EDITOR’S NOTE: This story has been modified. See below for an explanation of the changes made to this story since it initially appeared.
Apple’s iPhone has wowed most of the globe — but not Japan, where the handset is selling so poorly it’s being offered for free.
What’s wrong with the iPhone, from a Japanese perspective? Almost everything: the high monthly data plans that go with it, its paucity of features, the low-quality camera, the unfashionable design and the fact that it’s not Japanese.
In
an effort to boost business, Japanese carrier SoftBank this week
launched the "iPhone for Everybody" campaign, which gives away the 8-GB
model of the iPhone 3G if customers agree to a two-year contract.
"The
pricing has been completely out of whack with market reality," said Global Crown Research analyst Tero
Kuittinen in regard to Apple’s iPhone
prices internationally. "I think they [Apple and its partners overseas]
are in the process of adjusting to local conditions."
Apple’s
iPhone is inarguably popular elsewhere: CEO Steve Jobs announced in October that the
handset drove Apple to becoming the third-largest mobile supplier in
the world, after selling 10 million units in 2008. However, even before the iPhone 3G’s July launch in Japan,
analysts were predicting the handset would fail to crack the Japanese
market. Japan has been historically hostile toward western brands —
including Nokia and Motorola, whose attempts to grab Japanese customers
were futile.
Besides cultural opposition, Japanese citizens possess high, complex standards
when it comes to cellphones. The country is famous for being ahead of
its time when it comes to technology, and the iPhone just doesn’t cut
it. For example, Japanese handset users are extremely into video and
photos — and the iPhone has neither a video camera nor multimedia text
messaging. And a highlight feature many in Japan enjoy on their handset
is a TV tuner, according to Kuittinen.
What else bugs the
Japanese about the iPhone? The pricing plans, Kuittinen said. Japan’s
carrier environment is very competitive, which equates to relatively
low monthly rates for handsets. The iPhone’s monthly plan starts at
about $60, which is too high compared to competitors, Kuittinen added.
And then there’s the matter of compartmentalization. A large portion of Japanese citizens live with only a cellphone as their computing device — not a personal computer, said Hideshi Hamaguchi, a concept creator and chief operating officer of LUNARR. And the problem with the iPhone is it depends on a computer for syncing media and running software updates via iTunes.
"iPhone penetration is very high among the Mac users, but it has a huge physical and mental hurdle to the majority who just get used to live with their cellphone, which does not require PC for many services," Hamaguchi said.
Cellphones are also more of a fashion accessory in Japan than in the United States, according to Daiji Hirata, chief financial officer of News2u Corporation and creator of Japan’s first wireless LAN, who spoke to Wired.com in June 2008.
So that would suggest that in Japan, carrying around an iPhone — a nearly year-old handset compared to the very latest Japanese cellphones — could make you look pretty lame.
Nobi Hayashi, a journalist and author of Steve Jobs: The Greatest Creative Director, told Wired.com in June 2008 that Japanese consumers also tend to shop for features, picking phones like the Panasonic P905i, a fancy cellphone that doubles as a 3-inch TV. It also features 3-G, GPS, a 5.1-megapixel camera and motion sensors for Wii-style games.
"When I show this to visitors from the U.S, they’re amazed," Hayashi said at the time. "They think there’s no way anybody would want an iPhone in Japan. But that’s only because I’m setting it up for them so that they can see the cool features."
However, despite its wow factor, the Panasonic proved to be crippled by usability problems, Hayashi noted. Hayashi is the proud owner of an iPhone, although he also carries other phones that can be used to pay for subway fares, taxis and food.
Kuittinen said he’s predicting Apple’s next iPhone will have better photo capabilities, which could increase its odds of success in Japan. However, he said the monthly rates must be lowered as well.
Otherwise, Apple might as well say sayonara to Japan.
Updated 10:30 a.m. Friday: Added a quote from concept creator Hideshi Hamaguchi about PCs and compartmentalization.
See Also:
Photo: DannyChoo/Flickr
EDITOR’S NOTE: Dylan Tweney here. I’m the senior editor in charge of Gadget Lab, and I’d like to explain what happened with this story and offer Wired.com’s statement about it.
Since this story was first published on Feb. 26 we have received a lot of feedback questioning our reporting and conclusions. We agree with some of the criticism and have updated and corrected parts of the story in response. Nevertheless, those errors aside, we believe the main thrust of the story is essentially correct. In short, there is good evidence the iPhone is not selling as well in Japan as it is elsewhere, thanks in part to demanding and specific Japanese expectations and tastes in mobile phone devices. Much of that evidence still stands.
However, there were problems with the way we used two of our sources, and with how we handled the corrections we made.
The first of those sources was a quote from Nobiyuki Hayashi that had originally appeared in an earlier Wired.com story, "In Japan, Cellphones Have Become Too Complex to Use."
Later in the day we added a statement by Daiji Hirata, taken from the same article. It’s not unusual in journalism to cite statements from earlier stories — and to quote from stories published by others — but in this case, we clumsily paraphrased Mr. Hirata’s and Mr. Hayashi’s statements, misconstruing what they had originally said.
The statement that carrying an iPhone "could make you look pretty lame" is our conclusion, not Mr. Hirata’s or Mr. Hayashi’s.
We also used their statements out of context, which compounded the errors; and we didn’t make it crystal clear that we took Mr. Hirata’s and Mr. Hayashi’s statements from an earlier story.
Mr. Hayashi did respond to an e-mail inquiry from us, but we didn’t receive his response until Friday, Feb. 27, after the story appeared. His email made it clear that the iPhone, despite several well-publicized problems, is doing better than expected, but that it still falls short for the Japanese market in several key areas. Mr. Hayashi spells out his view of the iPhone’s pros and cons on his blog.
We updated the story on Friday, Feb. 27, to try and correct these misattributions, but again, we didn’t make it crystal clear what changes we made to the story and why. We’ve made one more set of changes today to make the context and meaning of Mr. Hayashi’s quote plainer and to make it even clearer that Mr. Hirata’s statement came from the earlier story.
Wired.com regrets the errors, and we apologize to Mr. Hayashi and Mr. Hirata for misconstruing their statements.
We also apologize to you, the readers. Errors happen, on Wired.com as elsewhere. But we mishandled the situation by not disclosing, here on Gadget Lab, exactly what changes we were making.
We made the corrections in a good-faith attempt to correct errors in the story, but without making it clear to the public what changes were made and why. In so doing, we violated your trust. In the future, we’ll be far more transparent about disclosing those corrections as we make them.
One more thing: we could have discussed the edits and the feedback from Mr. Hirata and Mr. Hayashi in the comments. However, I closed the comments on this story on Friday afternoon because they were turning into a cesspool of racial invective.
We welcome vigorous debate and disagreement in our comments, but we will delete hate speech and off-topic invective. I have reopened comments on this post, but will close them again if necessary.
We do acknowledge the important role that our critics, including Apple Insider, played in pointing out the errors in this article.
As always, we welcome your feedback and strive to correct errors whenever we make them.
Apple just sent out an email to MobileMe subscribers to let them know of some new(ish) features. The biggest bullet point is the fact that push is back.
