Japan's mobile phone service providers are spending heavily as they brace themselves for the introduction of number portability, local media sources say.
From 24 October, mobile phone users will be able to keep their existing numbers when they switch to a new service provider. Millions of mobile customers are expected to switch.
Operators are adding mobile phone base stations in areas they previously considered to have 100 percent coverage, the Asahi Shimbun reports, fearing that subscribers whose phones have poor coverage will switch to another firm.
Softbank announced last month that it will spend US$4b adding 23,000 new 3G base stations within a year, and NTT DoCoMo is to spend a similar sum.
New handsets are expected from all of Japan's major mobile phone service providers. KDDI, for example, last week announced 12 new phone models simultaneously. The new phones are made by eight different manufacturers.
Mobile phones in Japan are often licensed exclusively from the manufacturer and are available only from a single service provider. The providers use phone features as a means of attracting subscribers.
Moving to a new provider will not be completely effortless for customers, however. They will have to pay approximately $45 each time they switch, with about half going to the old operator and half to the new.
But subsidies will help defray customers' costs. Mobile operator Vodafone KK, recently bought out by Softbank, is offering about US$20 in credit to customers who apply to switch to its network during the next few weeks.
Although the government-mandated number portability programme comes into effect on 24 October, some mobile firms will begin processing applications this month.
Japan is one of the world's most heavily saturated mobile phone markets, with some 93 million mobile accounts in use by the country's 127 million people.
As a result operators now expect most new customers to be existing mobile phone users who have transferred from another provider.
More than 90 percent of new phones sold are 3G models, which already hold about 50 percent of the market.
These upgrades are a major source of new customers for operators. Vodafone KK announced yesterday that it would stop accepting new 2G subscribers next year.
Even as operators spend big to hold on to customers, analysts have warned that it is a near certainty that they will be forced to drop basic charges as well.
This is expected to be another weapon in the armoury as operators battle for customers' attention.
Analysts have predicted that companies will redouble their efforts to offer 'sticky' services that bind customers to them. Community-based services are seen as particularly effective in this regard.
KDDI, for example, has just launched My Page, which media sources describe as a mobile phone version of the popular MySpace social networking site.
The new system will not allow customers to keep their old email addresses when they switch providers, according to the Yomiuri Shimbun.
Many Japanese get their main email service from a mobile phone firm, as the phone is their primary means of internet access.
Japan braces for mobile number portability
By Simon Burns on Sep 12, 2006 9:52AM