Market share of mobile telecommunications

mobile carrier image mobile carrier market size changes carrier and smartphone market share

Telecommunications market size became more than five times for 30 years!

  • The market size of mobile telecommunications is about 15 trillion yen.
  • Docomo, KDDI and Softbank occupy mobile telecommunications market.
  • The market size of mobile telecommunications will increase if 5G and IoT spread.

The market size of IT(ICT) industry in Japan is about 80 trillion yen(about 800 billion dollars) according to the report of Ministry of Internal Affairs and Communications in 2016. The market size of telecommunications is about 25 trillion yen, that of mobile telecommunications is about 15 trillion yen among them. The telecommunications market size became more than five times for 30 years.

The number of portable telephone line(internet line for portable device) is about 170 million in 2017, that was 3.5% increase from the previous year. MVNO, mobile routers and IoT devices contribute to a a increse in telephone line. It is said that the number of telephone line will increase about 200 million lines by 2022.

the mobile telecommunications market changes and outlook

Japanese mobile phone carrier's Data ARPU(Average Revenue Per User) is about 5,000 yen(about 50 dollars) in 2016. That was 2.7% increase from the previous year. On the other hand, their Voice ARPU is falling into a slump since smartphones appeared. Japanese carrier seek for increasing Data ARPU by unlimited plans and family plans. However, Japanese government promotes to reduce a phone bill, and to spread MVMO. It is said that ARPU will decrease from 2018 on.

Japanese mobile phone carriers seek for making a breakthrough in such a situation by 5G. Many services with 5G are expected to start by Tokyo Olympics in 2020. For example, NTT Docomo and Fuji Television started application "JidorAR" which use AR technology with 3D data. Users of this app can see dancing themselves with pop singers by smartphones. A large data by 5G may support career's ARPU if apps for 5G spread.

About the market share of mobile telecommunications, NTT Docomo has the top share of this market. KDDI has the second share, Softbank has the third share. The others are UQ communications, Y!mobile, IIJ and more. In addition, Rakuten Inc announced entering into this market in 2018.

carrier and smartphone market share pie chart

NTT Docomo accounts for over 40% of mobile telecommunications market. Its sales is about 4.7 trillion yen, profit is about 960 billion yen in 2017. It belongs NTT Group which consists NTT, NTT DATA, NTT Communications, NTT finance and more. NTT was state-owned enterprise, but it was committed a government agency to a private entity in 1985.

KDDI which is known as "au" brand was founded by KDD Co, IDO Co and DDI Co. KDD and IDO are subsidiary companies of Toyota Motor, DDI is subsidiary company of Kyocera. Therefore, Toyota and Kyocera are major shareholders of KDDI. The sales of KDDI is about 4.9 trillion yen, the profit is about 950 billion yen in 2017.

By the way, the number of broadband network(FTTH and ADSL) is about 39.2 million in 2017. That was 1.6% increase from the previous year because mobile phone carriers sold cellular phones and FTTH as a set. However, a broadband network will shrink from 2020 because of 5G.

NTT Docomo, KDDI and Sofrbank are listed on the Tokyo Stock Exchange. Foreign investors can invest in them on NYSE by ADR(American Depositary Receipt). In addition, they can do them through many ETFs, MAXIS Nikkei 225 ETF(NKY), iShares MSCI Japan ETF(EWJ), Wisdomtree Japan Hedged ETF(DXJ) and more.