handicapping the iPhone in Japan

For those of you who were unimpressed with this year’s MacWorld Keynote, Forbes has the latest article, Apple’s Fight In Japan, guessing whether the iPhone will do well in Japan.
It’s really hard to predict whether the iPhone will do well in Japan. I’m generally skeptical so I look to the fact that the iPhone (presumably) won’t have features that are unique to Japan such as the digital terrestrial TV tuner, or the digital wallet functionality, or the GPS functionality, etc. But Japanese consumers love new things and the iPhone would qualify, and yet maybe the hardcore have already purchased an iPod Touch?
The Forbes article touches on the fact that Japanese mobile phone users use one hand when operating their phones. That’s a significant difference with the usage of the iPhone. The iPhone is clearly a two-hand operating model, and from the market share of mobile phones with keyboards that require two-handed usage, that’s a niche market.
The question about the iPhone’s success in Japan gets to the heart of the fact that Japan’s mobile phone market is really an island unto itself, literally and figuratively. The fact that Samsung and Nokia have little-to-no market share in Japan and that Sony-Ericsson often launches separate Japan-only models speaks to the unique nature of this market.
Finally, and most importantly, will Jobs add a strap hook to the iPhone? I’ll bet he won’t, confounding the majority of Japanese users who love to accessorize their phones with straps and whatnot.
If you have thoughts on this topic, I’d love to hear from you.

7 comments on “handicapping the iPhone in Japan
  1. Chang says:

    I think it depends on how we define the market – if we’re looking at the smart phone market, I think iPhone will do okay in Japan… but if we’re talking about the mainstream or “feature phone” market, I don’t think iPhone will gain a major market share there.

  2. rcousine says:

    I think the iPhones fortunes in Japan are unknown and probably unknowable, but that’s not as much fun as predicting optimism or pessimism.
    There’s also a strong element of “who cares?” Japan’s phone market is, as you say, so alien that overlap between them and the rest of the world is minimal. So the iPhone might succeed, or it might not, but it’s already a success.
    Now, if there’s any Kremlinology people would like to discuss regarding iPhone-in-Canada rumors, bring it on!

  3. Marxy says:

    The iPhone is great if you want to combine your net life with your cell phone. The Japanese have no net life.
    They also had no mp3s, but still caught on to the iPod, so it’s not a lost cause. But yeah, probably will only do well in the Smart Phone segment. I mean, why would young women want to read the internet in full color on a nice screen when you can read keitai novels within in a tiny little box.

  4. Kakyou says:

    I’d be wary of taking telecom sector analysis from anyone who confuses the G in 3G with Gigabyte. 😉
    Really her whole article seems to be pieced together from information gleaned from the IR group at Docomo. It feels more like a justification for lack of innovation in the Japanese cellphone market than an in depth view at the future of the market.
    Docomo is in fact notorious for “knowing what consumers in Japan want” which explains their declining market share. In fact, innovation is what drives cellphone design in Japan. Additions like cameras, GPS, 1seg, and web browsing did not come from consumer demand, but are rather pushed into phones to fill out spec sheets and drive faster handset refresh sales. Meanwhile, Japanese consumers have shown more interest in aesthetic design than more practical/feature centric markets.
    In a lot of ways, the Japanese market seems more mature, already moving past function and locking hard onto form. Helping friends I know pick cellphones recently, I find that people I know are looking for a design that they like, and only require a minimum of these “basic” add-ons (mail and alarm clock seem to be some of the most important).
    While it is hard to say what kind of an impact the iPhone could have in Japan, I would think that Japanese carriers are more concerned with the new carrier/hardware partnership model that the iPhone is bringing in. While both Softbank and Docomo have made noise about wanting the iPhone, I find it very hard to imagine that senior management in either company would be open to the concessions that Apple will demand. I’d love to see one of the smaller players like Willcom or eMobile try to shake things up, but doubt they would be able to afford Apple’s price.
    The fact is that the cellular handset market in Japan is old, fat, and out of touch. Apple’s model might be a paradigm shift, but I thinks it’s too radical to be remotely possible in the current market. Change will happen slowly as is typical in Japan, and while it may be consumer driven in the end, it will not likely come as a result of business understanding what consumers want.

  5. Ken Y-N says:

    Gen, thanks for highlighting the story – it ties in nicely with a survey I’m publishing tonight.
    Agreed that the article reads almost like a DoCoMo press release! I’d love to know why, in their photo gallery, they cut and pasted the P905i screen – the landscape-opened display has the portrait wallpaper.
    Oh, and Japanese are not big fans of One Seg – they are fans of having One Seg-capable phones, but not many people really use it.

  6. drdave says:

    About the strap hook thing…
    Last time I was there, I noticed that a lot of the new Softbank models (the very thin, square-looking ones) didn’t have any strap hooks…
    It did strike me as either a very bold move or a very stupid oversight… Yet I’m told Softbank still does ok enough (for an outsider), don’t they?

  7. satoshi says:

    Hi gen san!
    I say iPhone will do well in Japan at first but not as well as the cell phone industry wants it to be.
    the fact that:
    -price is not the problem
    -there are a lot of iPod/Apple fans in Japan (from experience!)
    -and looking at the recent decline of the KDDI due to lack of strong hardware,
    I bet iPhone will be popular when it comes out.
    However, lack of fast/strong Japanese IME 予測変換 (what you call it in English?) I say the young people will not be happy with it when they text/email couple hundred times a day:(
    and DUH I forgot the mention the fact you need a computer to use iPhone…
    satoshi