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Asia-Pacific Market Perspective Vol. 7, Issue 3

Product Type: Market Research Report
Published by: Pyramid Research
Published: April 2007
Product Code: R8-562
Description
It’s final: KDDI’s au outperformed its peers in FY2007. Despite MNP in the second half, KDDI recorded the highest net additions for the year with 2.7m new subscriptions while NTT DoCoMo garnered 1.2m, Softbank Mobile 700K, and PHS player WillCom 665K. Despite last-minute bargain prices from Softbank and leading edge technology pitches from DoCoMo, KDDI has proven the loyalty and stability of its mobile subscriber base. This gives KDDI a substantial leverage moving into the fixed mobile broadcasting convergence (FMC) space because it now creates a fixed subscription layer on top of its mobile subscription base. This short-term defensive/long-term offensive play allows KDDI to avoid excessive price competition while saving on customer retention and attraction costs. As the carrier completes the migration an all-IP core and IMS layer (Contents Delivery Network, CDN) this fiscal year, its stable mobile subscriber base provides the carrier with a strong foothold in the FMC space without sacrificing profitability.
Table of Contents
KDDI, a strong MNO but weak fixed operator, needs to secure its competitive advantage now even if FMC remains 4-5 years away because the competitive pressure has increased; KDDI can no longer continue to subsidize its fixed business with successes in the mobile sector.


The carrier migrates to all-IP and IMS by March 2008, ahead of its nearest competitors, which gives the carrier the capability to deliver voice, Internet, and multimedia services across multiple devices across various environments. These technologies will enable the carrier to capture new revenue streams and realize cost savings.


Despite starting with a weak fixed business, KDDI’s current FMC activities see the carrier taking one-third of the total triple-play/quadruple-play market in 2007.
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