Japan Mobile Internet Device (MID) Market Forecast 2008-2012

In 2007, smartphones increased notably in the Japanese mobile market, and at the same time Ultra Mobile PC (UMPC)-type handsets were introduced. The emergence of new types of handsets in the saturated mobile market of Japan means that the mobile operators are focusing on meeting user needs by developing differentiated handsets, rather than exploring new markets.

Recently, players in the industry, led by chipmaker Intel, are actively pursuing a market for Mobile Internet Devices (MID). Accordingly, mobile devices equipped with chipsets for low power consumption are being released, UMPCs in particular.

In this report, ROA Group aims at introducing the MID market of Japan and provides a market forecast until 2012. The concept of MID is defined in this report according to five conditions, which are Mobility, Always-On, Embedded 3G+, Display Size, and Full Browsing as follows:

• 1. Mobility: MIDs have to be in-pocket size while meeting the definition of mobile devices just like smartphones.
• 2. Always-On: To be differentiated from small notebooks and the UMPCs, MIDs have to enable 24-hour battery life and always-on function, with which it can communicate with base stations all the time. Considering the fact that operating various applications and being operated on heavy OS requires enormous battery consumption, introduction of MIDs meeting the always-on function will take some time. In addition, applications demanding seamless communications with base stations (such as messenger and PUSH-type information system) will increase. Likewise, MIDs have to overcome many issues before they can play a significant role in the mobile market.
• 3. Embedded 3G+: In order to offer mobility while being differentiated from FWA, MIDs have to be embedded with 3G+ cellular chip. When mobile WiMAX is vitalized, MID products that cover voice services based on VoIP and offer mobile broadband might hit the market.
• 4. Display Size: Superficially, the biggest strength of MIDs is the large display, compared to conventional mobile handsets. On average, the display of MID reaches 3.5 inches.
• 5. Full Browsing: Full browser should be a standard function of MIDs. However, full browser will not make a big contribution to differentiating MIDs from others as the service will be a norm for smartphones and UMPCs as well.

In line with the trend of smaller chipset and less battery consumption, smartphone and MID market will take off in 2008. The Japanese MID market is expected to reach 0.6 million in 2008 and will grow to 5.3 million by 2012.

The combined market of smartphone and MID will surpass 18 million in 2012, occupying around 40% of the entire handset market in Japan.

This report provides an analysis on MID market expectations, factors that will boost market growth as well as issues hindering the growth. Based on the analysis, ROA Group expects that MID market will continue to grow by 2012. In addition, the report highlights the strategies of current chipset makers and analyzes the handset models.