Business Information Systems II
NTT DoCoMo: Marketing i-mode
Marc Hesse, Jan Upmeier, Philip Ebeling, Robert Vennemann
Q1. Japan's technological infrastructure: With its low internet penetration and already high mobile network coverage, Japan was an ideal place to implement a mobile internet service.
NTT DoCoMo's market position: Due to the former governmental telecom monopoly NTT its subsidiary DoCoMo has a 60% share of Japan's mobile internet market. This allows the market leader to dictate strict specifications to the handset manufactures.
Win-win strategy: DoCoMo achieved to create a system that formed a win-win situation for both the developers and the subscribers.
Q2. There are four main parties in the value chain of i-mode: First of all the handset manufactures, right after those DoCoMo itself, followed by the content partner and the users (see Exhibit 1).
Handset manufacturers: The handset manufacturers benefit from a growing market, an increased turnover and the growth of cell phone penetration, resulting in a faster fluctuation of new handset models.
Meanwhile DoCoMo comes up for a part of the inventory risk. That allows manufacturers to produce high quality technology early.
DoCoMo: Through the launch of i-mode, the company became market leader of Japan's mobile internet market and reached an enormous economic wealth.
Content partners: There are two types of content partners. Those who offer free access to their content and those called premium partners, who charge a fee for the use of their sites or services, e.g. ring tones etc. What is most valuable to content partners is that they can reach a high number of users with their marketing and offer their services via the telecommunication market. In general content partners have very high profit margins due to low market entry costs (i.e. easy to implement standards and no internal billing systems).
Subscribers: The benefit for...