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I-mode wireless to hit U.S. this year

Japan's NTT DoCoMo will offer its wireless Internet service in the United States during the second half of 2002. The fate of the U.S. wireless Web could lay with I-mode's success.

ORLANDO, Fla.--Japanese carrier NTT DoCoMo will offer its popular wireless Internet service in the United States during the second half of 2002, company president Keiji Tachikawa said Tuesday.

The I-mode service, which has about 31 million subscribers in Japan, will be offered by No. 3 U.S. carrier AT&T Wireless, Tachikawa told telephone industry executives gathered at the Cellular Telecommunications & Internet Association (CTIA) Wireless 2002 conference here. NTT DoCoMo owns a 15 percent stake in AT&T Wireless.

"Our partner AT&T Wireless is now preparing services that will be interoperable with I-mode," Tachikawa told CTIA attendees Tuesday. "It will happen this year."

The United States will be NTT DoCoMo's greatest challenge and could help shape the landscape of wireless communications and service offerings in the United States for years to come.

With success, AT&T Wireless could grow stronger and begin acquiring its rivals. But if the I-mode service fails to attract customers with its mix of text messaging and wireless Web surfing, it could help doom the wireless Web in the United States.

In both Japan and Europe, text messaging, the heart of the I-mode service, is wildly popular. In these areas there are about five times more cell phones than personal computers, making the cell phone the computing tool of choice.

But the landscape is very different in the United States. Although nearly 40 percent of U.S. residents own a cell phone, computers still outnumber mobile phones. As a result, the American market hasn't taken to using phones for new services such as wireless e-mail, instead saving messaging for the PC. U.S. carriers have introduced wireless messaging to help bring in new revenue sources.

There are about 350 million messages sent each month in the United States, according to various estimates. But in Europe, there are 30 billion wireless e-mails traded every month.

"We are taking lots of counsel" from NTT DoCoMo, said AT&T Wireless spokesman Ritch Blasi. "We have different needs here, and we're looking at how that will be done."

The move by NTT DoCoMo to the United States was expected. Its pattern has been to invest in carriers in different nations, then introduce its services through them. This week, NTT DoCoMo launched the I-mode service in three European countries, offering I-mode through the three European carriers it partly owns.

"We'll see how they do, but it won't be easy; nobody is having an easy time right now," said an executive at Cingular Wireless, speaking on condition of anonymity.

Telecom bug hits DoCoMo
The I-mode service was introduced three years ago and now has about 31 million users, the most of any wireless Internet service in the world. It's essentially text messaging on steroids. NTT DoCoMo customers can download videos or send each other wireless e-mails with file attachments like sound recordings.

It also takes wireless Web surfing to new levels. While there is only a smattering of wireless Web sites in the United States made specifically for the small screen of a wireless device, NTT DoCoMo gets its wireless Web content from about 50,000 companies, including Sony Music and Toshiba.

But even that success hasn't kept DoCoMo from suffering as a result of the telecommunications downturn of the past 18 months. The company just canceled a bond sale to help pay for its $9.8 billion investment in AT&T Wireless, saying it would rather wait for better economic conditions to make the sale.

NTT DoCoMo has also seen its once seemingly insurmountable technological lead evaporate in the last two months.

NTT DoCoMo was the first to launch a next-generation phone network capable of wireless download speeds 10 times faster than what other carriers were able to offer. But KDDI, its chief rival in Japan, switched on its high-speed network in March. And Verizon Wireless switched on its high-speed network in January.

AT&T Wireless is not the only American company NTT DoCoMo has ties to. The company just partnered with Oracle to create new software programs to sell to businesses, something Tachikawa on Tuesday stressed was a new direction for the I-mode service.

NTT DoCoMo has also turned to Sun Microsystems' Java software language to help in its battle. A version of Java for cell phones lets phones download software wirelessly and lets cell phone users download files like e-mail programs or other business applications through the air.

"Java makes more money," Tachikawa said.