iPhone selling far less than expected in Japan

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    The Wall Street Journal reports that demand for the iPhone 3G in Japan has fallen to a third of what it was initially and analysts are expecting the downward trend to continue:

    According to market-research firm MM Research Institute, Apple sold about 200,000 phones in Japan in the first two months. Since then, however, demand has been falling steadily, and analysts now widely believe sales are unlikely to reach a total of 500,000 units. That is half the one million units that they previously thought Apple could sell. One big challenge is that Japanese users already have access to some of the most advanced mobile-phone technologies in the world. Models currently sold by Japanese cellphone makers typically contain a high-end color display, digital TV-viewing capability, satellite navigation service, music player and digital camera. Many models also include chips that let owners use their phones as debit cards or train passes. Noriko Tanaka, a 34-year-old Softbank customer in Tokyo, said she likes the iPhone’s touch screen, but would prefer a phone with digital television capability. “The touch screen looks fun, but I’m not sure I could get used to it,” said Ms. Tanaka.

    Another challenge for Softbank is that Apple’s marketing for the new iPhone has touted the devices compatibility with 3G wireless networks, which give users faster access to the Internet. While this is a relatively new service in the U.S., 3G access has been a standard feature on Japanese phones for years.

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