Sony Corp., NTT DoCoMo Inc. and nine other companies announced plans Monday for a full-scale launch within the year of an electronic money system. The companies intend to develop the system into a major payment system within five years, the companies said in a joint statement.
Through a joint venture company, the partners will soon begin working on spreading use of the system, named Edy, to retailers and consumers with the goal of getting 30 million cards and 15 million personal terminals into the hands of Japan’s 127 million people by late 2006. At that time, the companies hope the card will be accepted at 25,000 retail outlets, 30,000 online shops and one million vending machines, they said in the statement.
The eleven partners in the joint venture, which is yet to be named and to be established in January 2001, represent almost all of the pieces needed to make a success of the system. Together, they include major banks, technology companies capable of making the cards and terminals, telecommunications companies to promote online and cell phone use and an automaker that will promote use of the card for auto-related applications.
Joining Sony and NTT DoCoMo in the venture are three major consumer and business banks, Sakura Bank Ltd., Sanwa Bank Ltd. and Bank of Tokyo-Mitsubishi Ltd., telecommunications carrier DDI Corp., auto maker Toyota Motor Corp., electronics maker Denso Corp. and Sony Finance International Inc., Sakura Information Systems Co. Ltd. and Japan Research Institute Ltd.
In the nine months running up to the anticipated October 2001 launch, the new company will work to establish a supporting infrastructure for the Edy system, license the card to the eleven partners and other companies and get retailers on board. As part of preparations for launch, Sakura Bank will issue cards to customers which will be able to use them to shop and deposit money at convenience stores.
The Edy e-money system uses contactless smart cards developed by Sony and has been on trial since July 1999 in the Gate City Osaki building near Sony’s headquarters building in Tokyo. Initially 500 employees of companies in the building could use the cards at five shops within the complex but this was expanded to 4,000 people and almost all the shops in the building earlier this year.
The Sony Group will be the largest shareholder in the new company with a 47 per cent stake, of which 42 per cent will be held by Sony Finance and five per cent by Sony Corp. Joint second largest shareholders will be NTT DoCoMo and the Sakura Bank Group with 15 per cent each, the latter stake split between Sakura Bank, Sakura Information Systems and Japan Research Institute. Additionally, Toyota Motor, Denso and DDI will each hold five per cent and Sanwa Bank and Bank of Tokyo-Mitsubishi will each own four per cent of the company.