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Final PPT of DoCoMo


Presentation On Case Study OfDoCoMo The Japanese Wireless Telecom Leader

Presentation compiled by;ITM-KHARGHAR EMBAGroup members Deepali Gopal krishnan Manas V Khaire Deepak Arora Sukhvinder Kaur Amit Singh Gopal krishnan KH08MARMBA14 KH08MARMBA32 KH08MARMBA13 KH08MARMBA63 KH08MARMBA07 KH08MARMBA21


START OF NTT-DoCoMo History of NTT DOCOMO is the history of mobile communications in Japan itself . Telecom started in 1949 when Ministry of Communication in Japan split into MTEL & Mop . MTEL was renamed as NTT & was a monopoly for telecommunications in Japan. In the late 1980`s Japan finally decided to reform its telecom regulatory framework to allow foreign players into Japan. DoCoMo began its operations in July 1992. The Initial portfolio included Mobile phones , Car Phone , Maritime Phones , Inflight phones & Pagers.

Docomo registered drastic decline in sales between 1992-94 . In Oct-93 - stops taking rental security deposits on handsets. April 1994 - launches its own handsets & reduces initial subscription fees in Dec 1996. Emerges as market leader in 1997. Differentiation strategy adopted .. Launched Do Pa in March 1997.

Beat the competition I-Mode launched in 22nd February 1999.

Success Story Of DoCoMo: I-Mode I-mode became an instant success resulting a phenomenal growth in subscribers. Generated 30% higher revenues per subscriber . DoCoMo announced its global strategy to establish it self as global player. I-Mode popularity attained a new altitude. The subscriber base in Japan accounted for more than 60% ( 18.1 million ) of the 30 million mobile internet customers in the world. External factors such as PC penetration was very low. (. In 1999, when i-Mode was launched, only 23% of Japanese had access to the Internet by computer) I-mode phones are constantly connected to a wide array of web-based services . Plans are in the works between NTT DoCoMo and Sony Computer Entertainment to allow i-mode users to play PlayStation games with each other over the phone. I-modes innovation is not chiefly technological, it is also based on a sophisticated business model

Business Model DoCoMo adapted AOls packet billing model. E-commerce traction on I-mode. never even mentioning the word Internet in marketing i-mode. It was a Win-Win-WIN situation for all . It chose not be just a gatekeeper between content companies and customer. Multiple point contact with customers. External factors such as PC penetration was very low.

I-mode came at right time, in right place, with right content.

DoCoMo - BEYOND I-MODE Launch of Freedom of mobile multimedia access (FOMA), a 3G service .

Riding on the success wave of I-MODE

Hurdles in entering Global Arena

BUT DoCoMo still going Global.

Problems A Plenty Losses written-off . Bottom Line affected. Postponement of Launch of FOMA Problems with Trial package provided to customers. But the Inevitable happened 3 G Launched

AFTER THE LAUNCH OF FOMA Customers complaints continued FOMAs subscriber base amounted to only 89000 by the end of march 2002,much below the expected 150000. Due to increase in competition the net subscriber base was 31.7 % lower in Dec-01 than in Dec-00. Docomo still dominated the market with 59% market share followed by KDDI & Vodafone J-phone with 17.7%. Docomo offered various subsidies. Biggest loss 116.19 billion yen

Cut off in the salaries of top executives by 10%-20% for a year. In April 2002,KDDI launched CDMA2002lx, its 3G service. Problems to convince its partner wireless companies . DoCoMo stake fell by 33.8% Offered discounts ..and free roaming services. The performance of I-Mode launched in other countries was also far from satisfactory .

Back In Business In Jun 2002 DoCoMo launched its first photo handset based on 2G network. In Jan 2003 DoCoMo reduced its promotional expenditure on 3G network. By Feb 2003 aggressively marketed FOMA handsets. In march 2003 company launched new handset P2102V. In April 2003 announced launch of new handset F661i with GPS system. In April 2003 Company launched a Wrist watch with phone . Announced plans to launch six new 2G camera phones.

Signs of Revival DoCoMos 3G initiative showed signs of revival. Company covered 90% of Japans population by the end of April 2003. DoCoMo bounced back on profit on account of its successful new launches with consolidated net profit of $1.83 billion for the year end. Subscriber based amounted to over 41million. Companys share prices increased to $2000 in April03 from $1700 in March03 DoCoMo was not free of all problems, Japan government passed new Local Taxes Amendment Law Competition in Japanese mobile market was increasing. Competitors like KDDI & JPhone was capturing market share.

