Following the previous issue, we are providing the remainder of the seminar proceedings at the 12th PHS MoU General Meeting, held on December 6, 2001.

1. New PHS services in Taiwan


2. New Value-added PHS Services in Japan


3. Introduction of "SDAIR"


4. Introduction of "Keitaide-Music"


5. An i-mode service in PHS and its potentiality of worldwide deployment

Dr. Hann-Bin Chuang




  FITEL, formerly known as a paging service provider, has decided to adopt the PHS as the next mobile business because of PHS's matured technology and proven large data communications capability. We gained the operator license two years ago, and started PHS service in June 2001.

  Since we have already presented our services at the previous general meeting, here I would like to talk about the situation in these six months and future possibilities.
  As Phase I, we commenced service in Taipei City. In Phase II, we expanded our service coverage to the area surrounding Taipei County.
As of the end of November 2001, we have installed 4,000 cell stations (CSs) in Taipei area, and the total number of subscribers has become 104,000. Currently we are using Sanyo Electric Co., Ltd.'s PHS terminal PHS- J88, and in January 2002, we are planning to introduce Sanyo PHS-J95, which employs a TFT color liquid crystal display. Currently, we are offering Japan-Taiwan roaming service as the first step of our international roaming project.

  On top of the voice telephony service, we provide voice mail service, short message service (SMS), mobile information mobile Internet (MiMi) service and wireless information wireless Internet (WiWi) service, among others.
The MiMi is equivalent to DDI-POCKET's H" Link (edge link). The WiWi is a 64-kbps data communications service based on the PHS Internet Access Forum Standard (PIAFS) 2.2. We are planning to make our business break even by June 2002.

Although the penetration rate of the GSM-based mobile service in Taiwan is already 70-80%, the Taiwanese, especially students, regard the PHS as a superior system to the GSM. The MiMi occupies 20% of all traffic, while SMS takes 10%. With regard to the SMS, communications from PHS to GSM was enabled in October 2001, and two-way communications between two systems was enabled in December 2001.

  For the MiMi service, there are currently 310 official content sites, and some twenty new content sites are being added every month. About 60% of all PHS users have accessed the MiMi service at least once.
This figure is quite large in comparison with 0.5% of the WAP use among GSM users. It is estimated that 20% of users are accessing the MiMi service every day.

  Although the traffic of the WiWi service is still about half of the MiMi traffic, users who started accessing the WiWi are considering continuous use of the service, and we expect that the number of users will steadily increase.
Also, the data communications charges are now set at half of the initial level, or NT$0.95 (approx. US$0.03) per minute including Internet access charges.

  Currently, 50% of users are between 20 to 30 years old, and 40% are over thirty. Since people below 18 years old are not allowed to contract alone in Taiwan, the ratio of subscribers in such generation is still small. From now on, we need to increase the penetration into this generation.

For these two or three weeks, we have been concentrating on our sales efforts to the corporate customers, in order to have them as intra-company communications tool users by replacing the existing fixed telephones with the PHSs. We are targeting department stores, hotels, hospitals and others. After "SOGO" department store introduced 1,000 PHS terminals with high reputation, we have been receiving inquiries from other department stores as well.

In data communications service, we set up "communications platforms" such as Bulletin Board Service (BBS), which occupies huge traffic. In comparison with GSM data communications PHS, which can download 1-MByte data for five minutes at NT$5 (approx. US$0.15), has an advantage over GSM General Packet Radio Service (GPRS) that downloads the same data for an hour at NT$600 (approx. US$18).
However, we recognize the significance of the packet mode, and are planning to introduce thereof in the future. In order to compete with the rival GSM system from now, the key lies in the service area coverage. Another task is the fact that the terminals are currently supplied by only one supplier, so in the midst of the global diffusion of the PHS, we expect the price to be lowered through cost reduction, more terminal suppliers' entry etc.
As for the future plan, we are considering the introduction of new terminals, adoption of new CSs with increased traffic channels, realization of roaming and introduction of the packet mode. (Exchange rate: NT$1=US$0.03)

