NTT DoCoMo, Inc.

I have to say that I enjoyed reading about the technologies that DoCoMo is developing; however, the case really seemed to jump around a lot, which made it somewhat confusing. It switched back and forth so much with different partnerships and competitors that I'm still a little confused on the different options that DoCoMo has moving forward.

I do think that the company has done a very good job with the FeliCa Networks, and that is the basis of their competitive advantage. While the idea of having a phone equipped with eMoney, building IDs, and other applications appeals to me, I am very concerned with the security issues around this new technologies. The case does touch on the security issues, but not as much as I would like to have seen. For instance, if something happens and you lose your phone, how hard is it for someone to use the money stored on there or gain access into a building? I know the case mentions that you can call your service provider to have the phone functions disabled, but there may be times where you don't realize your phone is gone until it is too late. I would suggest that you are required to provide a 4 digit password anytime you use your phone for something like money transactions or gaining access to secure buildings. This would at least help to prevent some unauthorized use of the features. Although this would slow down the transaction process itself, I think it is a necessary step. Perhaps this goes against the whole idea of the "speed of the process", but without solid security measures, there could be some very unhappy customers.

As far as the case is concerned, I think DoCoMo needs to work with Edy and Suica to develop a reader that will incorporate the three different FeliCa cards at checkout. This would be a strong incentive for retailers to push for this form of payment. I agree with the case when it states that retailers would not want to install three different readers. This would be a step in the wrong direction for them. It should be noted though that only 10% of total consumer spending in through a credit card, so this method of payment has to be largely advertised if it is expected to grow. If this segment does grow, DoCoMo should work hard to ensure that it's cards are the first ones that end up in a consumer's wallet.

Overall, DoCoMo needs to be careful as it moves forward with its operations. As noted, the company does not have a large amount of experience in dealing with financial services. In the past, it has been strong on the transaction side, which is where it's strategic advantage is best found. If DoCoMo decides to transition further into the credit industry, it must gain further knowledge about how companies in this industry are successful. Providing credit to unworthy candidates could have some very negative effects on the company. I would suggest that DoCoMo enter a nonexclusive partnership with incumbent credit card companies or enter an exclusive partnership with a single card issuer. This would allow DoCoMo to benefit from what it does best (transaction processes), while allowing the partner(s) to benefit from their core strengths (issuing of credit). It would be taking quite a risk for DoCoMo to not have a partner and this may end up damaging the company in the future.