Japan’s DoCoMo May Tap Google on Phones

Japanese telco NTT DoCoMo is considering a partnership with Google, adopting the Web giant’s search and e-mail features in its mobile phone Internet service, company sources said this week.

The move marks a strategic shift for Japan’s largest wireless operator by seeking a partner, as the firm has been lagging behind much smaller rivals in luring new subscribers in recent months.

For Google, the alliance will provide access to DoCoMo’s 48 million users of “i-mode” mobile phone Internet service as it tries to expand its presence in Japan, where Yahoo Japan leads the Web search market.

The alliance may eventually lead to the development of new functions and handsets, the sources said.

As of 0409 GMT on Wednesday, shares of DoCoMo were up 3.3 percent to 190,000 yen by mid-morning, outperforming a 1.6 percent gain by the benchmark Nikkei average .N225.

“We are currently studying the possibility of an alliance in search services with domestic or overseas partners, but nothing has been decided yet,” DoCoMo spokesman Hiroto Nakagawa said.

Starting as early as spring, users will be able to access Google searches, e-mail, scheduling and photo-saving features through DoCoMo’s i-mode network service, the Nikkei business daily said.

While rival KDDI has already been working with Google in search and e-mail on its mobile phones, DoCoMo eyes deeper ties in services and technology with the U.S. firm, including development of next-generation handsets featuring Google’s operating system, the Nikkei said.

In a note to clients, Nomura Securities analyst Daisaku Masuno said DoCoMo’s move is expected to boost the firm’s data traffic revenue as expansion in services should increase page views.

DoCoMo, which controls over half of Japan’s mobile market, has been losing its market share amid a fierce price war.

Softbank, the smallest carrier, signed up a net 191,600 additional subscribers in November, beating its rivals for the seventh-straight month. DoCoMo got the smallest number of net users among the three, with 48,200.

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