NTT DoCoMo Corporate Strategy
DOCOMO's future business direction is based on a new action plan, "DOCOMO's Change and Challenge to Achieve New Growth," which covers initiatives to be implemented between the current fiscal year 2008 ending March 31, 2009 and fiscal year 2012 ending March 31, 2013. Under the plan, DOCOMO aims to contribute to society's sustainable development and a safer, more secure environment for people to lead enriched, convenient lives.
1.Basic philosophy
After a period of rapid expansion, the Japanese mobile communications market has entered a mature phase. Now that total subscriptions exceed 100 million, it is difficult to expect further growth on a significant level unless breakthroughs are made. In addition, customers' values have diversified and their demands have become increasingly sophisticated.
Under such market circumstances, DOCOMO has implemented a thoroughly hands-on approach to serving its customers, working to deliver the best possible service, safety and security to each user. At the same time, the company has strived to exceed customer expectations by delivering on the pledges made in its New DOCOMO Commitments proclamation.
DOCOMO believes that the market has potential for significant growth if services that take advantage of unique mobile properties—such as real-time immediacy, personal authentication and locating capabilities—can be developed in conjunction with the evolution of networks and handsets. The increasing adoption of open-platform handsets and entry of new global players will produce new services that transcend conventional boundaries and thereby propel further advancements and diversification in the market. Perceiving this as an opportunity, DOCOMO intends to drive innovation in collaboration with a wide range of partners on a global scale, committing the company to taking on the challenge of creating new value by leveraging the virtually unlimited potential of mobile phones.
An overview of DOCOMO's future actions follows.
2.DOCOMO's Change
(1) New DOCOMO Commitments and review of operational structure
After DOCOMO's introduction of its New DOCOMO Commitments, the company, as first steps towards implementing the "Change and Challenge" action plan, changed its corporate branding and integrated its regional subsidiaries following a comprehensive review of operational structure.
(2) Promotion of customer-focused marketing
From the perspective of customer-focused marketing, the entire DOCOMO Group will join forces in all aspects of business based on a hands-on approach to serving customers. The aim will be to earn long-term customer loyalty by delivering the best possible service, safety and security to each customer.
(3) Steadfast implementation of actions for improved customer satisfaction
DOCOMO will perform a comprehensive review of all operations—from customer relations to handset and network development—to enhance customer satisfaction, aiming at being ranked No. 1 in customer satisfaction by FY2010.
3.DOCOMO's Challenge
As mobile services and networks evolve, mobile phones will assume the role of assisting customers' individual behavior, in addition to providing the means for communication, information access and support for daily activities. DOCOMO will take on the challenge of advancing each of these roles. DOCOMO will also contribute to the sustainable development of society by providing solutions to pressing issues.
(1) Personalization of services
DOCOMO will deliver personalized services and functions that cater to the varying lifestyles and needs of individual customers, and further enrich their lives.
(2) Development of social-support services
DOCOMO will launch new businesses in fields such as environment, ecology, safety, security and health management for the sustainable growth of society and the creation of value in these new domains.
(3) Provision of converged services
DOCOMO will link mobile phones with various devices to provide convenient services tailored to specific usage scenarios.
(4) Evolution of video services
Through collaboration with content providers, DOCOMO will support customers' lives and individual behavior with value-added video services available uniquely on mobile phones.
(5) Deployment of mobile broadband using LTE*1
To facilitate a widening array of advanced mobile broadband services, DOCOMO will construct a high-speed, low-latency, large-capacity network by implementing LTE from 2010.
(6) Handset evolution
DOCOMO will provide handsets and devices that better fit customers' specific needs. This will be achieved through the adoption of open platforms, the enhancement of hardware and software functions, and the diversification of designs and user interfaces.
(7) Collaboration of handsets and networks
DOCOMO will provide advanced services by optimizing the allocation of functions between handsets and networks, in particular to leverage the high-speed, low-latency, large-capacity properties of its LTE network.
(8) Basic research aimed at new value creation
DOCOMO will conduct research aimed at creating infrastructure that contributes to the development of society and its economy, ultimately to realize a more affluent society that fully leverages the advantageous characteristics of mobile communications.
