by Carlo Longino

Breaking Down Vodafone Japan's Breakdown

We've been following Vodafone's (mostly unsuccessful) efforts to right its ship in Japan: replacing leaders, then later replacing the replacements; saying it would sell airtime wholesale; introducing expensive international video calls"; and of course, our favorite, phones that look like blocks of cheese. All of these moves have one thing in common -- they haven't really helped. While the company may be trying to fix a bunch of little problems with these moves, they just mask the fundamental reasons for the company's steep decline. It wasn't because they didn't have international video calls, it was because customers had problems getting calls and messages. It wasn't because they didn't have cheese-shaped handsets, but because Vodafone tried to push the same handsets in Japan it was selling in Europe, apparently oblivious to the fact that cutting-edge foreign models are well behind Japanese devices. Part of the rationale for Vodafone's buyout of J-Phone several years back was that it would be able to export innovations from Japan to its operators around the world. But the problem for the Japanese unit is that Vodafone tried to export ideas and methods that may have been successful in Europe, but were unsuited for Japan to it.

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