Whether the strategy worked or was it a flash in the pan ? Concorde Enron Worldcom Premier Automobiles Radio Corporation of America ( Fortune 500 List 1960 ) Republic Steel ( Fortune 500 List 1960 ) Uniroyal ( Fortune 500 List 1960 ) BestFoods ( Fortune 500 List 1960 ) Youngtown Steel & Tube ( Fortune 500 List 1960 ) Tidewater Oil ( Fortune 500 List 1960 )

Current Position What happened to DoCoMo ( in terms of subscriber base ) after 2002 ? FOMA Subscriber base increased from 41011 as on 31/03/2002 to 54601 as on 31/03/2009. I-Mode subscription has increased from 32156 as on 31/03/2002 to 48474 as on 31/03/2009. Subscriber base Subscriber growth Foma. Subscriber growth I-Mode.

What happened to DoCoMo ( in terms of revenue ) after 2002 ? Net Income increased from 4,01,755.00 Million Yen as on Mar 2001 to 4,71,873.00 Million Yen as on 31/03/2009

Revenue Growth from 2001 to 2009

Internationally where it has spread ? HTCL (Hong Kong) Dec. 1999, 24.1% (Taiwan) Feb. 2001, 4.7% KT Freetel (Rep. of Korea) Dec. 2005, 10.3% ownership PLDT (Philippines) Mar. 2006, 14.0% ownership DOCOMO PACIFIC (Guam & Mariana) Dec. 2006, 100% U-Mobile (Malaysia) Apr. 2008, 16.5% ownership TM International (Bangladesh) Sep. 2008, 30% ownership Tata Teleservices Limited (India) Mar. 2009, 26% ownership.

Top 10 mobile operators in the world as of 2007 1. AT&T - the former SBC merged with AT&T creating the new AT&T (USA) 2. China Mobile - formerly China state-owned, now still state-controlled, one of two mobile phone monopolies in the entire China. 3. Vodafone - Britain's largest telecom operator. 4. Verizon Communications - US-based telecom company formed after a series of mergers. 5. Telefonica - Multinational company with stakes in Dpain, Latin America and Europe. Owns the O2 brand. 6. Deutsche Telekom - German telecom company, also owns t-mobile. 7. America Movil - Mexican operator controlled by the world's richest man - Carlos Slim. 8. NTT DoCoMo - One of Japan's telecom operators. 9. France Telecom - One of France's telecom companies. 10. Nippon Telegraph & Telephone - Japan's second largest telecom operator.

BLUE OCEAN STRATEGY Make the competition irrelevant Create and capture new demand Reconstruct market boundaries Overcome key organizational hurdles

Indian Telecom Industry 1851 First operational land lines were laid by the government near Calcutta. 1881 Telephone service introduced in India 1883 Merger with the postal system 1923 Formation of Indian Radio Telegraph Company (IRT) 1932 Merger of ETC and IRT into the Indian Radio and Cable Communication Company (IRCC)

1947 Nationalization of all foreign telecommunication companies to form the Posts, Telephone and Telegraph (PTT), a monopoly run by the government's Ministry of Communications. 1985 Department of Telecommunications (DOT) established, an exclusive provider of domestic and long-distance service that would be its own regulator. 1986 Conversion of DOT into two wholly government-owned companies: the VSNL for international telecommunications and MTNL for service in metropolitan areas. 1997 Telecom Regulatory Authority of India created. 1999 Cellular Services are launched in India. New National Telecom Policy 2000 DoT becomes a corporation, BSNL is adopted.

Current wireless players State-owned operators: BSNL, which covers 20 circles, and MTNL, which offers mobile services in the remaining two (Mumbai and New Delhi), offer GSM services. The original private service providers with a national presence: Bharti Airtel and Vodafone Essar . Those who took fourth-round licences or the opportunity provided by UAS licenses to create a national presence: Reliance Communications, Tata Teleservices, and, more recently, IDEA Cellular, Sistema Shyam, and Aircel Ltd. Greenfield operators issued new licenses in January 2008: Datacom Solutions, Loop Telecom, S Tel, Swan Telecom, and Unitech.

Current subscriber base The total number of wireless connections in India stood at 376.12 million at the end of February 2009. State-owned BSNL and MTNL, however, were allocated their 3G spectrum during the second half of 2008 3G auctions will not be held at all for the Rajasthan and North East circles as there is no spectrum yet available in the required bands.

Sources ICMR case collection by A.Neela. Radhika. TELECOM CARRIER ASSOCIATION-Japan BLUE OCEAN STRATEGY BOOK by reneey & Chang www.NTT ITCU - International Telephone Confernces Unit. TRPC Telecom Research Policy Conferences www. Cellular