iPhone + Softbank Mobile = The great equalizer?
There has been a lot of buzz in recent days about Apple's announcement that the iPhone will be sold in Japan through Softbank Mobile.:
NTT DoCoMo told CNET that it was "a shame" that Apple had announced it would partner with Softbank…
Commentary in English is here:
In other countries, Apple has consistently pursued a policy of partnering exclusively with the largest carrier. Why didn't Apple do this in Japan? There's some speculation that Apple's deal with Softbank might not be exclusive – They might just be using Softbank to gain leverage in negotiations with NTT DoCoMo. (And, who knows, maybe Apple could then offer the 3G iPhone through DoCoMo later this year?)
I get the feeling that it's not such a sophisticated decision. My "gut" tells me that it may simply be a pragmatic move to get the Apple iPhone into Japanese consumers' hands without further delay.
I hear that NTT DoCoMo and KDDI make things quite difficult for handset makers to get approved on their networks — I don't have direct experience of the tortuous approval process, but I know a couple of people who taken products through it. They tell me that these two carriers have the mindset of traditional "national infrastructure" providers, with uncompromising demands for quality of sound, reception and so on. Furthermore, they're very finicky about elements of the user interface — making sure that the device complies with their demands around text input, navigation, reliability and so on. Perhaps only the Japanese handset manufacturers have the patience / experience / expertise / connections to do business with these guys.
On the one hand, these extremely powerful carriers have dictated the standards that enabled services such as mobile payments and iMode-style mobile internet to take off in Japan. On the other hand, their strictness is making it hard for them to collaborate with innovative outsiders like Apple.
By contrast, I get the impression that Softbank Mobile has more tolerance for non-compliance with standards (or "imperfection" if you like). When I speak to the customers who signed up to Softbank in order to get a cool handset from HTC or Nokia, I often hear that they found something about the phone that fails to meet their expectations. One of my colleagues complains that the user interface of his HTC is "very unfriendly" – The device seems to crash and reboot more often than his previous phone and when he wants to input a new contact to his address book, it requires him to manually change from text input to numerical input in the fields for phone numbers. His comment: "NTT DoCoMo would not have allowed this thing into their stores until the maker had fixed these bugs."
Is it a good thing for a carrier to relax its standards on handsets? Well, the strategy seems to be working very well for Softbank right now. Their subscriber numbers are up and the brand has a pretty "cool" image. However, in the long term this might inhibit the development of new services. I recall that when Kristofer Tate (CEO of Zooomr) made a presentation to the Asiajin Meeting in February he explained that it's harder to offer his service to Softbank subscribers because there's no standard platform – the service provider is faced with a plethora of devices and platforms to support.
Philip Sugai at International University Japan, writes in the the Mobile Consumer Lab Blog that "…the prospects that the iPhone will spark further usage of mobile internet content and services in Japan seems to be a little far-fetched. But where the iPhone is likely to make it's greatest impact is bringing the Japanese market more closely in line with other markets around the world.
…Although I believe that Google's Android is a more blatant attempt to make Japan's overall ecosystem model relevant around the world, the iPhone may also go a very long way in bringing an entirely new level of collaborative innovation between Japan and the rest of the world. "
But I get the feeling that NTT DoCoMo and KDDI aren't culturally receptive to a "great equalizer." Can they be comfortable without being in total control of the mobile ecosystem? Can they collaborate in a messy sandbox with all the other hardware, software and service providers? Surely that's the cultural transformation they need to achieve if they don't want to be muttering "zannnen" (regretable) at the next innovative device, service or pricing model from Softbank.
I'd be delighted to receive comments / corrections / criticism from any readers who can shed light on the Apple angle or the Japanese carrier angle of this story. Please share your thoughts and opinions.