Wednesday, June 21, 2006

JupiterResearch: I-mode in Europe

Thomas Husson at JupiterResearch takes another look at how i-mode is faring in Europe. He writes:

The main drawback for the European i-mode alliance is the lack of handsets. DoCoMo used to work with its suppliers (NEC & co...) and phones were designed for services according to the operator's specs. Samsung also delivered some nice i-mode handsets but other handset manufacturers were missing. Nokia in particular. Difficult to gain market share when you cannot reach 30% of your market. Things may begin to change given Nokia's recent announcement to deliver its first FOMA handset - the NM850iG - which by the way did not had a very good press according to i-mode experts themseleves. Sony Ericsson also announced yesterday its first i-mode phone (a 3G one), which is good news for European telcos since operators witin the i-mode alliance are not particularly succesful with 3G (not launched yet by Bouygues Telecom, soft uptake for 02 in comparison to 3 or Vodafone, very few subscribers for Cosmote in Greece since the launch in time for the Olympics...)
He then points out that "we are far here from critical mass with around 6M European i-mode users in comparison to Vodafone-live users(around 25M in Western Europe). O2 recently announced to have reached 250,000 subscribers since launch in October 2005. This is great but hey this is only 1.6% of their installed base ! Bouygues Telecom had reach 500,000 subs a year after launch and they had a much smaller subscriber base."

He does note that "usage patterns seem to be encouraging for 02: i-mode users consume twice as much data per month as they currently do on comparable WAP services and 75% of users are active in a 30 day period. eBay's i-mode services is referred to be one of the top attractions on i-mode, "letting people track the progress of their bids and make new bids on the move (...) in the vital closing minutes of auctions". No doubt eBay is leveraging its brand in the mobile space and that the end-user can really benefit from the ubiquity of its phone."

Husson concludes that:
However, the challenge for 02 and other European i-mode telcos remain to gain market share and to transform the use of e-mail into a viral promotion of mobile content, trying to replicate Natsuno's virtuous cycle.