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All 3G Phone Service Is Not the Same


I enjoyed Stephen Baker's "Tale of a bubble" (Cover Story, June 3). But in "What's that ringing in DoCoMo's ear?", Irene M. Kunii suggests that DoCoMo has been outperformed by KDDI. DoCoMo's service operates at speeds more than 2 1/2 times greater than that of KDDI. While DoCoMo's service is based on a new network, KDDI's is based on "stretching" the performance of its existing network. This explains the current difference in prices as well as the fact that presently, DoCoMo's service is available only in major urban centers.

It should come as no surprise that there are, in the early stages of introducing a superior service, fewer takers for the "Rolls Royce" service than for the "Mini" service. Over time, with a larger number of subscribers and traffic, the price differential of DoCoMo's service may be expected to fall.

In comparing Vodafone's J-Phone, a successful image-sending phone-with-camera, with DoCoMo's video-phone service, Kunii fails to point out that J-Phone sends a number of still images, while NTT DoCoMo's FOMA service sends live video.

Whether large numbers of consumers will be willing to migrate to these faster services and pay the price differential is a key question that everyone in the global mobile industry is keen to answer. In the meantime, it is necessary to have an accurate understanding of the competitive process that will determine the outcome.

Martin Fransman

Edinburgh, Scotland

Editor's note: The writer is professor of economics and founder-director of the Institute for Japanese-European Technology Studies at the University of Edinburgh. "The farm bill is a $200 billion disaster" by Laura D'Andrea Tyson is an excellent piece of analysis (Economic Viewpoint, June 3). When most of the developing economies have undertaken a crusade to eliminate farm subsidies of various natures, the U.S. decides otherwise. And this despite its commitment to a fresh round of multilateral negotiations for revising the highly discriminatory subsidy regime.

Coupled with similar largess doled out in European Community countries, Asian economies can never dream of having access to the developed countries to export their farm products. The true nature of the U.S. government could not have been bared more starkly.

G.R. Saha

Calcutta

Laura D'Andrea Tyson's viewpoint on Mr. Bush's farm subsidy bill was refreshing. Indeed, to those of us concerned in the developing world, it did feel like an international slap in the face, eroding the mutual trust necessary for all to prosper. I do hope America is prepared to encounter a great deal of disenchantment within the poorer nations whose lifelines depend on the caring and generosity of their stronger brothers and sisters.

Chris Husbands

L.G. Fruit & Produce

Rodney Bay, St. Lucia Formula One has a plethora of problems that have hit the sport financially and in terms of viewership ("So far, no checkered flag," European Business, June 3). The sport involves huge amounts of money for research and development of cars, leading some teams, such as Alain Prost, to file for bankruptcy. The ban on tobacco ads in a few countries has also squeezed the financial pipeline of the teams.

If Formula One wants to increase its viewership and ensure that sponsors have an incentive to invest, it will have to increase its presence in Asia and Africa. At present, Formula One is Europe-centric, with a few other locations around the world. The proposed Grand Prix in Russia, China, and Dubai will not only increase revenues but also the popularity of the sport. The on-track events at Austria: A1-Ring, which helped Michael Schumacher, are not going to help the sport.

Neel Uppal

Bangalore, India Experience in other countries shows that raising gasoline taxes, as proposed by Gary S. Becker, will not work ("Want to cut gasoline use? Raise taxes," Economic Viewpoint, May 27). Other schemes have also failed: a tax for new cars in the Netherlands (45% on top of the car value, before VAT), a tax in Norway for driving along choke-points on highways during rush hour (electronic road pricing), and a tax for owning a car. In the Netherlands, liquid petrol gas (LPG) is the cleanest fuel in terms of emissions and also the cheapest at $1.45 per gallon. However, to make sure that enough tax money is "earned," the government simply tripled the tax for owning an LPG car. This means using LPG is cost-effective only when you drive at least 30,000 kilometers per year--a lot in such a small country!

Bouko J. de Groot

Hengelo, The Netherlands


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