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Tokyo-based Mitsubishi Electric Corp has decided to terminate its mobile handset business in Japan in order to strategically shift its resources to businesses which it plans to strengthen (mainly the Communication Systems Group and other groups involving communication-related business that are expected to show further development and expansion). The 600 or so staff in the mobile handset business’ R&D, manufacturing and sales divisions will correspondingly be reallocated.

Mitsubishi Electric started supplying car phones in 1983 to Nippon Telegraph and Telephone Public Corp and, since then, has sold mobile handset business in Japan, with recent products supplied to NTT DoCoMo Inc. It expects to ship about 2.1 million handsets in fiscal 2008 (to end-March).

However, the firm says that it has become difficult to grow demand in the already mature domestic mobile phone market, with the increasingly diverse preferences of consumers leading to severe business conditions. Consequently, Mitsubishi Electric’s mobile handset business has recently suffered reductions in shipments.

Mitsubishi Electric is therefore terminating launches of newly developed models after the current models supplied to and sold by NTT DoCoMo. However, it says that it will continue after-sales service after the restructuring. Meanwhile, mobile phone dealer Diamondtelecom Inc (a subsidiary of Mitsubishi Electric) will continue and work to further expand its business.

Mitsubishi Electric says that it will also work to maintain and further strengthen the partnership with NTT DoCoMo through the communication-related business that it aims to expand.

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