DoCoMo Subscribers Drop as Japanese Consumers Flock to IPhone 5

NTT DoCoMo Inc. (9437), Japan’s biggest mobile-phone operator, posted the first monthly decline in subscriptions in more than five years as Softbank Corp. (9984) and KDDI Corp. lured customers with Apple Inc. (AAPL)’s iPhone 5.

DoCoMo, the only carrier among Japan’s three biggest wireless operators that doesn’t offer the iPhone, lost 40,800 net subscribers in November, it said in a statement today. That’s the first monthly drop since August 2007, according to data from the Telecommunications Carriers Association, an industry group. KDDI and Softbank both posted increases in subscriptions last month, they said in separate statements.

The decline adds pressure on DoCoMo to offer Apple’s smartphone after the Tokyo-based carrier cut its estimates for full-year profit and new subscribers in October. The iPhone 5 topped Japan’s mobile-phone sales rankings last month, according to researcher BCN Inc., helping KDDI (9433) and Softbank erode DoCoMo’s lead in total subscriptions.

“The adoption of the handset by Japan’s largest carrier is now inevitable,” Amir Anvarzadeh, a Singapore-based manager for Asia equity sales at BGC Partners Inc. (BGCP), said today by e-mail.

DoCoMo rose as much as 3.4 percent, the most since March 16, to 122,200 yen in Tokyo trading after the Nikkei reported earlier the carrier may consider introducing the iPhone, citing an unnamed company official. The stock, down 14 percent this year, traded at 122,000 yen as of 12:49 p.m.

KDDI, Softbank

“IPhones and iPads are very popular and could be attractive among our line-up if we offered them,” Naoko Minobe, a spokeswoman for DoCoMo, said today by e-mail. “Nothing has been decided about our handset portfolio for next year and after.”

KDDI, Japan’s second-largest mobile-phone company, said it posted a net gain of 228,800 customers last month. Softbank, the third-biggest, added 301,900.

KDDI shares fell 2.6 percent, trimming their gain this year to 19 percent. Softbank dropped 2.1 percent and is up 33 percent in 2012.

DoCoMo had 60.8 million total subscribers at the end of November, compared with 36.6 million at KDDI and 31 million at Softbank, according to the companies’ statements.

The iPhone 5, which has a bigger screen, a more lightweight body design and a faster processor than previous iPhones, went on sale in Japan in September. DoCoMo added 16 new models last month, including Samsung’s Galaxy S III and Sony Corp.’s Xperia AX.

DoCoMo’s net income will increase 9.3 percent from a year earlier to 507 billion yen ($6.1 billion) in the 12 months ending March, the company said Oct. 26, lowering its previous forecast of 557 billion yen. The carrier forecasts subscriber additions will total 2 million this fiscal year, down from an earlier estimate of 2.8 million, it said at the time.

Cupertino, California-based Apple ranked second after South Korea’s Samsung Electronics Co. (005930) in global smartphone shipments in the three months ended Sept. 30, according to researcher IDC.

To contact the reporter on this story: Mariko Yasu in Tokyo at myasu@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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