The future of the internet is mobile...

Dr. Philip Sugai at International University Japan's Mobile Consumer Lab points to a recent report from IBM, which predicts that "Worldwide adoption of the mobile phone as the preferred device for accessing the Internet is just around the corner."

I think we can already see this today among young consumers and in developing countries, where cheap cell phones are more readily available than PCs with internet connections. To quote William Gibson: "The future is already here; it just isnt' evenly distributed yet."

Philip points out that the interfaces for mobile internet should not be the same as those we use for other media - they should leverage the strengths of mobile devices. He points to the example of Amazon Japan, which lets its mobile site's users navigate to its product pages by scanning the barcodes on DVDs or books that they come across in the real world.

I believe that another idea with great potential for mobile devices is "image search" or "visual search" - D2 Communications is developing new types of image search as alternatives to the text-based search engines that are more suited to PCs than they are to mobile devices. Imagine being able to snap a photograph of an item with your phone and quickly receiving relevant information in return. Today it works within certain limited categories (for example, D2 has launched a search engine that can identify wines from their labels). I think there's huge potential for mobile phones that provide contextual support, triggered by location, images, sounds or other non-text based inputs.

Online at 270km/h

I had to attend some business meetings in Kyoto on Saturday, so I decided to turn it into a weekend trip with my wife and visit some of the tourist sites on Sunday.

We came back by Shinkansen, which gave us 2.5 hours to play with a lot of gadgets and check out the options for wireless internet connectivity at 270km/h...

(1) Wireless LAN = Not available (Wait until 2009)

In June this year JR Central announced that they would roll out Wireless LAN connectivity on the high speed trains that run between Tokyo and Osaka. Starting 2009, passengers will be able to get a high speed internet connection from one of several hotspots in the train. For the moment, JR is still testing the service.

On this trip, when I looked at the "available networks" on my PC, I could see several hotspots with very good signals. All of the hotspots had names beginning with "N700". So I assume that we were riding on an N700 series train and those are the hotspots that will eventually let me surf at high speeds without any interruptions - even in tunnels. Yesterday, however, all of the hotspots were password protected and I couldn't find any way to connect to them. (Not that I was looking for a way to hack in).

There are a few other trains in Japan that have offered wireless hotspots since 2005. I think it will be more meaningful when this service launches on the long-distance, high speed Shinkansen trains.

(2) Apple iPhone on Softbank's 3G network = Pretty good (a couple of dead spots)

My wife's iPhone worked fairly well for large stretches of the journey. She was able to open web sites, access her email and use the GPS function to track our progress.

As you would expect, she couldn't connect at all when the train went into a tunnel. She also noticed a few "dead spots" between Nagoya and Tokyo where the reception dropped. Overall, though, it seemed to work well.

(3) eMobile modem card on eMobile's network (effectively means NTT docomo's 3G network) = Pretty good

eMobile is an MVNO, offering high speed mobile data communications services and voice services. I believe that they are using NTT docomo's 3G network to do this, which means that they have pretty good coverage for almost all of the area that the Shinkansen travels through.

My wife lent me her USB data card from eMobile, which is really simple to set up. I just plugged the device into the USB port of my PC and allowed it to install itself.

I was quite pleased with the speed and reliability of the service. I was able to set up a VPN connection to Forrester's network. That gave me access to email and other employee resources. For some downloads, it was a little slower than I would have liked, but quite adequate really.  I could actually get some work done.

Of course, it didn't work in the tunnels...

(4) 3G mobile phone on KDDI's network = Works OK. Rather dull. But when things went wrong this is the device that saved us.

I've been browsing various mobile phone sites with my ordinary Toshiba W52T phone for a couple of years now. It no longer wows me, even though I can use it to access mobile web sites with the EZ Web browser - and watch digital TV broadcasts (for free!) - and the connection seems to be pretty good for most of the trip from Kyoto to Tokyo.

Unfortunately...

• The browser for viewing regular web sites sucks....
• I don't forward my Forrester emails to this device...
• I find it to be tiresome to type messages using only the 12-key keypad...

