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The Japanese Cell Phone Market
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A recent trip to Japan exposed me to all sorts of neat cellular phones and gadgets that North Americans only dream about. This article discusses the Japanese cell phone market and some of the goodies that service providers and phone manufacturers are putting into their handsets to make them more attractive to the public.
Original publication date: September 2002.

Preamble and Introduction

I've always been amazed at how far "behind" the North American cell phone market has been compared to other places in the world. Only recently has the thought of custom ringtones been introduced to our cell phones, whereas phones in Europe have been able to download them for years. Only recently has the thought of custom ringtones been introduced to our cell phones, whereas phones in Europe have been able to download them for years. In this past year, Canadian service providers finally agreed to allow cross-provider SMS messages, something that Europeans have been doing for years, but even to this date, the US service providers still don't allow cross-provider SMS messages!

Ask someone from Europe about places where their cellular, or more correctly, "mobile" phone doesn't work and they will look at you funny. Ask someone on the street in North America and they will be able to rattle off a dozen places where coverage is questionable or non-existent. North Americans have to deal with all sorts of technologies (AMPS, tdMA, CDMA, iDEN, GSM) and each of these may come in one or two different frequencies. Phones with different technologies are virtually incompatible with each other. Fortunately, both AMPS and tdMA will be dropped in the next few years, reducing some of the confusion.

A combination of very cheap and available landlines has restricted the development of the cellular market in North America. In Canada you can go to a pay phone and plunk in 25¢ for an unlimited duration landline call. That same money might get you a couple of minutes at most anywhere else in the world. Want a landline in your house or business? The process might take a couple of weeks of waiting. Places in Europe, Central or South America might wait years for a landline installation and the cost would be prohibitive.

Most North Americans turn their cell phones on when they are out of the house and office, when they cannot be reached on a landline. This keeps their wireless minutes down and service providers don't make a lot on causal users of cell phones (<150 min/month). If cell phone providers allowed alternative long distance services on their lines, people might be more persuaded to drop their landlines and go completely to their cell phones. But only one service provider in Canada offers long distance rates that are even close to what you can get on a land line. The rest of them charge 2.5X or more than you would pay on a landline AND you still have to watch your airtime minutes.

This article takes a closer look into how demand and consumerism drive the Japanese cell phone market. Many people turn to the Japanese market to see what features and services might appear in North America in the near future. Read on to see what you might expect your future cell phone to offer.

The Japanese Market

Walk down the streets of any urban centre in Japan and you'll see the same picture over and over again. People with cell phones either glued to their hand or to their ear. Cell phones play a very important part of many lives, and especially so if you are female and between the ages of 12 and 40. Jump on any train or subway line in Tokyo and discreetly watch what people are up to. They are not reading the ads, they are usually not reading a book or a newspaper, they are either looking at their cell phone screen or they have their eyes shut. A quick glance to their screen will reveal that they are checking their call logs, sending messages, or playing games.

Jump off the train at the Akihabara neighbourhood of Tokyo. This is a very famous electronics district, filled with computer shops, camera stores, film wholesalers, and more. Looking for that replacement part? You are guaranteed to find it somewhere here.

Almost every single store has booths outside with dozens of phone models. Go to one of the street corners pick up some silver FOMA (Freedom Of Mobile multimedia Access) kleenex from a cute girl -- free advertising for NTT DoMoCo's new high-speed data services. Go inside some of the larger electronics stores and there might be a half floor devoted just to cell phones and the other half of the floor will be cell phone accessories. Sure, there will be a few car chargers and replacement batteries, but most of the accessories are things that make the phone unique -- faceplates, holograms, interchangeable LED covers, fuzzy cases, stick-on antenna characters, and things to hang off your antenna.

It's not just the electronics district, but everywhere you go there are cell phone stores with dozens of cell phone models for sale. And why not, seeing that almost everyone owns one and everyone likes to have the latest phone out there. New phones might sell upwards of ¥60000 (US$300), but a phone that is a few months out of date can be had for about ¥1200 (US$7).

