Current crisis acts as convenient distraction for wider NTT failings

Like many other businesses, NTT Docomo has pointed to COVID-19 for poor financial results, but this is a business which was struggling long before the coronavirus hit Japan.

In what should be considered a standard screen play from the PR handbook, NTT Docomo has offered much more detail on the 5G roadmap than any would have expected. Why, some might ask, perhaps as a distraction from the negative news which has been unveiled during the year-end financial results.

“As for the guidance for FY2020, given the difficulty of making reasonable estimates on our financial results due to the impact of COVID-19 outbreak, we decided not to make any disclosures at this juncture,” said CEO Kazuhiro Yoshizawa.

“After carefully assessing the impact on our financial performance, we will make a prompt announcement once it becomes possible to make reasonable estimates.”

NTT Docomo will not offer any guidance while the current crisis plagues society, while it has been a poor year from the Japanese telco. COVID-19 will of course explain some of the declines, but it would appear to be only one contributing element.

NTT Docomo full-year financial results to March 31 (USD ($), millions – approximate)
  Actual Year-on-year
Operating revenues 43,579 -3.9%
Operating expenses 35,570 -0.8%
Operating profit 8,007 -15.7%
Profit before tax 8,132 -13.4%
Profit 5,572 -10.5%

It might be easy to attribute the decline to COVID-19, but as you can see from the table below, revenues have been down year-on-year across all quarterly reports.

Breakdown of full-year financial results by quarter (USD ($), millions – approximate)
  Operating Revenues Year-on-year
Q1 2019 10,864 -1.5%
Q2 2019 10,971 -3.5%
Q3 2019 11,114 -6.3%
Q4 2019 10,638 -4.4%
FY 2019 43,579 -3.9%

For some businesses it is perfectly fair to largely ignore revenue declines in the most recent financial results, COVID-19 is a very unique crisis, though you have to place it into context. At NTT Docomo, the financial decline has been in place long before the impact of the coronavirus pandemic. It could be viewed as a convenient distraction for the wider failings across the business.

Of course, there is a direct link to COVID-19 also. International roaming is significantly down, migration from 4G to 5G has decelerated, while sales for data packages and ‘Smart Life’ solutions are lower due to shop closures. The coronavirus pandemic is causing problems, but the financial decline at NTT Docomo seems to be much more.

One issue for NTT Docomo seems to be eroding ARPU, as mobile subscriptions have been increasing, as well as some very heavy discounts and promotions across the year. Competition has intensified in Japan, which has been hitting revenues, though it might only get more detrimental for NTT Docomo as Rakuten enters the market with incredibly disruptive pricing plans. Looking at statement Rakuten has already made, tariffs look to be roughly half the price what is being offered by rivals.

Alongside the financial results, the telco has also offered greater insight into the 5G deployment plans over the next 12 months, as well as targets through to 2023. These projects will certainly keep the team busy.

After launching its 5G commercial services, NTT Docomo has said it has deployed 500 base stations to date, attracting 14,000 subscribers. Over the next 12 months, the team will continue this rollout (aiming to have 10,000 5G base stations by June 2021) while also concentrating on integrating OpenRAN solutions and mmWave spectrum.

By this point next year, NTT Docomo should have launched 5G commercial services in 500 locations including all government-designated cities, while it aims to have 2.5 million 5G subscribers. There are currently seven ‘5G services’ available, which will be increased across music, gaming, video and sports, while there are also 22 partnerships in place for the co-creation of new 5G solutions.

The 5G plan offers much more detail than many other operators have offered to date, though a sceptic might suggest this is a distraction technique to draw eyes away from financial failings.

NTT Docomo pulls its NB-IoT service after less than a year

Japanese telco NTT Docomo has decided providing services based on NB-IoT narrowband technology isn’t worth the hassle, so it’s going to stop.

The brief announcement was published only in Japanese, so we’re indebted to Google Translate once more. It apparently said NTT has been offering NB-IoT services since 25 April 2019, but in the light of the current business environment it’s going to stop, in order to concentrate management resources.

Read into that translation what you will, but it seems clear that the technology just isn’t adding up. Even more damning is the fact that NTT is going to keep providing IoT services based on Cat 1 and LTE-M technology, which implies it’s specifically the standard, rather than IoT in general, which is failing to deliver.

To find out why that might be we spoke to wireless technology expert William Webb. “NB-IoT looked at one time as if it would become the only wide-area IoT network, sweeping all others away,” said Webb. “Its advantages seemed to be overwhelming – it can be deployed by a software update to existing 4G base stations, quickly and cost-effectively delivering nationwide IoT coverage. Chipsets are available from Huawei and others and many module designs are in the marketplace although these have not yet hit the price points and power consumption levels that were originally promised.

