Thursday, June 08, 2006

RIM Brings BlackBerry to Japan

The Red Herring reprots that Research In Motion (RIMM) and NTT DoCoMo agreed to market BlackBerrys to corporate customers in Japan. Starting this fall, DoCoMo will start selling the wireless email devices to companies running Microsoft Exchange, IBM Lotus Domino, and Novell GroupWise email systems on their networks."

According to the article, "RIM stands to make potentially more money per customer with the DoCoMo deal by marketing its BlackBerrys in addition to its service. RIM plans to offer the service over the W-CDMA (wideband code division multiple access) and GSM/GPRS (global system for mobile communications/general packet radio service) operated by DoCoMo."

Regarding the fact "RIM has only recently begun to develop the ability to run over high-speed 3G services like W-CDMA," Gerhard Fasol at Eurotechnology Japan said, “A lot will depend on how willing RIM is to invest in proper R&D and product development in Japan, or whether it will just bring global products into Japan which are not specifically developed for Japan, as Motorola (MOT) and Nokia (NOK) are doing."

Fasol believed "Nokia and Motorola could be stronger players in Japan if they developed new phones for that market." He said, “They decided not to develop phones specifically for Japan, but just bring a few of their global models with minor changes onto the market in Japan, so they have about 0.5 percent market share or lower."

Fasol thought there was "enough of a market among the 30,000 foreigners living in Japan, as well as RIM customers from outside Japan who visit the country on business, to make the BlackBerry a viable business for Tokyo-based DoCoMo."

He was also encouraged by "results from Willcom and Sharp’s success with the W-ZERO, a Windows Mobile-based device with a QWERTY keyboard like the BlackBerry that handles wireless email via Microsoft Outlook."

Fasol pointed out that “Japanese people often have different customs, needs, and expectations than people in the U.S. and Europe. That killed Vodafone in Japan, because Vodafone noticed too late.”

Fasol expected "the BlackBerry to have a small overall market share in Japan, but it may be profitable in its niche."

One hurdle for RIM and DoCoMo will be adapting the network to run the BlackBerry service. Mr. Fasol pointed out that RIM only recently announced a 3G-capable device in May, in partnership with Vodafone.

Fasol opined, “Japan does not really need RIM, so unless RIM invests properly, nothing will happen. They will need quite a lot of resources and investment to make that a success in Japan.”

He added, “Western mobile phone companies have a history of underestimating what it takes to win in Japan. Since RIM is completely new to Japan, they are in a very critical and vulnerable market-entry situation. I hope they do not repeat Vodafone’s mistakes here in Japan. There is a long string of companies that did not take Japan seriously in the beginning, and when they notice the right things to do, it’s too late. Of course there is also a long string of foreign success stories in Japan, such as Starbucks and many more.”