In this chapter, we will consider the structure of the mobile telephony market, including some econometric analysis. Japan took an early lead in the mobile telephony sector when NTT DoCoMo launched i-mode in 1999, followed by the rollout of FOMA in 2001. Yet the initial take-up of FOMA was slower than the company anticipated; a three-way oligopoly emerged made up of NTT DoCoMo, KDDI, and Vodafone, and a number of other issues have arisen.1 Here we will examine Japan’s mobile phone sector by addressing the following four themes. First, the supply structure of Japan’s mobile telephony is described, based on data. Primary emphasis will be on the changes accompanying the transition from second generation (2G) to third generation (3G) mobile telephony services. Second, we examine the current state of mobile phone usage in Japan and recent changes among service providers based on a consumer questionnaire. Of particular interest is the question of whether customers are locked in to service providers through mobile phone numbers, email addresses, and so on. Third, we present a discrete choice model analysis based on data from the consumer questionnaire. This is a pioneering application of this type of analysis to subscriber demand for 3G mobile telephony services, and a mixed logit (ML) model is employed to represent cross-nested structures. We analyzed whether provider company brand or technology (2G versus 3G) were more important factors in subscriber demand for mobile phone service, and whether there was a significant difference in usage between the different mobile phone technologies. Fourth, we will discuss mobile phone market definition, whether there is effective competition in the mobile telephony market, and other relevant policy issues.