“But things have not gone quite to plan. NB-IoT has not been widely deployed. In some countries only one MNO has deployed, resulting in no competition. In other countries operators are deploying ‘on demand’, waiting until they have an order and then delivering the coverage required (eg across a campus). Only in a very few places is there vibrant competition.

“Why is this? Broadly it is due to the business case. Revenues are very weak with 10-year IoT SIM cards available for around $10, so only $1/year, miniscule by cellular standards. Volumes have been low, as they have for all IoT systems, questioning whether this is a large market. Sales have been difficult, requiring complex systems offerings, at high cost. As a result, many MNOs are struggling to make NB-IoT viable. And there is an opportunity cost as NB-IoT takes some spectrum away from the cellular network.”

Webb concluded by noting that this move is likely to send shockwaves around the telecoms world, as it will cause everyone else to question the viability of investing in NB-IoT services. That, in turn, could well initiate a self-reinforcing downward spiral. NTT made no mention of COVID-19 in its announcement, but it seems safe to assume the business environment will be very risk-averse for the rest of this year, which is further bad news for the LPWAN standard that once looked destined to dominate the IoT world.

Amdocs, NTT Docomo and CommScope are the latest MWC casualties

Add three more major exhibitors to the growing list of companies deciding not to risk coronavirus infection at Mobile World Congress 2020, and they won’t be the last.

Software vendor Amdocs is at the heart of the telecoms industry and usually has one of the most prominent stands at the big telecoms trade show of the year. Japan’s NTT Docomo is the first major operator to decide discretion is the better part of valour when it comes to combining novel pathogens with foreign climes, while CommScope is a major fixed-line infrastructure player.

“In the face of the public health concern from the novel coronavirus, we are placing the highest priority on protecting the health of our employees, customers and partners,” said Shuky Sheffer, CEO of Amdocs. “While we appreciate the precautionary measures put into place by the GSMA, we believe the safest option is not to attend MWC 2020 in Barcelona.”

So far NTT seems to have only made the announcement in Japanese, but the magic of Google translate yielded the following: “At present, the impact of the new coronavirus is expanding, and we were planning to exhibit from February 24 (Monday)-February 27 (Thursday) 2020. In consideration of the safety of the visitors, partner companies and staff members, we decided to cancel the exhibition.”

“With the continued global threat of the Coronavirus, CommScope has made the decision to cancel our physical presence at Mobile World Congress 2020 in Barcelona,” said the CommScope announcement. “This is not a decision our executive team took lightly, and although the likelihood of contracting the virus is low, we will not risk the health of our employees, nor the business impact that would result if a quarantine were ordered.”

These latest announcements take the total to nine major contributors bailing on the big telecoms trade show of the year in the past few days, including many of its largest exhibitors. If this rate of cancellation keeps up there won’t be many left by the time Mobile World Congress 2020 opens its doors on the morning of 24 February.

NTT DoCoMo says what it thinks 6G should be all about

Japanese operator NTT DoCoMo has become one of the first industry heavyweights to lay out its vision for 6G technology and service expectations.

In a recently published whitepaper, Japan’s largest mobile operator outlined what it believed how 6G would look like, including technology requirements, service scenarios, and the next step research agenda. NTT DoCoMo becomes the latest, as well as one of the first leading telecom operators, to set down a marker in the nascent but active 6G discussion.

This document was published 40 years after the then Nippon Telegraph and Telephone Public Corporation launched what it claimed to be the world’s first cellular mobile communications service. The company believes the mobile telecom industry normally goes through a generational technology change every 10 years, while the model of value creation would undergo a step change every 20 years. It sees 5G such a step change, and 6G being an upgrade, though immensely better. The operator expects 6G service to start rolling out around 2030.

Somewhat confusingly, the NTT DoCoMo authors called the ramp up from 5G to 6G “5G Evolution”, a term that has been used by companies like AT&T and Ericsson to refer to the stage when the industry was running up from 4G to 5G, and appeared as a debatable logo on AT&T phones before the carrier’s 5G service was launched.