Akihabara is one of the biggest electronics shopping districts in the world.

The Players

Japan is dominated by three service providers. There's KDDI who provides a service called "AU", NTT's "DoMoCo", and Vodafone's "J-Phone". Each provider offers various different services and rate plans and different coverage areas outside the urban centres.
Phones used by all providers are virtually incompatible with any other cellular service in the world. A combination of CDMA and unusual frequencies makes almost all phones sold in Japan useless to the outside world. Don't expect your overseas phone to work in Japan either. Some of the Japanese service providers do offer international roaming services, such as AU's "World Passport" that does allow limited CDMA roaming in Hong Kong, Korea, Australia, New Zealand, Canada (on Telus Mobility only) and a few service providers in the U.S.

There's dozens of phones to choose from with each service provider. You'll regularly see phones made by Sharp, Panasonic, Mitsubishi, Kenwood, Toshiba, NEC, Denso, Pioneer, Sanyo, Kyocera, Hitachi, Casio, and Sony Ericsson. Phones made by big-name companies, such as Nokia, seem to have very little market share.

Coverage is very important. Microcells are very common and fill in small coverage holes.

Typical Handsets

Recently I reviewed the new LG TM520 being sold by Telus Mobility in Canada and a very similar model, the LG VX1, is being sold in the US by Verizon. This particular model is about as close in design to the typical handset on the Japanese market. Most phones currently sold in Japan are of the flip or clamshell variety, with an exterior small display screen showing signal strength, date and time, and incoming message icons or phone numbers. Open the clamshell up and you'll find a huge TFT colour screen capable of displaying 65 536 colours on the top and a regular keypad on the bottom. There might be an external CCD camera lens on the hinge or outside and likely lots of accessory ports.

Only recently have colour screens been introduced to the North American market. Sprint PCS ran a series of commercials in the summer of 2002 bragging about their all new colour screen phone. Telus Mobility offered a coloured handset to the public in late 2001. But as of today almost all phones in North America still have monochrome screens. Ironically only a handful of phones sold on the Japanese market are monochrome, and these are often for use outside Japan on either CDMA or GSM networks.

There's also a few regular, non-clamshell, phones on the Japanese market. These also feature full colour screens, but they are not as popular due to the size of the phone to accommodate both the screen and the keypad. Small phones are definitely not common, the idea behind Japanese phones is to make the screen as big and colourful as possible and have an easy-to-navigate keypad for messages, games, and more.


Messages between friends in Japan is big. You can do regular SMS or email on your phone. Email is of course limited to small file sizes, but many of the phones allow for both English and Japanese characters to be sent. Each provider also allows special characters to be sent, such as an array of happy and sad faces, small animated images, animals, people, hearts, etc. When special characters are not available, people often use a specialized set of faces to show emotion:
Email can also be sent between between different provider phones, but many of the special characters are lost, hence to try and keep your circle of friends on the same provider to receive the special characters. Email, of course, may be sent from computers as well, but files are often stripped of headers and attachments.

ASCII faces

Games and Entertainment

Most North American phones come with a few games to keep people entertained for a limited duration. Japanese phones come with two different types of games: built-in ones and Java application ones. The built-in ones are simple, but again the graphics are very important to the game value. The two images on either side of this paragraph show a couple of the built-in games, including a SIM game and a Egg Catch game. Not exactly on the same level as the traditional Nokia Snake game.

Java application games are delivered via the network to your phone and there is a charge for this service. These games are much more complex and require streaming data to access. You can play Role Playing Games (RPG's), fashion design, complex Tetris and more. New games come out monthly. You can even buy joysticks and navigation consoles that plug into your phone.