But guess what? This is the device that I turned to in an emergency:  Our Shinkansen train was delayed for about 20 minutes at Yokohama Station and then it had to wait again at Shinagawa Station because the Shinkansen network was disrupted by severe rain in Shizuoka. The Shinkansen driver announced that he did not know when he would get permission to proceed to Tokyo Station.

We needed to get home quickly and I wanted to check which route to take. Without any hesitation, I pulled out my Toshiba mobile phone and fired up the NAVITIME application. In just a few moments, Navitime identified my location, checked the timetables and told me the best routes home -- including train times, cab fares and weather reports for all points on the route. And of course, I was able to buy some pastries on the way home with the stored value SUICA chip which is built into the mobile phone.

I thought it was quite funny that when the going got tough, I turned to my trusty old keitai.

(By the way -- What's red and white and moves at 270km/h?

Answer: A Tokaido Shinkansen driver's hinomaru bento).

iBuzz...

A friend of mine walked past the Softbank store on his way to work this morning. He told me that the queue to buy iPhones stretched all the way from the store to the national stadium. That's a long line... I didn't quite see how it could be possible...

But then I read that more than 800 people camped out over night to be the first in line to get an iPhone.

And when the store opened there were 1500.

And when I looked at Facebook, I saw that all of my friends are caught up in the excitement. A British friend of mine in Tokyo, an American friend in San Francisco and a Japanese friend (in Tokyo) were all using their status updates to talk about getting an iPhone.

The world is in a state of chassis.

Phony iPhones

Just as I finished my blog post about alternatives to the Apple iPhone, somone pointed out this review to me:

iPhone Clone Battlemodo: Which One Is the iPhoniest?

Unfortunately, the reviewers didn't look at the LG Prada phone and Sharp SH906 that are on offer in Japan.

Investors ask docomo: "Why no iPhone?"

Here's a follow-up to my blog post of a couple of weeks back about Softbank + iPhone.

At NTT docomo's AGM yesterday (June 20), shareholders asked why NTT docomo hadn't struck a deal with Apple to offer the iPhone on docomo's network...

My source is the following article from IT Media - http://plusd.itmedia.co.jp/mobile/articles/0806/20/news143.html

I won't translate the entire article - just two snippets:

docomo "is considering" an iPhone launch and sales of Blackberry to individuals

Following Apple's decision to sell iPhone through Softbank Mobile, shareholders asked why docomo broke off negotiations with Apple. Mr. Tsujimura of NTT docomo explained that one of the iPhone's attractive features is the user interface which leverages a touch panel and that NTT docomo had already released handsets with touch panels like "Prada Phone by LG" and "SH906"  - "[With the release of these two devices] we feel that we are adequately responding to the market's needs and we wish to increase the number [of models with touch interface]" He said that he couuld not discuss the content of negotiations about the iPhone because of non-disclosure agreements with Apple but said that docomo is closely watching the market and "would like to consider thhe possibility of docomo selling [the iPhone}".

This means that docomo is offering:   and

as alternatives to:

It wouldn't fly in the US, but maybe it will work in Japan -- I haven't tried any of the above devices. But I would guess that the SH906 will feel quite "familiar" to Japanese consumers who expect a phone to have a "normal" keyboard. And I'm quite sure that Japanese consumers won't be satisfied with exactly the same user interface that North Americans are using on the Apple iPhone.

Apple also seems to recognize this -- Japanese consumers who don't want to type on a QWERTY keyboard will have the option of selecting a virtual keypad that looks like a 12-button phone keypad.

(I culled the above image from a microsoft site - it was the first photo that came up in a Google image search for the iPhone's new language features. How odd).

And here's the second snippet that I want to share with you from the docomo shareholder's AGM:

In addition, regarding RIM's BlackBerry, which NTT docomo currently offers to corporate accounts and which is very popular, particularly in the US, having sold 14 million units worldwide -- NTT docomo's Vice President, Mr. Yamada, said : "We are also considering selling [the device] to individuals"

... I have been wondering for such a long time why NTT docomo was restricting the BlackBerry to corporate accounts. It strikes me as pretty weak that docomo should need to suffer the sting of missing out on the iPhone before they think about seriously promoting a device that they've had in their stable since September 2006.

iPhone + Softbank Mobile = The great equalizer?

