Friday, July 11, 2008

Will the iPhone succeed in Japan?

So it seems that iPhone had a successful launch in Japan with more than 1,000 people lined up at the flagship store of SoftBank (iPhone’s carrier in Japan). Check out the photos on this Japanese news site to get a feel of what it was like in Japan during the launch.

Having just came back to the US from Japan a few days ago, I wasn’t in Japan yesterday for the launch, which was a good thing because I may just have been tempted to buy one. From what I've heard from my friends, the iPhone launch got a load of coverage on TV and news programs. So you would probably have to live in a cave to not know about iPhone in Japan.

My question is then – will the iPhone become mainstream in Japan?

Japan is a very unique market. From browsing the web to downloading music, the young generation does the majority of their net related activities all on their cell phones rather than on computers.

So will the iPhone be a hit with the younger generation and the mainstream market of Japan?

There are plenty of reasons that it might be a success such as its “revolutionary” interface and the great user experience, but there are also some reasons that may impede its success. Here they are:

Lack of features that are standards in Japan's market

  • TV – A majority of the recent handsets allow consumers to watch TV via 1seg broadcasting. 
  • Electronic money – Handsets today in Japan come with the option of utilizing it as an electronic wallet. Consumers can use their cell phones to pay at locations that support the standard. The locations include stores, restaurants, vending machines, and more. Yes, the future, at least in Japan, seems to be one where you don’t need to carry a wallet anymore. 
  • Electronic mass transit pass / fare card– In addition, in Japan your cell phone can also serve as a train pass or a fare card. If you live in Tokyo, this function can be used in nearly all trains, buses, and even some taxis. 
Lack of contents on iTunes
When compared to the cell phone carriers’ library of contents, iTunes’ library in Japan seems really pale. Although the music content library has gotten rather good, it’s still missing some major artists. The video arena is where it suffers. The number of movies and TV shows you can purchase and download is close to zero.

Requirement of a PC / Mac
A majority of cell phone users are used to using cell phones without computers. They can and are willing to do everything from managing contacts, scheduling events, to buying contents all just with a cell phone. iPhone requires a computer and this could be a factor to preventing the mainstream adoption in Japan.

Only time will tell. 
If iPhone does succeed, it could mean that the standard set of features in Japanese cell phones are not truly relevant and desired by the consumers, and that Apple could have executed a blue ocean strategy in the hyper competitive cell phone market in Japan.


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