(9) Expansion of international businesses
DOCOMO will expand its revenue streams from international business and achieve sustained growth by strengthening its international service offerings and pursuing investments and alliances mainly in the Asia-Pacific region.
(10) New domestic investments and alliances
DOCOMO will grow revenues and achieve sustained growth by creating new businesses and reinforcing core businesses through the pursuit of investments and alliances in Japan.
4.Actions to strengthen core businesses
As the market matures in line with the increasing rate of mobile-phone penetration, DOCOMO will strengthen ties with existing customers, cultivate new markets and continue to provide convenient, attractive services with the aim of reinforcing its core businesses.
5.Improvement of cost efficiency
Under the plan, DOCOMO expects to achieve a 10% reduction in costs and expenses to solidify the company's financial standing for sustained growth. Initiatives include the nationwide optimization of operations and reduction of costs related to networks and sales.
6.Corporate Social Responsibility (CSR) Activities
DOCOMO will also contribute to society through initiatives to help protect the environment, promote universal design products and services, and realize a safer, more secure mobile society.
7.Operating income and return to shareholders
Under the plan, DOCOMO expects to achieve over ¥900 billion in annual operating income in FY2012. The company will also endeavor to maintain the highest level of payout ratio in Japan and stable dividends.
Please see the attachment for a more detailed explanation of the measures to be implemented under the "Change and Challenge" action plan.
*1 Abbreviation for Long Term Evolution. Also known as "Super3G" as proposed by DOCOMO or "3.9G" mobile communications system.
Special Note Regarding Forward-Looking Statements
This Press Release contains forward-looking statements such as forecasts of results of operations, management strategies, objectives and plans, forecasts of operational data such as expected number of subscribers, and expected dividend payments. All forward-looking statements that are not historical facts are based on management's current plans, expectations, assumptions and estimates based on the information currently available. Some of the projected numbers in this report were derived using certain assumptions that are indispensable for making such projections in addition to historical facts. These forward-looking statements are subject to various known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from those contained in or suggested by any forward-looking statement. Potential risks and uncertainties include, without limitation, the following:
1 . As competition in the market becomes more fierce due to changes in the business environment caused by Mobile Number Portability, new market entrants, competition from other cellular service providers or other technologies, and other factors could limit our acquisition of new subscribers, retention of existing subscribers, or may lead to diminishing ARPU or an increase in our costs and expenses.
2 . Current and new services, usage patterns, and sales schemes introduced by our corporate group may not develop as planned, which could affect our financial condition and limit our growth.
3 . The introduction or change of various laws or regulations or the application of such laws and regulations to our corporate group could restrict our business operations, which may adversely affect our financial condition and results of operations.
4 . Limitations in the amount of frequency spectrum or facilities made available to us could negatively affect our ability to maintain and improve our service quality and level of customer satisfaction.
5 . The W-CDMA technology that we use for our 3G system and/or mobile multimedia services may not be introduced by other overseas operators, which could limit our ability to offer international services to our subscribers.
6 . Our domestic and international investments, alliances and collaborations may not produce the returns or provide the opportunities we expect.
7 . As electronic payment capability and many other new features are built into our cellular phones, and services of parties other than those belonging to our corporate group are provided through our cellular handsets, potential problems resulting from malfunctions, defects or loss of handsets, or imperfection of services provided by such other parties may arise, which could have an adverse effect on our financial condition and results of operations.
8 . Social problems that could be caused by misuse or misunderstanding of our products and services may adversely affect our credibility or corporate image.
9 . Inadequate handling of confidential business information including personal information by our corporate group, contractors and other factors may adversely affect our credibility or corporate image.
10. Owners of intellectual property rights that are essential for our business execution may not grant us the right to license or otherwise use such intellectual property rights on acceptable terms or at all, which may limit our ability to offer certain technologies, products and/or services, and we may also be held liable for damage compensation if we infringe the intellectual property rights of others.
11. Earthquakes, power shortages, malfunctioning of equipment, software bugs, computer viruses, cyber attacks, hacking, unauthorized access and other problems could cause systems failures in the networks required for the provision of service, disrupting our ability to offer services to our subscribers, and may adversely affect our credibility or corporate image.
