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(No.1 High-Tech News Site in Japanese)

  • New Non-PC Network Services Appear in Japan
  • March 1, 1999 (TOKYO) -- New and easy-to-use network services using devices like mobile telephones and video game machines rather than personal computers are springing up in Japan.
    On Feb. 22, NTT Mobile Communications Network Inc. (NTT DoCoMo), Japan's largest provider of mobile telephone services, launched a new network service, called iMode, along with some new types of mobile phones that customers can use to access the network.

    The company expects to attract 3 million users for the service before the end of this year, and over the next two or three years it is hoping to see the number of users rise to around 10 million.

    Sega Enterprises Ltd. started offering a new network service at the end of November last year, the same time the company's new Dreamcast video gaming machine went on sale. Customers of the Dreamcast machine can use it to gain access to the network. Just around a month after the service was inaugurated, the number of people using the network had already surpassed 150,000. Sega expects that during this year the number of its network users will grow to a million or more.

    This April, IDO Corp. and DDI Corp.'s Cellular Group are scheduled to start offering another service which will provide data to users of the two companies' mobile phones. This new service from IDO and DDI is intended as a direct response to NTT DoCoMo's launching of the iMode service. The IDO and DDI services could possibly gain as many as a million users by the end of this year. (See chart 1.)

    Other services that allow users to access the Internet via their TVs, such as WebTV from WebTV Networks KK and NCTV from U.S.-based Network Computer Inc. (NCI), are also expected to steadily increase the number of their subscribers during the course of the year. (See chart 2.)

    Satellite broadcaster Japan Digital Broadcasting Services Inc. (SKY PerfecTV!) is also to start offering a new data broadcasting service this April.

    So, the number of network services that are not based on PCs has started to rapidly increase, and, as this year wears on, it looks likely that the network services industry in Japan will be undergoing some major changes.

    Network Business Heating Up

    NTT DoCoMo's new iMode service is in reality a type of Internet access service. Also, the new phones that the company has launched to go with the service, the 501i Series models, are basically portable Internet terminals equipped with Web browsers.

    Users of the 501i Series phones can use them to do things like reserve tickets for concerts or airline flights, to order books, and to buy and sell stocks. They can also use the service to send and receive e-mail messages (a particular user's e-mail address will simply be that user's own telephone number followed by @docomo.ne.jp).

    Already 67 different companies have decided to set up iMode sites where they can offer their services to the network's users. These sites will allow users to do things such as conduct financial transactions, reserve airline tickets and buy products via the network.

    Many companies that are positive about their use of the iMode network as a new sales channel are considering it a first step towards offering services through a wide variety of different e-commerce media. First and foremost among these is Japan Airlines Co., Ltd., which is currently promoting ticketless sales of seats on its flights.

    Because services like iMode, based on mobile phones, are restricted by the fact that the phones themselves have very small screens on which to display data, many companies are having to rewrite their Web contents to make them more text-based. However, on the plus side, there is no need for them to make any changes to the servers and other hardware devices they currently use in order to supply data for the new mobile phone services.

    Furthermore, because the cost of running the iMode service is completely covered by the fees users pay for using their phones, companies that make use of the network to offer their own services don't need to worry about paying anything.

    Lawson Inc., a major chain of 24-hour convenience stores, is selling concert tickets via the iMode network, and is planning to take the concept of selling tickets one step further.

    The idea is that, first, the user reserves the ticket for the concert or show of their choice by making use of the iMode service. Then, they simply go along to their nearest Lawson convenience store where there is a machine, called a Multimedia Kiosk Terminal, that will issue them the ticket they have reserved on the spot. This means that users will be able to get hold of tickets for popular concerts just by accessing the iMode network and then visiting their neighborhood convenience store.

    Dreamcast Targets Household Market

    If the iMode network is the new big thing for mobile users, then Sega's Dreamcast network is playing the same role for users who prefer to stay home.

    Sega also sees its Dreamcast game machine as a new type of network terminal, and plans to create a network infrastructure over which users can purchase goods.

    The Dreamcast network is not a service offering ordinary Internet access. Sega is providing its service using a special charging system that the company has developed using I4 Corp.'s WebMoney prepaid cards for use on the Internet. Sega plans to develop its own Internet site (dricas.com), which is centered on TV games, as the portal site from which its users can gain access to the network's other data providers.

