TOKYO—NTT DoCoMo Inc., the leading mobile carrier in Japan, announced its net income for the fiscal year ending March 31 was merely $6.2 million due to large special losses that DoCoMo posted from its overseas investments. DoCoMo posted a total of $6.3 billion in impairment losses from its investments in AT&T Wireless Inc., KPN Mobile, Taiwan’s KG Telecommunications and Hutchison 3G U.K.
Regarding the next fiscal year, the carrier is expecting to have $8.1 billion in operating income, a 4.2-percent increase from the previous year, and $4 billion in net income.
Keiji Tachikawa, president of NTT DoCoMo, said at the Tokyo press conference that the mobile telecommunications industry is at a turning point.
“The core service (of mobile telecommunications) has been shifting from voice services to data services, and the ARPU has been shrinking due to saturation of the market. We will tackle the new situation by employing new management strategies,” he said.
The Japanese mobile market has become saturated. Still, NTT DoCoMo managed to expand its mobile subscribers by 4.76 million in fiscal year 2001, but it is expecting to increase its users by only 3 million in FY 2002. The average revenue per user shrank from $67.30 in FY 2000 to $66 in FY 2001.
DoCoMo’s third-generation service, FOMA, which was supposed to make a breakthrough in the stagnant situation, failed to take off in FY 2001. As of March 31, there were only 90,000 users. DoCoMo is expecting to win 1.29 million new FOMA users in FY 2002. However, it might be difficult because there is no killer content for the high-speed data service, and the corporate market has not taken off.
As part of its effort to integrate the DoCoMo Group and improve the corporate value of the group as a whole, DoCoMo also announced it would make its eight regional operational companies into wholly owned companies of NTT DoCoMo. The action is scheduled to be enforced on 1 November once shareholder meetings of the regional companies approve the arrangement.
