DoCoMo to release smart cell phones

NTT DoCoMo Inc. announced Wednesday it will release next month smart cell phones with debit card, membership card and train ticket functions.

Japan’s largest mobile phone operator hopes to create a new revenue source with the handsets, which combine the company’s i-mode Internet service and Sony Corp.’s smart card technology.

“By combining wallet and cell phone (functions), you only have to take the handset with you when going out,” Takeshi Natsuno, the carrier’s i-mode business chief, told a news conference in Tokyo.

NTT DoCoMo will introduce four handset models equipped with Sony’s FeliCa integrated circuit chips. The handsets can be used as e-money at about 9,000 stores that accept Edy smart cards, which use the same technology as the phones.

Like the smart cards, users place the handsets over readers installed at stores’ cash registers, with money withdrawn from users’ electronic accounts.

NTT DoCoMo said the advantage of FeliCa handsets over the smart cards is that users can always check the balance of their accounts on their phone displays and can deposit money into their accounts over the Internet.

In addition to e-money, handsets can be used as electronic tickets at movie theaters and as shopping mileage cards at electronics stores.

East Japan Railway Co. has said it will introduce a system to allow NTT DoCoMo’s smart handsets to act as train tickets sometime between October 2005 and March 2006. JR East already issues its own FeliCa-based Suica smart ticket.

NTT DoCoMo is exploring new growth strategies, as the traffic volume in traditional businesses is likely to plateau sooner or later given the high population penetration of cell phones.

Yet the arrival of smart phones raises security concerns, foremost of which is — what happens if users lose their handsets?

But Natsuno said the risk of losing a handset is no greater than losing a wallet.

He also said that one handset model has a remote-rock function, which allows owners to dial their handsets and enter codes that freeze the e-money function.

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