New DoCoMo Prez Hopes to Halt Slide
By Carlo Longino, Thu May 20 17:00:00 GMT 2004

Masao Nakamura, who will take over the carrier's reins next month, says his top priorities are to reverse declining revenues and profits.

Nakamura says DoCoMo will focus on boosting subscribers to its 3G FOMA service, increase customer satisfaction and create new revenue sources. The carrier will combine its mobile multimedia and i-mode units in July in an attempt to spur the development of new services.

"All our company needs to do now is create new services," outgoing president Keiji Tachikawa told Nikkei Electronics Asia. "Although NTT DoCoMo has excellent technological skills, it was unable to take advantage of them in creating new services."

Japan's mobile market is nearing saturation, meaning subscriber growth is coming from carriers stealing others' users away, a battle DoCoMo's been losing for some time. Number-two carrier KDDI continues to add more subscribers, and DoCoMo said a few weeks back its sales and earnings this year will take a hit as a result.

DoCoMo's FOMA network was slow to grow thanks to spotty coverage and a dearth of cool handsets. While it continues to roll out impressive 2G i-mode phones, its FOMA lineup pales in comparison to KDDI's CDMA1x devices. If the company is pinning its hopes on new services for a recovery, it had better come up with some pretty quickly. While i-mode was the revelation that's driven the carrier over the last several years, it's no longer the force it once was, and has been equalled, if not surpassed, by other carriers' content systems. KDDI, too, is moving on to EV-DO with its WIN network, bringing data speeds on par with FOMA.

KDDI's success with flat-rate data pricing forced DoCoMo to institute similar tariffs, the clearest sign yet it may be ceding their market leadership. KDDI clearly has the momentum at this point, and DoComo -- and its new leader -- faces an uphill battle to swing the pendulum back its way.