  As a service provider, I would like to talk here about the concept of music downloading service.
In the Japanese market, the widespread use of portable audio players represented by the "Walkman" and music downloading service with PCs have created a foundation for the mobile music downloading service.
DDI-POCKET provides a music downloading service under the name of "Sound Market." The concept of the service is to provide music "anywhere," "anytime," with a "sound quality equivalent to compact disk (CD)" at "affordable prices."
The key is "affordable price." Regarding the charges, the air-time fee is 13 yen (approx. US$0.1) per minute everywhere in Japan, and information charges vary from 50 yen to 200 yen (approx. US$0.4 - 1.5), depending on content. In the case of a single CD title with some 4 MBytes per tune, the air-time fee via our 64-kbps network is about 100 yen (approx. US$0.8).
Together with the content charge, the price is equivalent to a CD single or lower. If the same content is downloaded via cellular phone's packet switched networks, it costs from 1,500 yen (approx. US$11.5) to, in some cases, 6,000-7,000 yen (approx. US$46-54). The "Sound Market" service also provides prelistening service of approximately one minute, which enables users to download after trying it. The representative additional service is online music gift service. With this service, one who gives a gift designates the PHS number of the recipient and the tune selected from the menu. Then the details of the gift is notified to the recipient through e-mail, which instructs the recipient for downloading the music content. Thus, the recipient can download it without content charge.

  The service requires a PHS terminal compatible with the service, a player terminal and a content storage card. There are two methods by different card used: the "Keitaide-Music ("KdM")" method and the "SDAIR" method.
The two have different content compression methods, MPEG Audio Layer 3 (MP3) and Advanced Audio Coding (AAC), respectively, as well as copyright protection methods that are different.
Now, one year has passed since the commencement of the service using the "KdM" method, while from the spring of 2001, the "SDAIR" method service started. (Exchange rate: US$1=130 yen)

I would like to present you with the concept of "SDAIR." This method distributes digital content to Secure Digital (SD) memory card via wireless networks.
In November 2000, five corporations of Kyushu Matsushita Electric, Co., Ltd.; Toshiba Corp.; IBM Japan, Ltd.; Matsushita Electric Industrial, Co., Ltd.; and, music.co.jp., inc. formed an association on the method, and in April 2001, the service using this method was commenced as DDI-POCKET's "Sound Market" service. The system uses TCP/IP between server and wireless networks, PHS Internet Access Forum Standard (PIAFS) protocol for wireless networks plus dedicated protocol between a PHS terminal and a music player into which an SD memory card is inserted. (Ref. Figure)




Figure. Logic protocol between server and SD terminal



There are three features in the "SDAIR" method "Sound Market" service: i) the SD memory card, the standard jointly developed by SanDisk, Matsushita Electric and Toshiba, is employed; ii) as a data compression method, MPEG-2 Advanced Audio Coding (AAC) is employed; and, iii) as a copyright protection method, a combination of Electronic Media Management System (EMMS; created by IBM) at the server side and Content Protection for Recordable Media (CPRM; created by Intel, IBM, Matsushita Electric and Toshiba) at the terminal side is employed. In the "SDAIR" method, the distribution protocol between a server and an SD terminal is realized by three protocols of mutual authentication, download and control command, as upper-layer protocols of communications basic protocol.

Benefits of this music player are: enabling music replay by the player only; when connected to Toshiba PHS terminal "DL-B01," enabling changes of order to replay and edit without PCs, and; when connected to PC, enabling not only edition but also back-up of music titles in the SD memory card to the PC.

  Currently, is there a provider which legally enables peer-to-peer music distribution? The answer is "YES." That is the "Keitaide-Music" ("KdM"). I herewith wish to talk about the "KdM," which allows one to distribute music titles securely by using "super-distribution" for mobile phones. The Japanese word "Keitai" refers to the "mobile phone."

 Put simply, the "KdM" is the infrastructure enabling lawful distribution in peer-to-peer music communications. With this service, users can copy and share content with their friends. The difference with the peer-to-peer communications offered by Napster is that our system enables charging.
Under the super-distribution, content is free of charge, allowed to be redistributed; users are charged only when content is reproduced. The requirements for lawful super-distribution are:
i) content and a license are distributed separately, ii) content is encrypted, iii) licenses are being firmly protected with a hard Tamper Resistant Module (TRM) and the Public Key Infrastructure (PKI),
iv) copying is prohibited while allowing for transfer and v) users are charged when content is decoded.
The "KdM" meets all these requirements.

