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Apple’s iPhone, Japan, and the LA Times

January 25, 2007
By Ken Worsley


I’ve been meaning to write this up for a bit, although it’s not directly connected to events within the Japanese economy. Nonetheless, it does have a relation to Japan and business, so here goes:

On January 11, Bruce Wallace at the LA Times published an article entitled In Japan, Barely a Ripple: Apple’s much-anticipated iPhone is ‘business as usual’ in a country where mobile features already are so advanced. I sort of groaned when I read the headline, having expected the American media to crawl over each other in an attempt to slag off Steve Jobs and his overly enthusiastic introduction of the iPhone to the “rest of the world” (ie, America). The article has actually been quite popular on the web, and many similar stories have been published. Those aside, Mr Wallace’s article in particular is so profoundly misguided that I had to write something in response.

Looking at the text, it turns out that the quote from the article’s leader (’business as usual’) was taken from a guy working at a cell-phone shop in Harajuku. There was no mention as to whether or not this gentleman had actually seen the mobile device in question, or knew anything about Apple’s recent introduction of the iPhone beyond what he had just been told.

The other Japanese person interviewed for the article, 23 year-old Mami Nawa, spoke of the technological virtues of her keitai with this quote:

I like it because it’s cute. And with my long nails, the paint gives me a better feel for the phone.

That’s right. Two people on the street quoted for an article ostensibly concerning mobile telephony in Japan. No market analysts. No engineers. No business leaders. Nobody from Sharp, Toshiba, Sanyo, Mitsubishi, Sony-Ericsson, Softbank, NTT DoCoMo, or KDDI’s AU. No official from the Ministry of Posts and Communications. Just a guy in a keitai shop making minimum wage and a girl who likes her nail color. Is that the basis for a newspaper article?

Here’s a quote on the supposed Japanese reaction to the release of the iPhone:

On the day when stock markets swooned and techies buzzed over Apple Inc. Chief Executive Steve Jobs’ long-awaited entry into the mobile-phone market, Japanese consumers could be excused for wondering: Why the fuss? … Many Japanese had a [hard] time buying Jobs’ line about “reinventing” the phone.

Japanese had a hard time buying a line they never heard? The thing is, Apple didn’t hype the iPhone’s release at all in Japan. Far from the reaction described in the LA Times piece, there was no reaction to Job’s announcement in Japan. Why should anyone be surprised that there was no reaction in Japan? The evening news I watched didn’t show any clips of Jobs speaking and the major daily newspapers didn’t run the story on their front pages. English blogs in Japan have picked up on it, but Apple made no push in Japanese. Jobs made his comments within the context of the American market. He may have overstated things, as he is wont to do, but he’s an evang-a-ceo, that’s his job. He’s a hype man.

Part of the criticism levied against Apple in the article is that it’s not 3G ready. Of course, no statistics are given on 3G market penetration in Japan, as though they wouldn’t be relevant to the article’s assertions (though still around 50%, it should increase as more subscribers take advantage of the number portability system and deep handset discounts).

Apple plans on having the iPhone out in Asia around 2008. That probably means 2009. By then it will easily be 3G capable, if not 4G; they know how to put new chips in it, they’re willing to do what it takes to make the product swim in the local market. Their existing partnerships in Japan stand to gain tremendously from its introduction to the Japanese market. Yes, the product might fail, but with two more years of developing it for this market, that’s looking unlikely. At the least, it looks like a good bet for Apple.

Now, as for the recent rumors of a Softbank partnership. I just hope this doesn’t happen, not only for Apple, but also the Japanese consumer’s sake. Goldman Sachs had the smarts to pull out on them. They are a joke of a company and treat their customers like crap. From the Yahoo BB fiasco to the having to pay money for them not to sell your email to ‘market research companies’ to the sheer volume of spam I receive since they bought out Vodafone (I’m going to AU next week), Softbank sucks.

Apple is over a year away from firing up its marketing machine over the iPhone in Japan, and selling them next to the hugely successful iPod in Japan’s largest electronics shops such as Yodabashi and Bic Camera, where they have secured premium retail space at the expense of Japanese manufacturers over the past few years…but that’s not in the article either. At any rate, when it’s successful, I’ll be looking forward to another piece by Bruce Wallace entitled I told you so: Apple’s iPhone big in Japan.

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Comments

14 Responses to “Apple’s iPhone, Japan, and the LA Times”

  1. Gen Kanai on January 25th, 2007 8:32 am

    I agree that the article was fluffy.

    I disagree that the iPhone will do well in Japan.

    Sure there will be the hardcore Apple fans, design fans, and smartphone fans (small market) who will snap it up, but I’m almost positive that the OS was not designed specifically for numeric keypad input (i.e. Japanese). You see the average keitai user in Japan, they’re writing emails via the numeric keypad, not a blackberry or smartphone style keyboard. If the phone is not optimized for this first, which it isnt, then I hardly see it making waves in Japan in the mass-market. It will have its own niche of course, especially if it is updated to 3G and perhaps a 1-Seg tuner, but I don’t see Apple investing the resources for the Japan market when there’s already so much competition here in the mobile space.

    Plus the other manufacturers now have a 2 year headstart on providing more iPhone-like capability to their own handsets if they agree that users want that functionality (which is not yet clear.)

