During the past month, NTT DoCoMo's i-mode 'mobile Internet' service notched up its 20 millionth Japanese subscriber. New subscribers are being added at close to half a million a week.
Why is NTT DoCoMo succeeding where other operators are struggling to make the 'mobile Internet' a success? We identify four critical factors.
i-mode was designed from the user's perspective, as an experience that makes sense in its own right... and clearly, it works for users. Crucially, it was not marketed as the Internet in mobile form, but as something new. Every detail of the user experience, from handset design to the billing system, has been thought through from the user's viewpoint.
i-mode is based on a packet data infrastructure, similar to the wired Internet. This makes a difference. Current implementations of WAP, for example, use an infrastructure designed for voice calls... which explains the 'Waiting for connection' message that is a central feature of today's WAP experience. Effectively, today's WAP phones have to "redial" every time they want to send or receive data. By contrast, i-mode provides an 'always on' experience: the user sees no connection delays at all.
Fortunately, new GPRS ("2.5G") technology will provide European users with a packet-based network later this year, finally enabling an 'always on' connection. But Japan has had a packet-based infrastructure since 1997 and has learnt how to use it, technically and commercially.
Having had a packet network since 1997, NTT DoCoMo has had time to implement a packet-based billing system, that has no problem in measuring and charging by the volume of data used - down to the finest detail. Operators elsewhere are struggling to move beyond charging on the voice model, based on connection time... not a sensible option when the connection is 'always on'.
And having created a billing system that makes it possible, DoCoMo has taken a policy decision to share revenue with premium content providers on the i-mode service... effectively acting as a money collection agency for content and service providers, who use the i-mode channel as a new way to get to customers. DoCoMo has deliberately pitched its cut of the cake low, encouraging a new industry of i-mode content providers, with a ready-made revenue stream from day one.
Is it possible to create a similar effect in Europe and elsewhere? Yes it is.
Japan is unique in many ways; the 'i-mode formula' cannot be transferred wholesale. But we see some clear lessons that are applicable to other regions, cultures and technologies. Correctly interpreted, i-mode is a global testbed and laboratory, which shows the way to implement systems with a similar growth pattern in other parts of the world.