Interview with Nakamura Masao, President and CEO, NTT DoCoMo, Inc.

(From Journal of Japanese Trade & Industry (JJTI))

Byline: Interviewer: Murakami Kuniko

NTT DoCoMo, Inc., which holds a majority share of the Japanese mobile phone market, was slow to promote the third-generation (3G) mobile service featuring high-speed data transmission, and fell behind its rival KDDI, the operator of the "au" mobile service, in the net growth of mobile phone subscriptions - new subscriptions minus cancellations - in 2004. DoCoMo has been trying to catch up with its rivals with the launch of fixed charges for packet data communication service and the introduction of brand-new handsets capable of e-money settlements called "Osaifu Keitai," or "Wallet Phones," for consumers. NTT DoCoMo President and CEO Nakamura Masao, eager to branch out into the credit business using mobile phones, talks about his company's future business strategy.

Capital Injection for Japan's No.2 Credit Card Firm Sumitomo Mitsui Card In April 2005, DoCoMo acquired a 34% equity stake in Sumitomo Mitsui Card Co., the second-largest credit card firm in Japan, to branch out into the credit business. What does DoCoMo hope to gain from its acquisition? Nakamura: First of all, DoCoMo will be able to obtain earnings with its 34% stake in Sumitomo Mitsui Card. We can expect increased revenues from Sumitomo Mitsui Card because payments can be made by placing DoCoMo's special mobile phones over credit card readers at its member stores. We also plan to branch out into the credit business with the DoCoMo brand. We would like to begin by using conventional plastic cards as well, besides using mobile phones as credit cards. We are now working out specific business plans.

Are you considering linking up with other credit companies? Nakamura: We want to do this in a non-exclusive way. If DoCoMo's mobile phones can be used at any store equipped with card readers, it would be much more convenient for users.

The average monthly charge for each subscriber is on the decline. Mobile phone carriers need to find new sources of revenue. What kind of business fields is DoCoMo planning to emphasize? Nakamura: Internet advertising for computer users is a rapidly expanding field. There still remains room to develop the mobile phone ad business, and it does not pose risks or increase costs for us.

DoCoMo Will Not Seek to Monopolize Content Rival carriers sell handsets that can monitor analog terrestrial broadcasts.