Smartphone operators eye user fee hikes

The growing popularity of smartphones has energized Japan's information technology sector, but the surge in data traffic is starting to become a problem for cellphone networks.

The spread of advanced handsets, which process substantial volumes of data, is threatening to overwhelm the capacity of current third-generation cellphone service networks within several years.

A smartphone — which offers a wide range of applications besides regular phone and texting functions — handles 10 to 20 times more data than a conventional cellphone, according to mobile phone carrier KDDI Corp.

This is already burdening services during morning rush hours and at high-traffic areas such as railway stations, as the massive data traffic smartphones generate strain networks and slow connection speed.

In late July, Softbank Mobile Corp. President Masayoshi Son said, "problems regarding the slow communication and connection difficulties of smartphones have affected" the company's data communication earlier than other carriers.

Softbank pioneered domestic smartphone services in 2008, when it became the sole distributor of Apple Inc.'s iPhone.

To address the issue of limited service capacity, major U.S. mobile phone carrier Verizon Wireless scrapped its fixed pricing plan and now charges its customers based on data volume instead.

Softbank is in the process of reviewing its own flat rates. "We have to control (the overall communications volume)," Son said, suggesting that altering the way smartphone subscribers are charged is an option to reduce network traffic.

NTT DoCoMo Inc. is meanwhile trying to avert a 3G phone network overload by diverting some of the subscribers to its Xi high-speed communication service launched last December.

The carrier intends to continue charging fixed rates for its 3G phone service, but may introduce a different plan for its Xi service.

"If subscribers' data usage reaches a certain level, prices may go up or communications speed may be lowered," said DoCoMo President Ryuji Yamada.

Phone carriers say they will likely only raise prices for extremely heavy users if they decide to revise fixed prices.

But as many smartphone users take fixed charges for granted, telecommunication firms that rejig their pricing plans risk losing customers. The intense competition in the market also makes price hikes a tough choice.

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