12. Concerns about wireless telecommunications health risks may adversely affect our financial condition and results of operations.
13. Our parent company, Nippon Telegraph and Telephone Corporation (NTT), could exercise influence that may not be in the interests of our other shareholders.
1.Basic philosophy
After a period of rapid expansion, the Japanese mobile communications market has entered a mature phase. Now that total subscriptions exceed 100 million, it is difficult to expect further growth on a significant level unless breakthroughs are made. In addition, customers' values have diversified and their demands have become increasingly sophisticated.
Under such market circumstances, DOCOMO has implemented a thoroughly hands-on approach to serving its customers, working to deliver the best possible service, safety and security to each user. At the same time, the company has strived to exceed customer expectations by delivering on the pledges made in its New DOCOMO Commitments proclamation.
DOCOMO believes that the market has potential for significant growth if services that take advantage of unique mobile properties—such as real-time immediacy, personal authentication and locating capabilities—can be developed in conjunction with the evolution of networks and handsets. The increasing adoption of open-platform handsets and entry of new global players will produce new services that transcend conventional boundaries and thereby propel further advancements and diversification in the market. Perceiving this as an opportunity, DOCOMO intends to drive innovation in collaboration with a wide range of partners on a global scale, committing the company to taking on the challenge of creating new value by leveraging the virtually unlimited potential of mobile phones.
An overview of DOCOMO's future actions follows.
2.DOCOMO's Change
(1) New DOCOMO Commitments and review of operational structure
After DOCOMO's introduction of its New DOCOMO Commitments, the company, as first steps towards implementing the "Change and Challenge" action plan, changed its corporate branding and integrated its regional subsidiaries following a comprehensive review of operational structure.
(2) Promotion of customer-focused marketing
From the perspective of customer-focused marketing, the entire DOCOMO Group will join forces in all aspects of business based on a hands-on approach to serving customers. The aim will be to earn long-term customer loyalty by delivering the best possible service, safety and security to each customer.
(3) Steadfast implementation of actions for improved customer satisfaction
DOCOMO will perform a comprehensive review of all operations—from customer relations to handset and network development—to enhance customer satisfaction, aiming at being ranked No. 1 in customer satisfaction by FY2010.
3.DOCOMO's Challenge
As mobile services and networks evolve, mobile phones will assume the role of assisting customers' individual behavior, in addition to providing the means for communication, information access and support for daily activities. DOCOMO will take on the challenge of advancing each of these roles. DOCOMO will also contribute to the sustainable development of society by providing solutions to pressing issues.
(1) Personalization of services
DOCOMO will deliver personalized services and functions that cater to the varying lifestyles and needs of individual customers, and further enrich their lives.
(2) Development of social-support services
DOCOMO will launch new businesses in fields such as environment, ecology, safety, security and health management for the sustainable growth of society and the creation of value in these new domains.
(3) Provision of converged services
DOCOMO will link mobile phones with various devices to provide convenient services tailored to specific usage scenarios.
(4) Evolution of video services
Through collaboration with content providers, DOCOMO will support customers' lives and individual behavior with value-added video services available uniquely on mobile phones.
(5) Deployment of mobile broadband using LTE*1
To facilitate a widening array of advanced mobile broadband services, DOCOMO will construct a high-speed, low-latency, large-capacity network by implementing LTE from 2010.
(6) Handset evolution
DOCOMO will provide handsets and devices that better fit customers' specific needs. This will be achieved through the adoption of open platforms, the enhancement of hardware and software functions, and the diversification of designs and user interfaces.
(7) Collaboration of handsets and networks
DOCOMO will provide advanced services by optimizing the allocation of functions between handsets and networks, in particular to leverage the high-speed, low-latency, large-capacity properties of its LTE network.
(8) Basic research aimed at new value creation
DOCOMO will conduct research aimed at creating infrastructure that contributes to the development of society and its economy, ultimately to realize a more affluent society that fully leverages the advantageous characteristics of mobile communications.
(9) Expansion of international businesses
DOCOMO will expand its revenue streams from international business and achieve sustained growth by strengthening its international service offerings and pursuing investments and alliances mainly in the Asia-Pacific region.
