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Interview with President of Japan's DDI
Posted: 08-Sep-2000 [Source: Nikkei Communications]

[DDI discloses plans to form alliances with European and US carriers and talks about its 3G rollout strategies in this interview.]

Tokyo -- "The IMT-2000 cellular service will soon be launched, and DDI Corp. plans to promote cdma2000 mobile communication services, which differ from those to be implemented by powerhouse NTT DoCoMo Inc.

"Nikkei Communications discussed the company's business strategy with President Yusai Okuyama.

"Okuyama will be appointed president of new DDI Corp. (KDDI) to be created in October through the merger of three telecom companies -- DDI, KDD Corp. and IDO Corp.

Nikkei Communications: "DDI is Japan's only carrier that has adopted the cdma2000 system as part of the IMT-2000 communications systems. Why have you selected it?

Okuyama: "Because we can take full advantage of the existing cdmaOne assets and evolve the assets to the IMT-2000 system. Prior to the start of KDDI in October, we have rearranged the existing assets. As of today, four types of mobile communications services are provided in the market. The cdmaOne service and PDC (at a bandwidth of 800MHz) are provided by DDI-Cellular Group and IDO Corp., PDC at a bandwidth of 1.5GHz of TU-KA Group, and PHS of DDI Pocket Inc. We have clearly defined where these services are positioned and how they should grow by exploiting their advantages.

Q: "How are you going about making plans for high-speed data communications services?

Okuyama: "We are planning to launch in the autumn of 2001 an extended cdmaOne service called "1X" at the 800MHz bandwidth. It will enable us to slash the necessary investments in facilities and equipment while also offering a high level of technology. So, we can take full advantage of the cdmaOne service know-how. The rate of 144kbps available for the 1X service belongs to a not-too-fast speed service, but we can expand the service area without delay.

Q: "NTT DoCoMo will begin the IMT-2000 service in May 2001. So, that company will likely run ahead of you in this field. Is that correct?

Okuyama: "KDDI will cover 99 percent of Japan's population with the 144kbps service at the end of 2000. We think that NTT DoCoMo won't be capable of acquiring such a large IMT-2000 service area at that point. In our opinion, only a small part of the densely populated areas will need NTT DoCoMo's 384kbps service.

Q: "Is KDDI planning a higher-speed service after that?

Okuyama: "We intend to adopt a cdma2000 method for the IMT-2000 service in the autumn of 2002, using 1X, which runs at 2GHz bandwidth. KDDI will release a dual-terminal that works at a bandwidth of both 800MHz and 2GHz. Also, we will adopt methods to offer super-high-speed service at around 500kbps to be called the high-data rate (HDR) and 1XTREME services. In this way, we intend to launch the super-high-speed service that will outstrip NTT DoCoMo's 384kbps service. This is our scenario.

Q: "Earlier, DDI seemed to be inclined toward the W-CDMA method, which would have put your company in the same camp with NTT DoCoMo. What was your actual intention?

Okuyama: "We had some concerns about it, such as the market growth rate and progress of technical development. So, we mulled over the two methods of W-CDMA and cdma2000 to the very last minute. Above all, our deepest concern was whether cdma2000 terminals would actually be produced. We made contacts with makers and as a result, we saw bright prospects that many makers would supply us with the necessary terminals. Also, it was known to us that many businesses would accept the 1X service overseas. In addition to that, a migration path is clear that we can integrate the 1X services -- HDR and 1XTREME -- with future technologies. Above all, we concluded it to be right to go back to our idea to counter NTT DoCoMo and we decided on the cdma2000 service.

Q: "What are your countermeasures against NTT DoCoMo?

Okuyama: "We plan to cooperate with overseas carriers. As a first step, we must decide before the merger of the three Japanese companies slated for this October. We intend to form a business alliance with carriers in Europe and the United States after the merger. Our company will obtain some major partners. The partners won't be limited to companies that will use the IMT-2000-based cdma2000 method. And it's still undetermined as to whether we'll invest ourselves, like NTT DoCoMo has done with its global partners.

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