Japan's J-Phone delays 3G launch

In a further blow to expectations for third-generation (3G) mobile systems, Japan's J-Phone Communications Co. Ltd. has announced a six-month delay in the rollout of its W-CDMA (Wideband Code-Division Multiple Access) service.

The company, in which Japan Telecom Co. Ltd. and Vodafone Group PLC are leading shareholders, said it now expects to launch commercial service in Tokyo in June 2002 and in the central and west Japanese cities of Nagoya and Osaka in October 2002. In a sttaement, it blamed slow development of hardware for the delay.

The delay means NTT DoCoMo Inc. will have a one-year head start over J-Phone in starting 3G services in Tokyo. NTT DoCoMo has long promised to launch the world's first commercial W-CDMA service in May this year, although with less than three months until launch, the company has yet to announce a launch date or provide any details of terminals or services. NT DoCoMo, which has drawn a lot of media attention in recent months because of its plan to be first with 3G, remains fully committed to launching in May, a company representative said Thursday.

After enjoying months of hype propelled by glitzy demonstrations of portable videoconferencing, promises of video and audio on demand and a series of multibillion-dollar auctions of radio spectrum, the image of 3G services has recently begun to come down to earth. Service providers and hardware makers alike are waking up to the fact that the path to 3G nirvana won't be as smooth as originally thought.

Numerous analysts have questioned to ability of some carriers to make money given how much they spent obtaining 3G spectrum, and also how much demand exists for the types of services that are expected to be on offer. More recently, equipment makers have been forced to admit that deployment of networks and handsets is running behind schedule. At a recent conference in Hong Kong, an analyst said adoption of the services in countries that don't already have strong wireless data services is likely to take several years longer than expected. The third Japanese cellular carrier, DDI Corp.'s Au Group, is planning to launch services some time next year based on the CDMA2000 system. That system is already in commercial use in South Korea by SK Telecom Co. Ltd. as an upgrade to its second-generation CDMA network, although the company has yet to actively promote the service because of a lack of handsets.

The latest two models, launched last week, still offer few benefits over existing second-generation handsets and none of the bells and whistles promised for 3G services. Japan Telecom, in Tokyo, can be contacted at +81-3-5540-8020 or found online at http://www.japan-telecom.co.jp/.

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