    Also, fyi:

    http://jonkenpon.com/2007/01/09/iphones-japanese-competitors/

  2. Nick on January 25th, 2007 12:24 pm

    Ken,
    Thank you for this article, I also live in Japan and had a similar reaction to the poorly written article by Bruce. Good to see you setting the record straight. On another note, most of the Japanese that I have spoken to, that are aware of the iPhone (IT folks) experienced a similar “WOW” factor to myself. I believe that the iPhone will be very successful here in Japan and echo your thoughts about the device being ready (3 or 4G) by the time the device touches down in Japan.
    Thanks again,
    Steve

  3. Ken Worsley on January 25th, 2007 1:35 pm

    Nick, I didn’t mention it, but I saw a similar group of reactions as well amongst family, friends and co-workers who are Japanese: “hoshiina! When’s it coming to Japan?” I think the current price will somewhat deter them, but I wonder if that isn’t a good thing for Apple; look at what happened when Louis Vuitton bags were brought down in price from ‘prohibitively expensive’ to ‘painful, but doable.’

    Gen, good point about the keypad. I have no idea what Apple plans to do about this, but I’m sure their people are well aware of it and they have a bit of financial resources available to them should they see the risk/reward in that favor (they should).

    I’m not sure what do well means, other than sells a lot of units in comparison to other handsets. I don’t see that as being too difficult. Of course it won’t be like the iPod, but that’s a once in a generation product I think. I’d love to see what Apple’s sales targets/units shipped targets would be for Japan, say in 2010.

  4. John S on March 1st, 2007 1:28 am

    How did I miss this one? Great article. I can’t believe the lack of research people can get away with a major news outlets. Two kids in Harajuku commenting on telecoms? Why not ask a fisherman in Hokkaido about the stock market?

  5. mike on March 30th, 2007 3:28 am

    Came through on a link from Japanprobe. Great write-up. Should Apple listen to its people here in Japan and make the keypad entry Japanese-friendly and drop the price a bit (then make money selling off iTunes), I see this doing very, very well once it actually gets released here. Apple stands in position to change the way that individual handsets are marketed in Japan, something I don’t think has been fully exploited yet.

  6. Ellie on August 13th, 2007 10:33 pm

    Thanks for the great article. I’ve lived in Japan for over 7 years and the only reason I know aboput the iphone is because I have a Mac and see the latest news on the Apple homepage everyday. I have enthused about it ever since finding out and now my friends an I are all eagerly awaiting it’s arrival in Asia. I’m sure that when Apple is ready, there will be iphone ads everywhere, as they did with itunes ads on our trains, and the ipod ads on giant billboards.

    I was in the states last week and went into a Mac store to try out the holy grail of phones and it surpassed my expectations. Not only was it as beautiful as the pictures we’ve seen but it was also very easy to use. My mum (technology is NOT her friend) was even able to use it easily. I think the main concern will be which provider Apple will partner up with. KDDI/AU please!

  7. Sunday Reading: What Japan Thinks on the iPhone and Japan : Japan Economy News & Blog on December 2nd, 2007 10:53 pm

    […] on January 25, we wrote up a review on what was a very poor quality article on the iPhone and Japan that had appeared in the Los Angeles […]

  8. Bringing an iPhone to Japan: Good Luck With the WiFi Spots : Japan Economy News & Blog on December 2nd, 2007 10:57 pm

    […] or lack thereof - in Japan. Back in January I took a look at an LA Times piece which asserted that Japan simply wasn’t interested in the iPhone, and just about ten days ago another piece appeared here which featured a translation of a […]

  9. Reality bytes on December 8th, 2007 8:13 pm

    The iphone will do all right in Japan…. eventually.

    I, and many of my Tokyoite expat friends, cannot wait to get our hands on one. Others will follow our lead. Including the Japanese. Japanese phones for all their advancements, generally have really sucky interfaces.

  10. Who’s going to bring Apple’s iPhone to Japan? Japan Economy News & Blog - Business, Economy, Marketing and Economic Reports on December 21st, 2007 1:39 pm

    […] About a year ago, we pointed out (as did many others) that the iPhone would have to be 3G in Japan to sell. It appears as though Apple is developing such a model, and now they’re actively looking for someone to be the carrier. […]

  11. Bryan on January 20th, 2008 2:47 pm

    If you live here, you know the LA times is an utter disgrace. Articles like this are the norm, not the exception. No one here takes the rag seriously, and no one anywhere else should, either.

  12. Ken Worsley on January 20th, 2008 4:41 pm

    Bryan, that’s funny. I guess I can’t say I’ve ever actually read it. I’ve always thought the Washington Post was the worst US paper, especially when it comes to Japan coverage. But over the last year there have been some strong challengers, and the BBC has been making every effort to publish just plain wrong information on a weekly basis. One is forced to wonder if they’re all working in tandem.

  13. Robert Swier on February 12th, 2008 9:18 am

    I guess I don’t understand the dissent about the iPhone’s prospects in Japan. I understand how phones are used in Japan, and I suspect that the iPhone will do well. The iPhone now has 16GB of memory. Check out the latest phones from KDDI, Japan’s second largest carrier. They max out at around 1GB.

    http://www.au.kddi.com/english/product/index.html

    Although some phones can show TV and FM radio, I don’t think any of them could be called iPod replacements, unlike the iPhone.

    Isn’t freedom from carrying two separate devices a killer feature, particularly for Japan?

  14. Ken Worsley on February 12th, 2008 3:29 pm

    Robert, those are some good points. I think the biggest hurdle the iPhone might face in Japan is the fact that Japanese users use numeric keypad input, as Gen said above. The Blackberry or smartphone input has not made any real headway into the market.

    That said, I don’t see why Apple couldn’t include a numeric input in the display and make that work by touch.

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