The Mobile Phone as the Key to Daily Life

'The Mobile Phone as the Key to Daily Life' is the keyword in DoCoMo's efforts to achieve sustained growth in the drastically changing mobile phone market. It embodies the company's commitment to the further evolution of mobile phone services in terms of technological advancement and security. DoCoMo intends to hasten this evolution by providing diverse, innovative services that enhance the convenience of customers' daily lives, including not only voice calls and Internet connection services via i-mode, but also credit payments, e-money, e-ticketing, music players and television, and even ID cards and house keys.

President and Chief Executive Officer Masao Nakamura, in his 2006 Address to Shareholders, talks about 'Changes in Operating Environment and Growth Strategy' for his company: "We have also brought about a major evolution in mobile handsets over the past two years. We launched "Osaifu-Keitai" handsets, which are equipped with the"FeliCa-" contactless IC chip two years ago. Since its launch, more than 13 million of our customers are using "Osaifu-Keitai" handsets, as of May 2006, and this has been a base bringing us new business possibilities."

"Amid the current slowdown in the mobile phone market, it is crucial to create new revenue sources for achieving sustained growth. For this purpose, DoCoMo has formed capital and business alliances with various companies in five peripheral areas which can be expected to create synergies with our core mobile phone business: payments and commercial transactions, broadcasting, content and Internet, global services, and mobile phone peripheral technology.

Although we have just begun to take on challenges in these fields, an area where concrete results have quickly emerged is credit services in the field of payments and commercial transactions. The penetration rate of credit-card payment is extremely low in Japan compared with other industrialized countries. However, if the convenience of "Osaifu-Keitai" can be enhanced with a credit function, the market could very well grow to a scale of many trillions of yen centering on the micropayment market. I firmly believe that the expansion of new businesses in the potentially explosive credit market will not only spur the evolution of the mobile phone into the lifestyle infrastructure that our company envisions but also provide a key to supporting sustained growth.

More time will be required before these new areas of business can be developed to an extent where they contribute significantly to our revenues. I believe, however, that the new added-value created by these new fields will, in the medium-to-long-term, enhance the appeal of our company's mobile phone services and ultimately contribute substantially to stronger competitiveness in our core business itself. Moreover, by using our overwhelming customer base, these new fields should lead to the development of other new businesses. By creating this positive growth cycle DoCoMo is aiming for further growth."