Elizabeth Judge, Telecoms Correspondent
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O2, Britain’s biggest mobile company, has ditched its flagship mobile internet service only two years after launching it after struggling to pick up enough customers.
The 18 million customer group said today that it would not issue new handsets for its i-mode service from this month.
The operator had amassed 546,000 i-mode subscribers in the UK and Ireland — about only 3 per cent of its total customer base in those markets.
The decision to drop the service is a huge embarrassment for O2.
I-mode was supposed to be central to its push to encourage mobile users to tap into lucrative data services on their mobiles instead of simply calling and sending text messages.
I-mode was created by NTT DoCoMo, the Japanese telecoms giant.
It allows users easy access to tailored internet services such as booking cinema tickets or surfing for a weather forecast while on the move.
The success of the service in Japan — where it has more than 45 million subscribers — prompted O2 to tie up with DoCoMo to offer the service itself.
Their relationship has effectively been terminated.
O2 said that its existing customers would be able to continue with the service for a further two years.
It blamed the decision to drop the service in part on a lack of suitable handsets.
In a statement, O2 said: “The service has proven to be successful with rich content and high satisfaction amongst users.
“However, a limited range of devices has restricted its growth and we don't see that changing ... We will continue to manage and serve any existing UK i-mode customers until July 2009."
I-mode’s performance outside of Japan, where it has tie-ups with operators including KPN, the biggest mobile operator in the Netherlands, Bouygues and Telstra, in Australia, has been inconclusive.
According to DoCoMo's website, it has so far amassed only six million users in the 15 countries outside Japan — including Australia, France, Russia, Belgium and the Netherlands — in which it is offered.
The slow uptake follows a wider reluctance of consumers to treat their mobiles as mini PCs.
Calling and text messaging still account for the bulk of mobile operators' revenues.
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The main problem i-mode faced was the ludicrous subscription system. Often you can't even get to a list of news stories before seeing "the subscription for this site is..." Since each website has a different subscription tariff and the shortest duration is monthly, I am never bothered to subscribe in order to find the one news story I'm looking for two or three times a week. I'd be happy to pay a micropayment of a couple of cent per story I viewed, but to turn it into a direct debit of up to EUR3 a month just isn't worthwhile.
The only good free site on i-mode is the Sky Sports one since all the news stories are free! You only have to subscribe to get video.
Thomas Ralph, Dublin 4, Ireland
Using an Orange PAYG on an SPV M600 I can get unlimited real internet for a week for 5 pounds. This is much cheaper than imode, and I can get proper internet pages and download files, by using a simple cable i can get these files onto a laptop or PC or even use my phone as a modem. Why would I ever want imode?
Oliver, Bristol,
The operators seem to have been so so slow in coming up with an intelligent and attractive way of marketting data services. 3G was supposed to be the killer blow for old 2G voice services but ironically voice has turned out to be the killer application for 3G - how did that happen ? Now mobile runs the risk of being overtaken by faster and cheaper WIFI so wake up operators or prepare to watch your profits vanish. As for the IPHONE mentioned above - well the states are technically further behind than Europe so while the IPHONE may look the biz it doesn't support 3G and Nokia have been supporting music and camera's for some years already now without any restrictive encoding.
marcus, London, UK
It's not the lack of content or the lack of handsets that is holding back mobile Internet, it is the absurd data pricing models which make it too expensive to do anything. To read this website on an O2 data plan would probably cost several pounds.
Roy, Dublin, Ireland
I browse the internet quite a lot on my mobile phone using the free 'Opera Mobile' browser which automatically 'shrinks' web pages on the fly to make them fit mobile phones and enormously reduces their size and therefore download time and cost, and will run on most Java enabled phones.
Given that the 'real' internet is so easily available this way, I could never work out the attraction of a proprietory 'mini-internets' such as i-mode.
John, Bristol,
I hope this means that O2 will open up their TCP/IP socket support and firewalls for basic web users, I'm not to keen to see my access to the internet crippled because I'm not on a higher tariff.
If you don't think using the web on the move is unusable or prohibitively expensive take a look at Opera Mini, it uses less bandwidth and renders most mobile versions of websites excellently.
Phil, London, UK
The Iphone useless where have you been the Iphone will reverlutionise the way mobiles work with it patented touch screen software and net access which i must add is fantastic as ive seen and used it the sms sytem is just like Ichat and the one touch voicemail is fantastic the only downfall is the 2mp camra apart from that its great ill be in line for one.
I can assume anyone who says other without seeing one doesnt like apple or own an ipod.
Lee Beck, Burntwood, UK
O2 Data charges are what crippled the service.
By now data should be charged by the gigabyte not megabyte.
Russ, Blackpool, UK
O2 are dropping this service, yet wasted money on gaining the poor quality over priced next-to-useless iPhone, CRAZY!
I simply use my mobile for very short calls, and still mainly for being contacted in an emergency.
I did have a contract back in 1996 when that was all there was, but after a couple or so years realised the new PAYG service was much more cost effective, I make phone calls when I'm at home, I use VoIP so my calls are free or inclusive for â¬10 per 120 days with VoIPStunt and also Sipgate, though VoIP.co.uk have an excellent offer for £20 for the year.
Now if the cost of using a mobile was much cheaper, then I probably use it more, the reason why I don't use my mobile much when roaming. Again I use VoIP simply use my mobile to initiate the call, by entering the number I wish to call and the number I wish to call from, using Vyke calling from a landline when abroad to a landline to the UK costs around 2p/min, there are other VoIP callback services that are cheaper.
C Parkes, West Midlands,
I have an O2 mobile - they've never explained to me what 'imode' is or how it could be beneficial to me. What is 'rich content' anyway? I suppose it's what they would patronisingly call 'an enhanced user experience'. All I know is that if I use my O2 phone to access the Internet, I run up a large bill very quickly. So I prefer not to.
Michael, Brighton, England
I got a motorola SLVR with i-mode in december.
I'm not able to use the built in mail client, the web browser is difficult to use and very tricky to input a new web address (that option just isn't there).
Even when I do connect with their web browser and try to get to my webmail - I'm asked to turn 'cookies' on - an option on the i-mode that still eludes me.
I actually work in web developent and have colleges that develop mobile internet websites. feeling quite technically proficient myself, the i-mode was a complete let down.
I've got access to high speed internet at home and at work. I've never had the real need to connect when not at either of those two places, so apart from usability - i don't even think there's a areal need from mobile internet right now
Chris, Knaresborough, UK
One word for the stupid management at O2 - iPhone.
harry wolf, Vancouver, Canada
Its no surprise is it? Apart to the mobile phone providers! What ever the phone, even the new over price iPhone, these things are just too small a screen to do any surfing on or watching tv on etc. And on top of that you want users to pay dearly for that , most will just wait til they get to work or home and use there laptop or desktop. For phone calls and sms, cellphones are a great idea, but heck thats because you can do both easy, anything else like cameras, or slick looking etc, gets users to buy the phone, but how many people actually use much more than the basics?
Graham, Southend, UK