DoCoMo is pinning its hopes on 3G

NTT DoCoMo, Japan's top mobile phone firm, has swung back into profit, and forecast a surge in earnings as demand for third-generation services picks up.

Net profits for the 12 months to end-March were 212.5bn yen (�1.1bn; $1.8bn), compared with a loss of 116.2bn a year earlier.

In the next 12 months, the firm now forecasts a near-tripling in profits, at least partly because its losses from overseas operations now seem to be moderating.

Even more importantly, it predicts that demand for 3G services - which allow faster downloads of multimedia services - will take off this year.

3G hopes

Over the past few years, DoCoMo has spent more than 1.9 trillion yen for shares in several foreign carriers, aiming to use its shareholdings to spread its i-mode wireless internet technology.

But the strategy backfired as telecoms share prices plunged in 2001, which forced DoCoMo drastically to write down the value of its holdings.

In the meantime, however, the foundations for growth in high-speed wireless technology seem to have been laid.

DoCoMo said it expected subscribers for its 3G service to total 1.46 million by March 2004, up from 330,000 at the end of March this year.

As the pioneer of i-mode, the main precursor to the 3G services currently being rolled out around the world, DoCoMo is pinning its hopes on a rapid take-up of the technology.