New smartphone sales legislation may hurt iPhone sales in Japan

Posted:
in General Discussion
Japan is in the process of creating new legislation that caps discounts mobile carriers can offer on devices, which may make the iPhone a less attractive choice in the country.

Japanese legislation could steer consumers away from the iPhone


The iPhone is by far the most popular smartphone in Japan, with a reported 49.6% share in 2018 However, a new proposal by the Japanese government may greatly influence what phones Japanese consumers buy, steering them away from the iPhone.

Hoping to end the country's high mobile phone charges, the Japanese government has decided to cap the discounts a mobile company can give to just 20,000 yen ($188). This would end the common practice of heavily discounting devices which has been said to give certain users "excessive benefits."

It would also force carriers to drastically cut cancellation fees for users who quit in the middle of a two year contract.

According to The Japan Times Apple has released a statement questioning the move.

"It will take away choice from Japanese customers and result in diminished competition and higher-priced (handsets) in the market," Apple says in a document disclosed last week that contains public comments from 67 companies, organizations and individuals.

The discount cap only applies to new stock, and all devices 24 months or older would be allowed to be sold at a 50 percent discount. If a device were discontinued, stores would be able to sell them at an 80 percent discount.

Apple products, however, typically don't meet these conditions.

In Japan, Apple sells their current generation of iPhones such as the iPhone XS and the iPhone XS Max, but also sells the iPhone 8 at a considerable discount, as this gives users more choice.

Apple goes on to state that other smartphone makers produce new phones more regularly and discontinue the production of unpopular models, which would then be able to take advantage of the steep discount plans allowed under the proposed legislation.

"[The proposal] will damage companies that provide only high-quality products and possibly lead consumers to choose low-performance products," Apple says, calling the move "unfair."

Apple has offered a solution to the Japanese government-- discount a phone based on the product's first unveiling, rather than the time it has remained unsold.

Some SoftBank shops in Tokyo currently offer an iPhone 8 with an 80,000 yen ($755) discount if they agree to switch from another carrier and sign a multi-year contract. This effectively makes the iPhone 8 free. Under the new proposal, this sales method would be banned.

"iPhones have been top-selling smartphones in Japan. One of the factors is that they've been promoted with quite a bit of a financial incentive," said Hideaki Yokota, an executive analyst at MM Research Institute, a Tokyo-based firm that tracks the mobile industry. "Apple's smartphones are basically expensive, So Apple will probably be affected the most."

Comments

  • Reply 1 of 14
    22july201322july2013 Posts: 2,653member
    Manufacturers, except Apple, will plan their devices' early obsolescence/discontinuance in order to get around these laws.

    Apple could also skirt these laws by discontinuing a certain configuration every 3 months. Maybe by increasing the amount of memory, for example. 

    Under the new law, which bureaucrat in Japan is going to decide when a new model is too similar to an older discontinued model to determine if the old model can be priced more cheaply?

  • Reply 2 of 14
    AppleExposedAppleExposed Posts: 1,805unconfirmed, member
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
  • Reply 3 of 14
    lkrupplkrupp Posts: 9,627member
    Limiting the amount of discounts? That sure doesn’t sound like a consumer friendly action to take. Also sounds like Apple is being targeted since Samsung doesn’t sell very much in the Japanese market.
    entropysjbdragon
  • Reply 4 of 14
    gatorguygatorguy Posts: 23,300member
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi, blocking carriers from tracking users of Fi, and including a VPN to make it more secure. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Heck the biggest techs have feelers out in just about every profitable segment. 
    edited August 2019 muthuk_vanalingamFileMakerFeller
  • Reply 5 of 14
    gatorguy said:
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi and blocking carriers from tracking users to do it. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Hecks the big techs have feelers out in every profitable segment. 
    The moment Apple announces (if it ever did) then the Anti-trust people will be rubbing their hands with glee.
    By staying out of strategic markets Apple can point to others who have the major market share in them and tell them to go take a hike.
    AppleExposedjbdragon
  • Reply 6 of 14
    avon b7avon b7 Posts: 5,956member
    gatorguy said:
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi and blocking carriers from tracking users to do it. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Hecks the big techs have feelers out in every profitable segment. 
    The moment Apple announces (if it ever did) then the Anti-trust people will be rubbing their hands with glee.
    By staying out of strategic markets Apple can point to others who have the major market share in them and tell them to go take a hike.
    Yes. Generally speaking it's not a good idea to be the provider of the product and the infrastructure it needs to run. 
    jbdragon
  • Reply 7 of 14
    AppleExposedAppleExposed Posts: 1,805unconfirmed, member
    gatorguy said:
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi, blocking carriers from tracking users of Fi, and including a VPN to make it more secure. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Heck the biggest techs have feelers out in just about every profitable segment. 
    If you were replying to my innovating comment, I wouldn't call "investing" innovative. That's just Google saying "we can't innovate so we'll give innovative companies money to do it for us".

