Ikea reenters Japan: IKEA’s first try to enter Japan in 1974 failed for IKEA. Now second try in 2006.

IKEA second market entry to Japan

IKEA enters Japan for the second time

IKEA created a joint venture in Japan in 1974 and abandoned it in 1986 – this company still flourishes, but IKEA withdrew from Japan…

Today, Monday April 24, 2006 at 7:30am, IKEA invited about 300 guests to celebrate the opening of the first 100% IKEA-owned IKEA store in Japan. We had the honor of working for IKEA – IKEA is another company that “thinks different” in so many creative ways. We wish them all the best in Japan!

IKEA had attempted earlier to establish business in Japan via a joint-venture established in 1974. This Joint-Venture was terminated in 1986, and IKEA ended business in Japan in 1986. Interestingly – and this is not the only such case – its only that IKEA itself at that time failed in Japan. The business IKEA created in this joint-venture actually continued successfully without IKEA even after IKEA had left Japan.

About 20 years later, this is now IKEA’s second venture into Japan.

The photographs shows Mr Koshichi Fujishiro, the Mayor of the City of Funabashi, and Mr Gordon Gustavsson, Manager of the new IKEA Funabashi store sawing the traditional log. Witnessing the log sawing ceremony are Ms Akiko Domoto, Governor of the Chiba Prefecture, His Excellency, Mikael Lindstrom, the Ambassador of Sweden, Anders Dahlvig, CEO of the global IKEA Group and Tommy Kullberg, CEO of IKEA-Japan:

IKEA opening ceremony for the IKEA store in Funabashi
IKEA opening ceremony for the IKEA store in Funabashi
Opening ceremony for IKEA's store in Funabashi
Opening ceremony for IKEA’s store in Funabashi
Opening ceremony of the IKEA store in Funabashi: the Mayor of Funabashi and the IKEA store manager saw a log
Opening ceremony of the IKEA store in Funabashi: the Mayor of Funabashi and the IKEA store manager saw a log

A JR-Keiyo Line train with IKEA logos passing the new IKEA store in Minami-Funabashi:

IKEA advertisements on JR-East trains
IKEA advertisements on JR-East trains

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1-SEG

1-SEG? One-Seg? wansegu?

In Japan the nickname for digital mobile TV is written in Katakana: ワンセグ (pronounced wansegu). Japanese people love to abbreviate – oneseg is short for One Segment. Why?

The reason is technical: digital TV is broadcast in certain radio frequency channels. Each TV station (e.g. NHK, Fuji-TV, TBS etc) uses one particular 6 MHz wide frequency channel for digital TV broadcasts. Each channel is divided into 14 segments, and one segment is used for digital TV to mobile phones, while the other remaining 12 segments are used for high-definition digital TV, while the 14th segment is used as a buffer between adjacent channels to avoid interference.

Read our report on mobile TV in Japan.

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Mobile TV

Digital mobile TV started officially in Japan on April 1, 2006 after several months of testing. Japan’s media industry is large – Japan’s broadcasting industry alone is about US$ 40 billion sales/year, so mobile-TV will probably develop into a multibillion-$ industry over the next few years. At the moment there is a chicken-and-egg situation: content providers need a market with lots of subscribers, but subscribers will only buy handsets if there is enough good content. So investment and a longterm view is necessary to jumpstart this new market.

Apparently about 500,000 mobile phones with digital TV have been sold already – KDDI started selling mobile phones for digital terrestrial TV (1-SEG) from autumn 2005, while DoCoMo introduced the first digital TV handset only a few weeks ago.

According to major phone retailers, buyers are mainly men in the 25-35 age group. So there are some more steps to do until mobile TV goes mainstream, for example, making mobile-TV enabled phones smaller and more attractive for female customers.

Viewers can watch TV and they can purchase & download the music, join fan clubs and much more

First simple estimations by our team based on analysis of Japan’s TV industry and on the development of i-mode in Japan show that the mobile TV industry segment in Japan may well reach a volume of US$ 4 billion or more within a few years for m-commerce, advertising and other business combined.

…more about mobile-TV: download our mobile-TV report

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