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Thursday, Nov. 8, 2012
Japan's telecom challenge
Competition in the mobile phone industry has entered a new phase as an increasing number of people use smartphones to enjoy access to the Internet, movies and games. The survival of mobile phone carriers now depends on their ability to provide high-speed transmission services, which are necessary to give full play to the functions of smartphones.
Both the government and the industry must make serious efforts to meet the needs of smartphone users.
Mobile phone service companies need to expand the areas where LTE (long-term evolution) — a high-speed communication standard that makes transmission of large-volume data easier — is used. They can do this by adding base stations or improving them. Otherwise, congestion will occur, reducing transmission speed.
The companies also need to lower fees, which are said to be high compared with fees abroad. The Internal Affairs and Communications Ministry needs to review the current frequency allotment policy to alleviate congestion in telecommunication.
So far, the third-generation communication standards (3G) have been mainly used for voice transmission from smartphones. Apart from its transmission speed, 3G has a weak point: It has two different main standards — W-CDMA and CDMA2000.
The strong point of LTE is that it is an internationally unified standard. LTE provides a maximum transmission speed of 75 megabits per second — about five times faster than earlier standards. It is logical for mobile carriers to move from 3G to LTE.
It is reported that the Internal Affairs and Communication Ministry is thinking of integrating the communication standards into LTE. The ministry should move in that direction by improving the environment for related technological development and for increasing the number of LTE users.
Mobile phone service companies over the world face the problem of shouldering big investment costs to expand and improve LTE services. Softbank's decision to acquire 70 percent of Sprint Nextel, the No. 3 U.S. mobile carrier, is aimed at securing a superior position in providing LTE-related services.
LTE is expected to help spread "tethering" — use of a smartphone as an access point to which personal computers and game machines can be connected through wires or wireless.
It is predicted that the number of smartphone contracts in Japan will increase from 26.83 million at the end of fiscal 2011 to 95 million at the end of 2016.
To help users take advantage of the conveniences offered by LTE, mobile carriers need to simplify their fee systems so that choosing mobile phones and fee plans are easy.
Both the government and the private sector must make various efforts to increase Japan's competitiveness in telecommunications.