Technology February 15, 2008, 7:25AM EST

Google Wins Japan's Mobile Net Battle

(page 2 of 2)

Story Tools

Deadlines vs. "Managed Chaos"

Sound like a natural fit? Hardly. For Lagerling and his team, it was a constant struggle bridging the cultural gap. Google was lucky to have him. A graduate of the Stockholm School of Economics and the University of Tokyo, Lagerling joined DoCoMo in 2001. Five years later, he quit to go to Google. Lagerling, who is fluent in Japanese, English, and Swedish, says from Day One it was his personal crusade to work with DoCoMo. "There were many, many times when we thought this wouldn't go through," he says. "The ways we do things are so different."

One example: Google's project deadlines are always in flux. Managers won't hesitate to delay the rollout of software that still has software bugs. "At Google, launch dates are flexible," says Takeshi Kishimoto, a mobile product manager in Tokyo. And since Google's engineers around the world are constantly adding lines of programming code to upgrade maps, Gmail, YouTube, and other services, they rarely bother to keep a record of the changes.

That can be maddening for the staff of a company such as DoCoMo, which prefers to create thick manuals of technical specifications and thinks deadlines should be set in stone. "Japanese companies focus on getting everything down on paper in detail, which makes things more predictable," says Lagerling. "But we like the managed chaos."

Can the Cooperation Last?

In their free time, members of Lagerling's team were negotiating with Japanese social networking sites Gree and mixi and handset makers Fujitsu and NEC, as well as working on a new service with KDDI called au one that gives subscribers a single e-mail address that can be used from a PC or mobile phone.

Despite Lagerling's efforts, some analysts think it's a matter of time before the veneer of cooperation wears off. Wireless operators outside Japan have made no secret of their resentment of Google's ability to use their networks for free while raking in a handsome amount of the mobile online ad revenues. Such revenues are still miniscule, amounting to just $83.3 million globally last year, according to researcher eMarketer. Yet by 2012, the figure could grow to nearly $3.8 billion. As the stakes get higher, tensions could mount. "I simply cannot conceive of these arrangements as anything other than a marriage of convenience," says eMarketer analyst John du Pre Gauntt. "Sooner rather than later, one of the parties will feel that it's learned enough from the other."

In the long run, their interests diverge more dramatically. The carriers want to channel subscribers through a proprietary Net gateway using proprietary browser software on mobile phones so they can charge subscribers for services, not just airtime. That's at odds with Google's mission: to give everyone Net access and make the online experience on a mobile device virtually indistinguishable from that on a PC.

Hall is BusinessWeek's technology correspondent in Tokyo .