If that's not enough, how about downloading a short video starring Winne the Pooh? A little karaoke perhaps? How about that boring screen on the phone? You can even download beautiful animated colour screensavers from commercial services to place on your phone. Surf a few web sites in full colour and with animations. Pop in a 64 Meg compact flash card and listen to a few hours of MP3 on your cell phone. Pay your parking fees online. The fun just doesn't stop.

Built-in Cameras

One of the recent popular additions to many of the Japanese phone models is a CCD Camera that is mounted either on the outside of the clamshell or on the clamshell hinge. The camera lens is slightly smaller than a dime and takes 4x4 cm pictures to display on the phone's screen or to send to others. Not only can you take pictures, but you can take video clips. Most phones take between 5-15 seconds of footage due to memory limitations, but you can send streaming video over your phone. Many of the advertisements for camera phones show people taking to each other and watching each other on the screen (both holding the phone and camera at arms length and using a hands-free microphone and earpiece). This might be cute at the beginning, but most people end up focusing the camera on a tree or street scenes and talking normally with the phone next to their head. Otherwise a very neat feature, and excellent at showing someone what is going on where you are.

The camera also has a couple of neat accessories that you can get, including an external flash that pops into an accessory port. You can even buy a miniature printer that will print out your pictures.

Camera pictures

GPS-Enabled Phones

For regular visitors to this site, you have likely seen mention of GPS before. GPS, or Global Positioning System, is a network of satellites that orbit the earth. Using a GPS unit, one can determine their position anywhere on the planet down to a few metres. GPS's are commonly used by people with boats, hikers, hunters, geocachers, or anyone else that has a need to know their exact position on the planet. GPS is also used with CDMA base stations, but not for position, but rather for the precise time signal that it delivers.

To incorporate yet another gadget into cell phones, many of the phone manufactures are now including a built-in GPS unit. The user can put the phone into GPS mode and determine their position. Base maps can be either downloaded or loaded with streaming data to give a background of streets, terrain, or just about anything else. GPS does have its limitations, with the big one being that you need to be able to receive good signals from at least three satellites to determine a position. This is easy in an open environment, but not inside buildings or along narrow streets with little opening to the sky above. Regardless, service providers promote that GPS-enabled cell phones can help you find your friends by sending your current position to them. On the screen a basemap will appear and customized icons, such as a little Hello Kitty, will appear where your friend's cell phone is or of a building that you need to go to. It's a neat idea, but it is a very basic GPS unit with limited waypoints and functions.


Market demand drives cell phone manufactures and service provides to offer new and improved services and functions in their cell phones. The demand for more visual interaction and entertainment with cell phones in the Japanese market is great and as such, their phones are many years ahead of what we will ever see in North America. Phones have definitely become an important part of people's lives in Japan, whereas North Americans still many view the cell phone as a tool and not as a entertainment device. The average phone in North America lasts 3-5 years before being replaced, in Japan it is a fraction of this time.

All the services offered on Japanese phones cost money, either up front for the feature or as a airtime or data charge. Owning a basic cell phone in Japan costs about US$40 a month, but costs can quickly rise with additional features, more airtime, streaming data, email and messages. Users of cell phones in Tokyo especially have to watch out for their phone ringing once with a unknown number -- dial that number back out of curiosity and you'll reach the equivalent of a 1-900 number in North America with high per minute costs for adult entertainment.

What will we see in the near future in North America? Colour screens are on the way, maybe video cameras and streaming java games. Likely GPS-enabled phones and streaming movies would not be a big hit if they were introduced to the North American market, simply because there are better devices currently available if you want to determine your position on earth or watch a movie. Who knows what else will show up on your next cell phone? Stay tuned...

Phone accessories for ¥100.


Many thanks to Wayne d'Eon, who provided some of the material and pictures used in this article, plus allowing me to test out his J-Phone while visiting Victoria. Thanks as well to Maia Tsurumi, who provided translation of some of the documents used for this article.

Further Reading

Check out Wireless Watch Japan for all the latest development with cell phones in Japan.


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