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Mon, Aug 23, 2004 - Page 12 News List

DoCoMo targets tightwads

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NTT DoCoMo Inc, the world's second-largest mobile-phone company, will introduce lower-priced versions of its high-speed mobile phones to encourage as many as half of its 47 million users to migrate to its newest services.

DoCoMo, whose FOMA high-speed wireless Internet service accounts for about a 10th of its subscriber base, plans to begin offering the cheaper handsets by September 2005, Chief Financial Officer Yoshiaki Ugaki, 54, said in a televised interview.

The new phones will have fewer functions than current high-speed models, helping Tokyo-based DoCoMo's manufacturers lower costs, Ugaki said. Producing the lower-cost models in bulk will also cut production costs, the executive said.

"DoCoMo is recovering after a delay in its development of third-generation service," said Shinji Moriyuki, senior analyst at Daiwa Institute of Research Ltd. in Tokyo, who has "outperform" rating on DoCoMo. "They have introduced a variety of handsets and a flat-rate fee to get the service's expansion into full swing." DoCoMo's FOMA, which lets users access e-mail, conduct video calls and download music, lags a similar service from KDDI Corp. by almost three to one. Mobile-phone carriers are counting on high-speed services to encourage users to spend more.

"We'll be able to lower the price of the phones by cutting procurement costs by ?10,000 per handset," Ugaki said.

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