NTT DoCoMo is Japans’ largest wireless company, but they don’t carry the iPhone yet. According to their president and chief executive Ryuji Yamada, they “haven’t given up” hope of landing the iconic handset. At the same time, he criticized a large volume of devices Apple is requiring iPhone carriers to commit to. Rival KDDI Corp, Japan’s #2 carrier, joined Softbank in selling the iPhone in Japan.
Should the introduction of the iPhone result in “the mass majority of our products occupied by the iPhone”, Yamada noted, then such a scenario would be “difficult to swallow”. Regardless of the politics, the key concern reportedly comes down to a simple question of Apple refusing to allow carrier junkware on their handset.
Apple has insisted from the onset that they be the only entity controlling what software goes on users’ iPhones. Apple is unlikely to change its stance as they’ve always acted as a gatekeeper of the iPhone, refusing to relinquish their ownership of user experience over to the carriers.
The closed operating system of the iPhone also limits NTT DoCoMo from pre-installing some of its applications—including its e-wallet, which allows consumers to pay for merchandise with their smartphones, as well as its i-mode email service—which Mr. Yamada said are important for Japanese customers.
We caught a glimpse of Apple’s legendary volume requirements when Sprint announced plans to spend $20 billion to purchase 30.5 million iPhones. Even though their CEO Dan Hesse said the handset is “worth every penny”, Sprint will lose money on the deal until 2014 and will need $7 billion in financing “to cover a cash shortfall caused by heavy investments in the Apple Inc iPhone introduction and a big network upgrade”.
With investment that large, no wonder regional operators such as U.S. Cellular and overseas carriers such as Telefónica Czech Republic AS both passed on iPhone 4S, blaming the decision on the hard-to-swallow terms of business dictated by Apple. Similar to the ongoing negotiations with NTT DoCoMo, Apple is also locked in a cat and mouse game with China Mobile, the world’s largest carrier which hosts ten million iPhones on its network even though it doesn’t carry the device yet. Not the fact that China contributed to one in six dollars of Apple’s Q3 2011 revenue and not even the secret meetings China Mobile reportedly held with Steve Jobs on occasions more than one would soften Apple, which won’t relent and bow to China Mobile’s unusual demand for App Store revenue sharing. So far, Apple’s been doing business exclusively with China Unicom, the country’s third-largest carrier, which is gearing up to launch iPhone 4S.