    Since iPhone everything has changed in the carrier space thanks to... Google (JK! Gotcha!). No, really, thanks to Apple. The launch of iPhone alone spiked user data upwards of 8,000% and forced carriers to think differently.

    I think Apple is the only company in the world strong enough to bypass stupid laws and create innovative paths to success.
    edited August 2019 radarthekat
  • Reply 8 of 14
    gatorguygatorguy Posts: 23,300member
    gatorguy said:
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi, blocking carriers from tracking users of Fi, and including a VPN to make it more secure. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Heck the biggest techs have feelers out in just about every profitable segment. 
    If you were replying to my innovating comment, I wouldn't call "investing" innovative. That's just Google saying "we can't innovate so we'll give innovative companies money to do it for us".

    I think Apple is the only company in the world strong enough to bypass stupid laws and create innovative paths to success.
    You don't have any idea about the things I mentioned do you. :/

    You should take 5 minutes and investigate what you aren't familiar with before posting. Those are almost all Google owned companies and projects.  
    edited August 2019 muthuk_vanalingam
  • Reply 9 of 14
    entropysentropys Posts: 3,193member
    lkrupp said:
    Limiting the amount of discounts? That sure doesn’t sound like a consumer friendly action to take. Also sounds like Apple is being targeted since Samsung doesn’t sell very much in the Japanese market.
    The end result will be higher cost overall. It is always the result when government starts limiting market options. It will create a new army of regulating clipboard warriors though. There is that.
    jbdragon
  • Reply 10 of 14
    AppleExposedAppleExposed Posts: 1,805unconfirmed, member
    gatorguy said:
    gatorguy said:
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi, blocking carriers from tracking users of Fi, and including a VPN to make it more secure. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Heck the biggest techs have feelers out in just about every profitable segment. 
    If you were replying to my innovating comment, I wouldn't call "investing" innovative. That's just Google saying "we can't innovate so we'll give innovative companies money to do it for us".

    I think Apple is the only company in the world strong enough to bypass stupid laws and create innovative paths to success.
    You don't have any idea about the things I mentioned do you. :/

    You should take 5 minutes and investigate what you aren't familiar with before posting. Those are almost all Google owned companies and projects.  
    You didn't answer the first line.

    If you were replying to the "innovative" line, which seemed to have triggered you to mention Google. You're wrong. Apple had to break down walls to get iPhone into the market which paved the way for your favorite knockoffs to flood the market off the back of Apples hard work.

    Now if you're replying to any other part of my comment. I have no idea what Google has to do with any of it since I was talking about Apple. :confused: 
    radarthekat
  • Reply 11 of 14
    gatorguygatorguy Posts: 23,300member
    gatorguy said:
    gatorguy said:
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi, blocking carriers from tracking users of Fi, and including a VPN to make it more secure. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Heck the biggest techs have feelers out in just about every profitable segment. 
    If you were replying to my innovating comment, I wouldn't call "investing" innovative. That's just Google saying "we can't innovate so we'll give innovative companies money to do it for us".

    I think Apple is the only company in the world strong enough to bypass stupid laws and create innovative paths to success.
    You don't have any idea about the things I mentioned do you. :/

    You should take 5 minutes and investigate what you aren't familiar with before posting. Those are almost all Google owned companies and projects.  
    You didn't answer the first line.

