Like most mobile operators, DoCoMo found its voice and data revenues were in decline some years ago. But the operator has been able to turn its business around and is optimistic about its revenue trajectory today, according to Kazuhiro Yoshizawa, DoCoMo's two-week-old CEO (just to be clear, that's not his age; he was appointed CEO two weeks ago).
The key to this has been its non-telecom business, where the company has actively focused on developing a platform play with the help of multiple partners. NTT DoCoMo Inc. (NYSE: DCM) calls this the "d+" strategy.
To develop this, the operator had to follow a four-point plan: invest in the creation of new technologies and services, create a partner ecosystem, promote and market the value of the platform and invest in enabling infrastructure, such as network upgrades. An important element of this approach was to allow access to DoCoMo's R&D, mobile platform, subscribers and back office systems.
One example of the d+ strategy is the creation of the "dmarket"; a set of mobile destinations that offer a variety of content, such as TV services, magazines, educational content, healthcare advice, etc.
Yoshizawa pointed to two of these elements, dTV and dmagazine, which have been particularly successful for DoCoMo. dTV is the largest VoD service in Japan with 5 million subscribers, while dmagazine has 3 million subscribers and offers 160 magazine titles. In total, the dmarket initiative has yielded 15 million subscribers for DoCoMo and adds "significant" revenue.
DoCoMo has also partnered with technology companies to create new apps. One such app, "Suguden," allows for interaction with a smartphone without tapping the screen. Lifting, flipping or shaking the phone performs some of the basic functions, such as answering the phone, rejecting a call and sending a busy text and calling.
Today, DoCoMo's d+ partners include companies from a variety of verticals, including retail, transport, education and agriculture. The operator is keen to grow its partner ecosystem as it believes a wide range of partners will be critical for the continued success of this strategy. Yoshizawa is seeking to push revenue from these services up to the same levels as traditional telecom services. And he is looking at the usual suspects (IoT, big data, AI), but to support his d+ initiatives rather than as standalone network applications.
DoCoMo has been an innovative company, launching a variety of mobile applications (including the mobile web via i-mode, as early as 1999). Given the revenue slowdown for voice and data services operators are facing, this kind of ecosystem-based approach might well be something for other operators to consider as well.
— Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation