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Japanese Business: In Cellphones Only 1/3 Profit

November 9, 2009

The economic news has been hard to swallow this past week in the U.S. Job numbers were the worst on record, hitting the highest unemployment figures since 1983. For Japan it’s not just about the labor market, but the yen’s constant appreciating has been hurting the export driven economy.

The business climate has been suffering as well, as reported by the Bank of Japan earlier this week. Both large businesses and small / medium sized businesses are still finding the economic climate “very tough.” Therefore, the Bank of Japan is looking into buying up some commercial paper to fuse monetary stimulus into the struggling system.

The challenge in the business market today in Japan is evidenced by the cell phone industry. Each newspaper released a story about the big three in the cell phone business.

Asahi “Out of the three big telecommunication companies, Softbank alone reported profits” The profits over the past half year in Japan for cell phone companies were released today. The cell phone market has hit a slump, with both NTT and KDDI recording losses, while Softbank was the only company that recorded profits.

NTT’s loss in profits is shown by the sharp decrease in number of units sold, down from 13.2% from last year. The number of business to business contracts is also below expectations. KDDI was also unable to pull themselves out of the red, and the Asahi sited investments not performing up to expectation.

The Asahi cited that Softbank’s good performance was due mainly to sales of the iPhone. Even in a bad economy the phone in Japan is selling well, that and a contract with Yahoo is also working well for the cell phone company.

NikkeiOnly Softbank reports profits, due to their iPhone” The Nikkei also highlighted the iPhone, and went on to say both the smart phone and the iphone services helped Softbank beat out their competition.  

The numbers, according to the Nikkei, were for NTT the lowest profits since 1998. KDDI also had total profits 4% less than previously released. Softbank was the only winner, having 2% overall increase in profits, or an increase in business profits of 49%.

Yomiuri “The new strand of flu has killed an Infant” The Yomiuri didn’t report on the cell phone companies and instead focused on news about the swine flu. In Kyoto on the evening of the 9th, a mother had noticed her baby wasn’t responding to her calls. She then rushed her baby to the hospital, and the baby was pronounced dead, having a 37.2 degree temperature. The city research center confirmed that the baby had died of Swine Flu.

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