Let me present DDI-POCKET's "Sound Market" service employing the "KdM." The service was commenced in November 2000 for the first time as service over mobile phone networks.
More than 2,000 titles including music, language learning, Rakugo (Japanese traditional entertainment), recitation and news are provided.

As a new challenge, music distribution by downloading prior to the release of CD and super-distribution of CD-ROM are being promoted. (Demonstrations of music, an English conversation lesson, Rakugo, recitation were made.)

  The characteristics of the "KdM" are as follows. It provides high-level security based on PKI. Because encryption is made by the Secure MultiMedia Card (SMMC), it's suitable for light platforms such as mobile phones.
Since content and a license thereon are separated, the service based on "KdM" not only provides a usual simultaneous downloading of the content and a license but also enables copying content only, sending content as a gift and super-distribution by combining CD-ROM; as a result, the service has become flexible.




Figure. Security of Keitaide-Music



  Next, I want to discuss the content protection technology in the "KdM." (Ref. Figure.) Content, being encrypted by a symmetrical key, is transferred from a sender to a receiver.
The symmetrical key is encrypted by a public key to become the license key, which is transferred to the receiver. The receiver, with the private key corresponding to the public key, decodes the license key to get the content's symmetrical key, with which the receiver can decode and obtain the content.

The difference from the PC platform model is: in the PC model, the sequence is such that content is decoded and re-encrypted on the PC, while in the mobile phone model, encrypted content and its license are directly written into the card, with the mobile phone playing just a role of path .

Finally, I would like to mention about the SMMC. The SMMC was proposed and developed jointly by Sanyo, Hitachi, Fujitsu and Nippon Columbia, and was adopted by the MultiMedia Card Association as a card with functions of standard MMC plus a security function.
Upgrading of the card's data transfer speed and further expansion of its memory capacity is planned henceforth.

Mr. Kazutoshi Watanabe

  Index Corp. is a company distributing content to the PHS and cellular phones.
Currently we have nearly 80 content/titles and 2.2 million members. Today, I would like to introduce our main content/titles and talk about our projects' possibilities we are exploring. The feature of our company is that we make our content as a first step, then put the emphasis on interactive communications with users.
That is the reason why we do not create content which are not needed by users. With such business strategy, we have succeeded in becoming one of the very few profitable companies in this kind of business.

  We collaborate with Fuji TV and TV Asahi to focus on the visual content market and with many other companies in the fields of network, Java, device and 3G respectively. We also cooperate with publishers, rental video shop chains and toy manufacturers in various fields. In collaboration with a toy manufacturer TAKARA, we are studying applications such as e-mail notification service by mobile phone for dog owners when their pet dog barks.

  The first content we coped with is a fortunetelling. We specialized in love-life fortunetelling, which was a smash hit that boosted the number of visitors to our site. Among other content, we have such content as games, ringing tone melodies, e-mail-related services, electronic commerce (EC), images and characters.

  The first item we dealt with in the mobile commerce field was the sales of perfumes. This item has been chosen because of its high user demands. Because we provide such perfumes that are difficult to obtain in local areas, we succeeded in attracting visitors to our site.
Another successful example of mobile commerce is the souvenirs sold at "Odaiba," one of the popular visiting spots in Tokyo. As for these cases, one of the keys for success is to handle goods that one can buy only at the site.

  We are also planning to provide a membership certificate function at rental shops via the Infra-red Data Association (IrDA) port installed in mobile phones, which is to be used for application as an electric wallet in the future.

In the home security field, we are co-developing with Hochiki Corp. (a security device manufacturer) a theft prevention system, which will soon be launched onto the market.
In this system, a microserver is used as a controller. It will be applied to home security systems such as sensors of gas leakage, water leakage and fire alarm, as well as a local content server.

  As for overseas business deployment, we are studying the feasibility of operation in the Republic of Korea, the U.S., China and Taiwan. For Chinese business, together with Mitsubishi Corp., we are proceeding collaboration with Linktone (a content provider).
PHS enables high-speed data communications in both directions of uplink and downlink. In particular, we think that it is necessary to focus on PHS's feature of fast communications speed in uplink concerning utilization for "personal casting," information transmission from individuals such as e-mails.