    The company will use the dricas.com site, the users of which will mainly be children who enjoy playing games and mothers looking after young children, in order to attract other businesses, such as toy manufacturers and mail order catalog companies, to set up Web marketing and e-commerce channels on the network.

    A New Service to Challenge iMode

    The remainder of this year will also see the appearance of other new non-PC network services in addition to those from NTT DoCoMo and Sega that have already been launched.

    Currently attracting much attention is the new service to be jointly set up and run by IDO and the DDI Cellular Group companies that will provide data to mobile telephone users and that is scheduled to start operations in April.

    This service will be more or less the same as iMode, except that it will incorporate the Wireless Access Protocol (WAP) technology that is rapidly becoming the industry standard, as recommended by major manufacturers of mobile telephones such as U.S.-based Motorola Inc., Sweden's Ericsson and Finland's Nokia.

    In addition to allowing users to view pages on the Internet and to send and receive e-mail messages with their mobile phones, IDO is also planning to let them make use of a Personal Information Manager (PIM) as part of its WAP service.

    Apart from IDO and the DDI Cellular Group companies, the TU-KA Group is also scheduled to launch services some time after the summer, and the DDI Pocket Group of personal handyphohe system (PHS) operators is also considering whether or not to adopt the service.

    Osaka Yusen Offers WebTV Free-of-Charge

    Services offering Internet access via ordinary TV sets, such as WebTV and NCTV, also look as if they will continue to attract new users and become more widely used.

    In the case of WebTV, Osaka Yusen (Yusen Broadcasting Corp.) has been providing WebTV terminals free-of-charge to all new subscribers to its wired service, and to existing subscribers who have requested one, since January. In this way, the company expects to distribute more than 60,000 of the terminals per year.

    The company decided to start handing out WebTV terminals because of its EPG (Electronic Program Guide) function. The number of channels that Osaka Yusen provides its subscribers with is 440, and the company was looking for a way to make it easier for subscribers to make use of the service on offer.

    On the other hand, NCTV will start providing services to TV users based on CATV Internet services which were originally targeted at PC users. For example, two cable TV operators, Town TV Narashino and Town TV Kanazawa, are planning to start providing TV-based Internet access services using NCTV terminals this April.

    Satellite Data Broadcasting for TV Users

    New moves are afoot even in the data broadcasting field. In April SKY PerfecTV!, which already offers a data broadcasting service called SKY PerfecPC! targeted at PC users, is to launch a similar data broadcasting service for TV users. The new service will feature Multimedia and Hypermedia Experts Group (MHEG) broadcasting technology.

    This new service won't just be packaging data along with ordinary satellite TV broadcasts. The special set-top box will allow for two-way communications, meaning that users will be able to conduct e-commerce transactions.

    At first, Digital Media Entertainment (DME), a company affiliated with Sony Corp., plans to use the service to sell music data. Users will be able to order and download the data during TV broadcasts of music programs.

    With all the developments outlined above taking place this year, it seems highly probable that 1999 will become the year that non-PC networking really starts to take off.

    Furthermore, even more developments are in the pipeline, so new services will continue to appear well into next year and beyond. These will include wideband CDMA services, which will allow video data to be sent to and from mobile phones, BS digital broadcasting services, and so-called mobile broadcasting services that will provide data to users of car navigation systems. The network service industry certainly looks as if it is going to keep getting bigger and bigger.

    Chart 1: Estimated growth of network infrastructure for mobile users.
    All estimates made by Nikkei Multimedia.
    1) Mobile telephone text data services.
    2) Wideband CDMA portable telephone services capable of handling video data.
    3) Satellite data broadcasting services for use with car navigation systems.

    (return to news)

    Chart 2: Estimated growth of network infrastructure for household users.
    All estimates made by Nikkei Multimedia.

    (return to news)

    Related stories:
    � NTT DoCoMo to Launch Text Services for Mobile Phones
    � TU-KA Group Employs WAP Protocol for Mobile Phone Service
    � Sega Unveils Prepaid Internet Access Service for Dreamcast
    � WebTV to Distribute Free CD-ROM for Dreamcast Net Service

    (Jun Honma, Staff Editor, Nikkei Multimedia)

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    Updated: Fri Feb 26 12:14:39 1999 PDT