I did not say there was no competition in Japan, and I was not comparing
Japan to other countries. I postulated that the monopoly or oligopoly-like
characteristics of the market place has significantly diminished the
potential economic benefits that might have been created through Japanese
innovations in the mobile internet space. I wrote that Japanese carrier
business practices have greatly affected the sustainability and
extensibility of the model.
Oligopoly does not assume no competition amongst participants. It assumes
that it is in the oligopoly participants' interests to collude to prevent
new entry by new players or introduction of new models that might change the
distribution of resources/profits in the system. The oligopoly can be
marked by intense levels of competition amongst participants, without the
necessary benefits to society that open, easy entry markets provide.
A side note, you point out many alternate systems to cMode as evidence that
anybody can join in. However, the point is not whether anybody can set up a
transaction system for iMode. If DCM does not select/anoint you, you are
significantly disadvantaged. For example, you would not have access to the
terminal's soft id info so to authenticate the user he/she would have to log
in every time he/she used the system. This usability problem would
hamstring you compared to DCM-selected partners, which could offer services
inside the DCM portal, without any login, and still connected to the DCM
phone bill. Many say this is why 'non-official' sites are having so much
trouble making money.
-----Original Message-----
From: ext Nik Frengle [mailto:eseller@eimode.com]
Sent: Wednesday, September 19, 2001 10:45 AM
To: keitai-l@appelsiini.net
Subject: (keitai-l) Re: Proprietary = BAD
Drew,
Let me jump into the fray here for a moment. Just to be sure we are on the
same page, Drew, are you saying that Japan's system is a monopoly? I would
disagree with that presumption, and I believe that most people who work in
this industry would also disagree. To call it an oligopoly, which you do,
may be somewhat closer to the truth. However, in this Japan is hardly
alone--most countries have two or three really strong carriers at most. In
England there is BT, Vodafone, and one more that slips my mind at the
moment. In the US there is Sprint PCS, Verizon, and AT&T. In Japan there is
NTT DoCoMo, au, and J-phone. If there is true competition between these
three strong players, however, can you really say that it is an oligopoly?
The following statement regarding compeition in the Japanese market seems
ill-informed:
>meets the needs of its customers. In a proprietary closed network, the
only
>people that make a system are those who a selected by the controlling
power.
You make the common mistake of assuming that there is little competition in
the Japanese market, which could not be further from the truth. There are
currently three COMPETING systems of Wireless Internet here--WAP,
cHTML/i-mode, and MML. There are 5 companies so competitive in the handset
market that your company had to bow out for a time. There are two COMPETING
wireless systems--PDC and CDMA, and soon to be W-CDMA. There are tens of
thousands of companies COMPETING for the viewership of wireless content
subscribers.
GSM, on the other hand, while undeniably a good system, has led to a few
companies, like your employer, dominating an entire continent's wireless
offerings. That those companies are handset makers and network
infrastructure providers rather than carriers seems to be what makes that
system better in your view. But of course your view is simply economic,
logical. Has nothing to do with the fact that you work for one of largest
oligopoly handset maker and network infrastructure companies in the world. I
would like to hear your response to that statement. There is plenty of
competition in Japan, and if you believe that an oligopoly can exist in a
truly competitive market, then your company is equally guilty of this sin.
Second, you say that cMode is a perfect example of an oligopoly/monopoly,
and its inefficiencies and anti-competitive behaviour. There are other
sytems being developed. Keitai Get and Omron have teamed up to offer payment
services through Java-enabled phones REGARDLESS OF CARRIER. Seven Eleven and
other convenience stores already offer payment gateways through i-mode and
other phones, and there are more in the works. Hardly an anti-competitive
market. Quite the opposite, cMode should be viewed for what NTT DoCoMo has
clearly said it wants the system to be--an extremely pervasive means of
conducting real-world transactions for online and offline goods and
services. Japan is nearly entirely a cash society, and cMode is NTT DoCoMo's
search for a way to make M-commerce work within that paradigm. I agree with
Michael, that this is simply a first step, an attempt to get at the issues
that need to be resolved to make it really seamless.
Anyone is free to set up a Coke machine connected to DoCoMo's network. In
fact, many companies do that already, to manage a machine's stock. Anyone is
free to set up a transaction system that works through i-mode. Completely
free, using a non-propreietary system--HTML. And anyone is free to put the
two together. That DoCoMo is first is more about them maintaining a
leadership position than a monopoly/oligopoly position. There is a
difference.
Cheers,
Nik Frengle
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Received on Wed Sep 19 05:58:06 2001