NTT To Buy Tower Stake

NTT DoCoMo, one of Japan’s major mobile phone service operators, is set to purchase a 40 percent stake in Tower Records Japan Inc. for 10 billion yen, which would make it the top shareholder in Japan’s leading music retailer.

The phone company’s plan is to use Tower to expand its subscription base of consumers who use their cell phones as e-money and credit cards by making such services available at all Tower Records stores in Japan. Users of NTT DoCoMo cell phones will be able to purchase CDs and DVDs with their phones.

To make such a service more attractive, they may offer discounts to people who buy products with their phones. Tower Records will in turn make use of customer shopping data received through these transactions.

NTT DoCoMo has been trying to sell the system to other music retailers and hopes that the realization of its plan through Tower Records will add momentum to the scheme. It is also considering the possibility of distributing music to cell phones.

Tower is already planning a music download service in conjunction with Napster that will start in April.

— Phil Brasor