Vodafone Vs DoCoMo: 3G Sparks Wireless Battle

date: April 23, 2001

Japan's NTT DoCoMo and British-based Vodafone Group are racing to take pole position and dominate the future of mobile communications in Asia, Europe and the United States, but with markedly different strategies.

Vodafone, the world's biggest mobile operator, has been on a major acquisition spree since mid-1999 to build market share and a user base before launching high-speed, third-generation mobile Internet, video and quality music services.

Japan's top wireless company DoCoMo, whose name means ''anywhere'' in Japanese, puts greater importance on its home market, and will become the first cellphone group to bridge the generation gap and launch 3G services in Tokyo in May.

Unlike Vodafone, which likes to take control of overseas targets, the offshoot of Japanese telecoms monolith NTT only moved overseas last year by taking minority stakes.

Despite a conservative acquisition strategy, investors have rewarded DoCoMo by propelling its market value not only above that of its parent but also above Vodafone's amid hopes it will dominate the mobile data world as the first 3G-compatible networks level an international playing field.

Europe, Asia and parts of the United States are adopting the same W-CDMA standard of 3G technology, which is billed as minimizing interference and noise and offering stable, high-quality voice and multimedia services.

Unperturbed by a 50 percent drop in telecoms prices on average since last year as the global economy slows, revenues fall and debts mount, the two cellphone titans are forging ahead to build scale to milk potentially lucrative roaming revenues.

While DoCoMo is expected to break into South Korea and China in the first half of this year, Vodafone remains one of the few European telecoms companies with the financial clout to continue snapping up purchases despite heavy 3G license costs in Europe.

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