WW-162 -- Mobile Commuter Passes Release 2

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J at pan Inc presents the Wireless Watch Newsletter:

W I R E L E S S W A T C H

Commentary on the Business of Wireless in Japan
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Issue No. 162
Thursday April 5, 2007
Tokyo

SUBSCRIBERS: 23,930 as of April 5, 2007

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Mobile Commuter Passes Release 2

East Japan Railways (JR East) introduced the mobile version
of its Suica commuter passes in January 2006. The phone can
be used as a debit card through charging an embedded IC chip.
Just like the Suica card, a Mobile Suica compatible phone
commuters hold their mobile phone near the sensor of the
automatic fare gate to pay and pass through. The Suica
phones can also be used as e-wallets at more than 10,000
shops in the greater Tokyo region. Even coin lockers at
station accept Suica payments.

As of October last year, about 200,000 Mobile Suica users
were registered. Growth was limited to 500-1,000 users a day
not so much regarding the more than 18 million Suica cards
issued. Indeed, we did not see many people using their mobile
phone passing the fare gates.

A major bottleneck for faster growth was that a View Card -
the railway company's credit card was required to apply
for Mobile Suica membership. The Mobile Suica usage fees
to top-up the Suica were charged to this credit card.

Due to several measures, growth rates are due to accelerate.
Applicants are not bound anymore to the View Card all major
credit cards can be used now. Furthermore, the Easy Mobile
service was introduced. This new service does not require
registering a credit card anymore. Recharging the Mobile
Suica can be done at the cashier in convenience stores.
Also more phones are Mobile Suica compatible, and the three
main mobile carriers DoCoMo, KDDI and Softbank support the
service now.

The first results are already visible about 1,000 to
1,500 people register every day. About half of the new
applicants registered using a different credit card, while
35% applied for Easy Mobile. JR East expects that by the
end of March 2007, 400,000 Mobile Suica will be issued.

Last month, the public and private railway, underground
and bus companies linked their commuter pass systems.
Before Suica could only be used when traveling on JR-lines.
As of March 18, usage of the Suica card has been extended to
all public transport systems. To change from JR to subway
lines does not require different passes or debit cards
anymore - a major improvement of the commuting experience.

The public transport companies and mobile carrier have now
created a stable platform that will enable much faster growth
of e-wallet penetration. Don't be surprised there will be one
million Mobile Suica by the end of this year.


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STAFF
Written by Arjen van Blokland; edited by the
J at pan Inc staff (editors at japaninc.com)
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