"Once the World's Best, Now Not Even in the Top 5"... The Current State of Japan's Mobile Industry That Was a Decade Ahead of the iPhone

31.3 Million Smartphones Sold in Japan—Most from Foreign Brands
Isolated by Proprietary Technical Standards Since the 2000s

As Apple releases its first foldable phone in 19 years, there are growing concerns that Japan, which led the world with its most advanced technology in the 2000s when mobile phones began to spread rapidly, has now lost its competitiveness in the device market.

Citizens are exploring the officially released foldable smartphones 'Galaxy Z Fold8 Ultra, Fold8, Flip8' and smartwatches 'Galaxy Watch Ultra2, Watch9' at a Samsung Store in downtown Seoul. This is a stock photo unrelated to the article. Photo by Yonhap News.

On September 11, Japan's Yomiuri Shimbun reviewed Apple's first foldable phone, the 'iPhone Duo', remarking that "Chinese and South Korean manufacturers are taking the lead in the foldable smartphone sector."

In Japan, Apple dominates about half of the local smartphone market. According to data from MM Research Institute, which focuses on internet and information and communications technology (ICT) in Japan, a total of 31.3 million smartphones were shipped in Japan in fiscal 2025. In this massive market of more than 30 million units, Apple accounted for 51.6%, Google (U.S.) for 12.7%, Samsung Electronics (South Korea) for 11.3%, Sharp (under Taiwan's Hon Hai) for 7.4%, and FCNT (under Lenovo China) for 6.2% of shipments respectively, with these firms taking up 90% of the total shipments. No Japanese capital company was among the top five.

Whenever Apple releases a new iPhone, Japan is enthusiastic about comparing it with Samsung Electronics and Chinese manufacturers' products. However, domestic brands such as Sharp's 'AQUOS' or Sony's 'Xperia' rarely receive similar comparative attention.

Up until the 2000s, Japan was considered to have created a mobile ecosystem nearly a decade ahead of the iPhone, thanks to a series of innovations such as 3G network technology, mobile internet, camera phones, location-based services, and mobile e-wallets. In 2002, for instance, Panasonic launched a mobile phone with a slim 16.8mm body—about half the thickness of typical devices at that time—demonstrating Japan’s capabilities in radical design and manufacturing.

Japan held a dominant domestic position in those years. In 2001, NEC claimed a 29% share of Japan's mobile phone market, with Matsushita Communication Industrial (now Panasonic) at 15.1%, and Sanyo, Sharp, Mitsubishi (all around 9% each), so that Japanese manufacturers accounted for roughly 80% of the market.

However, the market structure—where giant Japanese telecom companies wielded enormous influence over phone manufacturers—ultimately backfired. Evolving independently within an isolated ecosystem, Japan lost its ability to compete with global products such as the iPhone and Galaxy that target international markets.

Japanese IT magazine 'Sumaho Life' pointed out that while Japanese cell phone technology once led the times, its insistence on unique technical standards eventually led to a 'Galapagos syndrome'. The magazine noted that a persistent focus on the carrier-driven "contract-device bundle sales" model led the market away from global standards, and as a result, foreign firms have now seized the initiative in both market share and technological leadership.

This content was produced with the assistance of AI translation services.