AFTER the schools turn out in downtown Tokyo, it鈥檚 a common sight to see
a gaggle of girls in their uniforms looking at a mobile phone and giggling.
Later, as darkness gathers on the packed train back to the suburbs, office
workers sit head-down, tapping obsessively on the buttons of their
phones.
These are just a few of the many people addicted to i-mode, Japan鈥檚 latest
technofad and the country鈥檚 answer to WAP phones. And what a fad it is: i-mode
was only launched in February 1999, but by August this year it had signed up 10
million people. Demand has been so fierce that DoCoMo, the company that runs
i-mode, had to stop advertising the service because it couldn鈥檛 keep up. Its
overloaded computer system kept crashing.
A million a month
DoCoMo is still signing on people at a rate of a million a month. It
reckons on having 14 million subscribers by the end of the year, and if it keeps
growing at its present rate, by next September it will be the world鈥檚 largest
Internet service provider. Just in case you still think the mobile revolution is
just a lot of hype, in the minute it鈥檚 taken you to read this far, at least 20
Japanese people have acquired their Internet-ready phones.
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In much of the developed world, the Internet exploded onto the scene in the
mid-1990s. Most ordinary Japanese missed out on that revolution. What鈥檚
happening with i-mode now is Japan鈥檚 own brand of Net revolution. Business
analysts are asking whether it will stop at Japan鈥檚 shores, or sweep round the
world, sinking WAP in the process.
Perhaps the strangest aspect of this revolution is that for most Japanese,
the big attraction has little to do with the Net itself. 鈥淢ost of them don鈥檛
even realise they are connected to the Internet,鈥� says Roger Boisvert, head of
Global Online Japan. 鈥淚t鈥檚 not the Internet to them, it鈥檚 just a telephone with
added features.鈥�
The most popular feature is e-mail, according to DoCoMo. Japanese society is
largely divided into groups鈥攊ndividuality still takes second
place鈥攁nd the mobile phone has given group members a new way to stay in
touch. Typing has to be done by laboriously punching a combination from the
numbered keyboard to make characters. But, 鈥渋t鈥檚 fun, like a toy鈥�, says Makio
Inui, telecoms analyst with Salomon Smith Barney in Tokyo. 鈥淭eenagers obviously
can鈥檛 make a phone call in the middle of class but sending an e-mail is easy,
and a fun thing to do.鈥� There is a form of shorthand too: to ask somebody for a
drink, just send the cocktail glass icon.
One group that latched onto i-mode is urban teenagers. Often found in
restaurants, bars and shopping centres, they discovered that mobile phones
fitted their lifestyle. 鈥淭he youth market wants to be mobile,鈥� says Paul Rogers
who works for software company Logica in Tokyo. 鈥淭he concept of personal and
differentiated space has become more important to them in recent years because
they tend to live with their parents for longer,鈥� he says. 鈥淭he Internet
provides this space. The Mobile Internet means they can take it with them
补苍测飞丑别谤别.鈥�
Beyond e-mail, there are some 20,000 specially converted websites to visit.
About half the traffic to these sites centres on entertainment. Entire new
industries have sprung up to enhance the appeal of the mobile as a fashion
accessory. For a tiny sum of money, youngsters can download cute animated
figures to use as the mobile equivalent of screen savers, and new tunes to
replace their old ringing tones.
Other popular sites dish out horoscopes and tarot readings, while photoshops
download people鈥檚 digital photos to an i-mode site for friends to share. Another
popular pastime is gaming. Golf, fishing, Grand Prix have all been configured
for tiny phone screens, and multi-user games have also taken off.
But it would be wrong to think of i-mode as just for the young. Only half its
users are under 30. This is reflected in the other half of i-mode鈥檚 website
traffic, which is devoted to finding information and carrying out transactions.
Japanese people love to read weather forecasts and check out train timetables on
their phones. The Yomiuri Giants baseball site is one of many sports sites that
are heavily patronised. Or people can search for recipes while they鈥檙e out doing
the food shopping.
And there are online airlines, banks and stock trading. In some delivery
companies, the bike riders don鈥檛 phone in when they鈥檝e finished a job鈥攊t鈥檚
cheaper to check the company鈥檚 website.
If i-mode has caught Japan鈥檚 imagination it鈥檚 not because of its flashy
presentation. Information coming off i-mode is all plain text squashed into a
tiny display鈥攋ust as with WAP phones. There are none of the fancy graphics
and streaming video that people expect with a PC. But Japanese consumers are
clearly not bothered.
Why? It鈥檚 possible that i-mode simply suits the Japanese way of life. 鈥淕iven
the amount of travel the Japanese do on public transport, the mobile phone is
ideal. People can sit down and read e-mails on a mobile phone on a crowded
train,鈥� says John Boyd, Tokyo-based editor of the Internet news company
the451.com. 鈥淚f you look at the culture in the States where people use the car a
lot then the personal computer makes a lot of sense. You can carry a laptop
around in the car.鈥�
But this is not the only reason i-mode took off so quickly. For many Japanese
people, it is the cheapest way to get online. This is mainly because of the
state of the country鈥檚 conventional phone system.
In other countries, landline Internet connections are cheaper than mobile
Internet. But in Japan the landline system is hampered by government regulation.
The lumbering Nippon Telegraph and Telephone (NTT), which owns more than half of
DoCoMo, levies the highest charges in the world for telephone calls, and has a
virtual monopoly on the land-based telephone system.
