NTT DoCoMo Inc. will pursue technological tieups rather than capital investments to expand its mobile phone business overseas, according to the firm’s president.
“We will expand our business to overseas markets by mainly seeking technological tieups” with local entities, said Masao Nakamura, who became president of Japan’s largest mobile phone carrier on Friday.
Nakamura was referring to a strategy shift by the company away from capital investments in overseas operators, with the firm having posted huge losses through investments of this kind in recent years.
NTT DoCoMo invested heavily in AT&T Wireless Services Inc. of the United States and other mobile phone service companies abroad to disseminate third-generation mobile phones compatible with its i-mode and FOMA mobile Internet services.
These investments reached about 1.9 trillion yen at one time.
But the implosion of the Internet technology bubble caused huge appraisal losses on its securities holdings, and as a result, depressed its consolidated group companies’ earnings. NTT DoCoMo plans to sell its stake in AT&T Wireless by the end of this year.
“We will think of making capital investments in markets like Southeast Asia, if it is better than tieups, because it is inexpensive compared with Western markets,” Nakamura said.
Asked about the company’s relationship with AT&T Wireless, Nakamura said the firm would consider technological tieups with Cingular Wireless LLC, which is expected to buy AT&T Wireless to create the largest U.S. mobile phone service operator.
Nakamura said the company is considering tieups in the Chinese market as well, although the matter is still at the wait-and-see stage.
“The country has not decided yet on the format of the third-generation mobile phone,” he said.
Noting that NTT DoCoMo recently made a capital investment in a digital map and global positioning service operator in Bangkok, Nakamura said that business may also be a promising field.