With sales of mobile phones flagging and mobile-equipment makers slashing earnings estimates and laying off employees, NTT DoCoMo and AT&T Wireless are looking to jump-start wireless Internet access in the United States. The two companies plan to launch a U.S. version of Japan's popular I-mode wireless Internet service early next year, an NTT exec told the Associated Press Wednesday.

AT&T Wireless execs were unavailable for comment because of a federally imposed quiet period in connection with parent AT&T Corp.'s split-up, but a source within the company couldn't confirm the AP report. The source says a subsidiary being created by the two telecom companies to support next-generation services in the United States hasn't even been formally created yet, and that no services could be rolled out until that subsidiary is in place. The source did say that some of the planned services will be based on NTT's I-mode technology, which makes Web sites displayed on phones look more like a PC-based browser, but that the U.S. service may or may not feature the name "I-mode."

Analysts weren't surprised that the service is being planned, given that NTT in December acquired a 16% stake in AT&T Wireless for $9.8 billion. Forrester Research analyst David Cooperstein says a key challenge will be getting consumers to upgrade their phones to I-mode models. AT&T recently rolled out services tied to Nokia's new 8260 mobile handset, and Cooperstein isn't sure consumers will adopt the PC-upgrade mentality to their phone purchases simply to obtain better mobile Internet access. "The jury is still out on how important wireless data is to the consumer market," he says. Cooperstein also says, however, that the new service will let AT&T offer additional mobile applications to its business customers.

For an I-mode-style service to succeed in the United States, says Jupiter Research analyst Joe Laszlo, American carriers will have to embrace the business model being employed in Japan, where consumers are willing to pay nominal subscription fees for news and data, and where NTT's billing systems let content providers bill consumers directly. Laszlo says I-mode's popularity in Japan has been fueled in large part by the appetite for mobile content in the 15- to 25-year-old age group. That audience, he says, is more willing to pay for information such as sports scores and entertainment news, and AT&T and other U.S. wireless carriers must do a better job of addressing that demographic. "If U.S. carriers pick up on the lessons of I-mode," says Laszlo, "I'd expect to see more enthusiasm for wireless Internet services here."