    If you were replying to the "innovative" line, which seemed to have triggered you to mention Google. You're wrong. Apple had to break down walls to get iPhone into the market which paved the way for your favorite knockoffs to flood the market off the back of Apples hard work.

    Now if you're replying to any other part of my comment. I have no idea what Google has to do with any of it since I was talking about Apple. :confused: 
    Nor apparently are you looking at what you wrote. You said:
    "Heck only Apple is innovating the carrier space and they aren't even a carrier!"

    I showed you that's not true even if you might be having a problem understanding. I tried. 

    EDIT: Google's Pixels were also the first smartphones to use e-sims. That's in the carrier space too isn't it? 
    edited August 2019 muthuk_vanalingam
  • Reply 12 of 14
    normmnormm Posts: 645member
    Big discounts and multiyear contracts with high early termination fees are really just a way to buy a phone over time.  Apple has dealt with the end of subsidies elsewhere by simply offering good financing options.  This seems like no big deal.


    radarthekat
  • Reply 13 of 14
    AppleExposedAppleExposed Posts: 1,805unconfirmed, member
    gatorguy said:
    gatorguy said:
    gatorguy said:
    Man, Apple needs to become its own carrier. They'll still have to abide by dumb laws but can still offer better service and innovation. Heck only Apple is innovating the carrier space and they aren't even a carrier!
    Rumor of Google investing in a "4th carrier" along with Dish. Then there's Project Fi, blocking carriers from tracking users of Fi, and including a VPN to make it more secure. Those are in the "carrier space". Add to that investing in SpaceX and the Starlink satellite network, Loon, Wing, Google Fiber (yup still a thing)....

    Apple is not the only company investing in innovative ways to offer better communication services. I would guess all the big techs have feelers out. Heck the biggest techs have feelers out in just about every profitable segment. 
    If you were replying to my innovating comment, I wouldn't call "investing" innovative. That's just Google saying "we can't innovate so we'll give innovative companies money to do it for us".

    I think Apple is the only company in the world strong enough to bypass stupid laws and create innovative paths to success.
    You don't have any idea about the things I mentioned do you. :/

    You should take 5 minutes and investigate what you aren't familiar with before posting. Those are almost all Google owned companies and projects.  
    You didn't answer the first line.

    If you were replying to the "innovative" line, which seemed to have triggered you to mention Google. You're wrong. Apple had to break down walls to get iPhone into the market which paved the way for your favorite knockoffs to flood the market off the back of Apples hard work.

    Now if you're replying to any other part of my comment. I have no idea what Google has to do with any of it since I was talking about Apple. :confused: 
    Nor apparently are you looking at what you wrote. You said:
    "Heck only Apple is innovating the carrier space and they aren't even a carrier!"

    I showed you that's not true even if you might be having a problem understanding. I tried. 

    EDIT: Google's Pixels were also the first smartphones to use e-sims. That's in the carrier space too isn't it? 

    Those bits and pieces and "investments" are innovative to you? haha.

    Googles ENTIRE mobile platform is Apples work. Apple literally made carriers change behavior to allow your knockoffs to even be carried by them. Heck, carriers didn't even allow proprietary App Stores and had low data bandwidth until Apple forced them to innovate and change decades-old thinking. They didn't have the vision Apple had and some estimates say iPhone increased data over 8000%!

    Apple single-handedly revolutionizes the mobile and carrier industry.

    Google picking backs into the market after stealing Apples designs, hard work and software. Far faaaar from "innovative.

    Still don't understand the need to squeeze lazy Google into the conversation.

    No one cares about Google Fiber and my comment stands:
    Only Apple has the power to innovate this industry.
    radarthekat
  • Reply 14 of 14
    Manufacturers, except Apple, will plan their devices' early obsolescence/discontinuance in order to get around these laws.

    Apple could also skirt these laws by discontinuing a certain configuration every 3 months. Maybe by increasing the amount of memory, for example. 

    Under the new law, which bureaucrat in Japan is going to decide when a new model is too similar to an older discontinued model to determine if the old model can be priced more cheaply?

    This is where Apple's suggestion of discounting based on the date of first unveiling makes the most sense.
    radarthekat
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