WW-79

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J@pan Inc presents the Wireless Watch Japan Newsmagazine:

W I R E L E S S W A T C H J A P A N LITE

Commentary on the Business of Wireless in Japan
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Issue No. 79 (Lite Version)
Tuesday, November 5, 2002
Tokyo

+++ Noteworthy News
--> DoCoMo's Downturn
--> Toshiba Looks to Pull Through Tech Downturn Better Than Rivals
--> Narita Airport Plans Global-roaming Service
--> Vodafone Plans to Drop J-Phone Brand
--> DoCoMo to Introduce Wireless Card Services

+++ Subscriber Statistics, Corrections, Credits, Administrivia

=============================EVENT====================================
3GMOBILE WORLD FORUM 2003
14-17 January 2003, Tokyo, Japan
As with our hugely successful 2002 event, 3GMobile World Forum 2003
will aim to present a realistic view of the 3G opportunity, and to
provide a platform to transform 3G technology and demand for new high
value services into revenue across Asia-Pacific, Europe and the US.
For further information, visit: http://www.3gmobileforum.com
======================================================================

+++ Noteworthy News
(Long URLs may break across two lines so copy to your browser.)

--> DoCoMo's Downturn
http://www.canada.com/technology/story.html?id=%7BF50A7504-8D44-4419-BB4...
Source: Technology Canada.com, Oct. 31

EXTRACT: In the Headquarters of NTTDoCoMo, every element -- colour, furniture,
decor -- has been minutely planned so that it fits with, and reinforces, the
next. The effect is of a hermetically sealed whole, designed to convey certain
themes. Power. Masculinity. Technological superiority. Wealth. "DoCoMo and all
other carriers need to review 3G," portfolio manager Makoto Sakuma ominously
told a newswire reporter last month, after subscriber figures for the new
service were released. Sakuma's firm, Asahi Life Asset Management Co., has $1.2
billion under management including shares of NTT DoCoMo. "They need to start the
project all over again from scratch."

COMMENTARY: This story is an extremely well-written review of Big D's current
difficulties. It's actually two stories in one: a useful review of how/why
i-mode took off, and a snapshot in time of the (sad) state of 3G in Japan and
Europe. Admittedly, it's hard to remain optimistic for 3G, but there are some
fundamentals that this item glosses over or fails to mention.

First, DoCoMo is on track to become one of Japan's most profitable companies in
FY 2003, and still has a slew of tricks up its sleeve in the 2G world (it
appears that the company has launched a major realignment of 2G data services,
based on recent press releases). Second, they are bringing new handsets and
expanded FOMA services to the market next month. Finally, remember that the tech
giant's commitment to 3G is based on voice - not data. What are the
alternatives? Build more second-generation PDC base stations? I don't think so.
Nonetheless, this story is well worth reading in the original.

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--> Toshiba Looks to Pull Through Tech Downturn Better Than Rivals
http://sg.biz.yahoo.com/021103/1/34cua.html
Source: Yahoo News, Nov. 3

EXTRACT: Toshiba is the most likely among Japan's electronics firms to ride out
the latest hi-tech slump while its rivals will be hurt more by a US downturn and
competition from South Korea, analysts said. "Toshiba's plan this year is to
generate 53 billion yen in operating profit (in their semiconductor division)
while the other companies are all talking about a 30 billion yen loss," said
Ikuo Matsuhashi, semiconductor analyst at Goldman Sachs. "The corporate value of
Toshiba's semiconductor business has rebounded," said Noriya Nishi, industrial
electronics analyst for Credit Suisse First Boston.

COMMENTARY: This is one of the first analyst follow-up reports I've seen after
the past two weeks' electronic manufacturer half-year earnings reports. The key
comment comes from Credit Suisse First Boston's Noriya Nishi, who states that
Toshiba will see its NAND flash memory business for cell phones "get better." In
fact, it looks like Toshiba is being sustained right now by massive profits in
its semiconductor division, with cell phone chips playing a key role. How can
this be, with cell phone sales off so sharply in Japan?

Keep in mind that the flash memory that is used in cell phones is also used in a
wide variety of electronic devices, including digicams, portable MP3 players,
and home networking equipment. For the first time in over a year, I was in
Akihabara yesterday hunting for a hard drive, and was struck by the number of
devices (printers, cameras, WLAN routers, hard drives) that are now boasting a
half to two or more megabytes of onboard memory - all of it flash.

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--> Narita Airport Plans Global-roaming Service
http://www.yomiuri.co.jp/newse/20021101wo11.htm
Source: Yomiuri Shimbun, Nov. 1

EXTRACT: The Narita Airport Authority and iPass Inc., a California-based
Internet roaming system developer, on Thursday announced a tie-up agreement that
will offer high-speed wireless local-area-network Internet connectivity to
airline passengers using Narita Airport in Chiba Prefecture, from late November.
The airport authority and iPass said Narita Airport will be the first Asian
airport to install the US company's wireless LAN-based iPass Global Roaming
Service.

COMMENTARY: This comes after Phase One of the "e-Airport" trial that ran for
several months until 31 Aug. 2002. Phase Two is now running until March 2003 and
provides WLAN access in Terminal 1 (4th floor departure lobby after passport
control and 1st floor arrival lobby) and Terminal 2 (4th floor departure lobby,
3rd floor satellite departure concourse after passport control, and 1st floor
arrival lobby). Access is free, but you have to provide your own data card. It
appears that the iPass system provides additional connectivity.

