NTT DoCoMo Eyes Emerging Market Growth as SoftBank Chooses U.S.Naoko Fujimura and Takashi Amano
NTT DoCoMo Inc., Japan’s biggest wireless carrier, may acquire companies in emerging Asian markets instead of returning to the U.S. as it tries to fend off subscriber gains by competitor SoftBank Corp.
Both companies are seeking to boost revenue from outside Japan, where a shrinking population limits demand for handsets and services. While DoCoMo looks to Asia as economic growth spurs orders for faster networks, SoftBank, Japan’s third-largest carrier, is buying Sprint Nextel Corp. for $21.6 billion to enter the U.S. market.
“If there’s an opportunity, we’ll consider” network acquisitions in Asia, Kaoru Kato, president of DoCoMo, said yesterday in an interview in Tokyo. “We like challenges, and there are many things we can do together with a partner in every phase, such as building networks.”
DoCoMo, which counts almost half of Japan’s 127 million people as subscribers, owns stakes in carriers in Bangladesh, Taiwan, the Philippines and India, said Kato. SoftBank has 33 million users in Japan, without including its subsidiaries.
Tokyo-based DoCoMo plans to keep its 26 percent stake in Tata Teleservices Ltd. in India, Kato said. It has scaled back spending on phone companies outside Asia after an investment in the U.S. company then known as AT&T Wireless Services Inc. led to a writedown a decade ago.
“We’re different from SoftBank,” Kato said. DoCoMo has no plans to make acquisitions in developed markets to expand its network business, he said.
Galaxy Over iPhone
DoCoMo faces declines in adding new subscribers, with May’s total down almost 28 percent from a year earlier. SoftBank’s new subscribers increased almost 16 percent and KDDI’s increased 14 percent in the same period.
DoCoMo forecasts a 2.9 percent increase in net income to 510 billion yen this fiscal year and 3.8 percent growth in sales, it said April 26. The carrier plans to boost handset sales 4 percent to 24.5 million in the year ending March 31.
DoCoMo is promoting Sony Corp.’s Xperia and Samsung Electronics Co.’s Galaxy smartphones to lure customers from SoftBank and KDDI Corp., whose lineups include Apple Inc.’s iPhone. Some subscribers are leaving DoCoMo for competitors because the carrier doesn’t offer the iPhone, Kato said.
Sales of Sony and Samsung handsets are “faring well,” as the company sold 830,000 Xperias and 400,000 Galaxy S4s through June 30, he said. The president declined to say if the carrier would offer Apple’s handset.
DoCoMo fell 1.1 percent to 156,200 yen at the close of trading in Tokyo, paring this year’s gain to 26 percent. That compares with an 85 percent advance for SoftBank, a 65 percent gain by KDDI and the 37 percent climb by Japan’s benchmark Topix index.