KDDI's Domestic Status

The KDDI CORPORATION was established in October 2000 through the merger of DDI CORPORATION, a long-distance communications company; KDD Corporation, an international communications company; and IDO CORPORATION, which provided mobile communications. Thereafter, we expanded our business through mergers in both the mobile and fixed-line businesses.

As a result, KDDI has amassed a host of access lines. In the mobile category, these include 3G/4G LTE and WiMAX networks. In the fixed-line category, we have FTTH and CATV. The KDDI Group's customer base includes approximately 64 million mobile subscriptions [1] and around 8.8 million fixed-line broadband subscriptions [2]. We are leveraging this situation by promoting the "3M Strategy [3]."

• [1]

  Total for au + UQ (as of March 31, 2016)

• [2]

  Total for FTTH + RGU households (as of March 31, 2016)

• [3]

  3M stands for Multi-network, Multi-device, and Multi-use. Our growth strategy calls for the establishment of an environment that seamlessly provides a variety of content and services to customers through an optimal network that can be used anytime and anywhere, with a variety of devices, including smartphones and tablets.

• [4]

  Japan Cablenet Limited

• [5]

  UQ Communications Inc. (due to KDDI's voluntary adoption of International Financial Reporting Standards (IFRS) from the fiscal year ending March 31, 2016, changing from an equity-method affiliate to a consolidated subsidiary)

• [6]

  Chubu Telecommunications Co., Inc.

• [7]

  Jupiter Telecommunications Co., Ltd.

• [8]

  Share among NTT DOCOMO, INC. (NTT DOCOMO), SoftBank Corp. (SoftBank), and KDDI (au)

• [9]

  KDDI + ctc + OKINAWA CELLULAR TELEPHONE COMPANY (Okinawa Cellular)

Mobile

As of March 31, 2016, au mobile subscriptions numbered 45.91 million, up 5.6% year on year and accounting for a 29.3% share of the mobile market, which has three major carriers.

Of this figure, in the Personal Services segment, which accounts for more than 70% of KDDI's consolidated operating revenue, smartphone penetration had risen to 58% (56% if limited to LTE).

UQ that provides WiMAX and WiMAX 2+ service (TD-LTE) had a total of 18.05 million subscriptions as of March 31, 2016, an increase of 89.1% year on year. Moreover, in October 2015 UQ also started operations as an MVNO under the name UQ mobile, and is working to expand its customer base in the MVNO market.

• [10]

  KDDI + Okinawa Cellular

• [11]

  au smartphones/general handsets (smartphones and feature phones (including prepaid))

Fixed-Line Broadband

As of March 31, 2016, the cumulative number of FTTH subscriptions stood at 3.75 million, up 7.6% year on year and accounting for a market share of 12.9%.

In CATV services, the number of RGU households [12] as of March 31, 2016 stood at 5.05 million, up 3.5% year on year.

KDDI's share of pay multi-channel CATV subscriptions as of September 30, 2015 stood at around 50%.

By cross-selling FTTH and CATV services to the au customer base, we expect our customer base to continue growing stronger and expanding.

• [12]

  RGU: Revenue Generating Units. Each household's subscription to CATV, high-speed Internet connection, and telephony services each represent one RGU respectively.

• [13]

  JCN only for the fiscal year ended March 31, 2013. J:COM + JCN for the fiscal year ended March 31, 2014. In line with the inclusion of JCN into the scope of J:COM's consolidation in December 2013, the method of calculating the total number of subscribing households has been unified to J:COM's standard. From the fiscal year ended March 31, 2015 onward, the definition was changed from "Number of Subscribing Households" to "Number of RGU Households".
  Households on the number of subscribing households basis in the fiscal year ended March 31, 2015 was 5.05 million.