Source: NTT DoCoMo

Specifically, the NTT DoCoMo whitepaper lists these six technology benchmarks for 6G to achieve:

  • Extremely high-speed and high-capacity communications, e.g. peak data rate to go >100Gbps;
  • Extreme coverage extension, including coverage in high altitude, under sea, and in space;
  • Extremely low power consumption and cost reduction, including alternative charging technologies;
  • Extremely low latency, e.g. sub 1ms end-to-end latency;
  • Extremely high reliability, e.g. availability to improve from “five-nine” to “seven-nine” (99.99999%)
  • Extremely massive connectivity and sensing, e.g. handling 10 times as many connections as 5G does in comparable space

The operator sees these technology properties critical to realise the use cases ranging from the fusion between digital and physical environment and communication between humans and things to bridging the digital gap between different social groups and addressing other societal issues.

NTT DoCoMo believes the following should be the R&D focus areas in the years to come:

  • New network topology
  • Coverage extension including non-terrestrial network
  • Frequency extension and improved spectrum utilization
  • Further advancement of wireless transmission technologies
  • Enhancement for URLLC and industrial IoT networks
  • Expanded integration of variable wireless technologies
  • Multi-functionalization and AI for everywhere in mobile network

What NTT DoCoMo has laid out, despite with more details, is not too different from what the Finnish 6Genesis programme announced at last year’s Mobile World Congress, including the expected timing of 6G rollout. The industry conversation has since picked up speed, with the first 6G Wireless Summit held in the Finnish Lapland in March.

The so-called “world’s first 6G White Paper” was published in September, to which the new NTT DoCoMo whitepaper has much in common, in particular the research agenda. However, the clout of one of the world’s largest mobile operators will lend weight to the ongoing discussion of what 6G should be about. While China has also thrown its weight behind 6G, we can expect to hear more about this topic at the upcoming MWC 2020.

NTT kicks-off 5G foray at Rugby World Cup

There might be more attention given to the rugby than mobile networks in Tokyo right now, but the World Cup is giving NTT Docomo a pleasant opportunity to test out its 5G smarts.

Last Friday, the Rugby World Cup kick-off in Japan and NTT said it was also offering a trial 5G service ahead of a full-commercial launch in Spring 2020. According to local press, 5G devices will be set-up in local stores to allow for a more in-depth experience of the games, while the telco has also announced it will step-up deployment plans.

“We are marking Friday as the day we begin our full-fledged 5G services,” said NTT Docomo President Kazuhiro Yoshizawa.

Although this is progress, what is worth noting is this is little more than a dress-rehearsal for the telco. As one of the official partners of the Rugby World Cup, NTT has an excellent opportunity to test out how the network will perform under strain. Lessons learned here will be passed onto the next big-ticket event, the Tokyo 2020 Olympics.

This is an event which will give NTT the opportunity to show-off what it can do and put itself in a leading-position in the 5G race. The world will be watching the Olympics, huge numbers of fans will flood into the country and connectivity will be tested to the extreme.

Alongside the announcement of the 5G trial, NTT has also said it will speed-up 5G deployment plans over the next couple of months. Given one of its rivals, Softbank, said that was shifting up a gear last week, it was only going to be a matter of time before NTT followed suit.

By next June, NTT has suggested it will be ready to launch the 5G connectivity onto the waiting masses, with plans to have 10,000 base stations in action by the spring of 2021. The team also wants 60% population coverage by 2023, a reasonable objective and certainly not one of the most aggressive we have seen around the world.

While Japan was arguably one of the leading voices in the 5G arena during the early years, it has maybe fallen into the shadows. This is nothing to do with the continued progress of the Japanese telcos, but perhaps due to the fact others around the world have been much more vocal and bullish. Realistically, it doesn’t matter a huge amount whether the 5G networks are switched-on or not right now, the big difference will be how quickly the telcos can scale the coverage footprint.

This is a challenge which will be faced by every nation around the world, though with the Rugby World Cup and the Summer Olympics next year, Japan has an excellent opportunity to stake a claim for global leadership.

NTT Docomo set to ditch Huawei phones over Android fears – report

Japanese operator group NTT Docomo will not offer Huawei smartphones when it launches its 5G network next year, according to a report.

The scoop comes courtesy of Nikkei Asian Review, which chatted to some NTT execs that preferred to keep it on the QT. The reason for this sudden reticence is fairly simple: if Google pulls the plug on Android support for Huawei phones the operator doesn’t want to be stuck with thousands of very expensive bricks that nobody wants to buy.

If this is true then it sets a very alarming precedent for Huawei, especially if the other Japanese operators follow suit. Japan was apparently Huawei’s fifth largest market last year and is right in the middle of the geopolitical arm wrestle between the US and China that has forced Google’s hand when it comes to Android support for Huawei phones.

