic intent and synergies. We shared our business plan and mutual goals, and negotiated terms and conditions of agreements, until a deal was done in June 2000. The new company, Recruit About.com Japan, was eventually funded 49.5% by Recruit, and 47.5% by About.com.

Q. I see you are now SVP and CAO of Recruit About.com in Japan. Tell me about your current role and challenges.

A. In no particular order my responsibilities include Strategic planning, Investor Relations, Moderation of Board and Shareholder Meetings, Legal Negotiations and Compliance, HR Management, and General Administration. Since we’ve grown from just 0 to 50 employees in just one and a half years, the change of pace here is quite rapid. One thing I’ve discovered is how difficult it is to effectively and efficiently manage this organization of 50 and the talents and needs of each unique individual. Often the organization’s strategic focus and the people’s needs vary over time according to changing internal and external situations, so this requires some timely adjustments. I also find it challenging but exciting to move forward and ahead with uncertainties.

Q. Finally, How do you like working now for a foreign-capital firm in Japan?

A. It’s nothing special to me as my MBA experience at UCLA means that I am used to working with Americans. I enjoy working with people from diverse cultures. Unlike other typical foreign parents in other Japanese joint ventures, About.com doesn’t try to control but rather tries to understand and respect the local operation so it is actually much easier for us to do business with them on a mutual trust and respect basis than I thought. They are very cooperative in passing on to us their success and failure experiences. In fact I haven’t had to travel to NY much now because most of our communication with About.com is done on conference calls and e-mail. I enjoy everything I do to make this friendly international joint venture successful. Thank you Max. Mr. Ninomiya can be reached via e-mail at maxnino@recruit.about.co.jp his company’s website is http://allabout.co.jp/


Previous Interviews

Upcoming Events,

Fiber Optics Expo
January 16-18, Tokyo Big Sight (Tokyo International Exhibition Center)

Second annual event focusing on optical communication devices & equipment. 633 companies exhibited last year and attendance was almost 50,000.

IC Packaging Technology Expo
January 16-18, 2002 at Tokyo Big Sight (Tokyo International Exhibition Center), Tokyo

A variety of equipment, components and materials for IC packaging technology. There are also four other technology related events/exhibition will be held at the same place, such as Internepcon Japan, Electrotest Japan, Electronics Components Expo, Printed Wiring Boards Expo, and Fiber Optics Expo. The scale of this year's exhibition is about three times bigger than the one last year.

Japan Storage Vision 2002
January 23, 2002 at the Tokyo Conference Center

IDC Japan's seminar on the future of Network Storage
and the Japanese market.

Electronic Design and Solution Fair 2002
January 24-25, 2002 at Pacifico Yokohama

This event sponsored in part  by the Japan Electronics and Information Technology Association(JEITA), introduces the latest updates on IC design andsolutions. The event features a keynote speech from the President of eAccess on the Broadband revolution.

 

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