Presentation Materials
Principal Questions and Answers Earnings Release for FY2009 3Q (ended December 31, 2009)
Announced on January 29, 2010
Please be advised that the following text has been edited/modified from the original Q&A conversations for the sake of clarity.
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Questioner No. 1
Q1 You mentioned that you changed the estimation method of the allowances for "Nikagetsu Kurikoshi" (two-month carry over) service and "docomo point" service during FY2009/3Q. Please give us more details on the changes made.
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Q2 It has been over a year since you announced your medium-term vision. I heard the management team gathered in a hotel to hold a meeting. What kind of discussions were made concerning your future directions, concrete measures or risk factors for the achievement of your vision?
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Q3 Do you foresee any possibility of raising your stake in TTSL from currently 26% to a higher level?
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Questioner No. 2
Q1 It seems to me that you have not been so active in the sale of smartphones or PC data cards. When compared by the effect of raising packet revenues, don't you think it makes more sense to generate an additional 10 billion yen in revenues by increasing the user base of smartphones and PC data cards, assuming that it could grow to up to 1 million, than spending efforts to boost the usage of approximately 50 million i-mode users to gain an additional 60 billion yen? What are your views on the balance of revenues vis-a-vis subscriber growth?
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Q2 Apple's newly announced iPad is a SIM-free device, and I expect it will gain popularity on a global scale. Under your current billing structure, the upper limit of the monthly flat-rate charge for data access via a SIM-free device is very expensive at 13,000 yen. Amid this global trend of innovation, do you plan to continue charging users a high rate if they use a device sold by external parties other than DOCOMO?
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Q3 iPad adopts micro SIM. Will it be difficult for DOCOMO to adopt micro SIMs in your products?
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Q4 With respect to the previous question on the billing structure, can we expect that you may come up with a new billing plan around the summer of this year depending on the degree of penetration of iPad?
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Questioner No. 3
Q1 With respect to the outlook of operating income for the next fiscal year, voice revenues are expected to decline by some 200 billion yen in FY2009, and I believe it will continue to fall in FY2010 due to the expanded uptake of "Value Plan". Even if you try to sustain your revenues by growing packet usage, your packet ARPU growth may end up weaker than your competitors, remaining almost flat at around 2,400-2,500 yen. In such case, I believe you will have to slash your costs even further, but it is not clear how much room is left for further reduction. Can you comment on the likelihood of your operating income remaining unchanged at around 830 billion yen next fiscal year, and the grounds for that assessment?
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Q2 Can you give us more details concerning the development of "docomo market", such as the structure of the development team, your philosophy and ambitions?
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Q3 Will it be appropriate to consider that "docomo market" will be a small-scale market only for DOCOMO users, compared to the JIL concept promoted by SoftBank?
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Questioner No. 4
Q1 The idea of adopting or selling Google's or Apple's content is fine, but the added value will all be controlled by Google or Apple. Do you plan to accept the role of only providing a network without offering any added value, or do you plan to deploy your own content and platform? It seems that you have not decided on your policy in the areas of "docomo market" and the content platform on open operating systems. I think you should work on the development of "docomo market" sparing hundreds of engineer resources. What size of business are you contemplating, and what kind of actions are you taking at this point?
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Q2 When do you plan to finalize the policies for billing and platform, etc?
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Questioner No. 5
Q1 It seems that you have been actively selling data cards bundling them with PCs. Is this a profitable approach, when you consider the balance of the required commissions and the projected ARPU from these users?
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Q2 You mentioned that the number of handsets submitted for repair has been rising. Do you plan to drastically review the structure of repair service, including the "Mobile Phone Protection and Delivery" service?
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Q3 KDDI is about to embark on a new media strategy with the capital participation in Jupiter Telecom. Last spring, you invested in Oak Lawn Marketing (OLM), a company which also has a subsidiary engaged in TV broadcasting business. Do you have any plans for new business deployment jointly with OLM, such as entering the broadcasting business through OLM?
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Questioner No. 6
Q1 The Android-enabled Xperia device you unveiled the other day seemed very well designed. How do you position this device vis-a-vis your Operator Pack products. Do you plan to shift the focus of your development from Linux- or Symbian-based i-mode handsets to open OS devices in the future?
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Q2 You previously mentioned that you do not plan to make any additional investment in India's TTSL to finance their 3G auction fees. Does that policy remain intact?
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Q3 I heard the mobile operators in India are worn out due to intensified price competition. What are your views on the Indian market?
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Q4 You mentioned that you plan to expand the variety of local content offered through the "i-concier" service. What kind of organizational structure do you plan to use to collect the voices of users in each region and develop content catered to their needs?
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