There has been a lot of buzz in recent days about Apple's announcement that the iPhone will be sold in Japan through Softbank Mobile.:

NTT DoCoMo told CNET that it was "a shame" that Apple had announced it would partner with Softbank...

http://japan.cnet.com/mobile/story/0,3800078151,20374618,00.htm

Commentary in English is here:

http://asiajin.com/blog/category/cellular-phone/

In other countries, Apple has consistently pursued a policy of partnering exclusively with the largest carrier. Why didn't Apple do this in Japan? There's some speculation that Apple's deal with Softbank might not be exclusive - They might just be using Softbank to gain leverage in negotiations with NTT DoCoMo. (And, who knows, maybe Apple could then offer the 3G iPhone through DoCoMo later this year?)

I get the feeling that it's not such a sophisticated decision. My "gut" tells me that it may simply be a pragmatic move to get the Apple iPhone into Japanese consumers' hands without further delay.

I hear that NTT DoCoMo and KDDI make things quite difficult for handset makers to get approved on their networks -- I don't have direct experience of the tortuous approval process, but I know a couple of people who taken products through it. They tell me that these two carriers have the mindset of traditional "national infrastructure" providers, with uncompromising demands for quality of sound, reception and so on. Furthermore, they're very finicky about elements of the user interface -- making sure that the device complies with their demands around text input, navigation, reliability and so on. Perhaps only the Japanese handset manufacturers have the patience / experience / expertise / connections to do business with these guys.

On the one hand, these extremely powerful carriers have dictated the standards that enabled services such as mobile payments and iMode-style mobile internet to take off in Japan. On the other hand, their strictness is making it hard for them to collaborate with innovative outsiders like Apple.

By contrast, I get the impression that Softbank Mobile has more tolerance for non-compliance with standards (or "imperfection" if you like). When I speak to the customers who signed up to Softbank in order to get a cool handset from HTC or Nokia, I often hear that they found something about the phone that fails to meet their expectations.  One of my colleagues complains that the user interface of his HTC is "very unfriendly" - The device seems to crash and reboot more often than his previous phone and when he wants to input a new contact to his address book, it requires him to manually change from text input to numerical input in the fields for phone numbers. His comment: "NTT DoCoMo would not have allowed this thing into their stores until the maker had fixed these bugs."

Is it a good thing for a carrier to relax its standards on handsets? Well, the strategy seems to be working very well for Softbank right now. Their subscriber numbers are up and the brand has a pretty "cool" image. However, in the long term this might inhibit the development of new services. I recall that when Kristofer Tate (CEO of Zooomr) made a presentation to the Asiajin Meeting in February he explained that it's harder to offer his service to Softbank subscribers because there's no standard platform - the service provider is faced with a plethora of devices and platforms to support.

Philip Sugai at International University Japan, writes in the the Mobile Consumer Lab Blog that "...the prospects that the iPhone will spark further usage of mobile internet content and services in Japan seems to be a little far-fetched. But where the iPhone is likely to make it's greatest impact is bringing the Japanese market more closely in line with other markets around the world.

...Although I believe that Google's Android is a more blatant attempt to make Japan's overall ecosystem model relevant around the world, the iPhone may also go a very long way in bringing an entirely new level of collaborative innovation between Japan and the rest of the world. "

http://mocobe.blogspot.com/2008/06/japans-iphone-portal-to-world.html

But I get the feeling that NTT DoCoMo and KDDI aren't culturally receptive to a "great equalizer." Can they be comfortable without being in total control of the mobile ecosystem? Can they collaborate in a messy sandbox with all the other hardware, software and service providers? Surely that's the cultural transformation they need to achieve if they don't want to be muttering "zannnen" (regretable) at the next innovative device, service or pricing model from Softbank.

