I was talking to my Japanese teacher this morning about the idea that eventually cell phones will go flat rate. The idea being that a modern cell phone is basically a computer connected wirelessly to the net. There is no reason you shouldn’t be able to browse the net, use skype for unlimited phone calls, download music, tv movies, etc, all for a flat fee. The only thing preventing this from happening currently is the cell phone companies themselves.
While it is in their individual interest to keep fees high, all it will take is one competitor to start the flat fee service and users will start switching in droves forcing the other companies to follow suit.
I don’t know when this will happen but, after bringing that up with my teacher she mentioned that Softbank just bought Vodafone Japan. Vodafone is one of the 3 largest cell phone service providers here along with AU-KDDI and NTT Docomo.
I don’t know if Softbank plans to go flat rate but I have my hopes up because…Softbank is the company arguably soley responsible for the Japanese broadband revolution. Softbank runs Yahoo BB (BB = Broadband) which is the most successful ISP in Japan. Before Yahoo BB, broadband was like it is in the states. More expensive than dialup. A typical broadband connection was 1~2megabits per second and cost $50 a month where as dialup was $20 a month. Except for computer geeks like me, very few people felt the need to switch to broadband.
Yahoo BB changed all that, they started selling broadband connections for $20 a month which made it the same price as dialup. Nearly overnight the entire country was switching to broadband. Even more, in Japan, unlike in the USA, there is no flat rate for local calls so a $20 dialup connection plus the fees to the phone company for each minute connected made Yahoo BB’s offering CHEAPER THAN DIALUP. There was no reason not to switch.
Of course within 3~6 months the other ISPs finally started offering broadband at more reasonable prices although none of them matched Yahoo BB. I assumed they all thought that because they were “brand names” and Yahoo BB was the upstart they could charge a premium price.
Even so, Yahoo BB countered by constantly upgrading their services. 8megabit connections, then 20 megabit connections and now 50 megabit connections. Yahoo BB even offers 1000megabit connections to your building now.
Japan owes a huge debt of gratitude to Yahoo BB / Softbank because without their initiative Japan would not be one of the most broadband countries in the world ready to take on the 21st century.
So, now that Softbank has bought Vodafone. I can only hope they plan to push the cell phone services in the same forward thinking way and revolutionize the cell phone industry as well.
in november 2006, the number portability will be introduced. this means that you can change your carrier (cell phone company) without changing your cell phone number. it certainly will be a competitive market.
flat rate for data is already introduced for all carriers. flat rate for voice is already introduced for wilcom and vodafone kk (under a condition). it’s going to be an interesting couple of years.
I’ve had this thought and fully agree with you Greggman. The maintenance costs for cell phone services must be miniscule when compared to the miles and miles of fixed above & underground wiring and exchanges etc needed for fixed lines. Replacing a burnt out circuit board here and there must be a hell of a lot cheaper than sending a crew out to dig up and repair a cut cable.
In the States, no broadband company is willing to produce cheap fast broadband, cuz they’re all greedy. In Japan and Korea, the net is cheap, so why cant they do it here?
very annoying
The UK is getting there but will allowing users to go wi-fi when available undermine flat rate services? I can see it might drive the price down if running cost for operators is reduced but beyond that I’m not sure.
Flat rate for data is only for data on the keitai though and only through software it supports so for example, running Skype on your phone is out currently as is plugging it into your notebook.
I am betting against a flat rate system anytime soon. The reason being is underlined in your own logic: If one company offers, the others will pretty much soon after. Considering that the rate of new cellphone users is decreasing due to market saturation in this country, I do not think one of the established players will make this move, as in the end every company making the same move will just dilute the impact and lessen profits for everyone all round. Granted, I think vodafone now that it is owned by Softbank are the more likely to make the move out of NTT or AU however. In fact, Vodafone already gave it a good shot with the 300\\ couple deal, but it didnt move many more phones. But, like your example with Yahoo! BB, I think it will take a completely new startup with some sort of radical business model to shake up prices here. For the time being, it will be the quality of the phones released (particularly if it has an Mp3 player is my guess) which will dictate the short term future market in Japan.
Flat rate is really where things need to head to speed up take up of all these new services, especially outside Japan. We have i-mode here in Australia and the prices are unbelievably expensive. Although on a silimar note, we have had number portability for quite a while now so suprising to hear that it’s coming so late to Japan! Also our mobile ‘broadband’ is an absolute rip-off. I get it as par of my phone service and did some tests recently. It costs me AUD$10.00 just to check my email, assuming no one has sent me anything more that a few plain text emails. God help you if there’s an image in the email!
Each company has different rules on the TYPES of packets it will consider under their flat-rate plans. To my knowledge, Vodafone is one of the most generous but still does dumbass things like blog gmail and doesn’t count imap email on your all-you-can-eat plan. For some packet services, you have to use a different access point (Access Internet instead of Web). DoCoMo is still raping customers only allowing imode pages to be viewed as flat-rate.