The Nikkei Asian Review is on good form today, having also learned that Softbank is hoping to launch its 5G network two years ahead of schedule. How great an achievement this is, however, is open to debate, since many 5G networks around the world are already live. If the original projection by Softbank was that it wasn’t going to get its 5G act together until 2022 then it just as well it has belatedly pulled its socks up.

All four operators are awarded 5G licences in Japan, with security conditions attached

NTT DoCoMo, KDDI, Softbank, and Rakuten have all received the 5G licences they applied for, but they come with coverage obligations and security commitment.

The Ministry of Internal Affairs and Communications announced on 10 April (in Japanese) that all the four applicants have been awarded radio frequencies and licences to rollout 5G services. Each licensee is awarded 400MHz spectrum on the 28GHz frequency, while three of them are awarded 200MHz on 3.7GHz except Rakuten, which has requested 100MHz.

All the operators are going to roll out 5G services starting in 2020. NTT DoCoMo, KDDI and Softbank will launch the service in spring time, with Rakuten planning to open its service in June. The total investment planned by the operators to the end of 2024 amounted to Yen 1.6 trillion ($14.4 billion).

While both NTT DoCoMo and KDDI have pledged to cover over 90% of the country within five years, Softbank only plans to cover 64% of the country and Rakuten 56%. The minimum requirement from the government is serving every prefecture within two years, and at least 50% of the whole country within five years, calculated by the number of geographical blocks the networks will cover out of the total 4,500 blocks the Ministry divides the country into.

In addition to coverage requirement, the Ministry has also attached a dozen granting conditions (pp.16-17 of the summary, in Japanese), including commitments to expand optical fibre networks (#2), to improve safety measures to minimise outage during natural disasters (#3), to prevent interference of existing radio licensees (#7) etc.

The item that may raise eyebrows is Item 4 on the list, which requires the operators to “take appropriate cyber security measures including measures to respond to supply chain risks” (unofficial translation). It refers to earlier regulations including the “”Information and telecommunications network safety and reliability standards” published by the Ministry of Post and Telecommunications in 1987, “Common Standards Group for Information Security Measures for Government Agencies and Related Agencies” issued by the National Information Security Center (NISC) in 2018, and the cross-departmental “Agreement on IT procurement policy and procedures for goods and services” published on 10 December 2018.

The last two documents, though neither of them names any particular countries or brands to be excluded, have been broadly recognised as the Japanese government’s decision to ban companies like Huawei and ZTE from public sector procurements. By invoking these regulations, it may not be too much of a stretch to read it as a message to the operators to stop using equipment supplied by the Chinese vendors. This may not cause serious disruptions to the operators’ business though, as Softbank, the only operator that has Huawei equipment on its network, is already planning to swap for Ericsson and Nokia, Nikkei reported earlier.

Japanese 5G licensees

5G ROI is a no-brainer for us – Orange

5G is clearly critical for the digital economy of tomorrow, but the expensive job of rolling out the networks take a bit more cunning thought.

Speaking on a panel session at Total Telecom Congress in London, Yves Bellégo, Director of Network Strategy at Orange pointed out there is no debate on the ROI for 5G. It’s simple; 5G enables us to deliver data significantly cheaper. With internet traffic continuing to explode, and mobile usage heading north as well, why wouldn’t anyone want to invest in something which can make business operations cheaper.

But here is the clincher; rolling out these networks is an expensive job, and ROI still hasn’t be completely justified. Telcos will have to accept the ‘build it and they will come’ attitude, though trying selling that to accountants. As Takehiro Nakamura, General Manager of 5G Labs at NTT Docomo pointed out, 5G will not just be there overnight, the rollout out will be gradual and it will be years before the concept of nationwide if even close to a reality because of this very reason.

For 5G to realise its potential, there will need to be considerable thought to identify the services which can be offered from Day One. It isn’t going to be as simple as offering a sweeping portfolio of new services, with the progressive rollout which many telcos have in mind, with 4G and 5G working alongside for years to come, difficult choices will have to be made.

Fortunately, a lot of these services can be offered on 4G, though as Ramy Boctor, CTO of Vodafone Qatar, pointed out, the performance will just be better on 5G. Perhaps this will play into the hands of the telcos; limited supply and potentially high demand, a perfect recipe for making money.

This is perhaps a fact which is lost in the buzz and hype; 5G will be incredibly limited for years to come. The rollout will take time, upgrading existing sites will take time, densifying the network with new sites will take time. This is not something many people seem to be saying, but it is worth remembering.

Nokia takes 5G to the edge in Brooklyn

Networking vendor Nokia is using a 5G event in New York to show off some of its latest shiny things.

