NTT DoCoMo

one true story

a MBA2-2 class project by Erwin

Identification on DoCoMo
Vision and mission Opportunities & Threat. Strengths & Weaknesses. Long Terms Objectives. The generating of strategies. The selection of strategy.

Vision & Mission

Vision Challenging the Mobile Frontier

Mission
(1) We will refine our brand and strengthen ties with our customers (2) We will solicit and incorporate feedback from customers so that we continue to exceed their expectations (3) We will continue to innovate so that we can earn the respect and admiration of people worldwide (4) We will become an organization whose energetic staff is capable of overcoming all challenges in pursuit of our corporate vision

Opportunities & Threat

Opportunity By the year 2010, the mobile communications market is projected to grow to three times its current size.
Threat While the mobile communications market in Japan has grown remarkably, it has started to show signs of slowing down.

Strength & Weaknesses

Strength Since its inception in 1992, NTT DoCoMo has been hell-bent on one goal: to dominate Japan's cell-phone market. With nearly 60% of the local digital-cellular universe--or 32 million Japanese--DoCoMo handily accomplished that goal. Then, 18 months ago, it set out on a new mission: to lead Japan in the world's first instantly accessible mobile Internet service, called i-mode, which offers users an online connection without the need to dial up. DoCoMo has accomplished that, too. I-mode boasts 70% of Japan's local wireless Web market. Weakness DoCoMo wants to become a leader in both cellular and wireless Web services worldwide. But since it's coming late to an overcrowded game, DoCoMo is embarking on a low-key strategy that involves sprinkling small investments into several companies in Europe and Asia rather than making outright acquisitions. With little room left in Japan to grow, global outreach is the only option.

Long Terms Objectives

World Domination
on the Cheap

The generating & selection of strategies at DoCoMo

Network externality effects that generate more users. When a new user joined the network, it created incremental benefits for all users in the network. After a critical mass was reached, there were added incentives for new consumers to come in, thus helping the network to grow. High customer-retention rates. DoCoMo had a massive up-front investment and customer acquisition cost. To prevent its customers from switching DoCoMo created a sticky business model. Under this model, the customers found the cost of switching to other service providers higher than the value gained by switching. Economies of scale. The cost of supporting new content providers, users, and new technology diminished and the size of the network grew.

The 4Q on the DoCoMo Case

1.

Analyze in detail, the strategies adopted by DoCoMo during the early and mid 1990s in detail and comment on the factors that helped it establish itself as a market leader. Critically examine the role played by the I-Mode service in making DoCoMo the largest company in Japan. What were the major factors that led to the success of I-mode? Examine DoCoMos global strategies and 3G initiatives. Do you support DoCoMos global strategies? Why/Why not? Do you think DoCoMo was correct in advancing to 3G technology during the early 2000s? Justify your answer with reasons.

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4.

Critically examine DoCoMos initiatives to increase its revenues. In the light of the saturation of Japans cellular market, intensified competition and decreasing ARPUs, do you think DoCoMo would succeed in retaining its market share? What measures would you recommend for DoCoMo to increase revenues and retain is leadership?

Docomo Strategies on 90s that making it as the market leader

As an old player, NTT inherit DoCoMo with its wireless communication business The entry of foreign player make DoCoMo to stop taking FEES (security deposits, initial fee, etc.) The Japanesse patriotisms aimed by DoComo in order to survive foreign players attack

Major Factor that making the iMode success

The 1st mobile Internet service in the world Ease of use, just press the I button, and youre connected The technology growth (from 1G, 2G, till now the 3.5G, and soon will be 4G) BILLING MODE, based on the volumes of data received & sent, not time-based Growing e-commerce transaction that become a lifestyle for the japanesse

Major Factor that making the iMode success (contd.)

Marketing campaign was keep as simple as it is, they dont rever anything into Internet, Web, or even WAP Profit sharing between content provider & DoCoMo, while the customer get the information they want, make the whole process as a WIN-WIN-WIN solution Since PC penetration in Japan is very low, there come the companion for the Japanesse, the i-Mode I-mode came at the right time, in the right place, with the right content. It just dazzled everybody

Global Strategies for 3G

Expanding abroad by investment or joint services Retain customer by making cost of switching is higher than the value gained by operator switching Economics of scale; the bigger the volume, the bigger the profits, multiplication is the solution

Docomos revenue stream

Mobile / Wireless service (i-Mode, FOMA, CDMA 2002-1x) Global investment in various foreign country Network partnership (applications, contents, operators, & technical)