Will Sha-Mail Create a New Culture?

By Hajime Yamada (GLOCOM)

In this series, I have repeatedly reported on mobile communications market trends. In particular, the situation of the Third Generation (3G) System, a service started in Japan ahead of the rest of the world, has been described several times.

The data transmission speed of a 3G service called FOMA by NTT DoCoMo Inc. is as high as 384 kilobits per second. NTT DoCoMo's strategy seems to be to differentiate FOMA from the Second Generation (2G) services by raising the data transmission speed. However, spread of this service in the market is very slow. It has been one year now since the start of FOMA service in October, 2001, but the number of subscribers remains at 135,700 as of the end of September, 2002. The increase of subscribers in the month of September, 2002 alone was only 2200.

Moreover, the outlook for 3G services is not clear in Europe or in the United States at all. Also, the start of services has been delayed everywhere in Asian nations, including Singapore. Therefore, a subscriber to a FOMA mobile phone in Japan cannot use it abroad. Many have said that 3G services would suit global roaming, but there seems to be only the fanfare and no follow-through.

Under such circumstances, NTT DoCoMo has decided to slow down the pace of seeking new markets for its 3G service. Mr. Tachikawa, president of NTT DoCoMo, said at a press conference, "If demand remains stagnant, it is common sense to put off the supply."

On the other hand, the cdma2000 1x service provided by AU of KDDI Corporation is progressing satisfactorily. The service started in April, 2002, and has already collected 2,652,400 subscribers by the end of September. In other words, it has succeeded in acquiring as many as 20 times more subscribers only in half a year than FOMA did in one year.

AU does not very loudly publicize the data transmission speed of this service. Actually, it is less than half the speed of FOMA. AU rather advertises that it can send images in front of a user to friends by an attached digital camera, or that a user can instantly find out where he or she is by utilizing its Global Positioning System (GPS) function. In other words, the company advertises solely about amusements this service would provide for users.

As I have already reported, Sha-Mail by J-Phone Co. Ltd. started massive popularization of mobile phone sets with attached digital cameras throughout Japan. As of the end of October of 2002, more than seven million Sha-Mail phone sets are used in the market. Moreover, because AU provides its own services and DoCoMo is also toeing, more than 10 million mobile phone sets with attached digital cameras are already in common use in the market. Some companies are reported to be considering attaching a digital camera to every mobile phone set.

Sha-Mail Seems to Have Created a New Culture

A telephone with a television camera and monitor has long been proposed. By using such a videophone, users can see the face of the person on the other end of the phone. However, the devices are not used widely except for videoconferences because users are cautious about keeping their privacy.

Sha-Mail might seem to be a type of such a videophone. Instead, it is often used to convey images seen in front of a sender to a receiver. For example, many use Sha-Mail to transmit images to ask if the receiver is interested in buying nice clothes they have found, or to show beautiful flowers in front of them. Although users could transmit their own faces, of course, they would rather utilize Sha-Mail for sharing what they see with receivers. Those cases in which users send photos of their own faces to each other would probably be limited to situations such as between two lovers.

Thus, Sha-Mail cameras and videophones face in different directions by one hundred and eighty degrees.

Digital cameras are becoming more and more popular. At first, their selling point was that these cameras could easily transmit images to personal computers. Casio Computer Co. Ltd. had top market share around 1996. Later, resolution had improved so that digital cameras could produce photos of the same quality as still cameras. At this stage, around 1998, Fuji Photo Film Co., Ltd., one of the traditional camera makers with achievements in still cameras, increased its share of the market. Users trusted digital cameras manufactured by an experienced camera maker with a lot of achievements.

Since around 2000, the non-computer-operating population also started to buy digital cameras. These people would bring their memory cards to photo processing shops for printing after photographing with digital cameras.

These days, Sha-Mail is replacing use of such digital cameras. When Sha-Mail spreads even further, there is a possibility of reduction of the market of single-purpose digital cameras. Thus, Sha-Mail is creating a new culture of a life-style in which users share sights in front of them via mobile phones. At the same time, it is destroying distinctions between business categories in the industry, i.e. between camera and mobile devices.