The Brooklyn 5G Summit describes itself as a ‘5G technology summit hosted in Brookly, NY’, which seems hard to argue with. The listed contact from the event is a Nokia email address so we’re going to assume Nokia runs the whole thing unless advised otherwise, and there don’t seem to be any other vendors involved.

The big thing Nokia is looking to bring attention to this year is its Edge Cloud datacenter solution, which is inevitably being positioned as 5G-ready. Nokia has been putting a lot of effort into the datacenter side of things in recent years via its AirFrame portfolio, which looks like an increasingly wise bet as edge computing becomes ever more prominent in the telecoms world.

This announcement concerns a server specifically designed for edge computing. It puts an emphasis on open architectures and software for fast deployment (it’s OPNFV compatible), and support for ultra-low latency to support things like automation and Cloud RAN. All this stuff plays a big role in 5G so that juxtaposition seems fair enough in this case.

“The edge cloud will play an essential role in delivering the compute power required for 5G,” said Marc Rouanne, President of Mobile Networks at Nokia. “By expanding our AirFrame and 5G Future X portfolio we can provide a network architecture that meets the needs of any operator and their customers.

“Used with the Nokia ReefShark chipset and our real-time cloud infrastructure software, the Nokia AirFrame open edge server will deliver the right decentralization of 4G and 5G networks. We can work with operators to ensure that data center capabilities are deployed exactly where they are needed to manage demands as they expand their service offering.”

“The edge cloud is an integral part of 5G network architecture, bringing more processing capabilities closer to where data is generated and consumed,” said Dan Rodriguez, GM of the Communications Infrastructure Division at Intel. “Nokia’s new AirFrame open edge solution is built on Intel Xeon Scalable processors, which offer the needed balance of compute, I/O and memory capacity for the edge cloud to work seamlessly across the wide range of workloads deployed on the edge.”

And that’s not the only piece of 5G-related goodness Nokia has bestowed on the grateful residents of Brooklyn this week. Nokia Bell Labs has persuaded NTT DOCOMO to get involved in some demo some millimetre wave tech involving a phased-array chip solution for the 90 GHz band to increase radio coverage in higher frequency bands and deliver multi-gigabit speeds at scale.

The main point of this demo seem to be to show the viability of 5G at these very high frequencies, including the use of a large number of antennas and also show how dynamic offloading relocation in a 5G core will enable low-latency networks.

“At Bell Labs, we work with leading operators such as NTT DOCOMO to develop disruptive technologies that will redefine human existence,” said Bell Labs President Marcus Weldon. “At the Brooklyn 5G Summit, we will show the world’s first RF solution that addresses the challenge of delivering optimized coverage for future mmWave frequencies, using a pioneering RFIC design that can be scaled to any array dimension and deliver optimized connectivity to any set of devices.”

Nokia crows about flogging some kit again

Japanese operator NTT Docomo bought some baseband gear from Nokia. That’s it – nothing else happened – sorry.

It was great gear though, with all the bells and whistles like antenna and flashing LEDs and that. In fact, as far as baseband gear goes, it wouldn’t be an overstatement to call it legendary. KDDI and Softbank are going to be sooo jealous when NTT installs these paragons of shininess. They’re going to want to just chuck their basebands in the bin.

And as if that’s not enough these basebands are totally 5G as well. You know you get some basebands that say they’re 5G but you can just tell their heart isn’t in it? This isn’t one of those times – these are 110% 5G to the max. They’re the 5G-est basebands you’ll ever see. If you said ‘4G’ to them they’d be like: “I don’t even know what you’re talking about bruv, I’m all about the 5G innit.”

“We have been collaborating with partners such as Nokia on various 5G technology and use case trials since 2014,” said NTT CTO Hiroshi Nakamura. “With this agreement with Nokia, we are now proceeding to the next step to launch 5G mobile services by 2020, and accelerate co-creation of new services and businesses with vertical industry partners.”

“The agreement with NTT Docomo is a major milestone in bringing 5G to commercial reality, especially in a country with a long and proud history of technological achievements and early technology adoption,” said Marc Rouanne, President of Mobile Networks at Nokia. “Together we have worked hard in recent months to commence preparations for NTT Docomo’s eventual launch of its operational 5G service by 2020, which we have now set in motion by this very exciting announcement today.”

In other news Nokia got some new curtains at its HQ that really brighten up the place and it found a great new sushi place in Helsinki. Furthermore Nokia’s new trainers cost loads more than Ericsson’s, it has a PlayStation 4, an Xbox One and a Nintendo Switch with loads of games and steering wheels and stuff, and its dad could totally batter Ericsson’s dad in a fight.