I'd be delighted to receive comments / corrections / criticism from any readers who can shed light on the Apple angle or the Japanese carrier angle of this story. Please share your thoughts and opinions.

DoCoMo becomes docomo

On April 18, NTT DoCoMo Inc. announced that it was revamping its brand. The company is ditching this:

In favor of this:

I heard on the grapevine that some vendors are now scrambling to ship out any hardware that carries the old logo. Apparently, they've got a grace period of a few weeks. After that, all products sold under the DoCoMo brand must display the new logo. (I guess that the "old brand" stuff that doesn't ship before the deadline will probably find its way to a market stall in Shanghai).

The English language discussion gives a "meh" verdict on the new corporate identity:

http://www.underconsideration.com/brandnew/archives/do_co_mo_no_mo.php

But I quite like this rebrand:

(1) The company is dropping the artificial and forced explanation for its name.

Old NTT DoCoMo told us that the name meant "Do Communications Over the Mobile Network."

And for years and years, I've been looking at this capital "D", lower-case "o", capital "C", lower-case "o", capital "M", lower-case "o" ... Who did they think they were kidding? They just wanted to call themselves "Docomo" because it's a kind of pun on the Japanese word for "Anywhere."

It's part of a pattern of retroactively seeking out an "English" justification for cute Japanese brand names. The worst offender must be JR East's SuiCa. The company explains that it stands for "Super Urban Intelligent Card." Hmmm....

Of course, it's not just a Japanese problem. I'm aware that American and European companies do equally silly things. Do you remember the Commodore PET (Personal Electronic Transactor)? It surely would have been better to ditch all pretenses and call it the "Commodore Cuddly Puppy."

(2) I like the simplicity of this new look

The mix of colors, shapes and patterns in old DoCoMo logo never did anything for me. I quite like the simplicity of the red on white logo in an all lower-case geometric typeface.

Will this new look put some pep back into the somewhat tired DoCoMo brand?

In and of itself, I would guess not. But if the company delivers on its new brand statement by "getting to know you as an individual and understanding your aspirations" then the company should become more customer centric - That could be the key to revitalizing the brand.

http://www.nttdocomo.com/about/brand/index.html

Keep It Simple award #1 - Gucci Ad. with NFC tech.

Today I am introducing an award for services and products that I consider delightful and simple.

I have decided to call it the K.I.S.S. Award. (K.I.S.S. = "Keep It Simple Stupid")

Disclaimer: Please understand this award merely reflects my opinion. There are no objective evaluation criteria. This award in no way reflects the opinion of Forrester Research. Treat it as a bit of fun.

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And the first winner is: The Gucci handbag advertisement in Omotesando subway station

What does it do?: It lets you get a Gucci coupon just by touching the handbags with your cell phone

Tell me more: As I walked past the Gucci poster, I noticed that the handbags on the wall stand out from the poster by about two centimeters . On closer inspection, there's a symbol representing a mobile phone and the word "TOUCH!"

So, I held my mobile phone next to the poster... and within seconds, the phone flashed a green light and gave me a message that I had received a Gucci coupon. Sure enough, my phone memory now holds a URL for a mobile site -- "Gucci Joy" -- which invites me to explore the Gucci Joy range of handbags and accessories. The site also allows me to register as a member:

http://guccijoy.jp

Unfortunately, you cannot view this site from a PC. (You need to be using the browser on a Japanese mobile phone, I think). Basically, it's a content site - no retail function. It allows me to see handbags and find out where the Gucci stores are in Japan. If I register as a member, I assume that I will receive some newsletters and perhaps some special offers. (I'm sorry. I'm not a handbag fan -- I haven't explored this site in great detail).

How does it do that?: I guess that the handbag that I touched with my mobile phone contains a Near Field Communications device. I'm not sure if the handbag sends data directly to my mobile phone or if it identifies me from the NFC chip in my phone and then sends a signal over the network. I will try to find out...

So what?: Well, I think this is a good demonstration of a technology that will help companies to connect the physical world with the virtual world, using the mobile devices that are already in our pockets.

