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Pre-pay plans to boost i-mode in Europe

KPN changes tactics

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Dutch telecom operator KPN Telecom finally introduced DoCoMo's i-mode to pre-pay users in the Netherlands last week in a move intended to boost its subscriber base. The same service will be offered through KPN's subsidiaries E-plus and BASE in Germany and Belgium later this year.

So far, i-mode users had to subscribe to a complex mobile pricing plan. KPN charged a fixed monthly fee with additional charges per kilobyte of data transferred, while most people in Europe prefer to use pre-pay cards.

By introducing pre-pay plans, KPN believes it can meet its goal of one million i-mode customers across the Netherlands, Germany and Belgium by year's end. KPN signed up 225,000 new customers in the Netherlands, Germany, and Belgium during the first quarter alone.

So far, the spread of i-mode outside of Japan has been disappointing. DoCoMo's strategy of taking minority stakes in mobile operators - at a cost of ¥1.9 trillion ($15.96 billion) - foundered as the tech boom went bust, resulting in a huge write-off. In Germany i-mode stalled because of a lack of handset choices.

In some European countries, however, i-mode is slowly gaining momentum as more operators adopt the data service. Bouygues Telecom in France signed up 200,000 subscribers who pay as much as €15 ($16.95) a month for data traffic.

Spain's Telefónica Móviles launched i-mode on 25 June, albeit under a different banner. This fall, Wind, Italy's third-largest mobile phone group, will bring i-mode phones into Italian shops. Analysts believe 600,000 people are now using the service in Europe, and that number could more than double by 2004.

However, market researcher IDC believes only ten per cent of mobile users in Europe will buy i-mode phones by 2007, compared with the 20 per cent who use it in Japan. The service is facing fierce competition from operators all over Europe. Vodafone Live attracted 1.5 million UK users since its debut last October. Although DoCoMo holds stakes in Hutchison 3G, a British i-mode service hasn't been announced yet. ®

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