Entering the telecom industry in Japan

Abstract

The current Japanese recession along with pressures from WTO and GATT have forced Japan to open up, and a deregulation process has started in various industry sectors. The deregulation process in the telecom industry has been relatively slow compared to other countries, but along with the global development of the Internet, the Japanese telecom industry has started to change rapidly.

The purpose of this thesis has been to investigate the telecom industry in Japan and evaluate how a small foreign company supplying consumer products can enter this market. As our case company we have used Todos Data System AB, which is a small Swedish company that produces telecom and datacom consumer products.

In order to be able to study what type of entry strategy that Todos can pursue we have briefly investigated the Japanese macro environment and focused on analysing the Japanese telecom industry. Entering Japan normally involves relatively high costs and long payback times. To act as efficiently as possible in the fast-changing telecom industry, a company needs to be committed and goal oriented. Depending on what type of customer to target, we have identified different alternatives for Todos when entering Japan. In these cases, Todos should get assistance from a partner, which could be either an agent or a distributor/trading company. A more long-term alternative is to create a strategic alliance with a telecom manufacturer for knowledge exchange and thereafter jointly develop products.