TOKYO-While the Japanese cellular phone market has been rapidly expanding, the paging industry is in decline. According to the Telecommunications Carriers Association (TCA), an industry association, Japan had 1.8 million beeper users at the end of May. During its heyday from 1995 to 1996, Japan had more than 10 million beeper subscribers.
Besides NTT DoCoMo, 31 new common carriers (NCC) provided beeper services in May 1999, when an NCC competed with NTT DoCoMo in each district. But due to sluggish sales, most NCCs have withdrawn from the market or stopped their services. Only five NCC carriers currently compete with NTT DoCoMo.
But NTT DoCoMo, the largest mobile carrier in Japan, is determined to continue to provide its beeper services in the future. Although the carrier added many former users from out-of-business NCCs, it today has only 1.4 million beeper users nationwide.
“Since there is strong demand for beeper services in the market, we will continue to provide our services,” said Hiroyuki Takeuchi, senior manager of DoCoMo’s Paging Business Department.
DoCoMo’s strategy for revitalizing the sinking market is targeting corporate users with paging’s unique simultaneous broadcasting function. Due to the effort’s success, up to 74 percent of DoCoMo’s users are corporate users, including department stores, local governments and radio stations.
For instance, Yokohama Sogo, a major department store in Yokohama City, is sending shopping information, such as notices of discounts, to each of its selected customers via beepers. The Kawasaki municipal government is broadcasting instructions and information about urgent incidents over pagers to each staff member of its fire department.
Kanto Kotsu, a taxi operator, is putting a small display-using a paging system-in each taxi to offer a variety of information to its customers. The Japan Tennis Association is using beepers to send information about games and game results to tournament players. Chuo FM, an FM radio station in central Tokyo, is distributing beepers to 400 listeners for exchanging information.
To further reverse the current declining tendency, NTT DoCoMo plans to launch a completely new paging service that puts paging technology into consumer electronics to allow users to remotely control appliances.
At the moment, DoCoMo is working with air conditioner manufacturers to develop beepers built into air conditioners.
Only five NCCs-in Tokyo, Hiroshima, Gunma, Kumamoto and Okinawa-currently provide services. Tokyo Web Link, a beeper operator in the Tokyo metropolitan area, filed bankruptcy in May 1999 with a 25 billion yen (US$236,000) deficit. The carrier changed its name from Tokyo Telemessage and is making an effort to reorganize. Web Link’s strategy is similar to NTT DoCoMo’s, but Web Link is more clearly focusing on corporate users.
One representative of the carrier even said it is not targeting individual users at all. Its major first targets are preschools, hospitals, technical colleges and fire stations. Web Link is also trying to equip air conditioners with beepers.
Kenij Takagi, senior executive manager, said because manufacturing costs for pagers in Japan are high, Tokyo Web Link plans to shift its beeper production sites to South Korea and Taiwan, where labor costs are cheaper.
Takagi said because there are still strong demands for beepers in the Tokyo metropolitan area, Web Link can rebuild its business. The carrier has 200,700 subscribers.
Four other NCCs are trying to survive with different strategies.
Okinawa Telemessage, a beeper operator in Okinawa prefecture, is emphasizing its Zero Service. Since its introduction last year, the carrier has 91,200 subscribers for the calling party pays (CPP) service. Kazuya Hokama, spokesman for Okinawa Telemessage, said the carrier would soon have more offerings based on Zero Service.
Kyushu Network System, a beeper operator in Kumamoto prefecture, is trying to survive using conventional strategies, targeting individual and corporate users and using its conventional charging and CPP plans.
Shinichiro Yasutake, a Kyushu Network System spokesman, said the carrier would promote its business
Telemessage Hiroshima Co. seems to have failed to work out any clear-cut strategies for future survival. “We will do our best in order to survive. That’s it,” a company representative said.
