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Sony gets top billing as DoCoMo shuns iPhone

Bloomberg

NTT DoCoMo Inc. will order more Sony Corp. smartphones as the nation’s largest wireless carrier keeps Apple Inc.’s iPhone off its shelves because the iTunes Store competes with its own e-commerce business.

Sales of Sony’s Xperia A handset could reach 2 million by Sept. 30 after going on sale in May as DoCoMo focuses on a smaller range of devices, DoCoMo Chief Financial Officer Kazuto Tsubouchi said in an interview in Tokyo on Wednesday.

The carrier is trying to spark growth with discounts as it adds users at a slower pace than Softbank Corp. and KDDI Corp., which both sell the iPhone. DoCoMo is reducing the number of models in its stores by as much as half to focus its promotions on Sony and Samsung Electronics Co. handsets, Tsubouchi said.

“To win against the iPhone, we have to offer a model that is generally easy to use,” Tsubouchi said. “Sony’s brand and Xperia’s image are just as good as the iPhone.”

DoCoMo may consider altering its stance on the iPhone if it can limit the smartphone’s share of sales to less than 30 percent of the company’s total, he said. The carrier’s online store, called dmarket, offers music, videos and games.

Sales of the Xperia A reached about 1.24 million units as of Aug. 4, DoCoMo said, while sales of Samsung’s Galaxy S4 totaled about 630,000.

The carrier is “fighting back” after restarting cash-back campaigns to win customers, Nathan Ramler, an analyst at Macquarie Group Ltd. in Tokyo, said in a note Wednesday. The company’s promotional campaign “continues to sell handsets.”

“We will respond to the needs of the market,” Yu Tominaga, a spokesman for Sony in Tokyo, said. The company is targeting a wide range of customers including those upgrading from feature phones, he added.

Sony said Aug. 1 it posted a quarterly profit in the smartphone business after losing money a year earlier. Smartphone shipments in the three months through June rose to 9.6 million from 7.4 million a year earlier. Sony expects to sell 42 million smartphones this year.

Reviving earnings growth will depend on DoCoMo’s ability to add new users as it looks to cut costs in the 12 months ending next March, Tsubouchi, the CFO, said.