Slowdown in Japanese Wireless Handset Market

Japan : Japan's cellular and PHS handset sales for 2002 reached 39.3 million and 1.24 million units, respectively, for a total market of 40.54 million units. Factors contributing to the market contraction include:

-- Market penetration is approaching 60 percent.

-- Demand for replacement handsets has not offset the fall in new subscriber growth.

-- The impact of 3G service launches has been unclear.

-- The market for feature-rich browser phones has reached a plateau because of saturation.

"The challenge has been to identify the killer applications," says Naoto Nakagawa, Yankee Group Wireless/Mobile Asia-Pacific analyst. "Of course, in Japan's wireless/mobile market, where operators tend to hold the cards, handset manufacturers have little room to maneuver when planning their own products. Nevertheless, the vendors should focus on identifying the users' requirements rather than rushing into introducing the newest buzz technology."

With the critical need to create new markets and revenue streams, the Yankee Group sees manufacturers developing the following types of devices:

Multimedia handsets: The deployment of 3G networks and services will accelerate demand. However, the lack of killer applications remains a problem for all vendors in the value chain.

Machine communication: The Yankee Group expects shipment of these devices to exceed that of the mainstream cellular market today. The category includes man-to-machine and machine-to-machine communication.

TODAY'S PRESS RELEASES

Orange, the mobile phone group controlled by France Telecom, said Tuesday it was on track to launch high-speed, third-generation (3G) mobile phone services in Britain in mid-2004.

Sony Ericsson's application focused business strategy has started to drive market share growth in both the Japanese and GSM markets. Sony Ericsson's recent GSM-products have made a strong impact on the market

HCL Technologies announced it will provide multimedia solutions and services for 2.5G and 3G wireless handheld manufacturers that use Texas Instruments Incorporated (TI) OMAPTM platform.

Dilithium Networks, a leading provider of wireless multimedia solutions, announced the introduction of the DTG 2000TM wireless multimedia gateway. The carrier-class, high-density gateway enables mobile operators to offer a new class of revenue-generating services

Huawei Technologies announced that the company has made a successful demonstration of 3G MMS (Multimedia Messaging Services) on its trial network of WCDMA in April in Shanghai.

Japan's cellular and PHS handset sales for 2002 reached 39.3 million and 1.24 million units, respectively, for a total market of 40.54 million units.