Japan: DoCoMo Drives Nationwide Rollout of Contactless Wallet Phones

 

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JapanNationwide
Scope: 
Rollout
Status: 
In progress
Launch: 
Jul 2004
Main Application: 
Payment and ticketing
Mobile Operator: 
NTT DoCoMo
Mobile Operator: 
KDDI
Mobile Operator: 
Softbank Mobile
Service Provider (application): 
NTT DoCoMo (iD)
Service Provider (application): 
JR East (Mobile Suica)
Service Provider (application): 
bitWallet (Edy)
Service Provider (application): 
Seven-Eleven (nanaco)
Service Provider (application): 
JCB (QUICPay)
Service Provider (application): 
McDonald’s (loyalty)
Service Provider (application): 
All Nippon Airways (airline check-in, loyalty)
Service Provider (application): 
Japan Airlines (airline check-in)
Service Provider (application): 
Coca Cola Japan (Cmode—vending purchases)
Service Provider (application): 
Yodobashi (camera store—loyalty)
Merchants: 
500,000-plus
Users: 
5 million-10 million regular (est.)
NFC Handsets: 
Various (non-NFC) models (More than 60 million distributed)
TSM*: 
FeliCa Networks
Secure Element: 
Embedded
Other Vendors: 
Sony Corp., others under license (FeliCa chip), NTT Data, others (OTA network and IT services), Sharp, NEC, Fujitsu, Panasonic, Casio, others (handsets)

NTT DoCoMo launched its Osaifu-Keitai, or contactless wallet phones, in July 2004, mainly as a platform for its ambitious plans to establish a new payment brand in Japan via its phones. DoCoMo and its two major telco competitors have made Sony’s embedded FeliCa contactless chip a default feature in most of their models. About half of Japan’s more than 100 million subscribers carry the FeliCa phones, capable of supporting a host of applications--from several brands of contactless e-money to transit ticketing, loyalty and airline check-in.

NFC Times Take: 

DoCoMo’s gamble on contactless wallet phones has yet to pay off, despite the impressive numbers of contactless phones, mobile applications and acceptance points. Transactions figures showing how much Japanese subscribers use the phones are hard to come by. Some estimates put regular use at about 10%, though more tap their phones to pay on a less frequent basis. Consumers can tap contactless cards on the same terminals. Sony’s proprietary technology, FeliCa, increases costs for contactless cards and phones, as well as readers, and prevents expansion outside of Japan. That’s a situation that even DoCoMo wants to escape by eventually moving to NFC in Japan. This is despite the large share of the licensing and application management organization it owns with Sony and JR East, FeliCa Networks. DoCoMo’s competitors KDDI and Softbank Mobile are even more keen to move to standardized NFC.

 

 

* Trusted Service Manager: Defined loosely to include companies or other organizations securely distributing, provisioning and managing applications, generally over the air, on secure elements in NFC mobile phones; or licensing their platforms for this purpose.

N/A: Not available or not applicable.

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