Fujitsu in talks with wireless affiliate


DDI Pocket is one of three wireless networks run by cell-phone provider KDDI, whose stock is up on Thursday

By Alex Frew McMillan
CNN Hong Kong

TOKYO, Japan (CNN) -- Tokyo-based chipmaker Fujitsu Ltd. is in talks to enter Japan's wireless communications market via a KDDI affiliate, it confirmed on Thursday.

"We're exploring different options with DDI Pocket," spokesman Robert Pomeroy told CNN.

DDI Pocket is an affiliate of cell-phone company KDDI Corp. It started selling mobile-communications capacity in August.

But Pomeroy declined to comment on a report that Fujitsu plans to offer wireless services to business customers as early as July.

Open for competition

To achieve that aim, Fujitsu will lease a handphone network from DDI Pocket Inc., the Nihon Keizai Shimbun stated Thursday.

The Japanese government opened up mobile communications for leasing last year. That has accelerated the process of competition, with new telecommunications providers able to enter the market much more quickly than if they had to build their own network.

Fujitsu will sell wireless communications services for personal computers and personal digital assistants, or PDAs, according to the Nikkei. It expects to charge a monthly rate.

The chip- and computer maker may eventually roll out the service to individual customers, via its Nifty Internet service, the largest ISP in Japan. Fujitsu may also install the new service on its own personal computers.

Tussle with NEC

Fujitsu tussles with NEC Corp. for the No. 1 spot in personal-computer manufacturing in Japan. Both also make chips for computers, though NEC is spinning off its chip business (full story). Fujitsu gets 60 percent of its sales from computers and information-technology services.

Sources suggest that Fujitsu has been in talks to sell Nifty to Sony (full story).

Fujitsu expects to make wireless-oriented communications cards and other add-ons under its own brand, to go into computers. It would then lease capacity using DDI Pocket's base stations.

Fujitsu shares are down 0.68 percent at 880 yen at the end of morning trade Thursday, on a day the Nikkei is down 0.66 percent at 11,252.51.

But KDDI shares are gaining ground, up 1.2 percent at 429,000 yen. DDI Pocket is one of three wireless systems that it runs.