At Tokyo's other airport, Haneda, NTT DoCoMo began offering its "Mzone" wireless
LAN service on 28 October 2002. Launched in July 2002, Mzone service was
available in 12 locations as of end-October, including hotels and office
buildings throughout Tokyo and vicinity. DoCoMo plans call for the continued
expansion of the Mzone wireless LAN service area to some 100 spots within this
year in the Tokyo region.

At Haneda Airport, log onto Mzone at:

First floor: Central airport lounge
Second floor: Departure gate lounges 2, 3, 13, 14, 22 and 23
Main entrance of Big Bird Central Shopping Mall Galleria, PC lounge
Third floor: South airport lounge

Application for Mzone service (2,000 yen per month flat fee) can be made online
at http://www.wlan.nttdocomo.co.jp (Japanese only). For some weird reason the
press releases says "Users can also apply for the service at three DoCoMo branch
offices (Marunouchi, Shinjuku and Shibuya), where a sign-up fee of 1,000 yen
will be required." Why is it cheaper to sign up in person than online?

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--> Vodafone Plans to Drop J-Phone Brand
http://www.wirelessweek.com/index.asp?layout=story&doc_id=
106343&verticalID=34&vertical=Business+and+Finance&industry=
Financials
Source: Jiji Press on WirelessWeek.com, Oct. 29

EXTRACT: Vodafone Group PLC, the British parent of J-Phone Corp. in Japan, plans
all its Japanese operations to be branded "Vodafone" by December 2003. It is
part of a concerted marketing effort to create what Vodafone Group Strategy
Director Alan Harper calls a global "Vodafone experience," in which users of
Vodafone services can enjoy the same product in Vodafone networks all across the
world.

COMMENTARY: There are several absolutely key points in this report, including:

** Vodafone's new "Vodafone live!" service (Britain, Germany, Ireland, Italy,
the Netherlands, Portugal, Spain and Sweden) is largely similar to J-Phone's
successful Sha-mail service - and is initially based on similar 2.5G technology.

** The disappearance of J-Phone's brand means Vodafone is well on its way to
learning the value of a strong, uniform brand identity - a point I've made in
past WWJ newsletters. (Vodafone live! is a single-branded service offering with
a customised Vodafone interface.)

** For Vodafone live!, the initial makers are Sharp, Matsushita Electric
Industrial, and Nokia (this is Sharp's first foray into Europe). Great news for
the Japanese makers!

** New 3G handsets from J-Phone will conform to 3GPP standards, and include
dual-mode functionality, allowing J-Phone customers to roam on Vodafone's
networks elsewhere - a first for Japan and a clear differentiation from DoCoMo's
FOMA.

================================EVENTS===============================

>> GLOCOM Platform International Forum in Tokyo
Socio-Economic Impacts of Mobile/Wireless Technologies:
Strategies and Policies

November 21 (Th) 13:30-17:30 and Reception, 17:30-19:30
The Japan Foundation, International Conference Room
(ARK Mori Building 20th floor)

This highly relevant seminar will feature presentations and
discussion panels focusing on the impact of current and new wireless
technologies on societies. Program participants include professor
Jonathan Aronson from UCLA, David Isenberg, president of Isen.com,
vice president Shuji Tomita from NTT Communications, and Tim Pozar,
founder of the Bay Area Wireless Users Group, as well as other
leading researchers, policy makers, and thinkers.

Admission: free
To confirm your reservation, send mail to: vox@glocom.ac.jp or telephone:
03-5411-6714
======================================================================

--> DoCoMo to Introduce Wireless Card Services
http://www.yomiuri.co.jp/newse/20021101wo12.htm
Source: Yomiuri Shimbun, Nov. 1

EXTRACT: NTT DoCoMo said Thursday it would introduce wireless card data
communications services in the spring that use the personal handyphone (PHS)
network, allowing users to transfer data using personal computers and personal
digital assistants (PDAs) while away from their homes or offices. The nation's
top mobile-phone operator said it would set the monthly rates for the service,
which will provide unlimited access to the Internet, at between 4,000 yen and
5,000 yen, lower than the fixed rates offered by competitor KDDI Corp.'s DDI
Pocket.

COMMENTARY: This report goes on to say that DoCoMo's new service is expected to
be faster than DDI Pocket's, and some analysts predict DoCoMo's entry into the
market likely will cause a rapid increase in the number of PHS card users. I
can't find any relevant PR release on the DoCoMo site, so it's hard to figure
out -- DoCoMo already offers PHS-based data card services. There are two models
available: the "P-In Comp@ct" and the "P-In M@ster" (which also provides 16MB of
memory). They connect at 64 or 32 Kbps using the PIAFS protocol, and are
reasonably popular -- and cheap (I saw P-In M@aster data cards for 0 yen at Bic
Camera in Shibuya two weeks ago).

It looks like Big D is upgrading at least part of their PHS network to allow
data downloads at 128Kbps, similar to DDI Pocket's "Air-Edge" service - and with
a similar flat-rate pricing plan (until now, it's been strictly by-the-minute).
Look for a press release later this week? (Monday Nov. 4 is a national holiday
-- Culture Day -- in Japan.)

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+++ Subscriber Statistics, Corrections, Credits, Administrivia

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