In 2007, I wrote a research document ("How Japanese Companies Guide Their Customers To Mobile Internet Experiences") in which I explained QR codes. Well, QR codes are very nice ways to help your customers to reach your mobile web sites -- but they require a few manual steps on the part of the customer. It's not always easy to scan the QR codes. By contrast, the Gucci poster required almost no effort at all.

Don't you agree that this is simple and delightful?

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Well, if you don't agree... perhaps you will tell me about something even simpler or even more delightful. Just leave a comment on my blog with a short description of your favourite "simple and delightful" service, product, web site etc. If I agree with you, I will post some photographs of the product and a KISS award logo in a subsequent blog post.

In addition, I'll be looking out for delightfully simple products and services in Tokyo and at any events that I attend. If you're demonstrating a delightful and simple product somewhere, don't recoil when you hear someone say: "I'd like to give you a KISS."

KDDI launches "Simple Plan" - an end to handset subsidies

October 5 - Nikkei Business Daily (Nikkei Sangyo Shinbun) article titled: After the removal of "subsidy money"... Handset Price War

The article concerns an announcment from KDDI that customers would be given a choice between "Full Support" plans and "Simple" plans. Those selecting "Simple" will pay full price for their handset (KDDI won't subsidize the handet), in return for which their charges for making calls will be substantially reduced - with the cheapest plan weighing in at 1510yen per month.

This move is not happening in isolation. SInce the introduction of number portability, which allows consumers to take their phone number with them if they move to another carrier, DoCoMo has also been reducing the subsidies that it pays for handsets.

The news should be welcome for the almost half of Japanese consumers who find their current phone bills burdensome - according to a new survey from My Voice (translated here by Seron).

Surely this spells the beginning of an inevitable consolidation for Japanese mobile handset manufacturers, who have survived so far because of the low risk relationships that they enjoyed with Japan's major carriers? In the past they only had to make the phones that the carriers told them to make - and they could survive.

I think the future presents more risk to hanset makers - carriers aren't going to accept the costs of handsets that don't sell and they aren't going to encourage customers to get the fanciest phones with the most features regardless of what  the customer wants. I expect to see a group of consumers - for whom 90% of their phone's current capabilities are surplus to requirements - decide that it's better to have a cheap, reliable phone with the cheapest possible running costs.

What does this mean for innovation? Does the rest of the world catch up to Japan? I believe that the innovation will increasingly take place in the software and services on phones - whether that means innovative pricing, innovative applications, innovative support. The carriers will differentiate themselves with the customer experience that they offer rather than by pushing features on users who don't always want them.

Please let me know if you agree - or if you think I'm missing something.

脱「奨励金」の次はイノベーションがハードからソフトに変わるのでしょうか？

10月5日の日経産業新聞でこの記事を読みました：脱「奨励金」の次は端末価格競争

記事によりますと、KDDIが11月から「シンプル・コース」というプランを提供する予定です。「シンプル・コース」とは端末の価格がキャリアによってサポートされない代わり通信料金が安いというアイディアです。最近、ナンバー・ポータビリティによって、顧客がより簡単に競合社のサービスに移行できる時代になったので当たり前の動きだと思います。

今まで日本のキャリアの奨励金システムの中で育てられた端末メーカーはこの新しい環境でいきることができるのでしょうか？そして今まで端末のきのう等で世界をリードした日本はこれからもそうでしょうか？

「どうせ携帯端末のきのうの１０分の１しか使ってないから、安き良き携帯と料金プランの方がよい」と思ってる日本人も少なくないと思います。最近のマイボイスのアンケートで回答人の45.2％は今の携帯電話の料金が「やや負担になっている」もしくは「かなり負担になっている」と思っているらしいです。

もし「奨励金」時代がこれで終わりのであれば、次の時代ではハードウェア（つまり端末の機能）で差別化をするよりも、その端末の周りのサービス、料金プラン、アプリケーション、サポート（ある意味でカスタマー・エクスペリエンス）がポイントになるのではないかと思います。いかがでしょうか。