updated 08:30 am EDT, Fri August 8, 2008
KDDI Hit by iPhone 3G
Japanese wireless carrier KDDI has seen its growth stifled in July primarily by the iPhone 3G launch the same month, according to a report from the company itself. The company's subscriber growth was near flat at just 17,000 new users for the month and saw the first month KDDI has known where the amount of cancellations with phone number portability, or the number of customers switching to rivals, overtook new subscriptions of the same kind. The sudden downturn comes just as the iPhone's official carrier, SoftBank, saw an immediate spike and added 52,000 new users.
KDDI has acknowledged the difference in results through a company spokesperson, who directly attributes the sluggish results to the iPhone and notes that cancellations briefly surged for the iPhone launch. The provider chiefly cites a lack of alluring devices to counter Apple's; most modern Japanese phones still adopt a traditional number pad design with most extras centering around mobile TV and games, contrasting sharply against the almost exclusively touchscreen iPhone and its emphasis on both media playback and Internet access.
"We are accepting the fact, considering that our handsets weren't attractive enough," the spokesperson says.
Few American phones ever go on sale in Japan, with both 3G network compatibility issues and a lack of familiar design often hurting their chances. The BlackBerry Bold as example is Research in Motion's first device that will support Japanese networks without needing a special model.
KDDI is unwilling to guess how many customers directly switched due to the iPhone 3G as it believes the device may have a "halo" effect on SoftBank sales as customers are drawn to the rival carrier through the iPhone but ultimately settle on another device. Over 1,500 people lined up at SoftBank's flagship store alone the day the handset became available.
SoftBank was already the fastest-growing carrier in a slowing market, having added 215,400 users in the past year versus market leader NTT DoCoMo's 94,200 in the same period.