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For the year ending
March 31, 2008, SoftBank and KDDI added 2,676,500 and 2,150,800 new subscribers6
respectively.
DoCoMo, however, added only 766,600, just ahead of the 411,500 new
subscribers added by the relatively new entrant EMOBILE Ltd (Emobile).7
The month of March generally saw intense competition between mobile service
providers ahead of the start of the academic and business year in Japan.
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In this
crucial month, SoftBank added 543,900 new subscribers, while KDDI, DoCoMo, and
Emobile added 500,500, 173,700, and 130,200 new subscribers respectively.8
DoCoMo dropped to the third place in terms of gaining
new subscribers despite a high voltage marketing campaign to counter the
price competition and its decision to count one subscriber with two
phone numbers as two subscribers.
Analysts felt that the company had suffered the most due to its
customers defecting to rivals. In the year ending March 31, 2008, DoCoMo
lost 916,400 customers to rivals. This figure included 137,000 customers
in the month of March.9
Analysts attributed SoftBank's stellar performance in March in part to
its scheme of offering discounts to students ahead of the back-to-school
season.10 SoftBank had been
adding more customers than DoCoMo and KDDI every month from May 2007 to
March 2008.
The company achieved this by formulating strategies on the pricing,
design, and service front like a retailer rather than like a telecom
company, according to Shinji Moriyuki (Moriyuki), senior analyst at
Mitsubishi UFJ Securities. KDDI too was able to wean away 75,700
customers from its rivals in March with a new discount scheme that
allowed family members using KDDI's service to call each other for free.11
As of April 2008, DoCoMo was trying to defend its position and win back
lost customers by launching new pricing plans and a range of mobile
phone handsets.12,13 However,
analysts felt that regaining its lost momentum would be a tough ask for
the company considering that the Japanese mobile market was approaching
saturation.
With more than 100 million mobile subscribers out of a total population
of 127 million, Japan was one of the most penetrated markets.14
Moriyuki said, "As user needs become varied, it's hard for any one
carrier to hold on to a majority of market share."15
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6] Here, new subscribers refer to the new subscribers
signed up for the service minus those that leave each company.
7] "SoftBank No. 1 in Annual Mobile Subscriber
Growth," www.japancorp.net, April 7, 2008.
8] "SoftBank No. 1 in Annual Mobile Subscriber
Growth," www.japancorp.net, April 7, 2008.
9] Mayumi Negishi, "DoCoMo Losing Stranglehold on
Japan Mobile Market," http://uk.reuters.com, April 7, 2008.
10] "KDDI Clarifies Technology Stance; SoftBank
Heads Monthly Net Adds," www.telegeography.com, April 7, 2008.
11] Mayumi Negishi, "DoCoMo Losing Stranglehold on
Japan Mobile Market," http://uk.reuters.com, April 7, 2008.
12] The mobile phone handsets were generally sold
at a low price, with the mobile service providers subsidizing the handsets.
13] However, as of early 2008, mobile service
providers were aggressively cutting subscriptions while phasing out handset
subsidies (Source: Jonathan Soble, "DoCoMo Files SoftBank Action," www.ft.com,
March 18, 2008).
14] Martyn Williams, "NTT DoCoMo Market Share Drops
Under 50%," www.pcworld.com, April 7, 2008.
15] "Sony Ericsson Says Reviewing Ties with NTT
DoCoMo," http://afp.google.com, March 9, 2008. |
