Reports of the 3G iPhone’s inability to find success in Japan are beginning to accumulate. According to a recent Wall Street Journal article, market-research firm MM Research Institute reports Apple sold about 200,000 phones in Japan in the first two months since launch. Since then, demand has been falling steadily, and analysts now believe sales are unlikely to reach a total of 500,000 units.
In an earlier DailyTech article we wrote about a conversation senior analyst Inui Makio had with Japanese tech site ItMedia +D. He pointed out the potential reasons why the 3G iPhone may have lost momentum in Japan.
One interesting point that becomes apparent in the Wall Street Journal article is that Softbank, the Japanese iPhone carrier, and Apple continue to provide no hard numbers on how many iPhones have been sold in Japan. According to some analysts, Apple and Softbank’s silence may indicate the 3G iPhone is far from meeting initial expectations. According to the article, MM Research Institute had initially predicted 1 million iPhones may be sold in Japan.
In the Japanese cell phone market, domestic manufacturers continue to dominate. Nokia Corp., the industry leader in global shipments, has less than 1% share in Japan. Instead, Sharp Corp. leads the Japanese market, with about 25% of shipments. It was believed the 3G iPhone had the potential to break in to the Japanese market because of its strong brand name and popularity of its iPod music players.
The Wall Street Journal article goes on to talk about how many of the 3G iPhone's "new" features are not considered new in the Japanese market and that it was missing features that almost all Japanese cell phones have. The high price of the iPhone appears to be another limiting factor, according to the article.
Features the 3G iPhone lack include the ability to use pictograms in emails, the ability to watch digital television, and the ability to use the cell phone as an electronic wallet using Felica technology. Finally, many Japanese text message with one hand and this is not easy to do, due to the way the 3G iPhone is designed.
Takuro Hiraoka, an analyst for GfK Marketing Services Japan Ltd says there is hope for Japanese sales of the iPhone, though. He argues, "Japanese users don't know what to do with an iPhone. Sales could grow if Apple provides specific examples of how it can be used."