Business / Corporate

Rakuten taking limited orders for services on its delayed Japan mobile network

Kyodo

E-commerce giant Rakuten Inc.’s mobile unit started taking limited orders for services on its network Tuesday after a delay in installing network base stations forced it to postpone a full-scale launch until next April.

Rakuten Mobile Inc. initially aimed to make a full-service entry into Japan’s mobile phone market Tuesday, bringing it into direct competition with the nation’s three established telecommunications companies and spurring greater competition in the saturated market.

It will kick off the new network by offering free services to 5,000 people in Tokyo’s 23 wards, Kobe, Nagoya and Osaka.

It said it wants to test the stability of the network before rolling out full-scale services. If more than 5,000 people apply for the initial service, participants, who can sign up online, will be chosen by lottery.

The trial is expected to run from Oct. 13 to March 31, and participants will be asked to fill out questionnaires on the quality of the network.

The postponement of the full-fledged service comes as a disappointment to the government, which has been hoping that the entry of a fourth player into a market dominated by NTT Docomo Inc., SoftBank Corp. and KDDI Corp. would spur competition and help lower mobile phone charges.

The government directed Rakuten three times to speed up work on the base stations after it admitted that its initial plan to install 3,432 nationwide by next March was behind schedule. The number was at just 653 as of Sept. 6.

The plan was presented to the Internal Affairs and Communications Ministry in April 2018 as part of conditions for approval for entry into the mobile telecommunications sector using its own wireless network.

Rakuten has not revealed the new price plan for its full-scale mobile phone services but will not charge cancellation fees, which are often criticized as stifling competition among carriers and keeping charges relatively high.

Rakuten first entered the mobile phone business in October 2014 as a virtual mobile network operator that uses other wireless carriers’ networks.

Its low-cost wireless communication service, Rakuten Mobile, has attracted around 2.2 million subscribers. The company has said it will aim for more than 10 million subscribers by the end of March 2029.

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