Tokyo Forum; November 21, 2002

GENUINE: The Mobile Internet Service

Masataka OHTA (Lecturer, Tokyo Institute of Technology, and CTO, Mobile Internet Service, Inc.)

This is a summary of Mr. Ohta's presentation at the Tokyo Forum on November 21, 2002.

Next Generation Information Infrastructure

Today my presentation is entitled "GENUINE: The Mobile Internet Service. The next generation information infrastructure will be purely Internet, of course. In addition, it will be purely optical, because optical fibers are so fast and inexpensive. However, we cannot move around with optical fibers attached to us. Our cars need some wireless technology for the mobile Internet environment. That is what we are trying to offer.

Mobile Internet Service (MIS) is a Japanese company established in April 2001. MIS was licensed as a Class1 carrier in July 2001. We started commercial mobile Internet service with wireless LAN in April 2002. However, we only have 250 base stations installed around Tokyo.

Given our service, people can move around from one base station to another. So we are offering a truly mobile environment. Our business scheme is such that we connect our equipment to the Internet. We have access points installed in many places, but not yet everywhere.

Mobile Internet Service

We have a clear advantage over legacy services such as IMT2000. It is important to differentiate our service, mobile Internet service, from so-called hot spot services. Both use wireless LAN technologies, but they are different. Mobile means that our terminal is portable and we are connected to the network anytime anywhere.

In addition, the Internet means the world's largest public IP network. It does not merely mean a private IP network. The Internet is not an application such as e-mail or web. So please don't be deceived by Microsoft actively advertising that "the browser is the Internet."

In the case of telephone-based web service, there is a gateway in the middle, which is a performance bottleneck and also a speed bottleneck. This is a single point of failure and it is expensive. In the case of the Internet we can have servers and clients everywhere. And over the Internet, e-mail, web and telephony are all free. It is important to note that dial-up service is not so much the Internet. Because it is a technology to access the Internet only indirectly through legacy information infrastructure.

These days technologies are wrongly applied to DSL and wireless LAN. But, they do not offer persistent connectivity to the Internet. Without persistent connectivity, we cannot, for example, receive phone calls over the Internet. That is a problem.

Importance of Mobility

Now what is mobility? That is another important topic. Mobility means connection to the network anytime anywhere. We really need persistent Internet connectivity for mobile Internet connectivity. Again, immobile service is better covered by optical fiber,so there is no reason to use wireless LAN for such services.

The Important thing is that for mobile service notebook computers like this are not an appropriate terminal. It is heavy and bulky. We cannot operate these laptops while we are walking. Because it consumes power, it needs wired power, so there is no reason to use wireless. PDAs are fine, on the other hand. As I showed, digital cameras are very good. Music players and phones should be mobile terminals connected to a mobile Internet environment.

So an important thing is that hot spot service is not mobile service. It is like a public phone or a cordless phone, which allows for certain mobility around telephone devices but does not enable us to cover a wide area of mobility. The image of the hot spot service is such that there are only spots. On the other hand, mobile service is such that base stations are everywhere and there is movement across those stations.

Expanding Area Coverage

Our problem is that we have only 250 base stations in Tokyo now. It is not so different from hot spot service yet. So, we are trying to expand our area through our community partner, MIAKO Net. MIAKO Net already has over 150 base stations in Kyoto, a much smaller area than Tokyo. They are offering free service to residents and visitors. There are several areas covered continuously by multiple base stations.

We also try to expand our area, relying on our legal privilege. As a licensed Class 1 carrier we have a privilege to forcibly install equipment and conduits upon permission of the Minister of PHPT. Clause 73 of the Telecommunications Business Act gives us such a privilege. MIS applied for such a privilege because our service area is small. And we wanted to install a base station in JR Railway stations of Tokyo, Shinjuku, Shinagawa and so on, because these are important areas publicly accessible.

Problem with Discretionary Administration

However, JR denied our request because they were trying to offer experimental hot spot services. So we asked the Ministry of PHPT, and the judgment of the Minister was favorable to us. The judgment was given four months after our request, which satisfied all the conditions of the existing guideline. However, before the final judgment the case was sent to the Coordination Committee on Telecommunication Business Disputes. They judged that it was outside of the intended scope of a corresponding clause of the now obsolete law, the Public Telecommunication Act of 1953. Our request was denied, and the Ministry of PHPT is now considering to modify the law to satisfy our request again.

There is a problem with the judgment. First, it is against the guideline. There is an existing guideline to provide services in railway stations. As I said, our request satisfied all the prerequisites of the guideline, but they denied our request. This is discretionary administration, which makes private sector business very difficult. That is a very serious problem of Japanese administration.

Another problem is that the committee's reasoning is unjust. They are seemingly just insisting on private rights. It is a Japanese tradition to insist on private rights. Their reasoning would have been good some 49 years ago, when the obsolete law was established, but it is completely unreasonable now. It makes our business very difficult.

To conclude, GENUINE of MIS is a mobile Internet service, and area coverage is essential to our mobile service. However, there is discretionary administration to interfere with private sector activities against our area coverage. Therefore, It is not easy to expand our business in the market.