Telecommunications

June 2005

Panasonic Mobile To Expand Handset Lineup For Overseas Sale
Panasonic Mobile Communications Co., a maker of cellular phone handsets affiliated with Matsushita Electric Industrial Co., will more than double the number of models for export this fiscal year to about 10, company officials said. The move is designed to tap growing overseas demand for high-end models, after the company slid into an operating loss last fiscal year on sluggish foreign sales. The new models, including a thin camera-mounted one and those targeting businesspeople or the younger generation, will be introduced starting in July through the Christmas season, primarily in Europe and China. Developing the new models became easier and more efficient through the use of common semiconductor processors and operating systems, the officials said. The company is asking Vodafone Group Plc of the U.K., China Mobile Communications Corp. and other major foreign mobile phone carriers to adopt its handsets. It has already made agreements with more than 10 mobile phone companies, mostly in Europe. The firm targets overseas shipments of about 8 million units this fiscal year, up 10% from fiscal 2004. (The Nihon Keizai Shimbun, June 17, 2005)

KDDI To Develop High-Speed Cell Phone Technology With 28 Firms
KDDI Corp. announced Wednesday that it will start working with 28 companies from the U.S., Europe and Asia to develop high-speed next-generation cellular phone technology. KDDI, provider of the au brand cell phone service, hopes that the group of telecommunications-related firms will be able to compile the specifications and standards by the end of 2007 to launch services based on the technology in 2009. The Next-Generation CDMA2000 technology will be developed by improving on the current 3G (third-generation) cell phone technology. The new version is expected to deliver data transfer rates of 100 megabits per second downstream and 50mbps upstream. These rates are comparable to those achieved by fiber-optic broadband Internet access services and are fast enough to download a television program recorded in a home server to a cell phone. The 28 firms will include cell phone service providers SK Telecom Co. of South Korea, China Unicom Ltd. and Verizon Wireless of the U.S., as well as handset makers Fujitsu Ltd., NEC Corp., Kyocera Corp. and Telefonaktiebolaget LM Ericsson of Sweden. KDDI's rival NTT DoCoMo Inc. has already been working to develop the Super 3G, which is next-generation technology based on the W-CDMA standard, with 26 firms from the U.S., Europe and Asia. These firms, which include Vodafone Group Plc of the U.K., have also targeted a launch of services based on their next-generation technology for 2009. (The Nihon Keizai Shimbun, June 16, 2005

Cell Phone Firms To Co-Develop Device To Improve Reception
Japan's four cellular phone service providers will jointly create a compact signal repeater for areas with poor signal reception, The Nihon Keizai Shimbun learned Monday. NTT DoCoMo Inc., KDDI Corp., Vodafone KK and Tu-Ka group companies will develop a repeater that can amplify signals between base stations and individual cell phones, enabling clear communication even in such areas as underground shopping malls. The device is expected to have a footprint of several dozen sq. centimeters and work with 2G (second-generation) and 3G handsets from all four firms. It will likely be available this summer priced at less than 1 million yen. The four firms are also considering cooperating in the marketing, maintenance and repair of the device. Under Japanese law, it is illegal for a party that is not a licensed cell phone service provider to install a repeater. But a number of restaurants operating in underground malls have installed the devices on their own to meet customer demand. Sold on the Internet for 300,000 yen to 400,000 yen, some of these devices have caused interference because their output is too strong. The four rivals have decided to work together to solve this problem as well as to heed the Ministry of Communications' urging to reduce areas with poor reception. DoCoMo and others have been selling their own repeaters for about 600,000 yen. But these are more expensive than those available on the Internet and also work with just one company's cell phone service. Because of incompatibility issues, cell phone firms have been individually installing base stations and repeaters in high demand areas with poor signal reception at an estimated cost of several million yen apiece. (The Nihon Keizai Shimbun, June 14, 2005)

KDDI Plans Cellular-Land Line Bundles To Fight NTT, Softbank
KDDI Corp. plans to begin sales this autumn of package deals combining cellular and fixed-line telephone service, a first for Japan's telecommunications industry. KDDI is the only firm in the nation to provide both fixed-line and cell phone service. It plans to combine such offerings as its au brand cell phone service, discount fixed-line phone service and fiber-optic communications service. KDDI's cell phone service has been growing steadily, but its fixed-line phone service launched in February has been facing stiff competition from the Nippon Telegraph and Telephone Corp. and Softbank Corp. groups. It aims to gain an edge in finding new fixed-line customers by offering discounts on its popular cellular service. KDDI's au cell phone service had about 19.54 million subscribers as of March 31, and its fixed-line service had about 420,000, including those who had placed orders. The firm believes that offering package deals will be effective because few subscribers are signed up for both services. (The Nihon Keizai Shimbun, June 02, 2005)

Govt To OK 1st New Cell Phone Market Entrants In 12 Years
The Communications Ministry is set to allow new entrants into the cellular phone service market for the first time in 12 years, The Nihon Keizai Shimbun learned Wednesday. The ministry will give priority to newcomers when it allocates frequency spectrum for 3G (third-generation) cell phones later this year, paving the way for these firms to start providing services as early as fiscal 2006. Softbank Corp. and eAccess Ltd. are among the companies to have announced intentions to launch cell phone services. Currently, there are three groups providing cell phone service in Japan: NTT DoCoMo Inc., Vodafone KK,, and KDDI Corp., which offers services under the au and Tu-Ka brands. The ministry is releasing the 1.7GHz and 2GHz bands for cell phone use. It is expected to announce as early as this week its licensing policy plan, which will list criteria for firms seeking allocations of frequencies. In this policy, it will make clear that newcomers will be given priority when firms are selected. After weighing feedback from the parties concerned, the ministry plans to officially decide on a licensing policy and start accepting applications for the frequencies by August. It aims to make a decision on the allocations by year-end after examining the applicants' funding and business plans, management stability, interference prevention technologies, and other factors. DoCoMo and Vodafone are expected to seek allocations in the 1.7GHz band, in addition to Softbank and major ADSL service firm eAccess. Softbank had filed a lawsuit against the government so that it could start using the 800MHz band, but dropped the suit in March and switched its focus to the 1.7GHz band. (Nihon Keizai Shimbun, June 02, 2005)

Cell Phone Frequencies
The Communications Ministry allocates use-specified frequency bands to telecommunications carriers and other users because the unregulated use of radio waves could cause interference and other problems. For cellular phone services, the 800MHz, 1.5GHz and 2.0GHz bands are currently used. Frequencies are in tight supply due to the rapid spread of 3G (third-generation) cell phones that can send and receive large amounts of data, including images. In addition, new demand has arisen in expectation of a ubiquitous network environment in which people can obtain information anytime and anywhere. The ministry has decided to newly allocate seven frequencies in the 1.7GHz band and three in the 2.0GHz band for 3G cell phone services. Since at least two frequencies are said to be needed to recover capital investment, only a few firms can be allocated them. (Nihon Keizai Shimbun, June 2, 2005)