(10) New domestic investments and alliances
DOCOMO will grow revenues and achieve sustained growth by creating new businesses and reinforcing core businesses through the pursuit of investments and alliances in Japan.
4.Actions to strengthen core businesses
As the market matures in line with the increasing rate of mobile-phone penetration, DOCOMO will strengthen ties with existing customers, cultivate new markets and continue to provide convenient, attractive services with the aim of reinforcing its core businesses.
5.Improvement of cost efficiency
Under the plan, DOCOMO expects to achieve a 10% reduction in costs and expenses to solidify the company's financial standing for sustained growth. Initiatives include the nationwide optimization of operations and reduction of costs related to networks and sales.
6.Corporate Social Responsibility (CSR) Activities
DOCOMO will also contribute to society through initiatives to help protect the environment, promote universal design products and services, and realize a safer, more secure mobile society.
7.Operating income and return to shareholders
Under the plan, DOCOMO expects to achieve over ¥900 billion in annual operating income in FY2012. The company will also endeavor to maintain the highest level of payout ratio in Japan and stable dividends.
Please see the attachment for a more detailed explanation of the measures to be implemented under the "Change and Challenge" action plan.
*1 Abbreviation for Long Term Evolution. Also known as "Super3G" as proposed by DOCOMO or "3.9G" mobile communications system.
Special Note Regarding Forward-Looking Statements
This Press Release contains forward-looking statements such as forecasts of results of operations, management strategies, objectives and plans, forecasts of operational data such as expected number of subscribers, and expected dividend payments. All forward-looking statements that are not historical facts are based on management's current plans, expectations, assumptions and estimates based on the information currently available. Some of the projected numbers in this report were derived using certain assumptions that are indispensable for making such projections in addition to historical facts. These forward-looking statements are subject to various known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from those contained in or suggested by any forward-looking statement. Potential risks and uncertainties include, without limitation, the following:
1 . As competition in the market becomes more fierce due to changes in the business environment caused by Mobile Number Portability, new market entrants, competition from other cellular service providers or other technologies, and other factors could limit our acquisition of new subscribers, retention of existing subscribers, or may lead to diminishing ARPU or an increase in our costs and expenses.
2 . Current and new services, usage patterns, and sales schemes introduced by our corporate group may not develop as planned, which could affect our financial condition and limit our growth.
3 . The introduction or change of various laws or regulations or the application of such laws and regulations to our corporate group could restrict our business operations, which may adversely affect our financial condition and results of operations.
4 . Limitations in the amount of frequency spectrum or facilities made available to us could negatively affect our ability to maintain and improve our service quality and level of customer satisfaction.
5 . The W-CDMA technology that we use for our 3G system and/or mobile multimedia services may not be introduced by other overseas operators, which could limit our ability to offer international services to our subscribers.
6 . Our domestic and international investments, alliances and collaborations may not produce the returns or provide the opportunities we expect.
7 . As electronic payment capability and many other new features are built into our cellular phones, and services of parties other than those belonging to our corporate group are provided through our cellular handsets, potential problems resulting from malfunctions, defects or loss of handsets, or imperfection of services provided by such other parties may arise, which could have an adverse effect on our financial condition and results of operations.
8 . Social problems that could be caused by misuse or misunderstanding of our products and services may adversely affect our credibility or corporate image.
9 . Inadequate handling of confidential business information including personal information by our corporate group, contractors and other factors may adversely affect our credibility or corporate image.
10. Owners of intellectual property rights that are essential for our business execution may not grant us the right to license or otherwise use such intellectual property rights on acceptable terms or at all, which may limit our ability to offer certain technologies, products and/or services, and we may also be held liable for damage compensation if we infringe the intellectual property rights of others.
11. Earthquakes, power shortages, malfunctioning of equipment, software bugs, computer viruses, cyber attacks, hacking, unauthorized access and other problems could cause systems failures in the networks required for the provision of service, disrupting our ability to offer services to our subscribers, and may adversely affect our credibility or corporate image.
12. Concerns about wireless telecommunications health risks may adversely affect our financial condition and results of operations.
13. Our parent company, Nippon Telegraph and Telephone Corporation (NTT), could exercise influence that may not be in the interests of our other shareholders.
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