Against this background, the deregulated mobile phone market flourished in
the late 1990s. Prices fell, and DoCoMo established itself as a major player in
mobile services. So when the company launched i-mode in 1999, it already had 23
million customers. And clever marketing made the transition to i-mode cheap and
simple. For a one-off fee of 2000 yen (拢30), and 300 yen (拢2) a
month added to their phone bills, subscribers could sign up and gain access to
500 鈥渙fficial鈥� sites, which are listed in menus on the phone, and thousands of
unofficial sites which they could type in or bookmark. The offer was too good to
refuse.
It鈥檚 not just about clever marketing though: i-mode is easy and cheap to use,
largely because it is a packet-switched system. Traditional telephone systems
open up a dedicated channel between two people, or two computers. This is
wasteful because even in normal conversations, there鈥檚 a lot of silence between
the words. Packet switching is more efficient because many conversations can be
carried on a single channel. Anything you say or type is broken up into data
packets, each of which bears the address of its destination. The phone network
directs these packets, by any free routes, to their destination where they are
reassembled.
So, although i-mode runs at a sluggish 9.8 kilobits a second, it has one big
advantage thanks to packet switching: it is always on. There鈥檚 no waiting for
the modem to dial in and connect you to the Net. You choose a site from a menu
and it appears almost instantaneously. Downloading from some sites can still
take a while, though.
Packet switching also means that users are charged by the amount of data they
send and receive, not by the time it takes to send it. Cheap pricing has led to
鈥渦nconscious consumption鈥�: people don鈥檛 even realise they鈥檙e adding pennies to
their phone bills. A 250-character e-mail message, for example, can be sent for
about 4.2 yen (3 pence). DoCoMo also charges 14.7 yen to download a news item
and 12.1 yen to search the English-Japanese dictionary. Companies providing the
service get 9 per cent of the revenue.
Not that i-mode doesn鈥檛 have competitors. J-phone, like i-mode, offers
continuous access, a similar data transfer rate and the added advantage of
better colour images. But it has attracted only 2.5 million subscribers. Another
system, called EZ, uses WAP, so heavily promoted in Europe. At 64 kilobits per
second, EZ鈥檚 system is much faster than i-mode, but only about 500 WAP sites are
available. It launched in April last year and now has more than 3 million
customers. Yet it still can鈥檛 match i-mode: it seems that Japanese consumers
prefer more content to faster speeds.
If i-mode鈥檚 future at home is assured, what will happen abroad is less
certain. DoCoMo clearly wants to be a global player. It recently bought a stake
in Dutch company KPN Mobile and in Hutchison 3G UK Holdings, which owns one of
the licences to develop a third-generation phone system in Britain. It has made
overtures to companies such as IBM and Japan鈥檚 Sanwa Bank, to bring Internet
banking to the mobile phone. DoCoMo has also been matched with telecoms
specialists SBC Communications and Bell South as part of its plan to introduce
i-mode to the US. Last month, it announced that it will buy a 40 per cent stake
in the service provider AOL Japan.
In Western Europe, the first packet-switched mobile service, GPRS, is only
just being introduced
(see 鈥淵our everything鈥�),
so i-mode already has a technical advantage.
The 3G networks will also be packet switched, and DoCoMo plans to introduce its
3G phones next year, ahead of its European rivals.
Other supposed advantages of i-mode are hotly contested. Much is made of how
easily i-mode sites can be created, compared with WAP sites. Websites were
originally written in hypertext markup language (HTML), and i-mode uses a
鈥渃ompact鈥� subset of these instructions, called cHTML. This is familiar to
programmers so it鈥檚 not hard to convert websites into i-mode sites. But
advocates of the rival WAP system point out that its language, wireless markup
language (WML), also derives from HTML. It may not be as familiar as cHTML, they
say, but it鈥檚 dead easy to use. Nokia already markets a server that converts
HTML to WML.
Roaming the world
Also DoCoMo鈥檚 i-mode is a proprietary system, while WAP is an open
standard supported by around 550 companies including Microsoft, Palm, Symbian,
Nokia, Ericsson, Motorola and Sony. It is unthinkable that DoCoMo would persuade
such a powerful group to change horses, says Bob Brace of Nokia Internet
Communications in London.
But pressurising others to change from WAP to i-mode is not DoCoMo鈥檚
intention, Inui argues. 鈥淒oCoMo isn鈥檛 interested in buying stakes in companies
and getting customers per se,鈥� he says. 鈥淎ll they want to do is secure `roaming鈥�
agreements, so people can use DoCoMo handsets anywhere in the world.鈥�
He believes that foreign companies are lining up to court DoCoMo because they
want its experience with packet-switching technology and with marketing and
handling content and content providers. This expertise may give them a few
months鈥� start over their rivals. In a business that鈥檚 moving at breakneck speed,
that鈥檚 a considerable advantage.
Back at home, DoCoMo continues to push forward. 鈥淲ith introduction of Java
technology, probably this winter, we鈥檒l be able to offer more compelling i-mode
phone applications,鈥� says Miki Nakajima McCants of DoCoMo. 鈥淭hese include
enhanced security for online banking and trading, increased functionality and
enriched contents, like game download.鈥�
Looking further ahead, DoCoMo has launched Vision 2010, a projection of what
it expects to see in mobile communications 10 years from now. Innovations
include global mobile conferencing, with video and simultaneous language
translation. In true Japanese style, its plans get steadily more grandiose,
culminating in a network of airships hovering over the country to convey the
huge quantities of data at superfast speeds.
Some of these plans may seem far out, but Western companies would be mad to
ignore DoCoMo. Japanese companies have a track record second to none when it
comes to innovation. The Sony Walkman appeared from nowhere to take the world by
storm. Will i-mode do the same?