iPod mobile phones for Japan?

SoftBank and Masayoshi Son

According the headline report in Nihon Keizai Shinbun (the world’s largest business daily) on Saturday May 13th, Apple’s CEO Steve Jobs and SoftBank’s Chairman Masayoshi Son met recently, and are developing a joint mobile phone with iPod and iTunes functions.

On March 17 SoftBank announced the full acquisition of Vodafone’s Japan subsidiary – the former J-Phone. Thus SoftBank has acquired a 20% piece of the global Vodafone-Group, propelling SoftBank into the global top-league of telecom players. Within a few days SoftBank announced a string of actions to bring the former J-Phone back onto it’s former growth track. Read below – and read a detailed analysis of the APPLE/SoftBank cooperation in today’s May 15 version of our Mobile Music report.

Is it pure coincidence that DoCoMo and Microsoft announced a music cooperation just one or two days before the APPLE/SoftBank iPod cooperation made headlines?

Apple/SoftBank iPod mobile phones have the potential to:

  • revolutionize Japan’s mobile phone market
  • accelerate the shift of the music industry’s business model from CDROM sales to mobile music for mobile phones
  • make APPLE a global mobile phone handset brand in the NOKIA league
  • put pressure on DoCoMo which has been falling behind in the mobile music sector
  • enable Vodafone to offer Softbank/APPLE/Vodafone/iPod phones globally via Vodafone’s recently announced Softbank joint venture for handset development

Implications of an Apple/SoftBank iPod mobile phone

  • Revolutionize Japan’s music business landscape: about 20% of Japan’s music sales are to mobile phones, while internet music downloads are almost neglibile in comparison. Therefore iTunes cannot have much impact in Japan if limited to internet downloads. iTunes downloads to mobile phones will change the business models of Japan’s music industry.

    • SoftBank could leapfrog DoCoMo which is already about 1-2 years behind KDDI/AU in the mobile music arena.
    • iTunes pricing is far below established mobile phone music prices in Japan
  • Pressure on DoCoMo and KDDI/AU: Success of an iTunes/SoftBank mobile phone will put strong pressure on DoCoMo and KDDI/AU: a “must have” iPod mobile phone can be a huge advantage for SoftBank when number portability arrives this autumn.
  • Global impact: Success of an APPLE/SoftBank phone could put APPLE on track towards a global mobile phone brand competing with the NOKIA’s of this world
  • Impact on Apple: APPLE could leverage it’s design power, it’s user interface principles, and brand power into BOTH the mobile phone space (globally), and the mobile music distribution space
  • Impact on global mobile phone business landscape: APPLE could become the challenger in the global mobile phone handset landscape

download latest version of our Mobile Music Japan report (includes analysis of iPod/SoftBank phones)

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