eurotechnology.japan.blog

DoCoMo plans to sell BlackBerry to corporates in Japan

With the RiM/NTP patent infringement lawsuit settled with a US$612.5 million payment, DoCoMo and Research in Motion (RiM) announced on June 8, 2006 that DoCoMo plans to start selling BlackBerry in Japan from autumn 2006 to corporate customers. Will RiM invest US$ 612.5 million to build business in Japan? Less? or more?

Over the last years I was asked 100s of times by foreign CEOs and expatriate managers why BlackBerry does not work and does not exist in Japan. Several large global corporations also asked us for work arounds to get solutions in place for Japan which fulfill the job of BlackBerry. Finally, also several venture companies came to us which supply secure corporate email solutions and corporate scheduling applications similar to BlackBerry's offerings.

Which BlackBerry device will DoCoMo offer

Although we have not seen an official announcement of the precise BlackBerry device DoCoMo will offer, we assume that it will be based on the Blackberry 8707 device.

We have also heard the following details:

• The planned BlackBerry for Japan will work on DoCoMo's FOMA (wCDMA) network in Japan, and will also have in-built connectivity for GSM and GPRS (2G legacy networks which are and will be in use for a long time to come in most countries outside Japan)


• The initial BlackBerry device will have no Japanese input, which restricts the device to foreign expatriates in Japan, and guarantees to keep BlackBerry initially out of the mainstream Japanese market. This means that the initial market will be mainly managers in foreign subsidiaries in Japan. Those managers who are integrated into Japan's business world and private world, will need a separate local Japanese mobile phone to communicate and exchange email messages with their Japanese colleagues

Why was there no BlackBerry in Japan?

For a number of reasons:

• RiM did not invest in Japan


• RiM reached no agreement with Japan's mobile operators


• BlackBerry until recently did not work with 3G (wCDMA/UMTS) which dominates in Japan


• Also, BlackBerry's QWERTY keyboard gives no advantage for Japanese language input


• and finally, Japanese mobile phones with added software already provide most functions of a BlackBerry (and a lot more functions which BlackBerries cannot do)

What are BlackBerry's prospects in Japan? Will BlackBerry be successful in Japan?

The key issue will be whether RiM invests sufficiently to succeed in Japan. Foreign telecom firms - including some of the most famous - have a record of underinvesting in Japan, and as a consequence to fail, or to remain trapped with a 0.5% market share. Will BlackBerry remain focused on the niche foreign executive market, or will BlackBerry expand into the much bigger mainstream in Japan?

The success of Willcom's W-ZERO is an indicator that BlackBerry might be successful beyond the expatriate market.

What will make success difficult for BlackBerry in Japan?

Success is not at all guaranteed for BlackBerry in Japan. We see as key issues:

• according to our information BlackBerry will not allow Japanese language input


• apparently BlackBerry will not support i-mode. Lack of i-Mode automatically cuts BlackBerry out of Japan's mainstream


• RiM will need to fulfill DoCoMo's quality requirements, which tend to be higher then those in other markets


• RiM's art will be to balance necessary investments and profitability requirements

Read an article in Red Herring about BlackBerry's announced entry to Japan, partly based on an interview with our CEO.