MEX

DoCoMo has just announced its eloquently titled ‘Medium Term Vision 2015‘. It sets out a clear commitment towards becoming a vertically integrated service provider, offering complete customer experiences in several areas, from media and banking to health and sustainability. DoCoMo intends to buy or build majority stakes in companies working in these areas, integrate them tightly with its core network and deliver the service to customers.

Over-simplified debate on the future of network operators (to bit pipe or not to bite pipe?) has padded out conference agendas for as long as I’ve been in the industry. While it continues to lull event participants to sleep, it has been largely irrelevant for end users: almost every new service since voice calling and SMS has been driven by third party innovation, not in-house network development.

Exceptions, however, are always need to prove the rule and as has often been the case in mobile, we must look to Japan for an alternative reality.

DoCoMo’s plan targets a 2.5x expansion in revenue from these new businesses over the next 4 years, while supporting a 12x growth in network traffic.

At a time when most operators around the world are stepping back from attempts to build their own new product experiences (witness the recent demise of Vodafone 360), DoCoMo’s strategy PDF makes for fascinating reading.

Operators fail to develop new experiences not because they are incapable, but because they are unwilling. If DoCoMo succeeds it will be because it has recognised the need to focus on what is delivered to the customer and then shape its network accordingly. In contrast, most operators tend to build a network and then create a separate division tasked with the broad and nebulous duty of ‘service innovation’. Corporate politics and the challenges of navigating your own company structure as an ‘internal customer’ doom such attempts to failure every time.

DoCoMo’s promise to become an ‘integrated service provider at its core’ has the ingredients for success: customer focus, board level management support and a mandate to invest in building proper business units to look after the users. I will watch with interest as the Medium Term 2015 approaches.