Research and Markets: Japan’s Telecom, Mobile & Broadband Sector, is one of the Most Active Markets in the World

Japan’s telecommunications sector is one of the most active markets in the world. Coming into 2009, the country was witnessing the continued growth of VoIP and triple play services, and strong competition among the mobile operators in the 3G segment of the market. Especially noteworthy has been the uptake of FttH services (with a corresponding move away from DSL) and the big strides taken in developing digital and mobile broadcasting. The telecommunications regulatory authorities in Japan have been very active in shaping the industry in this country. As a result of their efforts, Japan has assumed a dynamic leadership role in many aspects of global and regional telecommunications. The control that the incumbent operator, NTT Corp, has continued to exert over virtually all local customers remains a particular challenge for the regulator. In addition, a growing concern has been the development (and lack) of cyber law in a society that is increasingly spending its time online.

Japan is one of the world’s leading mobile telephone markets, not only in terms of size but also in terms of innovation and its ability to be early with the introduction of advanced technologies. The market is characterised by intense competition and as user needs become varied, it becomes more difficult for any one carrier to hold on to a majority of market share. Japan is one of the world’s top 3G markets, with concrete plans moving towards 4G within the next five years.

Key Highlights:

  • The number of broadband lines in Japan had posted dramatic growth to over 30 million by end-2008. In terms of quality and affordability, Japan’s telecommunications infrastructure is significantly ahead of that in the US and Europe. Going into 2009, DSL subscribers were still declining from the peak in 2006, as customers continued to shift to FttH. During the first half of 2008, FttH subscribers outnumbered DSL subscribers for the first time and had reached over 13 million by end-2008. The DSL and FttH platforms support the bulk of the country’s broadband market, with cable modem and wireless making up the balance.
  • During 2008, the number of fixed subscribers declined even further to 43 million (less than 35% penetration), and that of mobile subscribers surpassed 105 million (more than 80% penetration). The trend highlights the severe pressure on NTT, faced with declining fixed-line subscribers and high levels of competition eating away at its market dominance.
  • New mobile operator, eMobile, continued its network expansion and in early 2009 had attracted over 1.2 million subscribers.
  • The strong uptake of 3G continues, with over 90 million subscribers going into 2009, representing nearly 90% of all mobile subscribers. DoCoMo is one of the strongest drivers of the LTE standard and is expected to launch around 2009/10 before the standard is complete with its Super 3G version.
  • The local market’s other significant growth area coming into 2009 was in IP-based telephony, taking around 30% of all telephony subscriptions. Softbank is still a major player, with around 25% of the total VoIP subscriber base by September 2008, although NTT maintained its 50% market share after substantial gains in 2007.
  • Popular VAS continued to be i-mode for Internet access via mobile phones, music downloads facilitated by linkage between the content providers and the operators, and Osaifu-Keitai, a mobile wallet that allows subscribers to pay for train tickets and the like with their mobile phones. Japan had over 90 million wireless Internet subscribers by early 2009.

Key Topics Covered:

  • Key Statistics
  • Telecommunications Market
  • Regulatory Environment
  • Fixed Network Market
  • Major Operators
  • Telecommunications Infrastructure
  • Broadband Market
  • Convergence
  • Mobile Communications

For more information visit .