NTT DoCoMo is preparing to launch the world’s first commercial 3G service next month.
NTT DoCoMo’s failure to meet its original May launch date for 3G services was a major setback for the company. The stakes in October’s second launch attempt are high. DoCoMo’s credibility and the future success of 3G services hinge on a successful launch.
Having poured billions of pounds into their 3G licenses, European telecoms companies will be watching Japan anxiously. Not only will they want a product that can deliver, but they will also need to be assured of 3G’s commercial feasibility.
Yet the launch may still not run smoothly. While the problems discovered in May have now reportedly been solved, the Japanese company still faces serious challenges. On the technical side, it will have to postpone video downloads until an unspecified later date. With this key feature missing, DoCoMo will have a harder time convincing customers of 3G’s benefits.
DoCoMo may also run into difficulties using bandwidth more efficiently, as well as suffering from the lack of uniform standards. Simultaneously, the project will come under pressure from cheaper and more consistent 2.5G and wLAN technologies.
Meanwhile, given the state of the Japanese economy, DoCoMo will find it hard to convince customers to buy expensive 3G phones and subscriptions. The company expects 150,000 3G users by March 2002 and some six million by 2004; clearly prices will need to come down if 3G is to reach such a mass market.
Yet there are good reasons not to write off the venture yet. 3G was never expected to happen overnight; infant technologies frequently fail to perform as expected in first trials. The problems that occurred prior to DoCoMo’s May launch also forced BT to postpone its launch on the Isle of Man.
If DoCoMo manages to launch in October, it will emerge ahead of its competitors. The new technology could still create an upsurge in demand in the Japanese mobile phone market. The trick will then be to steer DoCoMo through the rough waters in an effort to maintain this edge.
