Japan's KDDI sees lower mobile phone sales for '08

KDDI predicts its mobile phone sales may have fallen as much as 30% this summer, as operators switch to a new sales model and the domestic market matures, a Reuters report said.

The Reuters report quoted KDDI president Tadashi Onodera also saying that sales will likely fall some 20% in the coming winter shopping season.

Japan's top three operators, which include DoCoMo and Softbank, have embarked on new sales plans which have boosted the price of mobile phones and cut calling fees.

The higher prices have hurt unit sales as users tend to keep their phones longer but carriers' profits have benefited as they no longer need to pay heavy subsidies to retailers to fuel sales, the Reuters report said.

'We are being careful with our orders, so inventories are not piling up that much,' Onodera told reporters.

'We do have more inventory than last year, but we believe we can sell enough of that.' KDDI sold 2.86 million handsets in the latest quarter, down 19% from the same period last year as many of its Tu-Ka brand users upgraded their phones last year before the brand ceased service in March 2008.

The company had previously operated services under two separate brands -- Tu-Ka and au -- on different bandwidths. The Tu-Ka brand stopped accepting new subscribers in 2006.

Mobile phone sales for industry leader DoCoMo, which shifted to the new model last November, fell 21% in the April-June quarter, hurt also by the difficulties of selling in a mature market where about 85% of population already own a cellphone.

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